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A N N U A L R E P O R T
CORPORATE DIRECTORY
CONTENTS
MINOTAUR EXPLORATION LIMITED
ACN: 108 483 601
ASX: MEP
DIRECTORS
Dr Antonio Belperio
Dr Roger Higgins
Mr George McKenzie
Mr Andrew Woskett
Executive Director
Non-Executive Chairman
Non-Executive Director
Managing Director
COMPANY SECRETARY
Mr Varis Lidums
REGISTERED OFFICE
C/- O’Loughlins Lawyers
Level 2, 99 Frome Street
Adelaide SA 5000
PRINCIPAL PLACE OF BUSINESS
Level 1, 8 Beulah Road
Norwood SA 5067
SHARE REGISTER
Computershare Investor Securities Pty Ltd
Level 5, 115 Grenfell Street
Adelaide SA 5000
LEGAL ADVISORS
O’Loughlins Lawyers
Level 2, 99 Frome Street
Adelaide SA 5000
BANKERS
National Australia Bank
22-28 King William Street
Adelaide SA 5000
AUDITORS
Grant Thornton Audit Pty Ltd
Level 3, 170 Frome Street
Adelaide SA 5000
www.minotaurexploration.com.au
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Chairman’s Review
Managing Director’s Report
Directors’ Report
Auditor’s Independence Declaration
Consolidated Statement of
Profit or Loss and Other
Comprehensive Income
Consolidated Statement of
Financial Position
Consolidated Statement of
Changes in Equity
Consolidated Statement of
Cash Flows
Notes to the Consolidated
Financial Statements
Directors’ Declaration
Independent Auditor’s Report
ASX Additional Information
This annual report covers both
Minotaur Exploration Ltd (ABN
35 108 483 601) as an individual
entity and the consolidated
group
comprising
Minotaur Exploration Ltd and
its subsidiaries. The Group’s
functional and presentation
currency is Australian dollars.
(‘Group’)
The description of the Group’s operations and of its
principal activities is included in the review of operations
and activities in the Directors’ Report on pages 7 to 17.
The Directors’ Report is not part of the financial report.
CHAIRMAN’S
REVIEW
Your Company maintained
its high rate of activity
successes - summarised as follows - and maintain the
throughout the reporting period, resulting in some
work tempo.
notable successes and accomplishments.
• Significant drilling campaigns at Minotaur’s Eloise
A year ago sentiment was rising, encouraging investor
joint venture with OZ Minerals Ltd (ASX: OZL), with
support for metals exploration, much of which was
notable copper-gold intercepts from the ‘Jericho’
channeled into ‘battery metals’ such as lithium, cobalt
system
and vanadium. More recently, investor appetite has been
• OZ Minerals decision to fast track its earn-in
suppressed as the spectre of a global trade war depresses
expenditure by more than 3 years
prices across all commodities.
Despite volatile macroeconomic conditions, the copper
price remained healthy throughout FY18 due to increasing
demand, with electric vehicle production a significant
contributing factor.
• A joint venture with Andromeda Metals Ltd (ASX:
ADN) where Andromeda may invest A$6m over 5
years to earn 75% in Minotaur’s kaolin deposits in
South Australia
• Purchase of the Highlands group of tenements east
of Mt Isa
• Steps towards realising value from nickel assets in
Figure 1: Spot copper price through FY2018
Western Australia
Your Board and management are very focused on
advancing Minotaur’s growth prospects and I am pleased
to address these now.
OZ Minerals Joint Venture
The joint venture with OZ Minerals Ltd (ASX: OZL) at the
Eloise copper-gold project has developed beyond our
expectations of one year ago. OZ Minerals had the option
to achieve 51% interest in the joint venture and then to
move to 70% interest over a 6-year time span. Results
from drilling since October 2017 and a recognition of
regional prospectivity have encouraged OZ Minerals
to contribute $10 million into JV activities and, within 3
years (by early 2019), OZ Minerals will achieve its 70%
interest. This level of support underscores the value of
work done and the rising confidence OZ Minerals has in
the untapped potential of the tenement package.
Minotaur is applying a sharp focus to exploration for
base metals, mainly copper. This speaks to our heritage
as a prospect generator and the high level of technical
capability that has evolved internally over the past
decade; attributes recognised by our joint venture
Project Generation
partners.
Minotaur is well recognised as a prospect generator
In line with the broader metals exploration market,
and for its business model based on solid joint venture
Minotaur experienced a decline in share value
alliances, such as those with OZ Minerals and JOGMEC.
through May-September 2018 that is at odds with the
New opportunities are sought as the basis of new joint
Company’s solid exploration and business development
venture arrangements, underpinning the sustainability of
performance, positive reports to shareholders, and
our operations.
the Company’s attractive prospects. We expect that
this disconnect will be redressed as we build on our
To this end Minotaur has announced it has joined in joint
venture with a private company, owner and operator of
2 Minotaur Exploration Limited Annual Report 2018
the Mungana and King Vol polymetallic base metal mines
growing importance of nickel sulphides in the ‘battery
at Chillagoe in Queensland. The JV enables Minotaur
metals’ sphere.
to farm-in to the Windsor exploration tenements 60km
SW of Charters Towers where we see opportunity for
under-cover base metal prospects to be identified using
our geophysical expertise. The terms agreed permit
Minotaur to arrange third party involvement as a funding
source to underwrite the exploration expense, in return
for an equity involvement in the tenements. This model
provides a pathway into tenure that is not readily
available through government licensing channels, or able
to be purchased, thereby securing access to an extensive
and under-explored ground position.
Finally, having nurtured the kaolin deposits in South
Australia over many years and with the benefit of lab
tests proving that the raw material is readily convertible
into high purity alumina, an earn-in joint venture
was agreed with Andromeda Metals Ltd (ASX: ADN).
Andromeda is actively investigating commercialisation
options for run-of-mine kaolin material into the Asian
ceramic markets and channels for sale of high-halloysite
grade kaolin and high purity alumina. With Andromeda
positioned to invest $6 million to earn 75% interest
over the next 5 years, Minotaur can potentially realise
Our recent acquisition of the Highlands tenement group
significant asset value for no further cost burden.
50km north-east of Mt Isa likewise secured a significant
area. Work done by the previous owner and the presence
Minotaur in the Exploration Realm
of an adjacent modest copper-gold sulphide resource,
named Barbara, provided sound evidence that the area
offers potential for copper discovery. Our plan is to
investigate several targets to demonstrate that potential,
with a view to engaging joint venture involvement at
higher valuation multiples than our entry cost.
Project Value Realisation
Exploration is and always will be the singular pathway
to new mines and, as existing resources progressively
deplete, major company dependence on junior
explorers as the generators of discovery must inevitably
grow. Minotaur is well-placed by our track record to
be a partner of choice to capitalise on that growth.
Shareholder faith in the Company’s future is often
expressed to management and your ongoing support is
We seek to dispose of our nickel tenements near
much appreciated.
Kalgoorlie, that effort gaining recent traction due to the
Drilling offsider emptying tube of core at Eloise JV, Cloncurry
Drill rig at Eloise JV, Cloncurry
Minotaur Exploration Limited Annual Report 2018 3
MANAGING DIRECTOR’S
REPORT
Business Review
Minotaur’s exploration activity level continued to rise
through the 2018 Financial Year, largely due to our OZ
research during the forthcoming ‘wet season’ field
shutdown. We anticipate follow up drilling will resume
around April 2019.
Minerals Ltd (ASX: OZL) sole funded joint venture near
OZ minerals agreed to expand the 2018 work
Cloncurry. Our joint venture in the same region with
the Japan Oil, Gas and Metals National Corporation
(JOGMEC) continued with regional scale ground EM
surveys leading to scout drilling of new targets.
In OZ Minerals’ case its initial 51% interest in the Eloise
JV was earned in a year less than scheduled and is on
track to reach its ultimate 70% interest in less than 3
years of the permitted 6-year timeframe. The rapid
pace of investment by OZ Minerals reflects its growing
satisfaction with results flowing from drilling and
Minotaur’s ability to generate prospects.
programme on several occasions, allowing continuous
drilling along Jericho between April and September
and also expanding to regional geophysical surveys
searching for similar anomalies within 30km of Jericho.
Should that be fruitful scout drilling will proceed in the
2019 field season. From the time OZ Minerals elevates
to 70% project interest, having funded $10 million,
Minotaur will be required to contribute pro-rata, or
dilute, as is standard under joint venture arrangements.
Our intention is to maintain Minotaur’s interest level and
that could involve investment of around $1.5 million
through 2019. OZ Minerals indicates that Minotaur shall
A notable copper discovery made for the Eloise JV very
continue to be joint venture manager and operator.
early in the reporting year was the Jericho EM anomaly.
Since October 2017 Jericho has been subject to 12,840m
of diamond drilling into its parallel J1 and J2 plates.
Twenty-eight holes demonstrate pervasive copper-
gold mineralisation along the combined plate length
of 4.5km, centered just 3km south of the Eloise copper
mine. More work needs to be done to fully understand
the system and vector towards a geochemical ‘sweet
spot’ that might deliver an economic resource. The drill
assay data base is now adequately developed to provide
empirical guidance and will be the focus of off-site
The Highlands project near Mt Isa was a bolt-on
acquisition, for which the Company paid $125,000
cash and shares to the value of $275,000 in return for
665km2 of tenure in a district known to host extensive,
small scale copper mineralisation. While numerous
anomalies were generated by the owners none had
been seriously followed up. Minotaur’s team carried out
site reconnaissance, rock chip sampling and ground EM
surveys over 2 such targets, Gospel and Coolibah, in
August and converted these to viable first-round drill
4 Minotaur Exploration Limited Annual Report 2018
targets. Our plan for Highlands is to prove several quality
The agreement exemplifies Minotaur’s business model
targets, by drill intersections, thereby adding value to the
to engage joint venture partners to fund its projects,
package, upon which we may seek farm-in joint venture
alleviating use of shareholders’ funds.
interest. The overall aspiration is to locate mineable
copper-gold deposits that could complement open pit
mining activity, when initiated, at the nearby Barbara
deposit owned by Round Oak Minerals (a subsidiary of
Washington H. Soul Pattinson Ltd).
This review provides guidance on Minotaur’s efforts to
focus on base metals and to build a growth pathway
inside well established mineral districts in Queensland.
It reinforces our business model based on quality joint
venture arrangements where project funding by the
Elsewhere in Queensland, near Charter Towers, we
earn-in partner leverages our projects and illustrates
accepted an invitation to farm-in to ground held
mechanisms for achieving that goal.
by Auctus Minerals, a subsidiary of private equity
group Denham Capital, owners and operators of the
Mungana and King Vol poly metallic mines. Auctus’
‘Windsor’ exploration tenements extend over 629km2
but have received scant exploration attention over the
past decade, due primarily to the highly conductive
characteristics of the cover sequence overlying the
basement. Minotaur intends to apply its under-cover
geophysical techniques, as around Eloise, to locate
sulphide hosting stratigraphy and, potentially, zinc
mineralisation. There are three known VMS stratigraphic
horizons in the region, each delivering high-grade
orebodies such as Thalanga, Liontown, Waterloo and
Highway-Reward. Work is able to start after the 2018
wet season ends and through 2019 will be funded by
Minotaur pending introduction of a joint venture funding
partner.
Andromeda Metals committed to an earn-in joint venture
over Minotaur’s kaolin tenements in South Australia.
For expenditure of $6 million over 5 years, Andromeda
may earn 75% beneficial interest in the assets, subject
to satisfying the minimum expenditure requirement of
$400,000 by end January 2019.
In summary, during 2019 Minotaur expects to have both
self-funded and JV funded active projects: Highlands
Cu; Windsor Zn; Eloise JV and Osborne JV, providing a
diversity of exploration settings conducive to discovery.
Corporate Review
The financial benefits of the Company’s enduring JV
relationships are clear: through the 2018 financial year
Minotaur’s exploration expenditure increased to $6.5
million ($4.8 million in 2017) of which Minotaur sole
funded $1.7 million ($1.8 million in 2017). Thus, Minotaur
leveraged its work funding by 2.7 times through joint
venture contributions. The year-on-year trend is well
illustrated by the accompanying graphic.
The Board’s view continues to be that the Company’s
joint venture model positions Minotaur with optimal
exposure to significant discoveries. Minotaur’s employees
have realised notable successes during the year for
shareholders and partners and we look forward to
building on that platform through the 2019 financial
year.
Figure 2: Minotaur’s exploration funding model
9.4
Expenditure
0.6
3.8
Funding Source
5.0
6.2
6.2
FY16
0.6
2.7
2.9
FY17
0.7
3.0
2.5
8.1
FY18
0.5
4.7
2.9
Total exploration & administration
R&D tax incentive
JV receipts
Net Minotaur spend
1 Data sourced from MEP Appendix 5B issues
Minotaur Exploration Limited Annual Report 2018 5
ASSET
LOCATIONS
Minotaur maintains a diverse array of mineral exploration
tenements around Australia, totalling 11,900km2,
including Joint Venture areas
6 Minotaur Exploration Limited Annual Report 2018
DIRECTORS’
REPORT
Your directors present their report on the consolidated
That encouraged the joint venture to continue drilling
group for the financial year ended 30 June 2018.
through the remainder of the 2018 calendar year in
order to sufficiently characterise the copper potential
Director Details
within Jericho.
The names of the directors in office at any time during,
A
joint venture with Japan Oil, Gas and Metals
or since the end of, the year are:
Corporation (JOGMEC), over Minotaur’s tenements
Mr Andrew Woskett
Managing Director
Dr Antonio Belperio
Executive Director
Dr Roger Higgins
Non-Executive Chairman
Mr George McKenzie
Non-Executive Director
Directors have been in office since the start of the
financial year to the date of this report unless otherwise
stated.
Review of Operations
Corporate
The 2018 financial year concluded with the Group
holding $2 million in cash and term deposits plus
$0.5 million equity holdings in ASX listed explorers.
Substantial and ongoing exploration investments by
our joint venture allies helped expand the Company’s
activity level. Sprott Group remains the Company’s key
shareholder with 13% of the issued shares.
surrounding the Osborne copper mine south of
Cloncurry, probed several geophysical targets without
returning any significant result. A new EM survey was
underway at the close of the financial year.
Sale of the Chameleon gold resource proceeded to
completion at the end of calendar 2017. A modest
cash production payment will be payable by the buyer
should mining of the asset produce gold.
Research & Development
Minotaur maintains an active R&D program, mainly
through the services of specialist agencies such as CSIRO
and various university research laboratories. While there
are several current R&D projects, Minotaur’s primary
exercise is investigation into new industrial applications
for nanoparticles; halloysite nanoclays within the kaolin
complex.
Likely developments, business strategies
OZ Minerals Ltd’s (ASX: OZL) investment in the Eloise
and prospects
Joint Venture, in which OZ Minerals may earn up to 70%
interest through expenditure of $10 million, exceeded
$6 million in total by the close of the financial year. OZ
Minerals continues to fund Eloise joint venture activity
into the 2019 financial year.
Exploration
Exploration activity focused on copper-gold targets in
Queensland.
The joint venture with OZ Minerals across the Eloise
area tenements located multiple EM anomalies south
of the Eloise copper mine. In particular, a conductive
system named ‘Jericho’ was shown to continue for
over 3km in length. Jericho was subjected to 7,900m of
reconnaissance drilling along its known strike extent,
with most holes returning significant copper grades.
The Company’s business model is substantially founded
on continuing support from joint venture partners. This
enables Minotaur to maintain a high level of exploration
activity, compared to its peers, and to constrain net
administration costs to 21% of its total exploration
spend of $5.2 million, of which 65% is contributed by JV
partners. The Company’s self-funded exploration level
in the financial year was $1.7 million, to generate new
opportunities or present new openings for prospective
joint venture involvement.
To those ends Minotaur acquired a 665km2 package
of copper prospective tenements east of Mt Isa for
cash and shares to the value of $400,000. Numerous
exploration targets are available from work carried out
by the vendor. Minotaur started ground assessment of
several of those prospects after close of the financial
Minotaur Exploration Limited Annual Report 2018 7
DIRECTORS’ REPORT
year. Terrain at the ‘Highlands’ project is rugged with
After satisfying an initial $400,000 minimum spend
geology exposed at surface, leading to faster and less
obligation by late January 2019 Andromeda can elect
expensive testing of basement targets than is the case
to sole fund joint venture expenditure which, for $6
around Cloncurry.
Minotaur conducted due diligence on a number of
additional opportunities, one of which is being actively
sought. If successful, it will provide a new region to
which the Company can apply its remote sensing and
million over 5 years, will result in Andromeda earning
75% interest in the tenements. Minotaur considers
this a positive outcome as it enables the Company to
focus its management and cash resources on its core
projects.
interpretive expertise to locate base metal prospects
Ongoing efforts to unlock value from other non-
under deep cover, as is the case near Eloise mine.
core assets are advancing. The Saints nickel deposit
A new joint venture was created over the Company’s
kaolin deposits in South Australia whereby Andromeda
Metals Ltd (ASX: ADN) is earning-in to the tenements.
near Kalgoorlie is available for sale. New interest in
acquisition of the Leinster nickel package has resulted
in the Javelin tenement being vended into a proposed
gold IPO.
Information in this report that relates to Exploration Results, Mineral Resources or Ore Reserves is based on
information compiled by Dr A. P. Belperio, who is a full-time employee of the Company and a Fellow of the
Australasian Institute of Mining and Metallurgy. Dr A. P. Belperio has a minimum of 5 years experience which
is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he
is undertaking, to qualify as a Competent Person as defined in the 2012 Edition of the “Australasian Code for
Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Dr A. P. Belperio consents to the
inclusion in the report of the matters based on his information in the form and context in which it appears.
8 Minotaur Exploration Limited Annual Report 2018
Names, qualifications, experience and special
of resource development companies culminating in
responsibilities
Dr Antonio Belperio BSC (Hons), PhD, FAusIMM
Executive Director
his tenure as managing director of Minotaur since early
2010. Andrew is a Fellow of the Australasian Institute of
Mining and Metallurgy.
Dr Belperio has an Honours Degree in Geology from
Mr Varis Lidums BEc, LLB, CA, MBA
the University of Adelaide, a PhD from James Cook
Company Secretary
University, and a diverse background in a wide variety
of geological disciplines, including marine geology,
environmental geology and mineral exploration. He
has over 35 years’ experience in university, government
and the mineral exploration industry. Dr Belperio is also
a Director of Thomson Resources Ltd, a public company
listed on the ASX.
Dr Roger Higgins BE (Hons), MSc, PhD, FAusIMM
Non-Executive Chairman
Dr Higgins has over 40 years’ experience in mine
management, project development and sustainability,
and is a current director of Newcrest Mining Ltd and
Metminco Ltd, and a former director of Blackthorn
Resources Ltd (resigned 2014), all public companies
listed on the ASX. He is also a current director and a
former Managing Director of Ok Tedi Mining Limited
in Papua New Guinea. As Chairman of Minotaur
Exploration Ltd, he is responsible for the management
of the board as well as the general strategic direction of
the Company.
Mr George McKenzie BA LLB (cum laude), FAICD, MtB (Order of Merit)
Non-Executive Director
George McKenzie is a commercial lawyer with over
25 years’ experience representing many of South
Australia’s explorers and mine developers. He was
a long standing Councillor of the South Australian
Chamber of Mines and Energy Inc. (SACOME), having
served as Vice-President and member of the Executive
Committee of the Chamber. Mr McKenzie has also been
a member of the Minerals and Energy Advisory Council
which advises the Minister of Mineral Resources and
Energy on strategic issues.
Mr Andrew Woskett B Eng, M Comm Law
Managing Director
Andrew Woskett has over 35 years’ project and
corporate experience in the mining industry. He held
senior development responsibility roles for a variety of
Australian mining landmarks in gold, copper, iron ore
and coal. He has had several roles as managing director
Mr Lidums is a Chartered Accountant and qualified
lawyer with over 25 years’ experience in the resources,
energy and accounting industries. He has held senior
roles with BP, Shell and ConocoPhillips and has been
the Commercial Manager at Minotaur Exploration Ltd
since 1 March 2011.
Operating Results
The consolidated loss of the group after providing for
income tax amounted to $2,516,051 (2017: $3,820,416).
Interests in the shares and options of the company
and related bodies corporate
As at the date of this report, the interests of the
directors in office in the shares and options of Minotaur
Exploration Limited were:
Number of
Ordinary Shares
Number of
Options Over
Ordinary Shares
Antonio Belperio
1,762,750
Roger Higgins
George McKenzie
Andrew Woskett
-
59,100
205,000
2,750,000
2,500,000
2,000,000
5,000,000
Dividends paid or recommended
No dividends were paid or declared since the start of
the financial year. No recommendation for payment of
dividends has been made.
Principal activities
The principal activities of the consolidated group
during the financial year were:
• To secure new tenements with potential for
mineralisation; and
• To evaluate results achieved through surface
sampling, drilling and geophysical surveys carried
out during the year.
Minotaur Exploration Limited Annual Report 2018 9
DIRECTORS’ REPORT
Risk management
Events since the end of the reporting period
The Group takes a proactive approach to risk
On 4 July 2018, the following unlisted share options
management. The Board is responsible for ensuring
expired:
that risks, and also opportunities, are identified on
a timely basis and that the Group’s objectives and
activities are aligned with the risks and opportunities
identified by the Board.
The Group believes that it is crucial for all Board
members to be a part of this process, and as such the
Board has not established a separate risk management
committee other than the Audit, Business Risk and
Compliance Committee.
The Board has a number of mechanisms in place to
ensure that management’s objectives and activities are
aligned with the risks identified by the Board. These
include the following:
• Board approval of a strategic plan designed to
meet stakeholders’ needs and manage business
risk.
•
Implementation of Board approved operating
plans and budgets and Board monitoring of
progress against these budgets, including the
establishment and monitoring of performance
indicators of both a financial and non-financial
nature.
Significant changes in the state of affairs
No significant changes occurred during the year.
Environmental regulations
The Group is aware of its responsibility to impact as
little as possible on the environment and, where there
is any disturbance, to rehabilitate sites. During the year
the majority of work carried out was in Queensland and
the Group followed procedures and pursued objectives
in line with guidelines published by the Queensland
Government. These guidelines are quite detailed and
encompass the impact on owners and land users,
heritage, health and safety and proper restoration
practices.
The Group adheres to regulatory guidelines, and any
local conditions applicable, both in South Australia
and elsewhere. The Group has not been in breach of
any State or Commonwealth environmental rules or
regulations during the period.
Issue Date
Expiry
Date
Exercise
Price
Number of
Options
05/07/2013
04/07/2018
$0.300
2,083,333
On 26 July 2018, 5,152,883 fully paid ordinary shares
were issued by the Company at an issue price of
$0.0534 as part consideration for the acquisition of the
Highlands Project successfully completed on 20 July
2018.
No other matter or circumstance has arisen since 30
June 2018 that has significantly affected the Group’s
operations, results or state of affairs, or may do so in the
future.
Unissued shares under option
Unissued ordinary shares of Minotaur Exploration
Limited under option at the date of this report are:
Exercise
Price
of Shares
$
Number of
Under
Options
Expiry
Date
Date
Options
Granted
Unlisted
20/11/2014
19/11/2019
07/09/2016
06/09/2021
18/11/2016
17/11/2019
05/10/2017
31/10/2019
27/10/2017
31/10/2019
08/12/2017
30/11/2020
0.190
0.115
0.250
0.068
0.068
0.250
5,105,000
2,530,000
10,250,000
1,800,000
2,500,000
2,000,000
24,185,000
Shares issued as a result of exercise of options
During or since the end of the financial year, the
Company issued ordinary shares as a result of the
exercise of listed options as follows (there were no
amounts unpaid on the shares issued):
Grant Date
of Options
Issue Date
of Options
Issue Price
of Shares
$
Number of
Options
08/01/2016
08/12/2017
0.095
797,755
10 Minotaur Exploration Limited Annual Report 2018
Barry van der Stelt, Senior Geologist, and Anna Ogilvie, Geologist, examining core at Cloncurry
Indemnification and insurance of
Introduction
directors and officers
The remuneration report details the remuneration
To the extent permitted by law, the Company has
arrangements for key management personnel who
indemnified (fully insured) each director and the
are defined as those persons having authority and
secretary of the Company for an annual premium
responsibility for planning, directing and controlling the
of $16,048. The liabilities insured include costs and
major activities of the Company and the Group, directly
expenses that may be incurred in defending civil or
or indirectly, including any director (whether executive
criminal proceedings (that may be brought) against the
or otherwise) of the Parent. These are as follows:
officers in their capacity as officers of the Company or
a related body, and any other payments arising from
liabilities incurred by the officers in connection with
Dr Antonio Belperio
Executive Director
Dr Roger Higgins
Non-Executive Chairman
such proceedings, other than where such liabilities
Mr Varis Lidums
Commercial Manager and
arise out of conduct involving a willful breach of duty
Company Secretary
by the officers or the improper use by the officers of
Mr Glen Little
Exploration Manager
their position or of information to gain advantage for
Mr George McKenzie
Non-Executive Director
themselves or someone else or to cause detriment to
Mr Andrew Woskett
Managing Director
the Company.
REMUNERATION REPORT
AUDITED
This report outlines the remuneration arrangements
in place for directors and other key management
personnel of Minotaur Exploration Limited in
accordance with the requirements of the Corporations
Act 2001 (the Act) and its regulations. This information
has been audited as required by section 308(3C) of the
Act.
Remuneration philosophy
The Board is responsible for determining remuneration
policies applicable to directors and senior executives
of the Group. The broad policy is to ensure that
remuneration properly reflects the individuals’
duties and responsibilities and that remuneration is
competitive in attracting, retaining and motivating
people with appropriate skills and experience. At the
time of determining remuneration consideration is
given by the Board to the Group’s financial performance.
Minotaur Exploration Limited Annual Report 2018 11
DIRECTORS’ REPORT
Employment contracts
The employment conditions of the Exploration
The employment conditions of the Managing Director,
Mr Andrew Woskett, are formalised in a consultancy
agreement. Mr Woskett commenced as a consultant
to Minotaur on 1 March 2010 and his annual retainer
is $355,675 per annum, exclusive of GST. The Company
may terminate the consultancy agreement without
cause by providing three (3) months written notice
and paying a severance amount equal to nine (9)
months’ retainer. Termination payments are generally
not payable on resignation or dismissal for serious
misconduct. In the instance of serious misconduct the
Company can terminate the agreement at any time.
The employment conditions of the Executive Director,
Dr Antonio Belperio, are formalised in a contract of
employment. Dr Belperio commenced employment
on 1 January 2005 and his gross salary, inclusive of the
9.5% superannuation guarantee, is $225,500 per annum.
The Company may terminate the employment contract
without cause by providing six (6) months written
notice or making payment in lieu of notice, based on
the annual salary component. Termination payments
are generally not payable on resignation or dismissal
for serious misconduct. In the instance of serious
misconduct the Company can terminate employment
at any time.
Manager, Mr Glen Little, are formalised in a contract of
employment. Mr Little commenced employment on 28
October 2014 and his gross salary, inclusive of the 9.5%
superannuation guarantee, is $192,000 per annum. Mr
Little is also entitled to the lease of a motor vehicle,
with the total cost to the Company totalling $20,000 per
annum. If in a particular year the cost to the Company
is less than $20,000, the difference will be paid to Mr
Little as additional remuneration. The Company may
terminate the employment contract without cause
by providing one (1) month written notice or making
payment in lieu of notice, based on the annual salary
component. Termination payments are generally
not payable on resignation or dismissal for serious
misconduct. In the instance of serious misconduct the
Company can terminate employment at any time.
The employment conditions of the Commercial
Manager and Company Secretary (effective 1 July
2016), Mr Varis Lidums, are formalised in a contract of
employment. Mr Lidums commenced employment on
1 March 2011 and his gross salary, inclusive of the 9.5%
superannuation guarantee, is $195,000 per annum.
The Company may terminate the employment contract
without cause by providing one (1) month written
notice or making payment in lieu of notice, based on
Barry van der Stelt, Senior Geologist, logging RC chips
from the Eloise JV
Jericho Cu-Au core (EL17D06)
12 Minotaur Exploration Limited Annual Report 2018
the annual salary component. Termination payments are generally not payable on resignation or dismissal for serious
misconduct. In the instance of serious misconduct the Company can terminate employment at any time.
The table below details the conditions under which non-executive directors of the Company are remunerated:
Non-Executive Directors
Dr Roger Higgins Non-Executive Chairman
Mr George McKenzie Non-Executive Director
Annual Retainer
$
90,000
45,000
Key management personnel remuneration and equity holdings
The Board currently determines the nature and amount of remuneration for board members and senior executives
of the Group. The policy is to align director and executive objectives with shareholder and business objectives by
providing a fixed remuneration component and offering specific long-term incentives.
The executive directors and other executives receive a superannuation guarantee contribution when required by law,
which is currently 9.5%, and do not receive any other retirement benefits. Some individuals, however, may choose
to sacrifice part of their salary to increase payments towards superannuation. All remuneration paid to directors and
other key management personnel is expensed as incurred. Key management are also entitled to participate in the
Group’s share option scheme. Options are valued using the Black-Scholes methodology.
The board policy is to remunerate non-executive directors at market rates based on comparable companies for time,
commitment and responsibilities. The board determines payments to non-executive directors and reviews their
remuneration annually, based on market practice, duties and accountability. Independent external advice is sought
when required.
Table 1: Director remuneration for the year ended 30 June 2018 and 30 June 2017
Short Term
Employee
Benefits
Post
Employment
Share-based
Payments
Salary & Fees
Bonus
Superannuation
Options
Performance
Based
Percentage of
Remuneration
%
Totals
$
Antonio Belperio
2018
2017
Derek Carter (i)
2018
2017
Roger Higgins (ii)
2018
2017
George McKenzie (iii)
2018
2017
Andrew Woskett
2018
2017
Total
2018
2017
205,936
205,936
-
38,150
90,000
67,500
45,000
18,750
355,675
355,675
696,611
686,011
-
-
-
-
-
-
-
-
-
-
-
-
19,564
19,564
-
82,225
225,500
307,225
-
-
-
-
-
-
-
-
-
-
-
74,750
52,020
-
-
38,150
90,000
142,250
97,020
18,750
-
149,500
355,675
505,175
19,564
19,564
52,020
306,475
768,195
1,012,050
-
-
-
-
-
-
-
-
-
-
-
-
(i) On 17 November 2016 Mr Derek Carter resigned as Chairman of the Company.
(ii) On 1 July 2016 Dr Roger Higgins was appointed as a non-executive director of the Company.
(iii) On 31 January 2017 Mr George McKenzie was appointed as a non-executive director of the Company.
Minotaur Exploration Limited Annual Report 2018 13
DIRECTORS’ REPORT
Table 2: Remuneration of other key management personnel for the year ended 30 June 2018 and 30 June 2017
Short Term
Employee
Benefits
Post
Employment
Share-based
Payments
Salary & Fees
Bonus
Superannuation
Options
Varis Lidums
2018
2017
Glen Little
2018
2017
Total
2018
2017
178,082
178,082
182,718
182,391
360,800
360,473
-
-
-
-
-
-
16,918
16,918
17,358
17,327
34,276
34,245
-
16,280
-
10,175
-
26,455
Totals
$
195,000
211,280
200,076
209,893
395,076
421,173
Performance
Based
Percentage of
Remuneration
%
-
-
-
-
-
-
Share based payments, being options issued to directors and employees under the Company’s Employee Share
Option Plan, are recognised at fair value using the Black-Scholes pricing model.
Other transactions with key management personnel
Throughout the year $54,470 (2017: $53,500) (inclusive of GST) was paid to a related entity of Dr Antonio Belperio
under a commercial lease agreement for the use of warehouse space located at Magill, South Australia.
Bonuses
No bonuses were paid during the 2018 financial year.
Share based remuneration
Options may be granted to Key Management Personnel at the discretion of the Board under an Employee Share
Option Plan. All options refer to options over ordinary shares of the Company, which are exercisable on a one-for-one
basis under the terms of the agreements. All options expire on the earlier of their expiry date or termination of the
individual’s employment.
Details of options over ordinary shares in the Company that were granted during the year as remuneration to each key
management personnel are set out below:
Number
Granted
Grant
Date
Value Per
Option at
Grant Date
$
Value of
Options at
Grant Date
$
Number
Vested
Exercise
Price
$
Last
Exercise
Date
Directors
Antonio Belperio
Roger Higgins
-
-
-
-
-
-
-
-
-
-
-
-
-
-
George McKenzie
2,000,000
08/12/17
0.02601
52,020
2,000,000
0.25
30/11/20
Andrew Woskett
Other Key Management
Varis Lidums
Glen Little
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
14 Minotaur Exploration Limited Annual Report 2018
Options held by key management personnel
The number of options to acquire shares in the Company held during the 2018 reporting period by each of the key
management personnel of the Group; including their related parties are set out below:
Balance at
Beginning
of Period
Granted as
Remuneration
Exercised
Net
Change
Other
Balance
at End of
Period
Expiry
Date
First
Exercise
Date
Directors - Unlisted Options
Antonio Belperio
2,750,000
Roger Higgins
2,500,000
-
-
George McKenzie
-
2,000,000
Andrew Woskett
5,000,000
Directors - Listed Options
Antonio Belperio
50,000
Roger Higgins
George McKenzie
Andrew Woskett
-
-
-
-
-
-
-
-
Other Key Management - Unlisted Options
Varis Lidums
Varis Lidums
Varis Lidums
Glen Little
Glen Little
250,000
450,000
400,000
1,000,000
250,000
-
-
-
-
-
Shares held by key management personnel
-
-
-
-
(50,000)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(250,000)
2,750,000
17/11/19
18/11/16
2,500,000
17/11/19
18/11/16
2,000,000
30/11/20
08/12/17
5,000,000
17/11/19
18/11/16
-
-
-
-
-
30/11/17
05/1/16
-
-
-
-
-
-
03/07/17
04/07/12
-
-
-
-
450,000
21/11/19
20/11/14
400,000
06/09/21
07/09/16
1,000,000
21/11/19
20/11/14
250,000
06/09/21
07/09/16
The number of fully paid ordinary shares in the Company held during the 2018 reporting period by each of the key
management personnel of the Group; including their related parties are set out below.
Balance as at
1 July 2017
On Exercise
of Options
Net Change
Other
Balance as at
30 June 2018
Directors
Antonio Belperio
1,712,750
50,000
Roger Higgins
George McKenzie
Andrew Woskett
Other Key Management
Varis Lidums
Glen Little
-
59,100
205,000
-
58,956
Use of remuneration consultants
-
-
-
-
-
-
-
-
-
-
-
1,762,750
-
59,100
205,000
-
58,956
During the financial year, there were no remuneration recommendations made in relation to key management
personnel for the Company by any remuneration consultants.
Minotaur Exploration Limited Annual Report 2018 15
DIRECTORS’ REPORT
Voting and comments made at the Company’s 2017 Annual General Meeting
Minotaur Exploration Ltd received more than 97.6% of “yes” votes on its remuneration report for the 2017 financial
year by proxy. The Company did not receive any feedback at the Annual General Meeting on its remuneration report.
End of audited remuneration report.
Directors’ meetings
The number of meetings of directors (including meetings of committees of directors) held during the year and the
number of meetings attended by each director were as follows:
Director
Antonio Belperio
Roger Higgins
George McKenzie
Andrew Woskett
Directors’ Meetings
Audit Committee
Eligible
Attended
Eligible
Attended
7
7
7
7
6
7
7
7
-
2
2
-
-
2
2
-
Proceedings on behalf of the group
No person has applied for leave of Court to bring proceedings on behalf of the Group or 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 any part of those
proceedings.
Company geologists mapping Coolibah copper prospect, Highlands project
16 Minotaur Exploration Limited Annual Report 2018
Non-audit services
During the year, Grant Thornton, the Company’s auditors, performed certain other services in addition to their
statutory audit duties.
The Board has considered the non-audit services provided during the year by the auditor and is satisfied that the
provision of those non-audit services during the year is compatible with, and did not compromise, the auditor
independence requirements of the Corporations Act 2001 for the following reasons:
• all non-audit services were subject to the corporate governance procedures adopted by the Company to ensure
they do not impact upon the impartiality and objectivity of the auditor; and
•
the non-audit services do not undermine the general principles relating to auditor independence as set out in
APES 110 Code of Ethics for Professional Accountants, as they did not involve reviewing or auditing the auditor’s
own work, acting in a management or decision-making capacity for the Company, acting as an advocate for the
Company or jointly sharing risks and rewards.
Details of the amounts paid to the auditors of the Company, Grant Thornton, and its related practices for audit and
non-audit services provided during the year are set out in Note 22 to the Financial Statements.
A copy of the Auditor’s Independence Declaration as required under s307C of the Corporations Act 2001 is included
on page 18 of this financial report and forms part of this Directors’ Report.
Signed in accordance with a resolution of the directors:
Roger Higgins
Chairman
Dated this 28th day of August 2018
Minotaur Exploration Limited Annual Report 2018 17
AUDITOR’S INDEPENDENCE DECLARATION
18 Minotaur Exploration Limited Annual Report 2018
FINANCIAL REPORT
Consolidated Statement of Profit or Loss and Other Comprehensive Income
for the year ended 30 June 2018
Note
4 (a)
4 (b)
4 (c)
4 (c)
4 (c)
4 (d)
4 (c)
4 (c)
4 (e)
5
Consolidated Group
30 June 2018
$
30 June 2017
$
224,562
231,559
268,923
253,508
(1,342,979)
(2,091,726)
(40,003)
(684,780)
(690,645)
(150,890)
-
(906,416)
(25,041)
(1,056,673)
(810,590)
(164,135)
(700)
(889,457)
(3,359,592)
(4,515,891)
843,541
695,475
(2,516,051)
(3,820,416)
Revenue
Other income
Impairment of exploration and evaluation assets
Impairment of available-for-sale investments
Project generation costs
Employee benefits expense
Depreciation expense
Finance costs
Other expenses
Loss before income tax expense
Income tax benefit
Loss for the year
Other comprehensive income (net of tax)
Items that may be reclassified to profit or loss
Fair value (losses)/gains on available-for-sale assets
18 (b)
(144,543)
46,585
Total comprehensive income for the year
(2,660,594)
(3,773,831)
Loss for the year is attributable to:
Members of the parent entity
Non-controlling interest
Total comprehensive income for the year is attributable to:
Members of the parent entity
Non-controlling interest
Earnings per share
Basic earnings per share (cents)
Diluted earnings per share (cents)
19
20
6
6
(2,516,051)
(3,814,220)
-
(6,196)
(2,516,051)
(3,820,416)
(2,660,594)
(3,767,635)
-
(6,196)
(2,660,594)
(3,773,831)
(1.05)
(1.05)
(1.80)
(1.80)
The above statement should be read in conjunction with the accompanying notes
Minotaur Exploration Limited Annual Report 2018 19
FINANCIAL REPORT
Consolidated Statement of Financial Position
as at 30 June 2018
CURRENT ASSETS
Cash and cash equivalents
Trade and other receivables
Other current assets
TOTAL CURRENT ASSETS
NON-CURRENT ASSETS
Available-for-sale investments
Property, plant and equipment
Exploration and evaluation assets
TOTAL NON-CURRENT ASSETS
TOTAL ASSETS
CURRENT LIABILITIES
Trade and other payables
Borrowings
Short-term provisions
TOTAL CURRENT LIABILITIES
NON-CURRENT LIABILITIES
Borrowings
Long-term provisions
TOTAL NON-CURRENT LIABILITIES
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued capital
Reserves
Accumulated losses
TOTAL EQUITY
Consolidated Group
Note
30 June 2018
$
30 June 2017
$
7
8
9
10
11
12
14
15
16
15
16
17
18
19
2,020,041
127,726
452,840
2,331,267
704,123
110,767
2,600,607
3,146,157
518,355
623,185
8,660,998
9,802,538
12,403,145
1,228,934
25,986
568,237
1,823,157
366,014
33,714
399,728
718,494
753,448
8,969,026
10,440,968
13,587,125
1,839,818
-
505,478
2,345,296
392,000
66,365
458,365
2,222,885
2,803,661
10,180,260
10,783,464
44,940,370
1,142,393
42,935,000
1,433,207
(35,902,503)
(33,584,743)
10,180,260
10,783,464
The above statement should be read in conjunction with the accompanying notes
20 Minotaur Exploration Limited Annual Report 2018
Consolidated Statement of Changes in Equity
for the year ended 30 June 2018
Consolidated Group
Issued Capital
$
Note
Share Option
Reserve
$
Other
Components
of Equity
(Note 18)
$
Accumulated
Losses
$
Total Equity
$
Balance at 1 July 2017
42,935,000
1,178,476
254,731
(33,584,743)
10,783,464
Comprehensive income
Total comprehensive
income for the year
Total comprehensive
income for the year
Transactions with owners,
in their capacity as owners,
and other transfers
Issue of shares through
Share Placement and Share
Purchase Plan
Issue of shares through
exercise of options
Transaction costs on shares
issued
Issue of unlisted options to
directors
Transfer from share option
reserve upon lapse of
options
17
17
18 (a)
-
-
2,043,422
76,489
(114,541)
-
-
-
-
-
-
-
52,020
(198,291)
2,005,370
(146,271)
(144,543)
(2,516,051)
(2,660,594)
(144,543)
(2,516,051)
(2,660,594)
-
-
-
-
-
-
-
-
-
-
2,043,422
76,489
(114,541)
52,020
198,291
-
198,291
2,057,390
Balance at 30 June 2018
44,940,370
1,032,205
110,188
(35,902,503)
10,180,260
The above statement should be read in conjunction with the accompanying notes
Minotaur Exploration Limited Annual Report 2018 21
FINANCIAL REPORT
Consolidated Statement of Changes in Equity
for the year ended 30 June 2018 (continued)
Consolidated Group
Issued
Capital
$
Note
Share
Option
Reserve
$
Other
Components
of Equity
(Note 18)
$
Accumulated
Losses
$
Non-
Controlling
Interest
$
Total
Equity
$
Balance at 1 July 2016
42,930,982
836,498
208,146
(29,842,301)
4,197
14,137,522
Comprehensive income
Total comprehensive
income for the year
Total comprehensive
income for the year
Transactions with owners,
in their capacity as owners,
and other transfers
Issue of shares through
exercise of options
Issue of unlisted options to
employees and directors
Adjustment upon increase
in ownership percentage in
controlled entity
Transfer from share option
reserve upon lapse of
options
-
-
17
4,018
-
-
-
-
-
-
415,755
-
(73,777)
4,018
341,978
18 (a)
46,585
(3,814,220)
(6,196)
(3,773,831)
46,585
(3,814,220)
(6,196)
(3,773,831)
-
-
-
-
-
-
-
-
-
4,018
415,755
(1,999)
1,999
73,777
71,778
-
1,999
419,773
-
-
Balance at 30 June 2017
42,935,000
1,178,476
254,731
(33,584,743)
-
10,783,464
The above statement should be read in conjunction with the accompanying notes
22 Minotaur Exploration Limited Annual Report 2018
Consolidated Statement of Cash Flows
for the year ended 30 June 2018
Consolidated Group
Note
30 June 2018
$
30 June 2017
$
213,691
242,689
(1,609,720)
(1,402,976)
Cash flows from operating activities
Receipts from customers
Payments to suppliers and employees
Interest received
Finance costs
R&D tax incentive received
Net cash used in operating activities
7
Cash flows from investing activities
Payments for property, plant and equipment
Proceeds from sale of property, plant and equipment
Purchase of available-for-sale investments
Proceeds from sale of available-for-sale investments
Buy back of shares in controlled entity
Proceeds from sale of tenements
Option, exclusivity and signing fees received
Joint Venture receipts
Government grants received for exploration activities
Payment for exploration activities
Net cash used in investing activities
Cash flows from financing activities
Proceeds from issue of shares through share purchase plan
and share placement
Proceeds from exercise of listed options
Payment of transaction costs for issue of shares
Repayment of borrowings
Net cash provided by financing activities
Net decrease in cash and cash equivalents
Cash at the beginning of the year
Cash at the end of the year
7
11,557
-
470,851
(913,621)
(20,628)
4,000
-
33,025
-
341,899
170,000
4,742,775
-
31,490
(1,501)
695,475
(434,823)
(3,622)
10,000
(140,757)
155,000
(6,471)
360,000
-
3,006,449
178,065
(6,674,046)
(1,402,975)
(5,250,848)
(1,692,184)
2,043,422
76,490
(114,542)
-
2,005,370
(311,226)
2,331,267
2,020,041
-
4,018
-
(17,507)
(13,489)
(2,140,496)
4,471,763
2,331,267
The above statement should be read in conjunction with the accompanying notes
Minotaur Exploration Limited Annual Report 2018 23
FINANCIAL REPORT
Notes to the Consolidated Financial Statements
for the year ended 30 June 2018
These consolidated financial statements and notes represent
those of Minotaur Exploration Ltd and Controlled Entities (the
”consolidated group” or “group”).
The separate financial statements of the parent entity,
Minotaur Exploration Ltd, have not been presented within this
financial report as permitted by the Corporations Act 2001.
1 SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES
Basis of preparation
The consolidated financial statements are general purpose
financial statements that have been prepared in accordance
with Australian Accounting Standards, Australian Accounting
Interpretations, other authoritative pronouncements of the
Australian Accounting Standards Board and the Corporations
Act 2001. The Group is a for-profit entity for financial reporting
purposes under Australian Accounting Standards.
Minotaur Exploration Limited is the Group’s Ultimate Parent
Company. Minotaur Exploration Limited is a Public Company
incorporated and domiciled in Australia. The address of its
registered office is C/- O’Loughlins Lawyers, Level 2, 99 Frome
Street, Adelaide SA 5000 and its principal place of business is
Level 1, 8 Beulah Road, Norwood SA 5067.
Australian Accounting Standards set out accounting
policies that the Australian Accounting Standards Board has
concluded would result in financial statements containing
relevant and reliable information about transactions, events
and conditions. Compliance with Australian Accounting
Standards ensures that the financial statements and notes
also comply with International Financial Reporting Standards
as issued by the International Accounting Standards
Board (IASB). Material accounting policies adopted in the
preparation of these financial statements are presented below
and have been consistently applied unless stated otherwise.
Except for cash flow information, the financial statements
have been prepared on an accruals basis and are based
on historical costs, modified, where applicable, by the
measurement at fair value of selected non-current assets,
financial assets and financial liabilities.
The consolidated financial statements for the year ended 30
June 2018 were approved and authorised for issue by the
Board of Directors on 28 August 2018.
(a) Principle of Consolidation
The consolidated financial statements incorporate the
assets, liabilities and results of entities controlled by
Minotaur Exploration Ltd at the end of the reporting period.
The parent entity controls a subsidiary if it is exposed, or
has rights, to variable returns from its involvement with
the subsidiary and has the ability to affect those returns
through its power over the subsidiary.
Where controlled entities have entered or left the Group
during the year, the financial performance of those entities
is included only for the period of the year that they were
controlled. A list of controlled entities is contained in Note
24 to the financial statements.
In preparing the consolidated financial statements, all
inter-group balances and transactions between entities
in the consolidated group have been eliminated in full on
consolidation.
Non-controlling interests, being the equity in a subsidiary
not attributable, directly or indirectly, to a parent, are
reported separately within the equity section of the
consolidated statement of financial position and statement
of profit or loss and other comprehensive income. The
non-controlling interests in the net assets comprise their
interests at the date of the original business combination
and their share of changes in equity since that date.
Non-controlling interests
Non-controlling interests (i.e. equity in a subsidiary not
attributable directly or indirectly to a parent) are presented
in the consolidated statement of financial position within
equity separately from the equity of the owners of the
parent.
(b) Income Tax
The income tax expense (revenue) for the year comprises
current income tax expense (income) and deferred tax
expense (income).
Current income tax expense charged to profit or loss is
the tax payable on taxable income. Current tax liabilities
(assets) are measured at the amounts expected to be paid
to (recovered from) the relevant taxation authority.
Deferred income tax expense reflects movements in
deferred tax asset and deferred tax liability balances during
the year as well unused tax losses.
Current and deferred income tax expense (income) is
charged or credited outside profit or loss when the tax
relates to items that are recognised outside profit or loss.
Except for business combinations, no deferred income tax
is recognised from the initial recognition of an asset or
liability, where there is no effect on accounting or taxable
profit or loss.
Deferred tax assets and liabilities are calculated at
the tax rates that are expected to apply to the period
when the asset is realised or the liability is settled and
their measurement also reflects the manner in which
management expects to recover or settle the carrying
24 Minotaur Exploration Limited Annual Report 2018
amount of the related asset or liability.
(c) Property, Plant and Equipment
Deferred tax assets relating to temporary differences and
unused tax losses are recognised only to the extent that it is
probable that future taxable profit will be available against
which the benefits of the deferred tax asset can be utilised.
Where temporary differences exist in relation to
investments in subsidiaries, branches, associates, and
joint ventures, deferred tax assets and liabilities are
not recognised where the timing of the reversal of the
temporary difference can be controlled and it is not
probable that the reversal will occur in the foreseeable
future.
Current tax assets and liabilities are offset where a legally
enforceable right of set-off exists and it is intended that
net settlement or simultaneous realisation and settlement
of the respective asset and liability will occur. Deferred tax
assets and liabilities are offset where:
a. a legally enforceable right of set-off exists; and
b. the deferred tax assets and liabilities relate to income
taxes levied by the same taxation authority on
either the same taxable entity or different taxable
entities where it is intended that net settlement
or simultaneous realisation and settlement of the
respective asset and liability will occur in future periods
in which significant amounts of deferred tax assets or
liabilities are expected to be recovered or settled.
Tax consolidation
The parent entity and its Australian wholly-owned entities
are part of a tax-consolidated group under Australian
taxation law. The head entity within the tax consolidation
group for the purposes of the tax consolidation system is
Minotaur Exploration Limited.
Minotaur Exploration Limited and each of its own
wholly-owned subsidiaries recognise the current and
deferred tax assets and deferred tax liabilities applicable
to the transactions undertaken by it, after elimination of
intra-group transactions. Minotaur Exploration Limited
recognises the entire tax-consolidated group’s retained tax
losses.
Research and development tax incentive
To the extent that research and development costs are
eligible activities under the “Research and development
tax incentive” programme, a 45% refundable tax offset is
available for companies with annual turnover of less than
$20 million. The Group recognises refundable tax offsets
received in the financial year as an income tax benefit, in
profit or loss, resulting from the monetisation of available
tax losses that otherwise would have been carried forward.
Each class of property, plant and equipment is carried at
cost as indicated less, where applicable, any accumulated
depreciation and impairment losses.
Land and buildings
Buildings are measured on the cost basis and therefore
carried at cost less accumulated depreciation for buildings
and any accumulated impairment. In the event the
carrying amount of buildings is greater than the estimated
recoverable amount, the carrying amount is written down
immediately to the estimated recoverable amount and
impairment losses are recognised either in profit or loss or
as a revaluation decrease if the impairment losses relate to a
revalued asset. A formal assessment of recoverable amount
is made when impairment indicators are present.
Plant and equipment
Plant and equipment are measured on the cost basis and
therefore carried at cost less accumulated depreciation
and any accumulated impairment. In the event the
carrying amount of plant and equipment is greater than
the estimated recoverable amount, and impairment losses
are recognised either in profit or loss or as a revaluation
decrease if the impairment losses relate to a revalued asset.
A formal assessment of recoverable amount is made when
impairment indicators are present.
The carrying amount of property, plant and equipment
is reviewed annually by directors to ensure it is not in
excess of the recoverable amount from these assets.
The recoverable amount is assessed on the basis of the
expected net cash flows that will be received from the
asset’s employment and subsequent disposal. The expected
net cash flows have been discounted to their present values
in determining recoverable amounts.
The cost of fixed assets constructed within the consolidated
group includes the cost of materials, direct labour,
borrowing costs and an appropriate proportion of fixed and
variable overheads. Subsequent costs are included in the
asset’s carrying amount or recognised as a separate asset, as
appropriate, only when it is probable that future economic
benefits associated with the item will flow to the Group
and the cost of the item can be measured reliably. All other
repairs and maintenance are charged to the statement of
profit or loss and other comprehensive income during the
financial period in which they are incurred.
Depreciation
The depreciable amount of all fixed assets including
buildings and capitalised lease assets, but excluding
freehold land, is depreciated on a straight-line and
diminishing value basis over the asset’s useful life to the
consolidated group commencing from the time the asset is
held ready for use. Leasehold improvements are depreciated
over the shorter of either the unexpired period of the lease
or the estimated useful lives of the improvements.
Minotaur Exploration Limited Annual Report 2018 25
FINANCIAL REPORT
Notes to the Consolidated Financial Statements
for the year ended 30 June 2018
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The useful life for each class of depreciable assets are:
Class of Fixed Asset
Leasehold improvements
Buildings
Plant and equipment
Motor vehicles
Useful Life
3 - 7 years
20 years
2 - 20 years
6 - 10 years
The assets’ residual values and useful lives are reviewed, and
adjusted if appropriate, at the end of each reporting period.
An asset’s carrying amount is written down immediately
to its recoverable amount if the asset’s carrying amount is
greater than its estimated recoverable amount.
Gains and losses on disposals are determined by comparing
proceeds with the carrying amount. These gains and losses
are included in the statement of profit or loss and other
comprehensive income.
(d) Exploration and Development Expenditure
Exploration, evaluation and development expenditures
incurred are capitalised in respect of each identifiable
area of interest. These costs are only capitalised to the
extent that they are expected to be recovered through
the successful development of the area or where activities
in the area have not yet reached a stage that permits
reasonable assessment of the existence of economically
recoverable reserves.
Accumulated costs in relation to an abandoned area are
written off in full against profit in the year in which the
decision to abandon the area is made.
When production commences, the accumulated costs
for the relevant area of interest are amortised over the
life of the area according to the rate of depletion of the
economically recoverable reserves.
A regular review is undertaken of each area of interest to
determine the appropriateness of continuing to capitalise
costs in relation to that area of interest.
Costs of site restoration are provided over the life of
the project from when exploration commences and are
included in the costs of that stage. Site restoration costs
include the dismantling and removal of mining plant,
equipment and building structures, waste removal, and
rehabilitation of the site in accordance with local laws and
regulations and clauses of the permits. Such costs have
been determined using estimates of future costs, current
legal requirements and technology on an undiscounted
basis.
Any changes in the estimates for the costs are accounted
on a prospective basis. In determining the costs of site
restoration, there is uncertainty regarding the nature and
extent of the restoration due to community expectations
and future legislation. Accordingly the costs have been
determined on the basis that the restoration will be
completed within one year of abandoning the site.
(e) Leases
Leases of fixed assets where substantially all the risks and
benefits incidental to the ownership of the asset, but not
the legal ownership, that is transferred to entities in the
consolidated group, are classified as finance leases.
Finance leases are capitalised by recognising an asset and a
liability at the lower of the amounts equal to the fair value
of the leased property or the present value of the minimum
lease payments, including any guaranteed residual values.
Lease payments are allocated between the reduction of the
lease liability and the lease interest expense for the period.
Leased assets are depreciated on a diminishing value basis
over the shorter of their estimated useful lives or the lease
term.
Lease payments for operating leases, where substantially all
the risks and benefits remain with the lessor, are recognised
as expenses in the periods in which they are incurred.
(f) Financial Instruments
Recognition and initial measurement
Financial assets and financial liabilities are recognised when
the entity becomes a party to the contractual provisions to
the instrument. For financial assets, this is equivalent to the
date that the company commits itself to either the purchase
or sale of the asset (i.e. trade date accounting is adopted).
Financial instruments are initially measured at fair value
plus transaction costs, except where the instrument is
classified “at fair value through profit or loss”, in which case
transaction costs are expensed to profit or loss immediately.
Classification and subsequent measurement
Finance instruments are subsequently measured at fair
value, amortised cost using the effective interest rate
method, or cost.
Amortised cost is the amount at which the financial asset
or financial liability is measured at initial recognition less
principal repayments and any reduction for impairment,
and adjusted for any cumulative amortisation of the
difference between that initial amount and the maturity
amount calculated using the effective interest method.
Fair value is determined based on current bid prices for all
quoted investments. Valuation techniques are applied to
26 Minotaur Exploration Limited Annual Report 2018
determine the fair value for all unlisted securities, including
recent arm’s length transactions, reference to similar
instruments and option pricing models.
The effective interest method is used to allocate interest
income or interest expense over the relevant period and
is equivalent to the rate that discounts estimated future
cash payments or receipts (including fees, transaction
costs and other premiums or discounts) through the
expected life (or when this cannot be reliably predicted,
the contractual term) of the financial instrument to the net
carrying amount of the financial asset or financial liability.
Revisions to expected future net cash flows will necessitate
an adjustment to the carrying value with a consequential
recognition of an income or expense item in profit or loss.
The Group does not designate any interests in subsidiaries,
associates or joint venture entities as being subject to
the requirements of Accounting Standards specifically
applicable to financial instruments.
(i) Loans and Receivables
Loans and receivables are non-derivative financial assets
with fixed or determinable payments that are not quoted
in an active market and are subsequently measured at
amortised cost. Gains or losses are recognised in profit
or loss through the amortisation process and when the
financial asset is derecognised.
Loans and receivables are included in current assets, where
they are expected to mature within 12 months after the end
of the reporting period.
(ii) Available-for-sale Investments
Available-for-sale investments are non-derivative financial
assets that are either not capable of being classified into
other categories of financial assets due to their nature
or they are designated as such by management. They
comprise investments in the equity of other entities where
there is neither a fixed maturity nor fixed or determinable
payments.
They are subsequently measured at fair value with any
remeasurements other than impairment losses and
foreign exchange gains and losses recognised in other
comprehensive income. When the financial asset is
derecognised, the cumulative gain or loss pertaining to that
asset previously recognised in other comprehensive income
is reclassified into profit or loss.
Available-for-sale financial assets are classified as non-
current assets when they are expected to be sold after 12
months from the end of the reporting period. All other
available-for-sale financial assets are classified as current
assets.
(iii) Financial Liabilities
Non-derivative financial liabilities other than financial
guarantees are subsequently measured at amortised cost.
Gains or losses are recognised in profit or loss through the
amortisation process and when the financial liability is
derecognised.
(g) Investments in Associates and Joint Ventures
Associates are those entities over which the Group is able to
exert significant influence but which are not subsidiaries.
A joint venture is an arrangement that the Group controls
jointly with one or more other investors, and over which
the Group has rights to a share of the arrangement’s net
assets rather than direct rights to underlying assets and
obligations for underlying liabilities. A joint arrangement in
which the Group has direct rights to underlying assets and
obligations for underlying liabilities is classified as a joint
operation.
Investments in associates and joint ventures are accounted
for using the equity method. Interests in joint operations
are accounted for by recognising the Group’s assets
(including its share of any assets held jointly), its liabilities
(including its share of any liabilities incurred jointly), its
revenue from the sale of its share of the output arising
from the joint operation, its share of the revenue from the
sale of the output by the joint operation and its expenses
(including its share of any expenses incurred jointly).
Any goodwill or fair value adjustment attributable to
the Group’s share in the associate or joint venture is not
recognised separately and is included in the amount
recognised as investment.
The carrying amount of the investment in associates and
joint ventures is increased or decreased to recognise the
Group’s share of the profit or loss and other comprehensive
income of the associate and joint venture, adjusted where
necessary to ensure consistency with the accounting
policies of the Group.
Unrealised gains and losses on transactions between the
Group and its associates and joint ventures are eliminated
to the extent of the Group’s interest in those entities. Where
unrealised losses are eliminated, the underlying asset is also
tested for impairment.
(h) Business Combinations
The Group applies the acquisition method in accounting
for business combinations. The consideration transferred
by the Group to obtain control of a subsidiary is calculated
as the sum of the acquisition-date fair values of assets
transferred, liabilities incurred and the equity interests
issued by the Group, which includes the fair value of any
asset or liability arising from a contingent consideration
arrangement. Acquisition costs are expensed as incurred.
The Group recognises identifiable assets acquired and
liabilities assumed in a business combination regardless
of whether they have been previously recognised in the
acquiree’s financial statements prior to the acquisition.
Assets acquired and liabilities assumed are generally
measured at their acquisition-date fair values.
Goodwill is stated after separate recognition of identifiable
intangible assets. It is calculated as the excess of the sum of
(a) fair value of consideration transferred, (b) the recognised
amount of any non-controlling interest in the acquiree, and
Minotaur Exploration Limited Annual Report 2018 27
FINANCIAL REPORT
Notes to the Consolidated Financial Statements
for the year ended 30 June 2018
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(c) acquisition-date fair value of any existing equity interest
in the acquiree, over the acquisition-date fair values of
identifiable net assets.
(i) Foreign Currency Transactions and Balances
Functional and presentation currency
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 and
presentation currency.
Transactions and balances
Foreign currency transactions are translated into 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 as a qualifying cash flow or net investment hedge.
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 profit or
loss.
(j) Employee Benefits
Short-term employee benefits
Short-term employee benefits are benefits, other than
termination benefits, that are expected to be settled wholly
within twelve (12) months after the end of the period in
which the employees render the related service. Short-
term employee benefits are measured at the undiscounted
amounts expected to be paid when the liabilities are
settled.
Other long-term employee benefits
The Group’s liabilities for long service leave are included
in other long-term benefits as they are not expected to
be settled wholly within twelve (12) months after the end
of the period in which the employees render the related
service. They are measured at the present value of the
expected future payments to be made to employees.
The expected future payments incorporate anticipated
future wage and salary levels, experience of employee
departures and periods of service, and are discounted at
rates determined by reference to market yields at the end
of the reporting period on high quality corporate bonds
that have maturity dates that approximate the timing of
the estimated future cash outflows. Any re-measurements
arising from experience adjustments and changes in
assumptions are recognised in profit or loss in the periods in
which the changes occur.
The Group presents employee benefit obligations as current
liabilities in the statement of financial position if the Group
does not have an unconditional right to defer settlement
for at least twelve (12) months after the reporting period,
irrespective of when the actual settlement is expected to
take place.
Equity-settled compensation
The Group operates an employee share option plan. Share-
based payments to employees are measured at the fair
value of the instruments issued and amortised over the
vesting periods. Share-based payments to non-employees
are measured at the fair value of goods or services received
or the fair value of the equity instruments issued, if it is
determined the fair value of the goods or services cannot
be reliably measured, and are recorded at the date the
goods or services are received.
The corresponding amount is recorded to the option
reserve. The fair value of options is determined using
the Black-Scholes pricing model. The number of options
expected to vest is reviewed and adjusted at the end of
each reporting period such that the amount recognised
for services received as consideration for the equity
instruments granted is based on the number of equity
instruments that eventually vest.
(k) Provisions
Provisions are recognised when the Group has a legal or
constructive obligation, as a result of past events, for which
it is probable that an outflow of economic benefits will
result and that outflow can be reliably measured.
Provisions are measured using the best estimate of the
amounts required to settle the obligation at the end of the
reporting period.
(l) Cash and Cash Equivalents
Cash and cash equivalents include cash on hand, deposits
available on demand with banks, other short-term highly
liquid investments with original maturities of 6 months or
less, and bank overdrafts.
Bank overdrafts are reported within short-term borrowings
in current liabilities in the statement of financial position.
28 Minotaur Exploration Limited Annual Report 2018
(m) Revenue and Other Income
(r) Comparative Figures
The Group generates revenues from management fees
charged to joint operation partners for the management of
exploration activities. This revenue is recognised when the
management services are provided.
Rental income from operating leases is recognised on a
straight-line basis over the lease term.
Interest income is reported on an accruals basis using the
effective interest method.
All revenue is stated net of the amount of goods and
services tax (GST).
When required by Accounting Standards, comparative
figures have been adjusted to conform to changes in
presentation for the current financial year.
(s) Critical Accounting Estimates and Judgements
The directors evaluate estimates and judgments
incorporated into the financial statements based on
historical knowledge and best available current information.
Estimates assume a reasonable expectation of future
events and are based on current trends and economic data,
obtained both externally and within the Group.
(n) Trade and Other Payables
Trade and other payables represent the liabilities for goods
and services received by the entity that remain unpaid at
the end of the reporting period. The balance is recognised
as a current liability with the amounts normally paid within
30-90 days of recognition of the liability.
(o) Borrowing Costs
Borrowing costs directly attributable to the acquisition,
construction or production of assets that necessarily take a
substantial period of time to prepare for their intended use
or sale are added to the cost of those assets, until such time
as the assets are substantially ready for their intended use
or sale.
All other borrowing costs are recognised in profit or loss in
the period in which they are incurred.
(p) 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 Taxation Office (ATO).
Receivables and payables are stated inclusive of the amount
of GST receivable or payable. The net amount of GST
recoverable from, or payable to, the ATO is included with
other receivables or payables in the statement of financial
position.
Cash flows are presented on a gross basis. The GST
components of cash flows arising from investing or
financing activities which are recoverable from, or payable
to, the ATO are presented as operating cash flows included
in receipts from customers or payments to suppliers.
(q) Government Grants
Government grants are recognised at fair value where there
is reasonable assurance that the grant will be received and
all grant conditions will be met. Grants relating to expense
items are recognised as income over the periods necessary
to match the grant to the costs they are compensating.
Grants relating to capitalised exploration and evaluation
expenditure are credited against the exploration and
evaluation assets to which they relate in order to match
the grants received with the expenditure the grants are
intended to compensate.
Key Estimates
(i) Impairment
The Group assesses impairment at the end of each
reporting period by evaluating conditions and events
specific to the Group that may be indicative of impairment
triggers. Recoverable amounts of relevant assets are
reassessed using fair value less cost of disposal calculations
which incorporate various key assumptions.
(ii) Exploration and evaluation expenditure
The Group capitalises expenditure relating to exploration
and evaluation where it is considered likely to be
recoverable or where the activities have not reached a
stage that permits a reasonable assessment of the existence
of reserves. While there are certain areas of interest from
which no reserves have been extracted, the directors are of
the continued belief that such expenditure should not be
written off since feasibility studies in such areas have not
yet concluded. Such capitalised expenditure is carried at the
end of the year at $8,660,998 (2017: $8,969,026).
(t) Changes in Accounting Policies
New and amended standards adopted by the Group
A number of new and revised standards became effective
for the first time to annual periods beginning on or after 1
July 2017. Information on the more significant standard(s)
is presented below.
AASB 2016-1 Amendments to Australian Accounting
Standards – Recognition of Deferred Tax Assets for Unrealised
Losses
AASB 2016-1 amends AASB 112 Income Taxes to clarify
how to account for deferred tax assets related to debt
instruments measured at fair value, particularly where
changes in the market interest rate decrease the fair value
of a debt instrument below cost.
AASB 2016-1 is applicable to annual reporting periods
beginning on or after 1 January 2017.
AASB 2016-2 Amendments to Australian Accounting
Standards – Disclosure Initiative: Amendments to AASB 107
AASB 2016-2 amends AASB 107 Statement of Cash Flows
to require entities preparing financial statements in
accordance with Tier 1 reporting requirements to provide
Minotaur Exploration Limited Annual Report 2018 29
FINANCIAL REPORT
Notes to the Consolidated Financial Statements
for the year ended 30 June 2018
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
disclosures that enable users of financial statements
to evaluate changes in liabilities arising from financing
activities, including both changes arising from cash flows
and non-cash changes.
AASB 2016-2 is applicable to annual reporting periods
beginning on or after 1 January 2017.
The adoption of these standards has not had a material
impact on the Group.
(u) Standards, Amendments and Interpretations to
Existing Standards that are not yet effective and have not
been adopted early by the group
Australian Accounting Standards and Interpretations
that are issued, but are not yet effective, up to the date of
issuance of the Group’s financial statements are disclosed
below. The Group intends to adopt these standards, if
applicable, when they become effective.
AASB 9 Financial Instruments
In December 2014, the AASB issued the final version of
AASB 9 Financial Instruments that replaces AASB 139
Financial Instruments: Recognition and Measurement and
all previous versions of AASB 9. AASB 9 brings together all
three aspects of the accounting for financial instruments
project: classification and measurement, impairment and
hedge accounting.
AASB 9 is effective for annual periods beginning on or after
1 January 2018, with early application permitted. Except for
hedge accounting, retrospective application is required but
providing comparative information is not compulsory. For
hedge accounting, the requirements are generally applied
prospectively, with some limited exceptions.
The Group plans to adopt the new standard on the required
effective date and will not restate comparative information.
During 2018, the Group has performed a detailed impact
assessment of all three aspects of AASB 9. This assessment
is based on currently available information and may be
subject to changes arising from further reasonable and
supportable information being made available to the
Group in 2019 when the Group will adopt AASB 9. Overall,
the Group expects no significant impact on its statement
of financial position and equity except for the effect of
applying the impairment requirements of AASB 9.
In addition, the Group will implement changes in
classification of certain financial instruments.
The Group does not expect a significant impact on its
balance sheet or equity on applying the classification
and measurement requirements of AASB 9. It expects to
continue measuring at fair value all financial assets currently
held at fair value. Quoted equity shares currently held as
30 Minotaur Exploration Limited Annual Report 2018
available-for-sale with gains and losses recorded in OCI will,
continue to be recognised through OCI with an irrevocable
election being made. This will result in all fair value gains
and losses, whether realised or unrealised to be quarantined
in OCI and not recycled to the statement of profit or loss
and other comprehensive income.
AASB 2014-10 Amendments to Australian Accounting
Standards – Sale or Contribution of Assets between an
Investor and its Associate or Joint Venture
The amendments address the conflict between AASB
10 and AASB 128 in dealing with the loss of control of a
subsidiary that is sold or contributed to an associate or
joint venture. The amendments clarify that the gain or
loss resulting from the sale or contribution of assets that
constitute a business, as defined in AASB 3, between an
investor and its associate or joint venture, is recognised in
full. Any gain or loss resulting from the sale or contribution
of assets that do not constitute a business, however, is
recognised only to the extent of unrelated investors’
interests in the associate or joint venture.
The IASB has deferred the effective date of these
amendments indefinitely, but an entity that early adopts
the amendments must apply them prospectively. The Group
will apply these amendments when they become effective.
AASB 2016-5 Amendments to Australian Accounting
Standards - Classification and Measurement of Share-
based Payment Transactions
The AASB issued amendments to AASB 2 Share-based
Payment that address three main areas:
•
•
the effects of vesting conditions on the measurement
of a cash-settled share-based payment transaction;
the classification of a share-based payment transaction
with net settlement features for withholding tax
obligations; and
• accounting where a modification to the terms and
conditions of a share-based payment transaction
changes its classification from cash settled to equity
settled.
On adoption, entities are required to apply the amendments
without restating prior periods, but retrospective application
is permitted if elected for all three amendments and other
criteria are met. The amendments are effective for annual
periods beginning on or after 1 January 2018, with early
application permitted. The Group is assessing the potential
effect of the amendments on its consolidated financial
statements.
AASB 15 Revenue from Contracts with Customers
AASB 15 was issued in December 2014, and amended in
May 2016, and establishes a five-step model to account for
AASB 2016-6 Amendments to Australian Accounting
Standards – Applying AASB 9 Financial Instruments with
AASB 4 Insurance Contracts
The amendments address concerns arising from
implementing the new financial instruments standard,
AASB 9, before implementing AASB 17 Insurance Contracts,
which replaces AASB 4.
The amendments introduce two options for entities issuing
insurance contracts: a temporary exemption from applying
AASB 9 and an overlay approach. The temporary exemption
is first applied for reporting periods beginning on or after
1 January 2018. An entity may elect the overlay approach
when it first applies AASB 9 and apply that approach
retrospectively to financial assets designated on transition
to AASB 9. The entity restates comparative information
reflecting the overlay approach if, and only if, the entity
restates comparative information when applying AASB 9.
These amendments are not applicable to the Group.
AASB Interpretation 23 Uncertainty over Income Tax
Treatment
The Interpretation addresses the accounting for income
taxes when tax treatments involve uncertainty that affects
the application of AASB 112 and does not apply to taxes or
levies outside the scope of AASB 112, nor does it specifically
include requirements relating to interest and penalties
associated with uncertain tax treatments.
The Interpretation specifically addresses the following:
• Whether an entity considers uncertain tax treatments
separately
• The assumptions an entity makes about the
examination of tax treatments by taxation authorities
• How an entity determines taxable profit (tax loss), tax
bases, unused tax losses, unused tax credits and tax
rates
• How an entity considers changes in facts and
circumstances.
An entity must determine whether to consider each
uncertain tax treatment separately or together with one
or more other uncertain tax treatments. The approach that
better predicts the resolution of the uncertainty should
be followed. The interpretation is effective for annual
reporting periods beginning on or after 1 January 2019, but
certain transition reliefs are available. The Group will apply
interpretation from its effective date. The Group is assessing
the potential effect of the amendments on its consolidated
financial statements.
revenue arising from contracts with customers.
Under AASB 15, revenue is recognised at an amount that
reflects the consideration to which an entity expects to be
entitled in exchange for transferring goods or services to
a customer. The new revenue standard will supersede all
current revenue recognition requirements under Australian
Accounting Standards. Either a full retrospective application
or a modified retrospective application is required for
annual periods beginning on or after 1 January 2018.
Given the nature of revenue streams of the Group, the
introduction of AASB 15 is not expected to have a material
impact on the Group.
AASB 16 Leases
AASB 16 was issued in February 2016 and it replaces AASB
117 Leases, Interpretation 4 Determining whether an
Arrangement contains a Lease, Interpretation 115 Operating
Leases-Incentives and Interpretation 127 Evaluating the
Substance of Transactions Involving the Legal Form of a
Lease.
AASB 16 sets out the principles for the recognition,
measurement, presentation and disclosure of leases and
requires lessees to account for all leases under a single
on-balance sheet model similar to the accounting for
finance leases under AASB 117. The standard includes two
recognition exemptions for lessees – leases of ’low-value’
assets (e.g., personal computers) and short-term leases
(i.e., leases with a lease term of 12 months or less). At the
commencement date of a lease, a lessee will recognise a
liability to make lease payments (i.e., the lease liability) and
an asset representing the right to use the underlying asset
during the lease term (i.e., the right-of-use asset). Lessees
will be required to separately recognise the interest expense
on the lease liability and the depreciation expense on the
right-of-use asset. Lessees will be also required to remeasure
the lease liability upon the occurrence of certain events (e.g.,
a change in the lease term, a change in future lease payments
resulting from a change in an index or rate used to determine
those payments). The lessee will generally recognise the
amount of the remeasurement of the lease liability as an
adjustment to the right-of-use asset.
Lessor accounting under AASB 16 is substantially
unchanged from today’s accounting under AASB 117.
Lessors will continue to classify all leases using the same
classification principle as in AASB 117 and distinguish
between two types of leases: operating and finance leases.
AASB 16 also requires lessees and lessors to make more
extensive disclosures than under AASB 117.
AASB 16 is effective for annual periods beginning on or
after 1 January 2019. Early application is permitted, but
not before an entity applies AASB 15. A lessee can choose
to apply the standard using either a full retrospective or a
modified retrospective approach. The standard’s transition
provisions permit certain reliefs.
In 2019, the Group will continue to assess the potential
effect of AASB 16 on its consolidated financial statements.
Minotaur Exploration Limited Annual Report 2018 31
FINANCIAL REPORT
Notes to the Consolidated Financial Statements
for the year ended 30 June 2018
2 PARENT INFORMATION
Assets
Current assets
Non-current assets
Liabilities
Current liabilities
Non-current liabilities
Equity
Issued capital
Reserves – Share option
Accumulated losses
Financial performance
Loss for the year
Other comprehensive income
Guarantees
30 June 2018
$
30 June 2017
$
2,007,276
9,564,780
11,572,056
992,067
399,728
1,391,795
44,940,370
1,032,205
(35,792,314)
10,180,261
1,710,076
10,427,329
12,137,405
895,576
458,365
1,353,941
42,935,000
1,178,476
(33,330,012)
10,783,464
(2,660,594)
(3,771,830)
-
-
(2,660,594)
(3,771,830)
Minotaur Exploration Limited has not entered into any guarantees, in the current or previous financial year, in relation to the
debts of its subsidiaries.
Contingent Liabilities
Contingent liabilities of the parent entity have been incorporated into the Group information in Note 23. The contingent
liabilities of the parent are consistent with that of the Group.
Contractual Commitments
Contractual Commitments of the parent entity have been incorporated into the Group information in Note 21. The contractual
commitments of the parent are consistent with that of the Group.
3 OPERATING SEGMENTS
The Board has considered the requirements of AASB 8 Operating Segments and the internal reports that are reviewed by the chief
operating decision maker (the Managing Director) in allocating resources and have concluded, due to the Group being solely
focused on exploration activity, at this time that there are no separately identifiable segments.
32 Minotaur Exploration Limited Annual Report 2018
4 REVENUE AND EXPENSES
(a) Revenue
Administration fees
Rent received
Bank interest received or receivable
(b) Other income
Net gain on disposal of available-for-sale investments
Net loss on disposal of property, plant and equipment
Initial recognition of listed shares
Option, exclusivity and signing fees received
Net gain on disposal of exploration assets
(c) Expenses
Impairment of non-current assets
Impairment of exploration and evaluation assets
Impairment of available-for-sale financial assets
Total impairment of non-current assets
Project generation costs
Project generation costs
Total project generation costs
Depreciation of non-current assets
Buildings
Leasehold improvements
Plant and equipment
Motor vehicles
Total depreciation of non-current assets
Finance expenses
Finance costs
Interest applicable to hire-purchase contracts
Total finance expenses
Consolidated Group
30 June 2018
$
30 June 2017
$
190,559
23,133
10,870
224,562
8,799
-
-
170,000
52,760
231,559
1,342,979
40,003
1,382,982
684,780
684,780
7,937
92,173
20,018
30,762
150,890
-
-
-
220,054
22,635
26,234
268,923
28,915
(316)
44,221
-
180,688
253,508
2,091,726
25,041
2,116,767
1,056,673
1,056,673
7,937
92,173
48,945
15,080
164,135
55
645
700
Minotaur Exploration Limited Annual Report 2018 33
FINANCIAL REPORT
Notes to the Consolidated Financial Statements
for the year ended 30 June 2018
4
REVENUE AND EXPENSES
(d) Employee benefits expense
Wages, salaries, directors fees and other remuneration expenses
Superannuation expense
Transfer (from)/to annual leave provision
Transfer to long service leave provision
Share options expense
Transfer to exploration assets
(e) Other expenses
Professional and consultancy
Employee taxes and levies
Occupancy costs
Insurance costs
ASX/ASIC costs
Share register maintenance
Communication costs
Promotion and seminars
Audit fees
Other expenses
5
INCOME TAX BENEFIT
The major components of income tax benefit are:
Statement of comprehensive income
Current income tax
Current income tax charge
Research and development tax incentive
Income tax benefit reported in the income statement
34 Minotaur Exploration Limited Annual Report 2018
Consolidated Group
30 June 2018
$
30 June 2017
$
2,267,088
165,283
(20,410)
50,518
52,020
(1,823,854)
690,645
220,689
83,379
228,708
53,161
37,988
31,654
9,013
32,208
48,757
160,859
906,416
2,267,164
166,951
22,370
8,322
415,755
(2,069,972)
810,590
228,755
113,192
251,981
53,248
37,873
48,163
11,023
22,393
44,178
78,651
889,457
Consolidated Group
30 June 2018
$
30 June 2017
$
-
(843,541)
(843,541)
-
(695,475)
(695,475)
A reconciliation between tax expense and the product of accounting loss before income tax multiplied by the Group’s applicable
income tax rate is as follows:
Consolidated Group
30 June 2018
$
30 June 2017
$
Accounting (loss)/profit before income tax
(3,359,592)
(4,515,891)
At the Group’s statutory income tax rate of 27.5% (2017: 27.5%)
Expenditure not allowable for income tax purposes
Research and development tax incentive
Tax losses not recognised due to not meeting recognition criteria
(923,888)
14,825
(843,541)
909,063
(843,541)
(1,241,870)
115,689
(695,475)
1,126,181
(695,475)
The Group has tax losses arising in Australia of $84,461,055 (2017: $83,582,234) that are available indefinitely for offset against
future taxable profits generated by the Group. In addition the Group has $8,055,232 (2017: $8,122,131) capital losses available.
These losses include $72,537,535 tax losses and $2,323,426 capital losses transferred by members to the tax consolidated group.
The utilisation of these losses will be restricted to their available fraction.
Tax Consolidation
Minotaur Exploration Ltd and its 100% owned Australian resident subsidiaries have formed a tax consolidated group with effect
from 5 February 2005. Breakaway Resources Ltd and its subsidiaries were included in the tax consolidated group upon their
acquisition on 5 December 2013. Minotaur Gold Solutions Pty Ltd joined the income tax consolidated group on 31 March 2017.
Minotaur Exploration Ltd is the head entity of the tax consolidated group.
6 EARNINGS PER SHARE
Basic earnings per share amounts are calculated by dividing net profit for the year attributable to ordinary equity holders of the
parent by the weighted average number of ordinary shares outstanding during the year.
Diluted earnings per share amounts are calculated by dividing the net profit attributable to ordinary equity holders of the parent
by the weighted average number of ordinary shares outstanding during the year plus the weighted average number of ordinary
shares that would be issued on the conversion of all the dilutive potential ordinary shares into ordinary shares.
The following reflects the income and share data used in the basic and diluted earnings per share computations:
Consolidated Group
30 June 2018
30 June 2017
Net loss attributable to ordinary equity holders of the parent
($2,516,051)
($3,814,220)
Weighted average number of ordinary shares for basic earnings per
share
240,592,566
212,373,155
Effect of dilution
Share options
Weighted average number of ordinary shares adjusted for the
effect of dilution
-
-
240,592,566
212,373,155
In accordance with AASB 133 ’Earnings per Share’, as potential ordinary shares may only result in a situation where their
conversion results in an increase in loss per share or decrease in profit per share from continuing operations, no dilutive effect
has been taking into account for 2018.
As no dilutive effect has been taken into account for 2018, 26,268,333 potential ordinary shares have not been included in the
calculation.
There have been no other transactions involving ordinary shares or potential ordinary shares between the reporting date and
the date of completion of these financial statements.
Minotaur Exploration Limited Annual Report 2018 35
FINANCIAL REPORT
Notes to the Consolidated Financial Statements
for the year ended 30 June 2018
7 CASH AND CASH EQUIVALENTS
Cash and cash equivalents
Cash at bank and on hand
Short-term deposits
Consolidated Group
30 June 2018
$
30 June 2017
$
1,841,941
178,100
2,020,041
2,153,167
178,100
2,331,267
Reconciliation to Statement of Cash Flows
For the purpose of the Statement of Cash Flows, cash and cash equivalents comprise the following at 30 June:
Cash at bank and on hand
Short-term deposits
Reconciliation of net loss after tax to net cash flows
from operations
Net loss
Adjustments for non-cash items:
Depreciation
Impairment of non-current assets and project generation costs
Net gain on disposal of property, plant and equipment, available-for-
sale financial instruments and tenements
Share options expensed
Initial recognition of listed shares
Changes in assets and liabilities:
(Increase)/decrease in trade and other receivables
(Increase)/decrease in accrued R&D tax incentive
(Increase)/decrease in prepayments
(Decrease)/increase in trade and other payables
(Decrease)/increase in employee provisions
Net cash used in operating activities
Consolidated Group
30 June 2018
$
1,841,941
178,100
2,020,041
30 June 2017
$
2,153,167
178,100
2,331,267
(2,516,051)
(3,820,416)
150,890
2,067,762
(231,559)
52,020
-
686
(372,690)
4,519
(99,307)
30,109
(913,621)
164,135
3,173,440
(209,287)
415,755
(44,221)
6,624
-
3,481
(155,025)
30,691
(434,823)
Included in short-term deposits is $178,100 relating to deposits to secure tenements and rental tenancy and as such is restricted
for this use.
Cash at bank earns interest at floating rates based on daily deposit rates.
Short-term deposits are made for varying periods between one month and six months, depending on the immediate cash
requirements of the Group, and earn interest at the respective short-term deposit rate.
36 Minotaur Exploration Limited Annual Report 2018
8 TRADE AND OTHER RECEIVABLES
Trade receivables (i)
Sale of tenements receivable (ii)
Consolidated Group
30 June 2018
$
30 June 2017
$
127,726
-
127,726
404,123
300,000
704,123
(i) Trade receivables are non-interest bearing and are generally on 30-90 day terms. An allowance for doubtful debts is made
when there is objective evidence that a trade receivable is impaired. No impairment was recognised in 2017 and 2018 and no receivables
are past due at balance date.
(ii) On 2 March 2017, Minotaur Gold Solutions Pty Ltd entered into a tenement sale and purchase agreement with Shine
Resources Pty Ltd for the sale of P29/2121, E29/661 and M24/336 for a total consideration of $550,000. As at 30 June 2017 the Group had
received a total of $250,000 with the balance of $300,000 in the year ended 30 June 2018.
Information regarding the credit risk of current receivables is set out in Note 26.
9 OTHER CURRENT ASSETS
Prepayments
Accrued income
Accrued R&D tax incentive
Net GST and PAYG receivable
Other
10 AVAILABLE-FOR-SALE INVESTMENTS
At fair value – Shares, listed:
Opening balance
Revaluations
Disposals
Initial recognition of listed shares
Acquisitions
Impairments
Consolidated Group
30 June 2018
$
30 June 2017
$
48,536
-
372,690
16,614
15,000
452,840
718,494
(127,111)
(33,025)
-
-
(40,003)
518,355
53,053
687
-
42,027
15,000
110,767
636,971
76,58
(155,000)
44,221
140,757
(25,041)
718,494
Minotaur Exploration Limited Annual Report 2018 37
FINANCIAL REPORT
Notes to the Consolidated Financial Statements
for the year ended 30 June 2018
11 PROPERTY, PLANT AND EQUIPMENT
30 June 2018
Cost
Land and
Buildings
Leasehold
Improvements
Plant and
Equipment
Kaolin Pilot
Plant
Motor
Vehicles
Total
Opening balance
508,723
611,218
Additions
Disposals
Accumulated
depreciation
Opening balance
Depreciation for the
year
Disposals
-
-
-
-
352,658
20,627
-
283,765
187,253
1,943,617
-
-
-
-
20,627
-
508,723
611,218
373,285
283,765
187,253
1,964,244
23,811
428,907
311,672
283,765
142,014
1,190,169
7,937
-
31,748
92,173
20,018
-
-
-
-
30,762
150,890
-
-
521,080
331,690
283,765
172,776
1,341,059
Net book value
476,975
90,138
41,595
-
14,477
623,185
Property is measured at historical cost less accumulated depreciation. Land and buildings with a net book value of $476,975
(2017: $484,912) is offered as security against a mortgage of $392,000.
30 June 2017
Cost
Land and
Buildings
Leasehold
Improvements
Plant and
Equipment
Kaolin Pilot
Plant
Motor
Vehicles
Total
Opening balance
508,723
611,218
-
-
-
-
508,723
611,218
398,926
3,622
(49,890)
352,658
283,765
187,253
1,989,885
-
-
-
-
3,622
(49,890)
283,765
187,253
1,943,617
15,874
336,734
302,301
260,326
126,934
1,042,169
7,937
-
23,811
92,173
-
428,907
48,945
(39,574)
311,672
23,439
15,080
-
-
187,574
(39,574)
283,765
142,014
1,190,169
Net book value
484,912
182,311
40,986
-
45,239
753,448
38 Minotaur Exploration Limited Annual Report 2018
Additions
Disposals
Accumulated
depreciation
Opening balance
Depreciation for the
year
Disposals
12 EXPLORATION AND EVALUATION ASSETS
Exploration, evaluation and development costs carried forward
in respect of mining areas of interest
Exploration and evaluation phase – Joint Operations
Exploration and evaluation phase – Other
Consolidated Group
30 June 2018
$
30 June 2017
$
7,483,688
1,177,310
8,660,998
5,597,913
3,371,113
8,969,026
Capitalised tenement expenditure movement reconciliation – Consolidated Group:
30 June 2018
Balance at beginning of year
Additions through expenditure capitalised
Reductions through joint operation contributions
Write-off of tenements relinquished
Transfers between categories
Balance at end of year
30 June 2017
Balance at beginning of year
Additions through expenditure capitalised
Reductions through joint operation contributions
Write-off of tenements relinquished
Disposals
Project generation costs
Transfers between categories
Balance at end of year
Exploration
Joint Operations
$
Exploration Other
$
5,597,913
4,706,663
(4,689,827)
(16,837)
1,885,776
7,483,688
6,322,354
3,836,889
(3,727,296)
(871,879)
(6,080)
-
43,925
3,371,113
1,018,115
-
(1,326,142)
(1,885,776)
1,177,310
3,894,698
1,429,671
-
(1,219,847)
(473,232)
(216,252)
(43,925)
Total
$
8,969,026
5,724,778
(4,689,827)
(1,342,979)
-
8,660,998
10,217,052
5,266,560
(3,727,296)
(2,091,726)
(479,312)
(216,252)
-
5,597,913
3,371,113
8,969,026
The impairment expense of $1,342,979 (2017: $2,091,726) arose from a review of the Group’s capitalised costs and the relevant
tenements to which the costs related.
The ultimate recoupment of costs carried forward for exploration and evaluation phases is dependent on the successful
development and commercial exploitation or sale of the respective mining areas.
Minotaur Exploration Limited Annual Report 2018 39
FINANCIAL REPORT
Notes to the Consolidated Financial Statements
for the year ended 30 June 2018
13 SHARE BASED PAYMENTS
Employee share option plan
The Company has established the Minotaur Exploration Ltd Employee Share Option Plan and a summary of the Rules of the Plan
are set out below:
All employees (full and part time) will be eligible to participate in the Plan after a qualifying period of 12 months employment by
a member of the Group, although the board may waive this requirement.
Options are granted under the Plan at the discretion of the board and if permitted by the board, may be issued to an employee’s
nominee.
Each option is to subscribe for one fully paid ordinary share in the Company and will expire 5 years from its date of issue.
An option is exercisable at any time from its date of issue. Options will be issued free. The exercise price of options will be
determined by the board, subject to a minimum price equal to the market value of the Company’s shares at the time the board
resolves to offer those options. The total number of shares the subject of options issued under the Plan, when aggregated
with issues during the previous 5 years pursuant to the Plan and any other employee share plan, must not exceed 5% of the
Company’s issued share capital.
If, prior to the expiry date of options, a person ceases to be an employee of a Group company for any reason other than
retirement at age 60 or more (or such earlier age as the board permits), permanent disability, redundancy or death, the options
held by that person (or that person’s nominee) automatically lapse on the first to occur of a) the expiry of the period of 1 month
from the date of such occurrence, and b) the expiry date. If a person dies, the options held by that person will be exercisable by
that person’s legal personal representative.
Options cannot be transferred other than to the legal personal representative of a deceased option holder.
The Company will not apply for official quotation of any options. Shares issued as a result of the exercise of options will rank
equally with the Company’s previously issued shares.
Option holders may only participate in new issues of securities by first exercising their options.
The board may amend the Plan Rules subject to the requirements of the Listing Rules. The expense recognised in the Statement
of profit or loss and other comprehensive income in relation to share-based payments is disclosed in Note 4 (d).
The following table illustrates the number and weighted average exercise prices (WAEP) and movements in share options under
the Company’s Employee Share Option Plan issued during the year:
Outstanding at the beginning of the year
Granted during the year
Forfeited during the year
Expired during the year
Outstanding at the end of the year
2018
Number
9,765,000
-
(1,575,000)
(555,000)
7,635,000
2018
WAEP
$0.18
-
$0.25
$0.09
$0.17
2017
Number
8,125,000
2,685,000
-
(1,045,000)
9,765,000
2017
WAEP
$0.20
$0.03
-
$0.20
$0.18
Exercisable at the end of the year
7,635,000
$0.17
9,765,000
$0.18
The outstanding balance as at 30 June 2018 is represented by:
• A total of 5,105,000 options exercisable at any time until 21 November 2019 with an exercise price of $0.19.
• A total of 2,530,000 options exercisable at any time until 6 September 2021 with an exercise price of $0.115.
The weighted average remaining contractual life for the share options outstanding as at 30 June 2018 is 1.99 years (2017: 2.50
years).
The range of exercise prices for options outstanding at the end of the year was $0.115 - $0.19 (2017: $0.115 - $0.25).
40 Minotaur Exploration Limited Annual Report 2018
Share options issued to directors
On 8 December 2017, pursuant to a motion passed at the 2017 Annual General Meeting, the following unlisted options were
issued to Mr George McKenzie.
Number
Granted
Grant Date
Value per
Option at
Grant Date
$
Value of
Options at
Grant Date
$
Number
Vested
Exercise Price
$
Last
Exercise Date
2,000,000
08/12/17
0.02601
52,020
2,000,000
0.25
30/11/20
Share based payments, being options issued to Mr George McKenzie, were valued using a weighted average fair value of $0.095,
expected volatility of 77.1%, risk free interest rate of 2.12% and an expected life of 3 years. These options were recognised at fair
value using the Black-Scholes pricing model.
14 TRADE AND OTHER PAYABLES
Trade payables (i)
Joint operation income received in advance
Accrued expenses
Other payables (ii)
(i) Trade payables are non-interest bearing and are normally settled on 30-day terms.
(ii) Other payables are non-interest bearing and are normally settled within 30-90 days.
Information regarding the credit risk of current payables is set out in Note 26.
15 BORROWINGS
Current
Bank borrowings
Non-current
Bank borrowings
Consolidated Group
30 June 2018
$
30 June 2017
$
757,823
178,641
266,487
25,983
1,228,934
1,130,962
253,456
431,167
24,233
1,839,818
Consolidated Group
30 June 2018
$
30 June 2017
$
25,986
25,986
366,014
366,014
-
-
392,000
392,000
Bank borrowings reflect a secured interest and principal loan that is fully offset by unrestricted cash. There are no annual renewal
or review terms.
Minotaur Exploration Limited Annual Report 2018 41
FINANCIAL REPORT
Notes to the Consolidated Financial Statements
for the year ended 30 June 2018
16 PROVISIONS
Current
Annual leave provision
Long service leave provision
Non-current
Long service leave provision
17 ISSUED CAPITAL
Consolidated Group
30 June 2018
$
30 June 2017
$
162,971
405,266
568,237
33,714
33,714
183,381
322,097
505,478
66,365
66,365
252,488,374 fully paid ordinary shares (2017: 212,386,616)
44,940,370
42,935,000
2018
2017
Number
$
Number
$
Balance at beginning of financial year
212,386,616
42,935,000
212,344,322
42,930,982
Issue of shares through Share Placement and
Share Purchase Plan
Issue of shares through exercise of options
Transaction costs on shares issued
39,296,603
2,043,422
805,155
N/A
76,489
(114,541)
-
42,294
-
-
4,018
-
Balance at end of financial year
252,488,374
44,940,370
212,386,616
42,935,000
Fully paid ordinary shares carry one vote per share and carry the right to dividends (in the event such a dividend was declared).
18 RESERVES
Reserves
Share option reserve (a)
Available-for-sale revaluation reserve (b)
(a) Share option reserve
Balance at beginning of financial year
Issue of options to employees and officers under employee share
option plan
Issue of options to directors of the Company
Transfer to retained earnings upon lapse of options
Balance at end of financial year
42 Minotaur Exploration Limited Annual Report 2018
Consolidated Group
30 June 2018
$
30 June 2017
$
1,032,205
110,188
1,142,393
1,178,476
-
52,020
(198,291)
1,032,205
1,178,476
254,731
1,433,207
836,498
109,280
306,475
(73,777)
1,178,476
The share option reserve comprises the fair value of options issued to employees under the Company’s Employee Share Option
Plan and to directors of the Company.
(b) Available-for-sale revaluation reserve
Balance at beginning of financial year
Transfer upon disposal of listed shares
Net revaluation (decrement)/increment
Balance at end of financial year
Consolidated Group
30 June 2018
$
30 June 2017
$
254,731
(488)
(144,055)
110,188
208,146
-
46,585
254,731
The available-for-sale revaluation reserve comprises the cumulative net change in the fair value of available-for-sale financial
assets until the assets are derecognised or impaired.
19 ACCUMULATED LOSSES
Balance at beginning of financial year
Net loss attributable to members of the parent entity
Transfer from share option reserve – lapsed options
Adjustment upon increase in ownership percentage in controlled
entity
Consolidated Group
30 June 2018
$
(33,584,743)
(2,516,051)
198,291
-
30 June 2017
$
(29,842,301)
(3,814,220)
73,777
(1,999)
Balance at end of financial year
(35,902,503)
(33,584,743)
20 NON-CONTROLLING INTEREST
Balance at beginning of financial year
Conversion of non-controlling interest loan to equity in controlled
entity
Adjustment upon increase in ownership percentage in controlled
entity
Net profit/(loss) attributable to non-controlling interest
Balance at end of financial year
21 COMMITMENTS FOR EXPENDITURE
Operating leases
Not longer than 1 year
Longer than 1 year and not longer than 5 years
Terms of lease arrangements
-
-
-
-
-
4,197
-
1,999
(6,196)
-
361,483
8,802
370,285
356,357
356,963
713,320
The Group has in place an operating lease for its principal place of business. The lease expires on 9 July 2019 and includes an
escalation clause linked to CPI.
Future minimum lease payments under hire purchase contracts together with the present value of the net minimum lease
payments are listed in the above table.
Minotaur Exploration Limited Annual Report 2018 43
FINANCIAL REPORT
Notes to the Consolidated Financial Statements
for the year ended 30 June 2018
21 COMMITMENTS FOR EXPENDITURE
Exploration licences
In order to maintain current rights of tenure to exploration tenements the Group will be required to outlay in the year ending 30
June 2019 amounts of approximately $2.9 million in respect of exploration licence rentals and to meet minimum expenditure
requirements. It is expected that of this minimum expenditure requirement, $1.5 million will be funded by Minotaur’s current
and potential joint venture partners. The net obligation to the Group is expected to be fulfilled in the normal course of
operations.
22 AUDITOR’S REMUNERATION
Audit or review of the financial report
Taxation compliance
Total auditor’s remuneration
Consolidated Group
30 June 2018
$
30 June 2017
$
48,757
17,700
66,457
44,178
9,500
53,678
23 CONTINGENT LIABILITIES AND CONTINGENT ASSETS
At the date of signing this report, the Group is not aware of any Contingent Asset or Liability that should be disclosed in
accordance with AASB 137. It is however noted that the Company has established various bank guarantees in place with a
number of State Governments in Australia, totalling $165,000 at 30 June 2018 (2017: $165,000). These guarantees are designed
to act as collateral over the tenements which Minotaur explores on and can be used by the relevant Government authorities in
the event that Minotaur does not sufficiently rehabilitate the land it explores on. It is noted that the bank guarantees have, as at
the date of signing this report, never been utilised by any State Government.
24 CONTROLLED ENTITIES
Name of entity
Parent entity
Minotaur Exploration Limited (i)
Subsidiaries
Minotaur Operations Pty Ltd (ii)
Minotaur Resources Investments Pty Ltd (ii)
Minotaur Industrial Minerals Pty Ltd (ii)
Great Southern Kaolin Pty Ltd (ii)
Breakaway Resources Pty Ltd (ii)
Scotia Nickel Pty Ltd (ii)
Altia Resources Pty Ltd (ii)
Levuka Resources Pty Ltd (ii)
BMV Properties Pty Ltd (ii)
Minotaur Gold Solutions Pty Ltd (ii)
Country of incorporation
Ownership interest
2018
%
2017
%
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
(i) Minotaur Exploration Limited is the head entity within the tax consolidated group.
(ii)
These companies are members of the tax consolidated group.
44 Minotaur Exploration Limited Annual Report 2018
25 FINANCIAL ASSETS AND LIABILITIES
Note 1(f ) provides a description of each category of financial assets and financial liabilities and the related accounting policies.
The carrying amounts of financial assets and financial liabilities in each category are as follows:
30 June 2018
Financial assets
Note
Cash and cash equivalents
Trade and other receivables
7
8
Available-for-sale assets
10, 27
Financial liabilities
Note
Trade and other payables
Current borrowings
Non-current borrowings
14
15, 25 (a)
15, 25 (a)
AFS
$
(Carried at fair
value)
-
-
518,355
518,355
Cash
$
Loans and
Receivables
$
Total
$
(Carried at amortised cost)
2,020,041
-
2,020,041
-
-
127,726
-
127,726
518,355
2,020,041
127,726
2,666,122
Payables
$
Borrowings
$
(Carried at amortised cost)
Total
$
1,228,934
-
1,228,934
-
-
1,228,934
25,986
366,014
392,000
25,986
366,014
1,620,934
30 June 2017
Financial assets
Note
Cash and cash equivalents
Trade and other receivables
7
8
AFS
$
(Carried at fair
value)
-
-
Available-for-sale assets
10, 27
718,494
Cash
$
Loans and
Receivables
$
Total
$
(Carried at amortised cost)
2,331,267
-
2,331,267
-
-
704,123
-
704,123
718,494
718,494
2,331,267
704,123
3,753,884
Financial liabilities
Note
Trade and other payables
14
Non-current borrowings
15, 25 (a)
Payables
$
Borrowings
$
Total
$
(Carried at amortised cost)
1,839,818
-
1,839,818
-
1,839,818
392,000
392,000
392,000
2,231,818
A description of the Group’s financial instrument risks, including risk management objectives and policies is given in Note 26.
The methods used to measure financial assets and liabilities reported at fair value are described in Note 27.
Minotaur Exploration Limited Annual Report 2018 45
FINANCIAL REPORT
Notes to the Consolidated Financial Statements
for the year ended 30 June 2018
25 FINANCIAL ASSETS AND LIABILITIES
25(a) BORROWINGS
Borrowings include the financial liabilities:
Financial liabilities
Fair value
Bank borrowings
All borrowings are denominated in AUD.
Borrowings at amortised cost
Current
Non-Current
2018
2017
2018
2017
25,986
25,986
-
-
366,014
366,014
392,000
392,000
Bank borrowings are secured by land and buildings owned by the Group (see Note 11). Current interest rates are variable and
average 4.78% (2017: 4.95%). The carrying amount of bank borrowings is considered to be a reasonable approximation of the
fair value.
Other financial instruments
The carrying amount of the following financial assets and liabilities is considered to be a reasonable approximation of the fair
value:
• Trade and other receivables;
• Cash and cash equivalents; and
• Trade and other payables
26 FINANCIAL RISK MANAGEMENT
Capital risk management
The Group manages its capital to ensure that entities in the Group will be able to continue as a going concern while
maximising the return to stakeholders. The capital structure of the Group consists of cash and cash equivalents and equity
attributable to equity holders of the parent, comprising issued capital, reserves and accumulated losses as disclosed in Notes
17, 18, 19 respectively. Proceeds from share issues are used to maintain and expand the Group’s exploration activities and fund
operating costs.
Consolidated Group
30 June 2018
$
30 June 2017
$
2,020,041
127,726
518,355
1,228,934
392,000
2,331,267
704,123
718,494
1,839,818
392,000
Financial assets
Cash and cash equivalents
Trade and other receivables
Available-for-sale assets
Financial liabilities
Payables
Borrowings
46 Minotaur Exploration Limited Annual Report 2018
Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Group.
The Group has adopted a policy of only dealing with creditworthy counterparties as a means of mitigating the risk of financial
loss from activities.
The Group does not have any significant credit risk exposure to any single counterparty or any Group of counterparties having
similar characteristics. The credit risk on liquid funds is limited because the counterparties are banks with high credit-ratings
assigned by international credit-rating agencies.
The carrying amount of financial assets recorded in the financial statements, net of any allowances for losses, represents the
Group’s maximum exposure to credit risk.
Interest rate risk
The tables listed below detail the Group’s interest bearing assets, consisting solely of cash on hand and on short term deposit
(with all maturities less than one year in duration).
Consolidated
2018
Variable interest rate
2017
Variable interest rate
Weighted average
effective interest rate
%
Less than 1 year
$
0.50
1.10
2,020,041
2,331,267
At the reporting date, if interest rates had been 50 basis points higher or lower and all other variables were held constant, the
Group’s:
• net loss would increase or decrease by $10,878 which is mainly attributable to the Group’s exposure to interest rates on its
variable bank deposits.
Liquidity risk management
Ultimate responsibility for liquidity risk management rests with the Board, which has built an appropriate liquidity risk
management framework for the management of the Group’s short, medium and long-term funding and liquidity management
requirements. The Group manages liquidity risk by maintaining adequate reserves.
Liquidity and interest risk tables
The following table details the Company’s and the Group’s remaining contractual maturity for its non-derivative financial
liabilities. The table has been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on
which the Group can be required to pay. The table includes both interest and principal cash flows.
Consolidated
2018
Interest bearing
Non-interest bearing
2017
Interest bearing
Non-interest bearing
Weighted average
effective interest rate
%
Less than 1 year
$
Longer than 1 year and
not longer than 5 years
$
4.78
-
4.95
-
25,986
1,228,934
-
1,839,818
366,014
-
392,000
-
Available-for-sale financial instrument risk management
Ultimate responsibility for the Group’s investments in available-for-sale financial instruments rests with the Board. The Board
actively manages its investments by reviewing the market value of the Group’s portfolio at each board meeting and making
appropriate investment decisions.
Minotaur Exploration Limited Annual Report 2018 47
FINANCIAL REPORT
Notes to the Consolidated Financial Statements
for the year ended 30 June 2018
27 FAIR VALUE MEASUREMENT
Financial assets and financial liabilities measured at fair value in the statement of financial position are grouped into three Levels
of a fair value hierarchy. The three Levels are defined based on the observability of significant inputs to the measurement, as
follows:
•
•
level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities
level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly
or indirectly
•
level 3: unobservable inputs for the asset or liability
The following table shows the Levels within the hierarchy of financial assets and liabilities measured at fair value on a recurring
basis at 30 June 2018 and 30 June 2017:
30 June 2018
Financial assets at fair value
Available-for-sale investments
Listed securities
30 June 2017
Financial assets at fair value
Available-for-sale investments
Listed securities
Level 1
$
Level 2
$
Level 3
$
Total
$
518,355
518,355
718,494
718,494
-
-
-
-
-
-
-
-
518,355
518,355
718,494
718,494
There were no transfers between Level 1 and Level 2 in 2018 or 2017.
Included within Level 1 of the hierarchy are listed investments. The fair values of these financial assets have been based on the
closing quoted bid prices at the end of the reporting period, excluding transaction costs.
28 RELATED PARTY DISCLOSURE AND KEY MANAGEMENT PERSONNEL REMUNERATION
Transactions with key management personnel
The following individuals are classified as key management personnel in accordance with AASB 124 ‘Related Party Disclosures’:
Directors
Dr Antonio Belperio
Dr Roger Higgins
Mr George McKenzie
Mr Andrew Woskett
Executive Director
Non-Executive Chairman
Non-Executive Director
Managing Director
Other key management personnel
Mr Varis Lidums
Mr Glen Little
Commercial Manager and Company Secretary
Exploration Manager
48 Minotaur Exploration Limited Annual Report 2018
Key management personnel remuneration includes the following expenses:
Salaries including bonuses
Total short term employee benefits
Superannuation
Total post-employment benefits
Share based payments
Total share based payments
Total remuneration
Transactions with associates
30 June 2018
$
1,057,411
1,057,411
53,840
53,840
52,020
52,020
30 June 2017
$
1,046,484
1,046,484
53,809
53,809
332,930
332,930
1,163,271
1,433,223
Throughout the year no transactions took place between Minotaur Exploration Limited and any associates (2017: $Nil). In
addition, no amounts were owed by any associates at the end of the year (2017: $Nil).
Director and key management personnel related entities
Throughout the year $54,470 (2017: $53,500) (inclusive of GST) was paid to a related entity of Dr Antonio Belperio under a
commercial lease agreement for the use of warehouse space located at Magill, South Australia.
Throughout the year, no other transactions took place between Minotaur Exploration Limited and any director or key
management personnel related entities.
Wholly owned group transactions
The entities comprising the wholly owned Group and ownership interests in these controlled entities are set out in Note 24.
Transactions between Minotaur Exploration Limited and other entities in the wholly owned Group during the year consisted of
loans advanced by Minotaur Exploration Limited to fund exploration activities.
29 POST-REPORTING DATE EVENTS
On 4 July 2018, the following unlisted share options expired:
Issue Date
Expiry Date
Exercise Price
Number of
Options
05/07/2013
04/07/2018
$0.300
2,083,333
On 26 July 2018, 5,152,883 fully paid ordinary shares were issued by the Company at an issue price of $0.0534 as part
consideration for the acquisition of the Highlands Project successfully completed on 20 July 2018.
No other matter or circumstance has arisen since 30 June 2018 that has significantly affected the Group’s operations, results or
state of affairs, or may do so in the future.
Minotaur Exploration Limited Annual Report 2018 49
DIRECTORS’ DECLARATION
The directors of the company declare that:
1.
the consolidated financial statements and notes, as set out on pages 19 to 49, are in accordance with the
Corporations Act 2001 and:
a.
comply with Accounting Standards, which, as stated in accounting policy Note 1 to the financial statements,
constitutes explicit and unreserved compliance with International Financial Reporting Standards (IFRS); and
b. give a true and fair view of the financial position as at 30 June 2018 and of the performance for the year
ended on that date of the company and consolidated group;
2.
the Managing Director and Company Secretary have each declared that:
a.
the financial records of the company for the financial year have been properly maintained in accordance
with s 286 of the Corporations Act 2001;
b.
the financial statements and notes for the financial year comply with Accounting Standards; and
c.
the financial statements and notes for the financial year give a true and fair view; and
3.
in the directors’ opinion there are reasonable grounds to believe that the company will be able to pay its debts as
and when they become due and payable.
This declaration is made in accordance with a resolution of the Board of Directors.
Roger Higgins
Chairman
Dated this 28th day of August 2018
50 Minotaur Exploration Limited Annual Report 2018
INDEPENDENT AUDITOR’S REPORT
Minotaur Exploration Limited Annual Report 2018 51
INDEPENDENT AUDITOR’S REPORT
52 Minotaur Exploration Limited Annual Report 2018
Minotaur Exploration Limited Annual Report 2018 53
ASX ADDITIONAL INFORMATION
Interests in Mining Tenements
as at 30 September 2018
Lease ID
Lease Name
State
Holding Company
Minotaur Equity
Equity Earned %
JV Partner
Border Joint Venture
EL5963
Mutooroo
SA
Minotaur Operations
Cloncurry (Regional)
EPM8608
Bendigo Park
QLD
Minotaur Operations
EPM16975
Cattle Creek
QLD
Minotaur Operations
EPM19530
Corella
QLD
Minotaur Operations
MDL432
Eloise
QLD
Levuka Resources
EPM25889
Sedan
QLD
Minotaur Operations
Highlands
EPM16197
Blockade
QLD
Minotaur Operations
EPM17914
Blockade East
QLD
Minotaur Operations
EPM17947
Blockade East
Extension
QLD
Minotaur Operations
EPM18671
Bulonga
QLD
Minotaur Operations
EPM19733
EPM18492
EPM25824
Mt Remarkable
Consolidated
Mr Remarkable
Extension
Mt Remarkable
Inclusion
QLD
Minotaur Operations
QLD
Minotaur Operations
QLD
Minotaur Operations
EPM17638
Phillips Hill
QLD
Minotaur Operations
EPM14281
Yamamilla
QLD
Minotaur Operations
Eloise Joint Venture (OZ Minerals)
MDL431
Eloise
QLD
Levuka Resources
EPM19500
Eloise North
QLD
Minotaur Operations
EPM18442
Eloise Northwest
QLD
Levuka Resources
EPM25389
Fullarton
QLD
Minotaur Operations
EPM26703
Holy Joe
QLD
Minotaur Operations
EPM17838
Levuka
QLD
Levuka Resources
EPM25237
Levuka
QLD
Minotaur Operations
EPM25801
Masai
QLD
Levuka Resources
EPM18624
Oorindi Park
QLD
Minotaur Operations
EPM26684
Pink Hut
QLD
Minotaur Operations
EPM26233
Route 66
QLD
Minotaur Operations
EPM25238
Saxby
QLD
Minotaur Operations
EPM26521
Sybellah
QLD
Minotaur Operations
Osborne Joint Venture (JOGMEC)
EPM18720
Cuckadoo
QLD
Minotaur Operations
EPM25886
Hennes Bore
QLD
Minotaur Operations
EPM25960
Jubilee
QLD
Minotaur Operations
EPM26230
Nithsdale
QLD
Minotaur Operations
EPM18571
Sandy Creek
QLD
Minotaur Operations
EPM25888
Tripod Tank
QLD
Minotaur Operations
EPM25699
Warburton Creek
QLD
Minotaur Operations
54 Minotaur Exploration Limited Annual Report 2018
Sumitomo Metal Mining Oceania Pty Ltd
South32 NSR
Sandfire Resources has 60% equity
in the tenement
Sandfire Resources has 60% equity
in portion of the tenement
Sandfire Resources has 60% equity
in portion of the tenement
47
100
100
100
40
100
100
100
100
100
100
100
100
100
100
49
49
49
49
49
49
49
49
49
49
49
49
49
100
100
100
100
100
100
100
Interests in Mining Tenements
as at 30 September 2018
Lease ID
Lease Name
State
Holding Company
Minotaur Equity
Equity Earned %
JV Partner
Industrial Minerals Project
EL5906
Acraman
ELA5502
Casterton South
EL5869
EL6144
EL5911
EL6202
EL5885
EL5398
EL5814
EL6096
EL5787
EL6128
Coober Pedy
Garford
Giddina Creek
Mount Hall
Oolgelima
Sceales
Tootla
Whichelby
Yanerbie
Camel Lake
Peake & Denison Project
EL6221
Big Perry
ELA2018/114
Davenport
EL6222
EL6223
Teemurrina
Wood Duck
Scotia Project
M 29/00245
Goongarrie 13
M 29/00246
Goongarrie 14
Leinster Project
E36/899
E36/936
E37/909
Fly Bore
Valdez
Leinster 2
Other Projects
SA
VIC
SA
SA
SA
SA
SA
SA
SA
SA
SA
SA
SA
SA
SA
SA
WA
WA
WA
WA
WA
Minotaur Operations
Minotaur Industrial Minerals
BMV Properties
Minotaur Operations
BMV Properties
Minotaur Operations
BMV Properties
Minotaur Operations
Great Southern Kaolin
Minotaur Operations
Minotaur Operations
Minotaur Operations
Minotaur Operations
Minotaur Operations
Minotaur Operations
Minotaur Operations
Minotaur Gold Solutions
Minotaur Gold Solutions
Altia Resources
Altia Resources
Scotia Nickel
EL5542
Blinman
SA
Perilya
EL5117
Ediacara
SA
Perilya
ML4386
Third Plain
SA
Perilya
EL5723
Wilkawillina
SA
Perilya
EL5984
Moonta
SA
Peninsula Resources
100
0
100
100
100
100
100
100
100
100
100
100
100
0
100
100
100
100
100
0
100
10
10
10
10
10
EPM26422
Mt Osprey
QLD
Birla Mt Gordon
22.9#
M15 1828
Spargos Reward
M15 395
M15 703
L15 128
L15 255
E15 967
E15 968
West Kambalda
West Kambalda
West Kambalda
West Kambalda
West Kambalda
West Kambalda
P15 5860
West Kambalda
WA
WA
WA
WA
WA
WA
WA
WA
# Diluting interest over former EPM17061 area
* 3% Au NSR over former P15 4886 area
1.5% NSR = 1.5% NSR all minerals other than Nickel
Minex Australia, Corona Minerals
3% Au NSR*
Tychean Resources
Tychean Resources
Tychean Resources
Tychean Resources
Tychean Resources
Tychean Resources
Tychean Resources
1.5% NSR
1.5% NSR
1.5% NSR
1.5% NSR
1.5% NSR
1.5% NSR
1.5% NSR
Andromeda Metals Limited
Andromeda Metals Limited
Andromeda Metals Limited
Andromeda Metals Limited
Perilya Ltd 90%, MEP 10% free carried to BFS
completion
Perilya Ltd 90%, MEP 10% free carried to BFS
completion
Perilya Ltd 90%, MEP 10% free carried to BFS
completion
Perilya Ltd 90%, MEP 10% free carried to BFS
completion
Peninsula Resources (Interest in portion of the
tenement)
Minotaur Exploration Limited Annual Report 2018 55
ASX ADDITIONAL INFORMATION
Shareholdings
as at 30 September 2018
Additional information required by the Australian Securities Exchange Ltd and not shown elsewhere in this report is as follows.
The information is current as at 30 September 2018.
Distribution of equity securities
Ordinary share capital
257,641,257 fully paid ordinary shares are held by 2,235 shareholders.
All issued ordinary shares carry one (1) vote per share and carry the rights to dividend.
Options
22,185,000 unlisted options are held by 28 option holders.
The number of shareholders, by size of holding, in each class are:
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 and over
Holding less than a marketable parcel
Substaintial shareholders
Ordinary shareholders
Citicorp Nominees Pty Limited
Yarraandoo Pty Ltd
TWENTY LARGEST HOLDERS OF QUOTED EQUITY SECURITIES
Citicorp Nominees Pty Ltd
Yarraandoo Pty Ltd
Oz Minerals Limited
Mr Ian Richard Kerr Gemmell
Syndicated Metals Ltd
FMR Investments Pty Limited
Sandfire Resources NL
Chetan Enterprises Pty Ltd
Mr Robert Gemelli
Mr Nicholas James Carter & Mrs Susan Mary Carter
Dorica Nominees Pty Ltd
HSBC Custody Nominees (Australia) Limited
Mr Peter Francis Hasenkam
Mr Robert William Moses
Bydown Fund Management Pty Ltd
Romsup Pty Ltd
BNP Paribas Nominees Pty Ltd
Mr Robert Lloyd Blesing
Mr Nicholas Carter
Mr Gordon Martin
56 Minotaur Exploration Limited Annual Report 2018
Fully paid ordinary shares
Unlisted Options
177
140
287
1,253
378
2,235
677
-
-
-
4
24
28
-
Fully paid
Number
39,457,036
17,489,188
Percentage
15.31%
6.79%
Fully Paid Ordinary Shares
Number
39,457,036
17,489,188
8,041,670
6,258,110
5,152,883
2,960,765
2,608,695
2,271,654
1,936,046
1,832,627
1,788,462
1,768,104
1,754,896
1,500,000
1,478,000
1,457,064
1,452,560
1,427,292
1,377,403
1,300,000
Percentage
15.31%
6.79%
3.12%
2.43%
2.00%
1.15%
1.01%
0.88%
0.75%
0.71%
0.69%
0.69%
0.68%
0.58%
0.57%
0.57%
0.56%
0.55%
0.53%
0.50%
103,312,455
40.10%
.
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