ANNUAL REPORT
2021
BCI Minerals Limited (ASX:BCI)
is a Western Australian
company that is developing a
salt and potash business.
B
CONTENTS
Our Business
Chairman’s Report
Managing Director’s Report
Sustainability
Corporate Governance
Directors’ Report
Remuneration Report
Directors’ Declaration
Annual Financial Report
Independent Auditor’s Report
Auditor’s Independence Declaration
Additional ASX Information
Mineral Resources and Ore Reserves
Corporate Directory
2
9
10
13
24
26
33
41
42
69
73
74
75
76
1
OUR BUSINESS
MARDIE SALT &
POTASH PROJECT
KARRATHA
PORT HEDLAND
ONSLOW
IRON VALLEY
MINE
NEWMAN
0
50
100
BCI Minerals Limited (ASX:BCI) is a Western Australian company that is developing a salt and
potash business supported by iron ore royalty earnings.
Mardie Salt & Potash Project
Key Project Features
BCI is rapidly advancing its 100% owned
Mardie Salt & Potash Project, a potential
Tier 1 project located on the West Pilbara
coast in the centre of Australia's key salt
production region.
Mardie will produce 5.35Mtpa of high-purity salt (>99.5% NaCl)
and 140ktpa of sulphate of potash (SOP) (>52% K2O) via solar
evaporation of seawater. Using an inexhaustible seawater
resource and a production process driven mainly by natural
solar and wind energy, Mardie is a sustainable opportunity to
supply the salt and potash growth markets in Asia over many
decades.
Optimisation results of the Mardie Definitive Feasibility Study
(DFS) were released in April 2021. A Final Investment Decision
(FID) is targeted in Q4 2021 with main construction to follow.
Input resource is an infinite supply of natural seawater which
could continue for 100+ years.
1
2
Operating Life
MINIMUM
60 YEARS1
Annual Production:
SALT 5.35MT,
SOP 140KT
99%
of the energy requirement
for the evaporation process
is driven by natural solar
and wind energy
Iron Valley
FY21 Highlights
Iron Valley is a mine located in the Central
Pilbara, which is being operated by Mineral
Resources Limited ('MIN') under a royalty-type
agreement. As at 30 June 2021, Iron Valley’s
Mineral Resource was 173.3Mt at 58.0% Fe
and its Ore Reserve was 68.3Mt at 58.2% Fe.
Iron Valley commenced exports in October 2014 and is
generating royalty-type earnings for BCI. It is a relatively simple
Direct Shipping Ore (DSO) operation that produces both lump
and fines, which are hauled to Port Hedland utilising road trains
and exported via Utah Point. It has a potential mine life of
around 10 years based on current ore reserves and the current
production rate of approximately 6Mtpa.
MIN operates the mine entirely at its cost and purchases Iron
Valley product from BCI at a price linked to MIN’s realised sale
price. BCI retains ownership of the tenements and certain
statutory obligations, including payment of royalties.
BCI's EBITDA from Iron Valley was a record A$69.5M in FY21.
Mine Life
APPROX.
10 YEARS
6.1MT
iron ore shipped
RECORD
A$69.5M
EBITDA; up 200% on
previous full year record
3
VISION
BCI’s Vision is to create shareholder value
by becoming a globally significant supplier
of chemical and agricultural feedstock
products, produced in a sustainable and
responsible manner.
4
VALUES
Values form the backbone of our company culture and define how we aspire to do
business every day. BCI’s key values are:
People and Assets
We look after each other’s wellbeing,
value diversity of people and ideas, and
protect our assets
Integrity
We are honest, respectful, transparent
and respect the rule and spirit of our
legal environment
Accountability
We embrace our responsibilities and
hold ourselves to account
Environment & Community
We care about our communities and the
environment where we operate
Performance
We have a can-do attitude and are
committed to deliver shareholder
value through innovative and high
quality results
Teamwork
We contribute, collaborate, and lead
by example with clear and open
communication.
5
Iron Valley mine
6
YEAR IN REVIEW
BCI FY21 HIGHLIGHTS
$22.0
MILLION
NPAT, up from $0.4M in
FY20
$69.5
MILLION
Record Iron Valley
EBITDA, up 200%
$79.4
MILLION
Cash balance
at 30/06/21
ZERO
Debt
$148.7
MILLION
$47.9
MILLION
Mardie contracts awarded
in 2021
Equity raised from
cornerstone investors
$450
MILLION
NAIF loan approved
Mardie Optimised
Feasibility Study
completed
Safety awareness
campaign launched
ZERO
Lost Time Injuries (LTI)
6 YEARS
Without a Lost Time
Injury (LTI)
EPA recommended
Mardie Project approval
Sustainability
Committee formed
Pilbara
office opened
Strong share price growth
on enlarged capital base
7
“The Optimised Feasibility Study
results reaffirmed to the Board
that Mardie has all the attributes
of a globally significant and multi-
generational asset.”
8
CHAIRMAN’S REPORT
This year we have taken significant steps to ensure
sustainability is embedded across all BCI’s processes, with
formation of a new Sustainability Committee chaired by Chris
Salisbury. The sustainability section in this annual report
provides further information on BCI’s sustainability focus.
The Board of BCI approved inclusion in the project budget
of expenditure to develop a clear, deliverable pathway to
net zero carbon emissions for the Mardie project. Relying
primarily on sun and wind to produce salts from an
inexhaustible source of raw materials, Mardie is already
“green” by nature, but this additional work will aim to reduce
net emissions to zero, following full ramp up of production.
While Mardie is our main focus, our Iron Valley royalty made
an outstanding contribution to our company, with record
cash flow generated this year. I would like to thank Iron
Valley’s operator, Mineral Resources Limited, for its ongoing
commitment to our relationship.
I would also like to take this opportunity to thank BCI’s
Managing Director, staff and Board for their significant
expertise and effort over the past year.
BCI’s shareholders continue to be extremely supportive,
and the Company sincerely thanks you for this commitment,
particularly the backing from existing major shareholders in
the 2020 entitlement issue. The Board of BCI is pleased that
BCI has been able to deliver share price growth on a larger
capital base, and three consecutive years of positive net profit.
We look forward to the year ahead, which we expect will mark
the beginning of the next phase of BCI’s evolution toward
becoming a globally significant mineral producer.
Brian O’Donnell
Non-Executive Chairman
Dear stakeholders,
I am pleased to present BCI’s Annual Report for the 2021
financial year – a year of substantial progress for our company.
BCI has a well-defined strategy to become a significant
supplier of industrial and agricultural minerals through the
development of our Mardie Salt & Potash Project, located on
the Pilbara Coast of Western Australia.
This year we made significant headway in realising this goal,
with the Optimised Feasibility Study (OFS) increasing the scale
and significance of the project, and confirming that Mardie will
be a world class, sustainable project - large scale, low-cost,
and with a long operating life. Mardie will be the largest solar
salt project in Australia, and the third largest globally, and
will be the first Australian operation to produce both salt and
sulphate of potash (SOP) from seawater.
Our Mardie Project obtained strong support from Federal
and State Governments, including via finance programs and
statutory authorities. The Project was also endorsed by
commercial banks, equity investors and independent technical
experts during the year. We thank all of these parties for this
strong support, which reflects the value and robustness of the
detailed studies and approval work conducted over a four-year
period, and the substantial progress we have made toward
obtaining the approvals, tenure and funding arrangements we
need to make Mardie a reality.
Significantly, and following extensive due diligence, the
Australian government’s Northern Australian Infrastructure
Facility (NAIF) approved a A$450 million loan to the Mardie
Project, representing more than a third of the overall Project
funding requirement. The loan is the largest NAIF allocation
to a Western Australian company to date and recognises
the potential long term benefits the Project will bring to the
region, including new multi-user export infrastructure, tax and
royalty revenues, local jobs and contracts, and indigenous
engagement.
Several commercial banks and other credit providers have
also conducted in-depth assessment of the Mardie Project,
with independent technical experts verifying the findings of
the OFS. We look forward to completing the capital raising
(debt and equity) for the Project in coming months, so that we
can commence main construction of the Project in early 2022.
In preparation for the operational phase of the Project, we
have broadened our skill set, with several senior executive
appointments and the addition of two Board members this
year - former Western Australia Premier and Treasurer,
Mr Richard Court AC, and former Rio Tinto Iron Ore Chief
Executive, Mr Chris Salisbury. Mr Court brings additional
skills and contacts from his time as Australia’s Ambassador
to Japan, while Mr Salisbury brings expertise in large-scale
capital construction and operations, salt industry experience
and sustainability.
9
MANAGING DIRECTOR’S REPORT
Mardie site activities
Enabling construction works have taken shape over the year
with expansion of the accommodation village, the northern
embankment trial nearing completion, construction of the
southern trial pond commencing and the contract awarded
for the primary seawater pump structure. These investigative
works are an essential precursor to main construction
to provide confidence about key assumptions, including
materials availability, construction methodology, pond wall
settlement, pumping rates, pond floor water retention, and
cost and schedule assumptions.
Contracts of approximately A$150 million have been
awarded in 2021 to date for the Mardie Project and more
than 180 expressions of interest have been registered on
BCI’s procurement portal which highlights and prioritises
indigenous, Pilbara and Western Australian businesses.
The initial pond construction, seawater pump structure and
accommodation village contracts were awarded to leading
Western Australian companies, evidencing the effectiveness
of BCI’s procurement process.
Processing trials and offtake strategy
Approximately 42 tonnes of raw salt was harvested from the
small-scale trial ponds at Mardie and processed through the
salt wash pilot plant at Nagrom’s facilities in Perth during the
year with positive chemical grade results achieved.
Kainite-Type Mixed Salt (KTMS) brine continues to be
generated from which to produce sulphate of potash samples.
The first of two SOP pilot campaigns of Mardie-grown KTMS
have been completed at SRC’s laboratories in Canada. SOP
product meeting market specifications has been produced
and further optimisation work will be undertaken ahead of the
second round of SOP piloting scheduled for late 2021.
Outcomes from these programs will assist with flowsheet
finalisation and generate additional samples for test work by
potential offtake customers.
Funding advanced
Funding for the Mardie Project was significantly advanced with
the Federal Government’s Northern Australia Infrastructure
Facility (NAIF) approving a 15-year A$450 million loan for
the Mardie Project in December 2020. The NAIF loan will sit
alongside other debt tranches with a number of commercial
banks and other lenders progressing through credit approval
processes. In addition, BCI raised A$47.9 million of equity
with strong support from its existing major shareholders
in the first half of the 2021 financial year. The proceeds of
the equity raising facilitated early enabling works at Mardie,
including the expansion of the accommodation village, access
road upgrades, improved communications, establishment of
construction water supply and storage, installation of fuel
storage facilities, and embankment trials.
Dear stakeholders,
Financial year 2021 has been a year of milestones with
significant progress made towards the development of the
Mardie Salt & Potash Project. BCI’s focus during the year was
on completing the Optimised Feasibility Study and progressing
the funding, approvals, tenure and offtake aspects of the
Project. At the same time, BCI has undertaken enabling
construction work at Mardie funded by the equity raised in
September 2020 together with record Iron Valley royalties.
Feasibility study optimisation
Optimisation results of the Mardie Definitive Feasibility Study
(DFS) were released on 21 April 2021, outlining improved
project footprint and economics. Compared with the DFS
announced on 1 July 2020, the optimisation delivered:
• ~20% increase in salt production (from 4.4Mtpa to
5.35Mtpa) and SOP production (from 120ktpa to 140ktpa),
• ~30% increase in annual EBITDA (from A$197 million to
A$260 million), and
• ~40% increase in Pre-tax Project NPV7 (from A$1,197 million
to A$1,670 million).
In addition, de-risking activities conducted during the
optimisation phase (including additional geotechnical work,
flowsheet and equipment design, process piloting and
progress with funding) have increased confidence in Mardie
estimates and value potential.
The optimisation results confirm Mardie can become a Tier
1 asset categorised by its long life (minimum 60 years), top
quartile scale, lowest quartile salt operating costs (after SOP
by-product credits) and high-quality salt and SOP products.
With attractive financial returns over many decades and future
expansion potential from the new tenements, development
of the Mardie Project should result in considerable long-term
value and dividends being created for shareholders.
Tenure and approvals progressed
Important progress was made during the year regarding the
approvals and tenure required for the development of Mardie.
The Western Australian Environmental Protection Authority (EPA)
recommended to the WA Minister for Environment that the Mardie
Project can be implemented as proposed in the Environmental
Review Document (ERD), subject to certain conditions.
An access agreement with the pastoral leaseholder of
Mardie Station was entered into during the year with the
pastoralist providing consent to the grant of key Mining Act
tenure required to construct and operate the Mardie Project.
A temporary access agreement with the owners of the gas
pipelines in the south of the Project has also been achieved
and a permanent access agreement is well progressed.
BCI continues to work closely with the Pilbara Ports Authority (PPA)
and the Department of Planning, Lands and Heritage (DPLH)
to finalise the tenure and agreements required to develop the
Mardie Port facilities within the new Port of Cape Preston West.
Main construction of the Project can only commence when BCI
has received approval from the WA Minister for Environment
as well as associated secondary approvals and when final
tenure and funding have been secured. BCI anticipates all
these to be in place by late 2021.
10
Strengthening and safeguarding our team
The BCI Management Team has been bolstered in advance
of the impending construction and operational phases of
the Mardie Project with the appointments of Sam Bennett,
Angela Glover and Jim Cooper during the financial year.
Sam Bennett joined BCI as Project Director, responsible for
contracting and construction activities at Mardie, Angela
Glover was appointed Head of Corporate Affairs and is
responsible for approvals and local engagement from BCI’s
new Pilbara office and Jim Cooper commenced as General
Manager Operations leveraging his extensive salt and
operating knowledge and experience from his role as General
Manager Dampier Salt (Rio Tinto).
The health and safety of our workforce is integral to the
sustainability of our business. To that end, an external health
and safety audit undertaken during the year found that BCI’s
Health and Safety Management System is compliant, that
it comprehensively addresses current needs and that our
site control and activity monitoring systems exceed industry
practice in most cases. We also launched the Critical Control
Awareness Campaign in 2021 which focused on BCI’s critical
risks and fatality prevention.
BCI has an excellent safety record and is highly focused on
continuing to provide a safe working environment for its
staff and contractors as site activities at the Mardie Project
increase. There was a single recordable injury during the year,
although there was no associated lost time with BCI now
6-years without a lost time injury (LTI).
Record Iron Valley earnings
The Iron Valley asset has become a more significant source
of funding than anticipated with record results posted in the
2021 financial year driven by the sustained strength of iron
ore prices. Iron Valley operator, Mineral Resources Limited
(ASX:MIN), shipped 6.1Mt of iron ore from the mine, which
generated revenue for BCI of A$160.2 million and a record
full-year EBITDA of A$69.5 million, a three-fold increase on
the previous record of A$23.1 million in the 2020 financial
year. Consequently, the Company achieved net profit after
tax of A$22.0 million, up substantially on the A$0.4 million in
recorded in the 2020 financial year.
Outlook
With a cash balance of A$79.4 million at 30 June 2021, zero debt
and ongoing Iron Valley royalty earnings, BCI is in a strong
position to advance the Mardie Project to FID this year. In the
interim, BCI intends to continue investing its cash reserves
in the Project with construction of embankment trial walls
currently underway.
The objective for the balance of 2021 is to secure the remaining
approvals, tenure, and full A$1.2 billion funding solution for the
Mardie Project. That will allow main construction of the multi-
generational Project to commence in early 2022.
Alwyn Vorster
Managing Director
11
With inexhaustible resources and natural
energy at the heart of the business, BCI strives
for sustainability in the communities and
environment in which it operates and to deliver
economic benefits for generations to come.
12
SUSTAINABILITY
BCI’s Stakeholders
Sustainability is a key value at BCI which is delivered
through an inclusive and integrated approach to our project
development and operations activities. Sustainability is
achieved through establishing productive relationships with
key stakeholders who underwrite our licence to operate.
Sustainable Development Goals
The United Nations Sustainable Development Goals (SDGs)
are a roadmap for the betterment of society. BCI has
prioritised 10 of the 17 SDG targets on which to focus to
contribute to achieving these goals as outlined below.
BCI’s stakeholders are entities or individuals that can
reasonably be expected to be significantly affected by BCI’s
activities or whose actions can reasonably be expected to
impact BCI’s ability to successfully implement its strategies
and objectives. BCI’s stakeholders include:
• Local communities
• Traditional Owners
• Shareholders
• Banks/Finance
• Customers/Offtake partners
• Regulatory authorities/
Government
providers/Creditors
• Analysts
• Employees/Board/
Contractors/Unions
• Environmental Groups
• Industry participants
and associations
• Civil society
• Media
During the reporting period, BCI prepared and implemented
its Stakeholder Engagement Management Plan (SEMP) for the
Mardie Project. The SEMP provides practical guidance to ensure
effective stakeholder engagement that is both consultative in
nature and based on the reciprocal sharing of information on
the Project, approvals and compliance with various legislative
and project development requirements including other
agreements with BCI stakeholders.
BCI applied a materiality process to inform the scope and level
of disclosures identified in this report. Material topics were
selected by considering feedback from stakeholders, BCI’s
leadership team, subject matter experts and an examination
of industry benchmarks. Topics were evaluated and prioritised
to ensure the Company’s purpose and strategic focus areas
were considered and are covered in the following section of
this report.
Zero Hunger
Mardie will produce high quality soil friendly
SOP fertilizer to improve crop quality and yield
Gender Equality
BCI exceeds industry average benchmarks
regarding gender diversity and strives for
gender equality
Affordable and Clean Energy
99% of project energy derived from natural
sun and wind
Decent Work and Economic Growth
Creation of ~500 construction jobs and 200
ongoing jobs. Indigenous and local contracting
prioritised
Industry, Innovation and Infrastructure
First Australian project to produce SOP
from waste salt bitterns; Cyclone rated
infrastructure; Sustainable production process
Reduced Inequalities
Project targets diverse local workforce and
will make >$150M native title payments over
project life
Sustainable Cities and Communities
Desalination plant for potable water;
Natural sun and wind energy; Quality site
accommodation with cultural theme
Responsible Consumption and Production
Produce salt as input for thousands of
consumer goods and SOP fertiliser to increase
quality and yield of crops
Climate Action
Displace energy and emissions intensive
production processes used for hard rock salt
and SOP production globally
Life Below Water
Monitor quality of seawater and protect all
species where seawater is drawn from and
dispersed into the ocean
13
FETY
& S
A
E
L
P
O
E
P
5.
Provide a Safe
Environment
1.
Harness Renewable
Resources
E
N
V
I
R
O
N
2.
Mitigate
Climate Change
M
E
N
T
&
C
L
I
M
A
T
E
Sustainability
Principles
4.
Promote Community
Prosperity
3.
Maximise Value,
Minimise Waste
C
O
M
M
U
NITIES
1. HARNESS RENEWABLE RESOURCES
2. MITIGATE CLIMATE CHANGE
Harness renewable natural resources to
produce quality products to sustain and
improve life on earth.
BCI’s primary purpose is to harness renewable natural
resources to produce quality products to sustain and
improve life on earth. Salt and sulphate of potash (SOP) are
the principal products harvested at Mardie.
Salt is an essential chemical input for more than 10,000
products including glass, PVC, soaps and pharmaceuticals
and is also used for water treatment, for de-icing and in the
food industry while SOP is a high value, soil-friendly fertiliser
that improves crop quality and yield.
Seawater provides an inexhaustible feedstock for salt
and SOP production and >99% of the energy used to drive
the evaporation process is from clean, natural solar and
wind sources.
Contribute to climate change mitigation
by displacing the energy and emissions
intensive production processes used in
industrial production globally.
BCI recognises the essential role of industry in contributing
to emissions reduction. The Paris Agreement’s goal is to limit
global warming to well below 2, preferably 1.5 degrees Celsius
compared to pre-industrial levels. BCI aims to contribute
to climate change mitigation by displacing the energy and
emissions intensive production processes used in industrial
production globally.
Emissions & Climate
SALT
Salt is an essential chemical input for more than 10,000
products including glass, PVC, soaps and pharmaceuticals
and is also used for water treatment, for de-icing and in the
food industry. More than 50% of global salt is produced by
energy and emissions intensive rock salt mining (21% of global
capacity) and solution mining (32% of global capacity). Mardie
aims to displace this production with salt produced by solar
evaporation of seawater, a process that emits 90% less CO2
than solution mining and 40% less CO2 than rock salt mining.
14
14
BCI SUSTAINABILITY PRINCIPLES | ENVIRONMENT AND CLIMATE
Fertilizers are important for agricultural productivity and to
reduce soil erosion as crops remove nutrients from the soil.
Key nutrients including nitrogen, phosphorus, potassium and
sulphur have no substitutes. Therefore, efforts to manufacture
these chemicals in a less carbon-intensive manner have an
important role to play in enhancing crop yield in the least
greenhouse-gas intensive manner. Mardie will be an energy
efficient SOP fertilizer producer using a flotation/schoenite
process, whereas 50%4 of the global SOP market is supplied
by producers using the energy intensive Mannheim process.
Furthermore, Mardie’s location at port reduces freight haulage
emissions, whereas all domestic peers and many global peers
are landlocked and SOP requires trucking to markets.
The Asia Pacific region is the largest consumer of salt,
representing ~52% of global demand in 2020. Mardie’s
portside location on the Pilbara Coast is ideally situated for
the APAC market with freight haulage emissions reduced in
comparison to landlocked international peers. Sustainability
is central to Mardie’s production process with inexhaustible
seawater the feedstock whereas rock salt mining, solution
mining and the solar evaporation of inland salt lakes deplete
finite natural resources.
SOP
Agriculture is an emissions intensive sector, responsible for
more than 12% of global greenhouse gas emissions, with
synthetic fertilisers contributing 2.5% of total greenhouse
gas emissions through production and use1. In Australia,
agriculture accounts for 13.4% of national emissions (2019)2,
including 2% driven by fertiliser use (globally 1.5% through
application)3. The Australian agricultural industry has a vision
(Ag2030) to increase farming sector value from $61 billion to
$100 billion by 2030 at a growth rate of 5.4% with greenhouse
gas emissions forecast to increase by 12% over that period
(2020 estimates)3 as farm production increases to support
growing populations
1
2
3
4
2020_IFA_The_SDGs_and_Sustainable_Fertilizer_Production.pdf
https://www.industry.gov.au/sites/default/files/April%202021/document/national-inventory-report-2019-volume-1.pdf
https://www.industry.gov.au/sites/default/files/2020-12/australias-emissions-projections-2020.pdf
Argus Media Limited (Dec 2020)
15
BCI SUSTAINABILITY PRINCIPLES | ENVIRONMENT AND CLIMATE
Mardie Production Process
99%
Sun and Wind
Energy
7
Ocean Going Vessel
(up to Capesize)
5
2.4km Jetty
6
Transhipper
(12,000t)
3
Primary Salt Crystallisers (16km2)
4
Salt Wash Plant
Inexhaustible
Seawater Resource
BCI SUSTAINABILITY PRINCIPLES | ENVIRONMENT AND CLIMATE
Energy Use and Renewables
The energy required to process
5.35Mtpa of salt and 140ktpa of SOP
is approximately 107,500GWhpa.
More than 99% of Mardie’s energy
requirement relates to the evaporation
process which is driven by natural sun
and wind energy. The remaining 1%
of energy demand, or 105GWhpa is
largely associated with the SOP and salt
processing plants, desalination plant
and to a lesser extent with harvesting,
haulage, and transhipping equipment.
The Optimised Feasibility Study (OFS)
energy assumptions involve an 18MW
gas-fired central power plant and
diesel-powered transfer pumps, village
and fleet. The OFS case creates an
estimated 76.6kt carbon dioxide (CO2)
equivalent annually. BCI is developing
a strategy to reduce emissions
through the use of renewables, diesel
substitution and created offsets.
A
Secondary Salt Crystallisers
(6km2)
B
KTMS Crystallisers (5km2)
C
SOP Process Plant
2
Evaporation Ponds (88km2)
1
Main Seawater Pump Station (six pumps)
1717
BCI SUSTAINABILITY PRINCIPLES | ENVIRONMENT AND CLIMATE
Water
The Mardie Project includes the development of seawater
intakes, bitterns disposal pipeline and outfall diffuser, trestle
jetty export facility, dredge channel, causeway, drainage
channels, and desalination (reverse osmosis) facilities.
The presence of the causeway, concentrator and crystalliser
ponds will result in changes to hydrological regimes, both tidal
and overland. BCI has incorporated floodways and culverts into
the causeway design, significant drainage corridors into the
pond design, and has relocated the development envelopes
inland to minimise impacts to tidal regimes within the intertidal
zone. As a result the Project is predicted to be able to be
developed without significant impacts to hydrological regimes.
Unlike many resource projects, Mardie does not involve large
scale dewatering, but rather the intake of 160GL of seawater
annually, equivalent to 70,000 olympic-sized swimming pools.
The evaporation ponds will be located on predominantly
barren mudflats, the impermeable clay of the mudflats making
ideal pond floors and the windswept, sunbaked habitat perfect
conditions for evaporation.
Biodiversity
The Mardie Project will rely on solar evaporation of seawater
to produce high purity salt and SOP product and as such
the large-scale inundation of some habitats is unavoidable.
Given the location of the Project, BCI has identified that
environmental constraints should be the primary input into
the design and commissioned initial Benthic Communities and
Habitats (BCH) surveys to map the boundaries of significant
BCH such as mangroves and algal mats. The Project design
was then moved inland by several kilometres in some areas,
to significantly reduce impact to mangrove habitat, and the
majority of algal mat and coastal samphire habitat. These
revisions and refinements included:
• Reshaping the western pond walls to target lower-value
BCH using detailed BCH mapping
• Drainage corridors incorporated into the design between
the pond walls to allow surface water flows to reach the
marine environment
• Reduction in the scale of the southern-most pond to
minimise hydrological impacts to Peter’s Creek drainage
• Siting proposed Pilbara Port Authority (PPA) infrastructure
and the causeway crossing outside areas of significant BCH
• The use of a trestle jetty to avoid impacts to offshore
coastal processes and intertidal flows
• The incorporation of a top-down jetty construction
approach to reduce direct disturbance
• The incorporation of a specific seawater intake design to
reduce intake rates and avoid associated fauna entrapment
• The incorporation of a multi-port bitterns outfall diffuser
with pre-dilution to minimise water quality impacts
• Using a desalination plant instead of groundwater bores
• Using a transhipment method to minimise dredging volumes
• Using a simple mechanical excavation dredging method
instead of a typical cutter-suction dredge.
1818
Effluents & Waste
The production process involves the discharge of bitterns
into the marine environment on outgoing tides. The bitterns
will be diluted prior to discharge by mixing with seawater and
discharged through a multi-port diffuser to promote mixing.
This discharge will result in unavoidable water quality impacts
in the vicinity of the diffuser, however the discharge will be in
accordance with industry best practice and forming part of
environmental approval.
The secondary processing of salt waste bitterns to produce
SOP and planned future extraction of magnesium reduces
the concentration and salinity of Mardie’s bitterns discharge
compared with local salt-only producers. This secondary
processing demonstrates BCI’s Sustainability Principle of
maximising value and minimising waste, discussed in the
following section.
Mine Closure & Rehabilitation
MARDIE
The Mine Closure Plan for Mardie includes the following activities:
• Decommission of the concentrator ponds including
removing excessive hypersaline material, breaching
external walls to restore water movement across the
landscape and stabilising closure landforms
• Remove hypersaline material from crystalliser ponds, cover
and rehabilitate
• Reinstating landscape drainage
• Recover any hypersaline groundwater plumes, where
present
• Removal of all processing, conveying/stockpiling and
miscellaneous infrastructure
• Investigate and remediate sources of contamination
• Rehabilitate roads, transport corridors and all other
miscellaneous open areas not required by other parties
• Remove safety hazards.
The Mine Closure Plan has been submitted to the Department
of Mines, Industry Regulation and Safety (DMIRS) for
assessment and approval and will be reviewed and revised
every three years.
IRON VALLEY
The Mine Closure Plan for Iron Valley includes the following
activities:
• Restoring the project area to a safe, stable and non-
polluting sequence of landforms, capable of supporting
native vegetation wherever possible and not posing any
hazard to the pre-mining land use of pastoral management
• Using waste rock (overburden and low-grade ore) to backfill
the mine voids and reduce the formation of saline pit lakes
• Contouring remaining above-ground landforms so that
they are non-eroding and visually consistent with the
surrounding landscape
• Ripping and treating disturbed surfaces to encourage the
re-establishment of native plant species and the return of
endemic fauna
• A research and monitoring program to ensure closure
activities are successful in achieving the desired end-points
The Mine Closure Plan for Iron Valley has been updated by BCI
to accommodate the below water table mining of the asset.
It has been approved by DMIRS and will be reviewed and
revised every 3 years.
Under the operating arrangements at Iron Valley, the current
operator of the Iron Valley mine must comply with all
rehabilitation obligations upon mine closure.
3. MAXIMISE VALUE, MINIMISE WASTE
Extract value at every stage of production
to maximise economic benefits,
minimise waste and preserve ecological
and heritage integrity.
The circular economy is demonstrated by BCI’s sustainability
goal to extract value at every stage of production to maximise
economic benefits, minimise waste and preserve ecological and
heritage integrity. A circular economy aims to redefine growth,
focusing on positive society-wide benefits. It entails gradually
decoupling economic activity from the consumption of finite
resources, and designing waste out of the system.
There are five existing solar salt operations on the Western
Australian coast, but only Mardie will reprocess salt bitterns
(waste) to produce SOP. This, together with Mardie’s recycling
of brine from its salt wash plant, desalination plant and
secondary crystallisers goes some way toward maximising
economic benefits, minimising waste while at the same time
preserving ecological integrity.
In the Australian context Mardie is unique, not just for its
coastal location, but because it will be the only SOP producer
to use renewable, sustainable seawater as feedstock, whereas
domestic peers are depleting finite resources by draining inland
lakes and aquifers. Mardie will be also be the only domestic
SOP producer to commercialise salt (whereas peers generate
~2.5Mtpa of waste salt on an equivalent SOP production rate).
In that same vein of waste reduction, BCI is investigating the
reprocessing of spent brine (bitterns) to produce magnesium
and bromine, before recycling back into seawater.
19
Mardie will be a multi-
generational asset benefiting
multiple stakeholders.
20
4. PROMOTE COMMUNITY PROSPERITY
Promote prosperity in our communities
through work, support programs,
government taxes and royalties and native
title payments.
Mardie will be a multi-generational asset for northern
Australia, delivering new multi-user export infrastructure, tax
and royalty revenues, local jobs and contracts, and indigenous
engagement. This is the very essence of BCI’s sustainability
principle to promote prosperity in our communities through
work, support programs, government taxes and royalties, and
native title payments.
Local Communities
BCI has cemented and expanded its Pilbara presence with
the opening of its regional office in Karratha. Located in
“The Quarter HQ” and fitted out by local contractors, the
office will comfortably accommodate BCI’s initial local
workforce with capacity for additional employees as main
construction at Mardie commences. The official opening
highlighted the strength of BCI’s community engagement
and was attended by approximately 80 guests including
government officials, Traditional Owners, local business
owners, media, the BCI Board and staff.
Procurement Practices
The Department of Industry, Science, Energy and Resources
(DISER) approved the Mardie Project Australian Industry
Participation (AIP) Plan under section 18(1)(a) of the Australian
Jobs Act (2013). BCI has implemented amendments to all
relevant contracts to ensure the obligations set out in the
AIP Plan are known and subsequently met. Of note is the
cascading of obligations to Mardie Project contractors and
sub-contractors, the priority hierarchy, requirement for a
local engagement resource, implementation and use of a
procurement portal and local price preference for contracts
less than A$1M.
BCI incorporates Aboriginal employment and contracting
considerations as part of selection criteria in competitive
tender processes. The engagement of aboriginal sub-
contractors and individuals is appropriately weighted in the
tender selection criteria to ensure contractors with aboriginal
engagement strategies and a history of aboriginal sub-
contractor engagement receive ranking points for having
those processes in place. BCI will transparently report against
AIP Plan compliance each year.
In response to the requirements of the Modern Slavery Act
2018 (Cth), BCI will be releasing its inaugural Modern Slavery
Statement by December 2021. The statement will outline the
foundational steps BCI will take to identify key risks across our
supply chain, operations and investments and undertake risk-
based due diligence and preventative actions.
BCI SUSTAINABILITY PRINCIPLES | COMMUNITIES
Taxes & Royalties
Mardie will deliver significant benefits to WA and Australia
over its 60+ year life:
>
$8
BILLION
Corporate
taxes
>
$800
MILLION
State
royalties
>
$200
MILLION
Native title
payments
Indigenous Peoples & Cultural Heritage
BCI has comprehensive native title and heritage agreements
in place with its two native title holder stakeholders, the
Yaburara and Mardudhunera (YM) People via the Wirrawandi
Aboriginal Corporation (WAC) and the Kuruma Mardudhunera
(KM) People via the Robe River Kuruma Aboriginal
Corporation (RRKAC).
BCI recognises the deep connection that Traditional Owners
have to the land associated with the Project and Mardie’s
Indigenous Engagement Strategy (IES) seeks to document
BCI’s collaborative approach to building relationships with
Aboriginal stakeholders and intent to ensure informed
decision making through regular consultation and proactive
information sharing. In addition, the IES was also created
to ensure that the Project is sensitive to Aboriginal heritage
values and supportive of local communities.
Heritage protocols set out how BCI engages with Traditional
Owners to identify Aboriginal heritage sites and other heritage
values; and ensures that those areas are protected and any
impacts mitigated or agreed. Heritage surveys conducted by
Traditional Owners have been completed across the Project
footprint over the past three years and registered sites and
other heritage places have been identified. Further heritage
work is being conducted during 2021 over the proposed Port
of Cape Preston West land and new optimised project areas.
BCI has an established a “Ground Disturbance Permit” system
that requires all ground disturbing works to be assessed
and approved. As part of the system, all ground disturbing
works are matched against agreed project footprints, relevant
consents and any heritage and environmental management
requirements. If the ground disturbing works are proposing to
affect an Aboriginal Site, senior BCI management is required
to review the status of all heritage consents, approvals and
correspondence from Traditional Owners confirming their non-
opposition to ensure that works are only undertaken with the
support of the Traditional Owners and compliant with heritage
legislation or avoided.
The BCI Executive team attended cultural awareness training
and rock art appreciation instruction on the Burrup Peninsula
during March. A cultural awareness training program with
the prescribed body corporate of the Traditional Owners
of the Mardie Project will be rolled out for BCI employees
and contractors over the course of the year. New directors
were provided with a full policy induction and Board briefing
sessions were conducted throughout the period on cultural
heritage status and issues.
2121
BCI SUSTAINABILITY PRINCIPLES | PEOPLE & SAFETY
5. PROVIDE A SAFE ENVIRONMENT
Provide a safe and diverse environment
for employees, contractors, suppliers
and customers.
Coming home safely each day is a basic expectation and BCI
is committed to providing a safe and diverse environment for
its employees, contractors, suppliers and customers.
Health, Safety & Wellbeing
BCI is committed to zero harm. We have a strong safety
record and are highly focused on continuing to provide a
safe and healthy working environment for our employees
and contractors as site activities at the Mardie Project
increased by more than 150% in the reporting period.
BCI recorded 1 Total Recordable Injury (TRI) for this year, and
BCI has achieved 6 years without a Lost Time Injury (LTI)5.
The early works phase of the Mardie Project has directed
significant development in BCI’s formal risk workshop process
and critical risk management. Construction risk assessment
workshops have been undertaken with key stakeholders to
identify the risks and treatment controls required for early
works and are continuing in preparation for construction into
FY22. A key highlight for BCI was the launch of the Critical
Control Awareness Campaign which focused on BCI’s critical
risks and fatality prevention.
System development of the Health and Safety Management
System was a major deliverable with the Health and Safety
Management Standards (HSMS) and Critical Control Standards
setting governance requirements. This year the INX InControl
Health and Safety technology system was implemented
which manages incidents, investigations, hazards, audits
and inspections. Leading indicators promoting in field
health and safety leadership included the development and
implementation of leadership interactions with BCI’s executive
members. Task based risk assessment tools, such as Take
5 and Job Hazard Analysis, were deployed for site based
personnel and contractors.
An external health and safety audit was conducted, towards
the end of FY21, primarily focused on independently assessing
current site activity and BCI’s HSMS against the Mines
Safety and Inspection Act 1994, associated regulations and
BCI Standards. The key highlights from the audit concluded
the HSMS was compliant, well written, comprehensive and
addressing current needs and site control and monitoring
activities of contractors, was in most cases, exceeding
industry practice.
The health and wellbeing of BCI staff is of paramount
importance and the following measures have been adopted:
• Paramedics on site at all times, with a first aid room and
equipped ambulance
• Pre-employment medicals in place for employees and
contractors
• Flu Vaccinations available
• Alcohol and drug testing conducted on Mardie site
• Employee Assistance Program available to all employees.
BCI’s pandemic preparedness was tested throughout FY21,
with COVID-19 continuing to be a factor. The flexibility to
respond to the WA Government health advice for BCI’s head
office and Mardie site were key to ensuring the health and
safety of our personnel. The continual review and update to
BCI’s COVID-19 Management Plan and key controls included
reviewing essential workers for site based travel, pre-entry
COVID-19 declarations and temperature testing continued
throughout the year. Outbreak periods included additional
risk mitigations controls such as BCI taking part in the FIFO
DETECT program prior to site entry. Working from home was
a key requirement during lockdown periods and keeping our
teams socially connect to one another was achieved.
Diversity and Inclusion
As stated in BCI’s People Policy, BCI has committed to:
• promote and encourage a workforce culture of respect,
diversity, inclusion and a workplace free from discrimination,
bullying, victimisation, and harassment; and
• Encourage diversity at all levels, regardless of age, gender,
ethnicity, marital or family status, sexual orientation,
race, cultural background, religious belief, or disability,
recognising the benefit of diversity for Company
performance and culture.
In addition, during the reporting period, BCI also prepared and
implemented a Diversity and Inclusion Standard and Plan,
which further articulates BCI’s commitment towards fostering,
promoting and establishing a culture of diversity and inclusion
at every level of its corporate and site culture, including its
relationship with stakeholders.
Gender diversity is a feature of BCI’s workforce, with female
employment of 42% in the Perth Head Office, 100% in
the Pilbara Office and 11% at Mardie site in FY21. At senior
executive level 33% of the group are female while at manager
level and board level the proportions are 28% and 14%
respectively.
BCI is committed to ensuring that employees with similar
skills, knowledge, qualifications, experience and performance
are paid equally for the same or comparable work. BCI
will remain focussed on pay equity and improving female
representation at all levels.
Our workforce is predominantly located in Perth, however
once the Final Investment Decision is made with regard to
the Mardie Project our recruitment will focus on Pilbara local
and indigenous communities. As part of BCI’s Indigenous
Engagement Strategy (IES), as positions become available
at Mardie, BCI or its contractors will provide written notice to
the Yaburara and Mardudhunera and Kuruma Marthudunera
People through the Implementation Committees or alternate
means as soon as is reasonably practicable prior to those
positions becoming available.
Employment
BCI believes that people are the key to the success of the
company and acknowledge that meaningful, long-term
relationships with the local and Aboriginal communities in
relation to the Project are fundamental to maintaining BCI’s
licence to operate. BCI seeks to build lasting and sustainable
relationships by engaging openly and transparently with
community stakeholders to develop and implement programs
that deliver mutual benefits across many areas including
employment.
Significant employment opportunities associated with Mardie
Project:
• 500 construction jobs
• 220 ongoing operating jobs
• Additional indirect jobs in the region.
LTI defined as per AS1885 and DMIRS definition of lost time injury/diseases = work injury or permanent disability that results in an absence
from work for at least one full day or shift any time or shift on which the injury occurred.
5
2222
BCI exceeds industry
average benchmarks with
gender diversity.
2323
CORPORATE GOVERNANCE
BCI Minerals has adopted a Corporate Governance Framework which forms the basis of a
comprehensive system of control and accountability for the administration of corporate
governance, through its Board, its subcommittees and the executives.
The BCI Board is committed to fostering an appropriate
culture through administering the policies and procedures with
openness and integrity, and pursuing the true spirit of corporate
governance commensurate with the Company’s needs.
To the extent they are applicable to the Company, the Board
has adopted the ASX Corporate Governance Council’s
Corporate Governance Principles and Recommendations
(4th edition).
BCI’s Corporate Governance Statement is available on the
corporate website together with the Company’s:
• Code of Conduct
• Charters
• Policies
The Company reviews its Corporate Governance Framework
and policies annually to ensure it reflects any changes within
the Company, or accepted principles and good practice.
Corporate Governance Framework
Board of Directors
Project
Review
Committee
Company
Secretary/
General
Counsel
Remuneration
and
Nomination
Committee*
Audit
and Risk
Committee**
Equity
Funding
Committee
Sustainability
Committee
C
h
a
r
t
e
r
s
PRC Charter
RNC Charter
Board Charter
ARC Charter
EFC Protocol
STC Charter
Recommend
and Oversee
Policies:
6. People
Policy &
Remuneration
Framework
Recommend and
Oversee Policies:
5. Share Trading
Policy
10. Disclosure Policy
11. Shareholder
Communications
Policy
Approve Policies:
1. Code of Conduct
2. Health and Safety
Policy
3. Risk Management
Policy
4. Environment and
Community Policy
5. Share Trading Policy
6. People Policy
7. Privacy Policy
8. Whistleblower Policy
9. Anti-Bribery and
Corruption Policy
10. Disclosure Policy
11. Shareholder
Communications
Policy
Managing Director/
Chief Executive
Officer
Recommend
and Oversee
Policies:
1. Code of
Conduct
3. Risk
Management
Policy
Recommend
and Oversee
Policies:
2. Health
and Safety
Policy
4. Environment
and
Community
Policy
6. People Policy
(subset)
7. Privacy Policy
8. Whistleblower
Policy
9. Antibribery
and Corruption
Policy
P
o
l
i
c
i
e
s
P
r
o
c
e
d
u
r
e
s
G
u
d
e
i
l
i
n
e
s
>100 Guidelines and Procedures to Ensure Compliance with Policies
Project Review
Committee
Remuneration and
Nomination Committee
Audit and
Risk Committee
Equity Funding
Committee
Sustainability
Committee
Garret Dixon
Jenny Bloom
Michael Blakiston
Michael Blakiston
Chris Salisbury
Chris Salisbury
Alwyn Vorster
Garret Dixon
Alwyn Vorster
Brian O’Donnell
Richard Court
Jenny Bloom
Richard Court
Garret Dixon
Chris Salisbury
Alwyn Vorster
Richard Court
Alwyn Vorster
Chair
Members
24
5x5 Risk Matrix
Almost Certain
Likely
Possible
Unlikely
Rare
Insignificant
5
4
3
2
1
Minor
10
8
6
4
2
Consequence
Medium
Major
Severe
15
12
9
6
3
20
16
12
8
4
25
20
15
10
5
d
o
o
h
i
l
e
k
i
L
Risk Management
BCI manages its activities within budgets and operational and
strategic plans. BCI acknowledges that there is risk associated
with all business activity and the Board works with senior
management to safeguard assets and to ensure that business
risks are identified and appropriately managed.
Licence to Operate
BCI’s commitment to sustainable business practices are
imbedded through our values and founded in the various
legislative requirements, approvals held or to be held by BCI,
and contractual rights and benefits granted to BCI under
agreements with third parties.
The Company aims to drive an effective risk management
culture by establishing a process for regular review of
business activities to objectively assess and identify risks
in the conduct of the business, recording risks in a risk
register and where appropriate, implement preventative and
mitigating controls, to reduce residual risk.
BCI’s risk profile is actively managed by undertaking:
• Monthly Risk & Compliance Report prepared by BCI’s Risk
Manager and reported to the Managing Director and Board
• Regular review of the risk registers reported to the Audit &
Risk Committee
• Implement a quarterly risk identification exercise to be
undertaken by management
• Document all risks with a potentially high impact on a risk
register which is reviewed by senior management on a
monthly basis
• Risk assessments are conducted for key business activities
• Bi-annual review of the risk management activities by the
Audit & Risk Committee
• Quarterly oversight of sustainability related activity through
the dedicated Sustainability Committee.
BCI is committed to preserving its licence to operate and
ensuring compliance with the licence to operate obligations
relating to matters such as:
• land access and native title
• heritage protection
• tenure compliance
• environmental compliance
• pastoral access
• community engagement
• stakeholder engagement
• other legislative requirements relevant to BCI’s business
and the Project.
A culture of care and high-quality performance is the goal,
with a target of zero material breaches of BCI policies and its
licence to operate obligations.
Monthly compliance reviews are carried out against BCI’s
licence to operate with the obligation owner and any breaches
are then reported in the Risk & Compliance Report which
is then incorporated into the monthly Managing Director’s
Report and reported to the Board.
There were no material breaches of BCI’s licence to operate
during the reporting period.
25
DIRECTORS’ REPORT
The Directors present their report on the results of the Consolidated Entity (referred to
hereafter as the Company) consisting of BCI Minerals Limited (“BCI”) and the entities it
controlled at the end of, or during the year ended 30 June 2021.
Principal Activity
The principal activities of the Company during the course
of the financial year were the development of assets in the
Pilbara region of Western Australia, primarily focused on the
Mardie Salt and Potash Project and Iron Valley Iron Ore Mine.
There has been no significant change in the nature of the
Company’s activities during the financial year.
Directors
The names of directors of the Company in office during the
financial year and up to the date of this report are:
Brian O’Donnell Chair (Non-Executive)
Managing Director (Executive)
Alwyn Vorster
Jenny Bloom
Director (Non-Executive)
Michael Blakiston Director (Non-Executive)
Director (Non-Executive)
Garret Dixon
Director (Non-Executive)
Richard Court
Director (Non-Executive)
Chris Salisbury
Mr Richard Court was appointed as a Director of the
Company on 28 January 2021.
Mr Chris Salisbury was appointed as a Director of the
Company on 28 May 2021.
26
Directors’ Qualifications, Experience and
Special Responsibilities
Mr Brian O’Donnell B Com, FCA, MAICD
Chair (Non-Executive) appointed October 2014
Period of office at August 2021 – 6 years and 10 months
In addition to being Chair of BCI, Mr O’Donnell is Director,
Finance and Investments for the Australian Capital Equity
Pty Limited (ACE) group, which includes BCI’s largest
shareholder, Wroxby Pty Ltd. He is a director of various ACE
group companies, including companies active in the property,
agricultural, financial services and investment sectors.
Mr O’Donnell is a non-executive director of Bravo Holdco Pty
Ltd (the holding company for Hive and Wellness Australia Pty
Ltd - formerly Capilano Honey Limited), SocietyOne Holdings
Pty Ltd, the West Australian Football Commission and The
Guide Dog Foundation Pty Ltd (WA). He is a former director
of Iron Ore Holdings Limited, Coates Group Holdings Pty Ltd,
WesTrac Pty Ltd, Landis & Gyr AG, Fremantle Football Club
Ltd and YMCA of Perth Inc. He is a Fellow of the Institute of
Chartered Accountants and has 35 years’ experience in the
finance and investment industry.
Mr O’Donnell is a member of the Audit and Risk Committee.
Mr Alwyn Vorster BSc (Hons) Geology, MSc (Mineral Economics) and MBA
Managing Director appointed 22 September 2016
Period of office at August 2021 – 4 years and 11 months
Mr Vorster commenced as Chief Executive Officer of BCI
in May 2016 and was appointed as Managing Director in
September 2016. He has more than 25 years’ experience with
numerous large mining houses in technical and commercial
management roles covering the total supply chain from mine
to market for iron ore, coal and other minerals.
Recent roles include Group Executive Mining at Australian
Capital Equity Pty Limited (ACE), Chief Executive Officer of API
Management and Managing Director of Iron Ore Holdings Ltd.
Mr Vorster is a member of the Remuneration and Nomination
Committee, Project Review Committee, and Sustainability
Committee.
Ms Jenny Bloom Grad. Dip Business Administration, GAICD
Director (Non-Executive) appointed March 2017
Period of office at August 2021 – 4 years and 5 months
Ms Bloom has an extensive business background with
experience in the public and private sectors in Western
Australia and Victoria. She was most recently the Deputy Chair
and Member of the Waste Authority Western Australia for eight
years and was a member of the Program and Risk Committee.
She is a non-executive director of Breaking the Silence (Inc)
and is a director of various private businesses. Ms Bloom
previously held an elected position as a Councillor and Deputy
Shire President for the Shire of Broome and as an independent
director of a Broome based Aboriginal Corporation.
Ms Bloom is Chair of the Remuneration and Nomination
Committee.
Mr Michael Blakiston B. Juris
Director (Non-Executive) appointed March 2017
Period of office at August 2021 – 4 years and 5 months
Mr Blakiston is a partner in Gilbert + Tobin’s Energy and
Resources group. He has over 30 years’ experience across
a range of jurisdictions. He advises in relation to asset
acquisition and disposal, project structuring, joint ventures
and strategic alliances, development agreements and project
commercialisation, capital raisings and company merger and
acquisitions.
Mr Blakiston has served on numerous ASX listed companies
and not-for-profit boards and is currently the Chair of Precision
Opportunities Fund Ltd, a specialist small to medium cap fund.
Mr Blakiston is the Chair of the Audit and Risk Committee.
Mr Garret Dixon
Director (Non-Executive) appointed 18 June 2020
Period of office at August 2021 – 1 year and 2 months
Mr Dixon has over 40 years of industry experience in the
areas of mining, construction, contracting, civil engineering
and bulk commodity logistics. Until recently, Mr Dixon held the
position of Executive Vice President and President Bauxite of
NYSE listed Alcoa Corporation, where he was responsible for the
global bauxite mining business including seven bauxite mines on
various continents.
His other experience includes positions as a Non-Executive
Director of Watpac Limited, Managing Director at Gindalbie
Metals Limited and Executive General Manager for Henry
Walker Eltin (HWE).
Mr Dixon is a member of the Remuneration and Nomination
Committee and Chair of the Project Review Committee.
Mr Richard Court
Director (Non-Executive) appointed 28 January 2021
Period of office at August 2021 – 8 months
Mr Court had served as Australia’s Ambassador to Japan from
2016 to 2020. He was also Premier and Treasurer of Western
Australia from 1993 to 2001. His other previous corporate
experience includes Chair of GRD Ltd, Chair of Iron Ore
Holdings Ltd, Chair of National Hire Ltd, Chair of RISC Advisory
Pty Ltd and Director of WesTrac Equipment Pty Ltd.
During the year ended 30 June 2021, Mr Court was appointed
as a member of the Audit and Risk Committee and the
Sustainability Committee.
Mr Chris Salisbury
Director (Non-Executive) appointed 28 May 2021
Period of office at August 2021 – 4 months
Mr Salisbury is a metallurgical engineer with more than
30 years of operational experience across a diverse range
of commodities. From 2016 to 2020, he was Chief Executive
at Rio Tinto Iron Ore responsible for optimising operations,
developing and implementing the company’s climate change
program and improving safety culture and operational
performance of a team comprising ~20,000 employees and
contractors, across a network of 16 mines, 4 ports and other
significant infrastructure. In this role, he was also responsible
for the management of Rio Tinto’s salt business (Dampier Salt)
which has the capacity to produce 10Mt of industrial salt per
annum from 3 operations.
During the year ended 30 June 2021, Mr Salisbury was
appointed as Chair of the Sustainability Committee and a
member of the Project Review Committee.
Company Secretary
Ms Susan Park BCom, ACA, F Fin, FGIA; FCG; GAICD
Joint Company Secretary appointed July 2018
Ms Park has over 24 years’ experience in the corporate finance
industry and extensive experience in company secretarial
and non-executive director roles with ASX, AIM and TSX listed
companies. Ms Park is currently Company Secretary of several
ASX listed companies.
Mrs Stephanie Majteles LLB(Hons), GAICD
Joint Company Secretary appointed 30 June 2021
Mrs Majteles has over 18 years’ experience in the projects and
resources industries, with significant experience at both a top
tier law firm and in-house at a large global resources company.
27
Meetings of Directors
The number of meetings held during the year and the number of meetings attended by each director was as follows:
Board
Audit and
Risk Committee1
Remuneration
and Nomination
Committee2
Project Review
Committee3
Sustainability
Committee4
Total Number
of Meetings
B O’Donnell
A Vorster
M Blakiston
J Bloom
G Dixon
R Court5
C Salisbury6
Held
Attended
Held
Attended
Held
Attended
Held
Attended
Held
Attended
11
11
11
11
11
5
2
11
11
11
11
10
5
2
4
-
4
-
-
-
-
4
-
4
-
-
-
-
-
-
-
4
4
-
-
-
-
-
4
4
-
-
-
9
-
-
9
-
-
-
9
-
-
9
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1 Members of the Audit and Risk Committee during the financial year ended 30 June 2021 were M. Blakiston (Chair), B. O’Donnell (Member) and
R. Court (Member) from date of appointment.
2 Members of the Remuneration and Nomination Committee during the financial year ended 30 June 2021 were J Bloom (Chair) and G. Dixon
(Member). A. Vorster was also appointed to this committee as a member on 24 June 2021.
3 Members of the Project Review Committee during the financial year end 30 June 2021 were G. Dixon (Chair), A. Vorster (Member) and C.
Salisbury (Member) from date of appointment.
4 The Board resolved to form a Sustainability Committee on 27 May 2021. Members of this committee are C. Salisbury (Chair), R. Court (Member)
and A. Vorster (Member). There were no meetings of this committee held during the financial year ended 30 June 2021
5 R Court was appointed as an independent Non-executive Director of the Company on 28 January 2021.
6 C Salisbury was appointed as an independent Non-executive Director of the Company on 28 May 2021.
Corporate Governance
In recognising the need for high standards of corporate behaviour and accountability, the Directors of BCI Minerals Limited support
and have adhered to the ASX Corporate Governance Council’s Corporate Governance Principles and Recommendations. The
Company’s detailed corporate governance policy statement can be found on the Company’s web site at www.bciminerals.com.au.
Directors’ Interests and Benefits
The relevant interest of each director in the shares, Performance Rights and options over shares issued by the Company at the
date of this report is as follows:
Director
B O’Donnell
A Vorster
M Blakiston
J Bloom
G Dixon
R Court
C Salisbury
Total
Ordinary shares
Performance Rights
Share Rights
Direct
Indirect
Direct
Indirect
Direct
Indirect
-
-
-
90,000
-
-
-
1,014,483
5,305,645
-
-
-
750,000
-
-
-
-
295,313
5,304,209
168,750
168,750
-
-
-
-
178,125
-
-
90,000
7,070,128
168,750
5,946,397
-
-
-
-
-
-
-
-
-
855,798
-
-
-
-
-
855,798
Dividends
No dividends have been declared in relation to the year ended 30 June 2021 (June 2020: Nil).
Rounding of amounts
The Company is of a kind referred to in ASIC Corporations (Rounding in Financials/Directors’ Reports) Instrument 2016/191,
relating to the ‘rounding off’ of amounts in the Directors’ Report. Amounts in the Directors’ Report have been rounded off in
accordance with that Class Order to the nearest thousand dollars, or in certain cases, to the nearest dollar.
28
Review of Operations
BCI is an Australian-based company that is developing a salt and potash business supported by iron ore royalty earnings.
Safety performance
BCI places a high priority on facilitating a safe working environment for all staff and contractors. During the year ended 30 June
2021, one incident resulting in a Recordable Injury occurred and the Total Recordable Injury Rate (“TRI”) for the year was 1.0
(2020: 0.0). No lost time injuries (“LTIs”) were recorded for the year and the lost time injury frequency rate (“LTIFR”) was zero
(June 2020: 0.0).
Mineral Resources Limited is responsible for Occupational Health and Safety matters at Iron Valley and therefore BCI does not
report safety performance for the Iron Valley site.
Operations
Mardie Salt & Potash Project
During the financial year, BCI’s focus at the 100% owned Mardie Salt & Potash Project was on completing the Optimised Feasibility
Study (‘OFS’) and progressing the funding, approvals, tenure and offtake aspects of the Project and progressing enabling works.
Optimisation results of the Mardie Definitive Feasibility Study (‘DFS’) were released on 21 April 2021, outlining improved project
footprint and economics. The optimisation delivers a ~20% increase in salt production (from 4.4Mtpa to 5.35Mtpa) and SOP
production (from 120ktpa to 140ktpa), a ~30% increase in annual EBITDA (from A$197M to A$260M) and a ~40% increase in Pre-
tax Project NPV7 (from A$1,197M to A$1,670M) compared to the DFS announced on 1 July 2020.
In addition, de-risking activities conducted during the optimisation phase (including additional geotechnical work, flowsheet
and equipment design, process piloting and progress with funding) have increased confidence in Mardie estimates and value
potential.
The optimisation results confirm Mardie can become a Tier 1 asset categorised by its long life (minimum 60 years), top quartile
scale, lowest quartile salt operating costs (after SOP by-product credits) and high-quality salt and SOP products. With attractive
financial returns over many decades and future expansion potential from the new tenements, development of the Mardie Project
should result in considerable long-term value and dividends being created for shareholders.
Project funding was significantly advanced during the year with the Federal Government’s Northern Australia Infrastructure
Facility (‘NAIF’) approving a 15-year A$450M loan for the Mardie Project in December 2020. The NAIF loan will sit alongside other
debt tranches with a number of commercial banks and other lenders progressing through credit approval processes. BCI raised
A$47.9M of equity at an issue price of A$0.24 per share via a 1 for 2 accelerated non-renounceable Entitlement Offer in the first
half of FY21. Strong support was received from BCI’s existing major shareholders, providing excellent endorsement for the Mardie
Project and BCI’s development plans. The proceeds of the equity raising facilitated early construction works at Mardie, including
the expansion of the accommodation village, access road upgrades, improved communications, establishment of construction
water supply and storage, installation of fuel storage facilities, and an embankment wall trial.
Important progress was made during the year with regard to the approvals and tenure required for the development of
Mardie. The Western Australian Environmental Protection Authority (‘EPA’) recommended to the WA Minister for Environment
that the Mardie Project can be implemented as proposed in the Environmental Review Document (‘ERD’), subject to certain
conditions which are materially consistent with BCI’s designs, costings and implementation plans as outlined in its initial
Definitive Feasibility Study. Following the completion of the final public appeals process, the Minister will consult with other
WA Government departments before making a decision. Main construction of the Project can only commence when BCI has
received the Ministerial approval as well as associated secondary approvals.
BCI continues to work closely with the Pilbara Ports Authority (‘PPA’) and the Department of Planning, Lands and Heritage (‘DPLH’)
to finalise the tenure and agreements required to develop the Mardie Port facilities within the new Port of Cape Preston West.
Engagement with potential buyers of Mardie’s salt and SOP products continued over the course of the year with two additional
non-binding Memoranda of Understanding (‘MOUs’) signed with Chinese chemical companies for up to 0.5Mtpa salt. 16 MOUs
are now in place covering 100% of 3-year salt production and 80% of 3-year SOP production. BCI will aim to convert these non-
binding MOUs to binding offtake contracts in support of financing milestones within the next 18 months.
With key funding, approvals and tenure elements substantially advanced, BCI is targeting a Final Investment Decision for the
Mardie Project in the second half of 2021.
29
Iron Valley Iron Ore Mine
The Iron Valley Mine is operated by Mineral Resources Limited (“MIN”) under an ore purchase agreement with BCI. MIN operates
the mine at its cost and purchases iron ore from BCI at the mine gate at a price linked to MIN’s received sales price. BCI is
responsible for paying third party royalties and securing key approvals.
During the March 2021 quarter, BCI completed payment of the $25M rebate as per the agreement between MIN and BCI
announced during the prior year. The 40% rebate represents BCI’s contribution to the additional capital investment required for
waste stripping and infrastructure upgrades at the Iron Valley mine that are expected to prolong the life of the mine and reduce
operating costs.
During the financial year MIN shipped 6.1 million wet metric tonnes (“M wmt”) (June 2020: 6.7 M wmt), which generated revenue
for BCI of $160.2M (June 2020: $76.8M) and EBITDA of $69.5M (June 2020: $23.0M).
Iron Valley Shipments (M wmt)
Iron Valley EBITDA ($M)
8
6
4
2
0
FY16
FY17
FY18
FY19
FY20
FY21
70
60
50
40
30
20
10
0
FY16
FY17
FY18
FY19
FY20
FY21
Other Assets
BCI has an interest in the Carnegie Potash Project, an SOP exploration project located approximately 220km north-east of
Wiluna. BCI currently owns 30% in a joint venture with Kalium Lakes Limited (“KLL”) and has rights to earn up to a 50% interest.
KLL, the joint venture manager, continues to focus on securing tenure and access to all required tenements.
Environmental Regulation
BCI is committed to minimising its environmental impact, with an appropriate focus on continuous monitoring of environmental
matters and compliance with environmental regulations.
BCI’s exploration, mining and development activities are the subject of various State and Commonwealth environmental
regulations. Compliance with these environmental regulations is managed through the Environment and Social Management
System (“ESMS”) and a series of other tools used to identify, analyse and control key risks associated with the environmental
impact from the Company’s activities. A compliance program is implemented on an annual basis to ensure appropriate records
are being maintained and periodic reviews (inspections and audits) are conducted to assess performance against regulatory
conditions and the requirements of the ESMS.
During the year, BCI submitted a number of reports and compliance statements to State regulatory bodies detailing BCI’s
performance against granted approvals. This includes all Annual Environmental Reports and Annual Compliance Reports, which
were all submitted on time and endorsed by the regulators.
There have been no material breaches of the Company’s licences, permits and approvals during the financial year.
30
Review of Results
Statement of profit or loss
The Company’s profit after income tax for the financial year ended 30 June 2021 was $22.0M (June 2020: $0.4M) arising due to
increased royalty returns realised from the Iron Valley Mine.
The following table provides a summary of the Company’s statement of profit or loss:
Revenue
EBITDA
Interest, tax, depreciation and amortisation
Impairment of assets
Net profit/(loss) after tax
30 June 2021
$M
30 June 2020
$M
160.5
28.9
(4.7)
(2.2)
22.0
77.2
8.3
(2.9)
(5.0)
0.4
The Company’s EBITDA for the financial year ended 30 June 2021 was $28.9M (June 2020: $8.3M), which incorporates a positive
EBITDA from Iron Valley of $69.5M (June 2020: $23.0M) and increased investment in the Mardie project of $34.5M.
The following table shows the EBITDA contribution for each segment of the Group:
Iron Valley
Gains from divestments
Mardie
Other
Total EBITDA
Statement of cash flows
30 June 2021
$M
30 June 2020
$M
69.5
-
(34.5)
(6.1)
28.9
23.0
10.2
(18.7)
(6.2)
8.3
Cash and cash equivalents as at 30 June 2021 increased to $79.4M (June 2020: $41.5M) with the positive movement resulting
from the $47.9M capital raising completed in the year, increased receipts from Iron Valley and inflows from divestment of assets.
Statement of financial position
Net assets increased to $172.7M (June 2020: $104.1M) primarily due to the increase in cash and receivables held by the Group
from the capital raising completed and net profit achieved during the year.
Dividends
The Directors have not paid or declared any dividends since the commencement of the financial year ended 30 June 2021.
(a) out of the profits for the year ended 30 June 2020 and retained earnings on
fully paid ordinary shares
(b) out of the profits for the year ended 30 June 2021 and retained earnings on
fully paid ordinary shares.
Corporate
2021
Nil
Nil
2020
Nil
Nil
Annual General Meeting
The Company’s annual general meeting was held in Perth on 26 November 2020. All ten resolutions considered at the meeting
were passed.
31
Performance Rights and Share Rights
As at the date of this report, there were 13,253,241 Performance Rights and 2,456,005 Share Rights on issue to Directors and
Employees under the Performance Right Plan and Share Right Plan, both approved at the November 2019 AGM (30 June 2020:
Performance Rights 11,000,000 and Share Rights 1,445,348). During the financial year, 2,805,000 performance rights vested
while 2,695,000 performance rights lapsed. Subsequent to the year end, a total of 2,301,146 share rights vested. Refer to the
Remuneration Report for further details of Performance Rights and Share Rights outstanding.
No Performance Right or Share Right holder has any right to be provided with any other share issue of the Company by virtue of
their Performance Rights or Share Rights holding.
None of the Performance Rights or Share Rights are listed on the ASX.
Shares issued as a result of conversion of performance rights and share rights
During the financial year, 816,000 ordinary shares were issued following conversion of performance rights that vested during the
year. Subsequent to year end, the Company has issued 361,337 ordinary shares following the conversion of share rights. Since
the end of the financial year, the Company has not issued any ordinary shares following conversion of performance rights.
Likely Developments and Expected Results
The Company will continue enabling works at Mardie with a Final Investment Decision expected in the second half of 2021,
triggering the finalisation of funding arrangements and the commencement of main construction.
BCI expects ongoing revenue and EBITDA from Iron Valley during the 2022 financial year. The Company may also receive residual
compensation and royalties following the divestment of assets last financial year.
Significant Changes in State of Affairs
There were no significant changes in the Company’s state of affairs not otherwise included in this report.
Matters Subsequent to the Reporting Date
Other than disclosed above, no matter or circumstance has arisen since the end of the financial year which significantly affected
or may significantly affect the operations of the Company, the results of those operations, or the state of affairs of the Company
in financial periods subsequent to the financial year ended 30 June 2021.
Audit Independence and Non-Audit Services
Auditor’s Independence Declaration
A copy of the auditor’s independence declaration as required under section 307C of the Corporations Act 2001 is attached to the
independent auditor’s report and forms part of the Directors’ Report.
Non-audit services
For the year ended 30 June 2021 the Board of Directors is satisfied that the auditor, BDO Audit (WA) Pty Ltd, did not provide
any non-audit services to the Company, as set out in Note 25 to the Financial Statements, that compromised the auditor
independence requirements of the Corporations Act 2001.
Signed in accordance with a resolution by the Directors.
Brian O’Donnell
Chairman
Perth, Western Australia
19 August 2021
Alwyn Vorster
Managing Director
Perth, Western Australia
19 August 2021
32
REMUNERATION REPORT
The Remuneration Report outlines the remuneration arrangements in place for Directors and other Key Management Personnel
(“KMP”) of the Company in accordance with section 308 (3c) of the Corporations Act 2001.
For the purpose of this report the KMP are defined as those persons having authority and responsibility for planning, directing
and controlling the major activities of the Company, directly or indirectly, including any directors of the Company.
Directors
B O’Donnell
M Blakiston
J Bloom
G Dixon
R Court
Non-executive Chair
Non-executive Director
Non-executive Director
Non-executive Director
Non-executive Director (Appointed 28 January 2021)
C Salisbury
Non-executive Director (Appointed 28 May 2021)
Executive Directors and Executives
A Vorster
S Hodge
S Bennett
Managing Director
Chief Financial Officer
Project Director (Appointed 16 November 2020)
Remuneration and Nomination Committee
The Remuneration and Nomination Committee (“RNC”) is a committee of the Board comprised of two independent Non-
Executive Directors, being Ms Bloom (Chair) and Mr Dixon. On 1 July 2021, Mr Vorster was appointed to the committee.
The role of the RNC is to assist the Board to fulfil its responsibilities with respect to employee and director remuneration, and
board composition and diversity, by making recommendations to the Board on:
• The Company’s People Policy which sets out the Company’s approach to Remuneration, Diversity and Privacy;
• A Remuneration Framework which enables the Company to attract, retain and motivate high quality senior executives who
create value for shareholders; and
• The selection, composition, performance and appointment of members of the Board so that it is effective and able to operate
in the best interests of shareholders.
Remuneration Framework
The Remuneration Framework of the Company aims to:
• Reward employees fairly and responsibly in accordance with the Australian market;
• Provide competitive performance based rewards that attract, retain and motivate employees;
• Ensure incentives provide fair reward in line with company and individual performance to deliver on the current and long term
strategic objectives; and
• Ensure a level of equity and parity across BCI and alignment with BCI’s culture while providing opportunity to recognise
expertise and individual performance.
Non-Executive Director Remuneration
Fees and payments to Non-Executive Directors reflect the demands which are made on, and the responsibilities of, the Directors
and are reviewed annually by the Board. The Chairman is not present at any discussions relating to determination of his own
remuneration.
Directors’ fees are determined within an aggregate directors’ fee pool limit, which is periodically recommended for approval
by shareholders. The maximum currently stands at $900,000 in aggregate and was approved by shareholders at the annual
general meeting on 19 November 2014. This amount is separate from any specific tasks the directors or their related entities may
take on for the Company.
Fixed Remuneration
Non-Executive Directors’ fixed remuneration comprise the following:
• Cash remuneration; and
• Superannuation.
33
Executive Remuneration
The objective of the Company’s executive remuneration is to ensure reward for performance is market competitive and appropriate
for the results delivered. The executive remuneration is aligned with achievement of strategic and project objectives and the
creation of value for shareholders.
The Board ensures that executive reward satisfies the following key criteria in line with appropriate corporate governance practices:
• Competitiveness and reasonableness;
• Acceptability to shareholders;
• Performance linkage/alignment of executive compensation;
• Transparency; and
• Prudent capital management.
Fixed Remuneration
The components of executives’ fixed remuneration are determined individually and may include:
• Base Salary;
• Superannuation; and
• Insurances, parking, professional development support and other benefits.
Variable Remuneration
Short-term Incentives
Executives listed in this report may receive a short-term incentive (“STI”) of up to 50 - 70% of their annual fixed remuneration.
The STI is an “at risk” component of remuneration and payment may, at the Board’s discretion, be in cash and/or equity.
Measurement is based on performance against annually agreed key performance indicators (“KPIs”). These KPIs will typically be
aligned to achievement of specific project and corporate objectives in relation to each financial year.
For the 2021 financial year, the Board exercised its discretion to award an STI based on the KPIs achieved during the year. Executive
KMP were in aggregate awarded an STI cash incentive of $242,326 (21% of their aggregate annual salary) with an additional award
of Share Rights valued at $242,326 (21% of aggregate annual salary). The STI cash incentive is recorded as an expense incurred
by the Company during the financial year ended 30 June 2021 with the cash payment to Executives occurring post year-end in the
2022 financial year. Subsequent to year end, a total of 249,677 share rights were granted to KMP under the approved Share Right
Plan and a further 262,431 Share Rights may be granted subject to approval at the next AGM of the Group. Rights granted are
subject to a vesting period over which the fair value of such rights will be expensed.
For the 2020 financial year, the Board exercised its discretion to award an STI based on the KPIs achieved during year. Executives
listed in this report were, in aggregate, awarded an STI cash incentive of $260,182 (21% of their aggregate annual salary) with an
additional award of Share Rights valued at $261,000 (21% of aggregate annual salary). The STI cash incentive was recorded as an
expense incurred by the Company during the financial year ended 30 June 2020 with the payment to Executives occurring during
the 2021 financial year. Subsequent to the 2020 financial year end, a total of 1,654,543 Share Rights were granted to KMP under the
approved Share Right Plan. Rights granted are subject to a vesting period over which the fair value of such rights will be expensed.
Long-term Incentives
Longer term incentive awards occur through the Performance Rights Plan (“PRP”) and the Share Rights Plan (“SRP”) which both
form part of an “at risk” component of remuneration. Performance Rights generally have a vesting period longer than one year.
Performance hurdles are primarily based on company share price and/or other relevant shareholder return measures. The PRP and
SRP operate entirely at the discretion of the Company’s Board and may be terminated, suspended or amended at any time, or from
time to time, in their entirety or in part in relation to any or all employees (except where contractual rights have been created).
During the year ended 30 June 2021 the Company granted Performance Rights and Share Rights to Directors and Employees
subject to the following performance and vesting conditions:
Share Rights
Performance Rights
Test Date
n/a
Vesting Date
4 August 2021
1 July 2022
1 July 2023
Performance Period n/a
1 July 2020 to 1 July 2022 plus an additional 1 year tenure period.
Vesting or
Performance
Conditions
Vesting of the Share Rights is subject to
the continuation of employment until
30 June 2021.
Conversion Period
Vested Share Rights must be converted
on or before 4 August 2023.
Shares issued upon conversion of the
Share Rights are subject to a 12 month
hold lock from the vesting date.
34
Performance conditions are:
a) Total shareholder return (TSR) over the period (50% weighting):
• Below 10% annual TSR, zero PRs vest.
• From 10% up to 20% annual TSR, proportionate vesting of 0% to 100%.
• 20% and above TSR, 100% vest.
b) Relative TSR to peer group over the period (50% weighting):
• Below 50th percentile, zero PRs vest.
• Between 50th and 75th percentile, proportionate vesting from 50% to 100%.
• Equal to or above 75th percentile, 100% vest.
Vested Performance Rights must be converted on or before 30 June 2025.
Shares issued upon conversion of Performance Rights are subject to a 12 month
hold lock from vesting date.
Subsequent to year end, a total of 868,188 Performance Rights were granted to KMP under the approved Performance Right
Plan and 1,110,118 Performance Rights may be granted to Directors subject to approval at the next AGM of the Group. Rights
granted are subject to a vesting period over which the fair value of such rights will be expensed.
Use of Remuneration Consultants
The Board and Remuneration Committee (“RNC”) reviews executive remuneration annually, including assessment of:
• Individual and business performance measurement against both internal targets and appropriate external comparatives; and
• General remuneration advice from both internal and independent external sources.
In the relevant financial year, the Board engaged BDO Reward (WA) Pty Ltd (BDO) as an external remuneration consultant to
provide a comprehensive benchmarking review of Board fees, Managing Director and Executive Remuneration. This review
included an analysis of market remuneration in comparison to a relevant peer and competitor group and assistance with the
development of company specific pay scales, including executive remuneration.
BDO was paid or accrued $37,500 for these services.
An agreed set of protocols were established to ensure that the remuneration recommendations would be free from undue
influence by key management personnel. These protocols include requiring that the consultant not provide any information
relating to the outcome of the engagement to the affected key management personnel. In addition, the consultant provided
separate reports covering each element of the review, to ensure RNC discussion of recommendations could be made in the
absence of the affected key management personnel. The Board was required to make inquiries of the consultant’s processes
at the conclusion of the engagement to ensure that it is satisfied that any recommendations made have been free from undue
influence. The Board is satisfied that these protocols were followed and as such there was no undue influence.
Findings from the review were developed for implementation in FY22. Industry remuneration data has been sourced through
Remsmart for the benchmarking of new positions and projected industry market movements.
Share Trading Policy
The trading of shares by all employees is subject to, and conditional upon, compliance with the Company’s share trading policy
which is available on the Company’s website: www.bciminerals.com.au. Directors and employees may not engage in short-term
or speculative trading of the Company’s securities and are prohibited from trading in financial products issued or created over, or
in respect of the Company’s securities during a non-trading period.
Service Agreements
The remuneration and other terms of employment for executive KMP are covered in formal employment contracts. The key terms
of their employment contracts, at the date of release of this report, are shown in the table below.
Name
Terms/Notice periods/Termination payment
A Vorster
(Managing Director)
S Hodge
(Chief Financial Officer)
S Bennett
(Project Director)
Base salary inclusive of superannuation of $671,000 reviewed at intervals to be determined by the Company.
Employment can be terminated at three months’ notice by Mr Vorster or by the Company. If the Company elects to
terminate the employment agreement for reasons other than Mr Vorster’s gross misconduct or default, Mr Vorster
will be entitled to a payment equal to six months’ total fixed remuneration. Certain agreed trigger events will lead
to Mr Vorster having the option to terminate the contract and receive a payment equal to twelve months’ total
fixed remuneration.
Base salary inclusive of superannuation $359,889 reviewed at intervals to be determined by the Company.
Employment can be terminated at twelve weeks’ notice by Mr Hodge or by the Company. Certain agreed trigger
events will lead to Mr Hodge having the option to terminate the contract and receive a payment equal to six
months’ total fixed remuneration.
Base salary inclusive of superannuation $504,999 reviewed at intervals to be determined by the Company.
Employment can be terminated at three months’ notice by Mr Bennett or by the Company. Certain agreed trigger
events will lead to Mr Bennett having the option to terminate the contract and receive a payment equal to six
months’ fixed remuneration
35
Remuneration of Directors and Key Management Personnel for the Year Ended 30 June 2021
The remuneration table below sets out the remuneration information for the directors and executives, which includes the
managing director, who are considered to be KMP of the Company.
Short Term
Post
Employment
Share Based
Payments
Salary
and fees
$
Incentives(a)
$
Other
benefits(b)
$
Super-
annuation
$
Performance &
Share Rights(c)
$
Termination
Payment
$
Total
$
Performance
Related (d)
%
-
-
-
-
-
-
-
-
-
150,381
85,932
85,932
93,305
25,500
7,177
448,227
959,535
526,760
6
6
6
6
0
0
5
44
33
29
9
33
29
141,750
73,973
73,973
80,456
23,288
6,554
399,994
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
7,027
7,027
7,643
2,212
623
8,631
4,932
4,932
5,206
-
-
24,532
23,701
Directors
B O’Donnell
M Blakiston
J Bloom
G Dixon
R Court(e)
C Salisbury(f)
Executives
A Vorster
S Hodge
499,300
134,018
313,836
65,028
A Chamberlain(g)
321,570
116,966
S Bennett(h)
285,725
-
16,399
12,443
9,343
5,214
25,000
25,000
22,917
14,583
284,818
110,453
81,309
133,366
685,471
29,226
-
334,748
1,420,431
316,012
43,399
87,500
505,806
133,366
2,506,514
TOTAL
1,820,425
316,012
43,399
112,032
529,507
133,366
2,954,741
(a) Short term incentives paid during the financial year relate to performance in the previous financial year. Please refer to section on short-term
incentive payments above.
(b) Other benefits include fuel, parking and insurances. Directors’ and Officers’ liability premiums have not been allocated to individual directors.
(c) Share-based payments represent the accounting expense incurred by the Company for the stated financial period, reflecting the terms of the
Performance Rights as valued using a Monte Carlo simulation and Share Rights valued using market pricing at time of issue.
(d) Percentage performance related is the sum of short-term incentives and share based payments divided by total remuneration, reflecting the
actual percentage of remuneration at risk for the year. Note that short-term incentives are reported in the year in which they are paid but relate
to performance in previous reporting periods.
(e) Appointed 28 January 2021.
(f) Appointed 28 May 2021.
(g) Resigned 31 May 2021.
(h) Appointed 16 November 2020.
36
Remuneration of Directors and Key Management Personnel for the Year Ended 30 June 2020
The remuneration table below sets out the remuneration information for the directors and executives, which includes the
managing director, who are considered to be KMP of the Company.
Short Term
Post
Employment
Share Based
Payments
Salary
and fees
$
Incentives(a)
$
Other
benefits(b)
$
Super-
annuation
$
Performance
Rights(c)
$
Termination
Payment
$
Total
$
Performance
Related (d)
%
Directors
B O’Donnell
M Blakiston
J Bloom
G Dixon(e)
Executives
A Vorster
S Hodge
132,527
82,192
69,863
-
284,582
-
-
-
-
-
512,387
119,832
321,897
63,931
A Chamberlain
354,492
43,362(f)
-
-
-
-
-
13,395
13,346
8,394
9,223
7,808
6,637
-
23,668
21,003
21,003
21,003
1,188,776
227,125
35,135
63,009
TOTAL
1,473,358
227,125
35,135
86,677
-
-
-
-
-
46,775
16,839
18,710
82,324
82,324
-
-
-
-
-
-
-
-
-
-
141,750
90,000
76,500
-
308,250
713,392
437,016
445,961
1,596,369
1,904,619
0
0
0
-
0
23
18
14
19
16
(a) Short term incentives paid during the financial year relate to performance in the previous financial year. Please refer to section on short-term
incentive payments above.
(b) Other benefits include fuel, parking and insurances. Directors’ and Officers’ liability premiums have not been allocated to individual directors.
(c) Share-based payments represent the accounting expense incurred by the Company for the stated financial period, reflecting the terms of the
Performance Rights as valued using a Monte Carlo simulation.
(d) Percentage performance related is the sum of short-term incentives and share based payments divided by total remuneration, reflecting the
actual percentage of remuneration at risk for the year. Note that short-term incentives are reported in the year in which they are paid but relate
to performance in previous reporting periods.
(e) Appointed 18 June 2020.
(f) Appointed 31 January 2019 – STI amount prorated.
37
J Bloom
G Dixon
Executives
A Vorster
A Vorster
A Vorster
S Hodge
S Hodge
S Hodge
Performance Rights on Issue
The terms and conditions of Performance Rights granted to KMP affecting remuneration in the current or future reporting
periods are set out in the following table.
Grant date Date to vest Expiry date
Risk free
rate at
grant date
Value per
right at
grant date
Number
granted at
grant date
Value at
grant date
Number
vested
Number
lapsed
Directors
B O’Donnell
26/11/2020
30/06/2023 30/06/2025
0.07%
0.128
295,313
37,800
M Blakiston
26/11/2020
30/06/2023 30/06/2025
0.07%
0.128
168,750
21,600
26/11/2020
30/06/2023 30/06/2025
0.07%
0.128
168,750
21,600
26/11/2020
30/06/2023 30/06/2025
0.07%
0.128
178,125
22,800
-
-
-
-
-
-
-
-
27/11/2019
30/11/2020 30/11/2022
0.68%
0.0186
2,500,000
46,500
1,275,000
(1,225,000)
27/11/2019
30/11/2022
30/11/2024
0.68%
0.0398
2,500,000
99,500
26/11/2020
30/06/2023 30/06/2025
0.07%
0.128
1,529,209
195,739
-
-
-
-
27/11/2019
30/11/2020 30/11/2022
0.68%
0.0186
900,000
16,740
459,000
(441,000)
27/11/2019
30/11/2022
30/11/2024
0.68%
0.0398
900,000
35,820
26/11/2020
30/06/2023 30/06/2025
0.07%
0.128
705,906
90,356
-
-
-
-
A Chamberlain*
27/11/2019
30/11/2020 30/11/2022
0.68%
0.0186
1,000,000
18,600
510,000
(490,000)
A Chamberlain*
27/11/2019
30/11/2022
30/11/2024
0.68%
0.0398
1,000,000
39,800
A Chamberlain*
26/11/2020
30/06/2023 30/06/2025
0.07%
0.128
782,925
100,214
S Bennett
26/11/2020
30/06/2023 30/06/2025
0.07%
0.128
1,000,000
128,000
-
-
-
(1,000,000)
(782,925)
-
A Monte Carlo simulation is used to value all Performance Rights granted by the Company. The Monte Carlo valuation simulates
the Company’s share price and depending on the hurdle, arrives at a value based on the number of Performance Rights that are
likely to vest. The risk-free rate of the Performance Rights on the date granted is shown in the table above.
Share Rights on Issue
The terms and conditions of Share Rights granted to KMP affecting remuneration in the current or future reporting periods are
set out in the following table.
Grant date
Test date Vesting date
Final
conversion
date
Value per
right at
grant date
Number
granted at
grant date
Value at
grant date
Number
vested
Number
lapsed
Executives
A Vorster
S Hodge
26/11/2020 02/08/2021
04/08/2021 04/08/2023
0.2550
855,798
218,228
855,798
31/07/2020 02/08/2021
04/08/2021 04/08/2023
0.1903
412,051
78,423
422,051
A Chamberlain*
31/07/2020 02/08/2021
30/09/2021 04/08/2023
0.1903
386,694
73,597
-
* A. Chamberlain resigned on 31 May 2021.
-
-
-
38
Equity Instrument Disclosures
The interests of Directors and Executives in Shares at the end of the financial year 2021 are as follows:
Balance at
1 July 2020
Acquired
during year
Performance
Rights converted
during year
Disposed during
the year
Other changes
Balance at
30 June 2021
Directors
B O’Donnell
M Blakiston
J Bloom
G Dixon
R Court
C Salisbury
Executives
A Vorster
S Hodge
A Chamberlain*
676,322
338,161
-
-
60,000
30,000
-
-
-
5,305,645
462,000
-
-
750,000
-
-
-
-
Total
6,503,967
1,118,161
-
-
-
-
-
-
-
-
510,000
510,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,014,483
-
90,000
-
750,000
-
5,305,645
462,000
510,000
8,132,128
The interests of Directors and Executives in Performance Rights at the end of the financial year are as follows.
Directors
B O’Donnell
M Blakiston
J Bloom
G Dixon
Executives
A Vorster
S Hodge
A Chamberlain*
S Bennett
Total
Balance at
1 July 2020
Granted as
compensation
Converted
to shares
Rights lapsed/
cancelled
Balance at
30 June 2021
-
-
-
-
295,313
168,750
168,750
178,125
5,000,000
1,529,209
1,800,000
2,000,000
705,906
782,925
-
-
-
-
-
-
-
-
-
-
295,313
168,750
168,750
178,125
(1,225,000)
5,304,209
(441,000)
2,064,906
(510,000)
(2,272,925)
-
-
1,000,000
-
-
1,000,000
8,800,000
4,828,978
(510,000)
(3,938,925)
9,180,053
The interests of Executives in Share Rights at the end of the financial year are as follows.
Balance at
1 July 2020
Granted as
compensation
Converted
to shares
Rights lapsed/
cancelled
Balance at
30 June 2021
Executives
A Vorster
S Hodge
A Chamberlain*
Total
* A. Chamberlain resigned on 31 May 2021.
-
-
-
-
855,978
412,051
386,694
1,654,543
-
-
-
-
-
-
-
-
855,978
412,051
386,694
1,654,543
39
Company Performance
The table below shows key financial measures of company performance over the past five years.
Continuing operations
Revenue
Net profit/(loss) after tax
Basic earnings/(loss) per share
Dividends paid per share
$million
$million
Cents
Cents
Share price (last trade day of financial year)
A$
2021
2020
2019
2018
2017
160.2
22.0
4.02
-
0.55
77.3
0.4
0.09
-
0.17
54.8
12.9
3.26
-
0.18
33.4
(16.9)
(4.29)
-
0.14
64.0
7.1
2.2
-
0.14
Transactions with Key Management Personnel
On 1 March 2017, Michael Blakiston was appointed as a Non-Executive Director of the Company. Mr Blakiston is a partner in the
legal firm Gilbert + Tobin. During the current financial year, the Company made legal fee payments to Gilbert + Tobin of $720K
(2020: $511K). All transactions were on normal commercial terms and conditions.
Refer to Note 26 for further detail on Related Party transactions.
Voting and Comments Made at the Company’s 2020 Annual General Meeting
The Company received 99.57% of ‘yes’ votes cast on its remuneration report for the 2020 financial year.
Other Information
Insurance of officers
During the financial period, the Company paid a premium in respect of a contract to insure the Directors and executives of the
Company against a liability to the extent permitted by the Corporations Act 2001. The contract of insurance prohibits disclosure
of the nature of the liability and the amount of the premium.
No liability has arisen under this indemnity as at the date of this report.
The Company has entered into indemnity deeds with each director and officer. Under the deeds, the Company indemnifies each
director and officer to the maximum extent permitted by law against legal proceedings or claims made against or incurred by the
directors or officers in connection with being a director or officer of the Company, or breach by the Company of its obligations
under the deed.
Independent Audit of Remuneration Report
The Remuneration Report has been audited by BDO. Please see page 72 of this report for BDO’s report on the Remuneration Report.
Signed in accordance with a resolution by the Directors.
Brian O’Donnell
Chairman
Perth, Western Australia
19 August 2021
Alwyn Vorster
Managing Director
Perth, Western Australia
19 August 2021
40
DIRECTORS’ DECLARATION
In the opinion of the Directors of BCI Minerals Limited:
a. the financial statements comprising the consolidated statement of profit or loss and other comprehensive income,
consolidated statement of financial position, consolidated statement of cash flows, consolidated statement of changes in
equity and accompanying notes are in accordance with the Corporations Act 2001 including:
i. giving a true and fair view of the financial position of the Consolidated Entity as at 30 June 2021 and of its performance
for the financial year ended 30 June 2021; and
ii. complying with Accounting Standards and the Corporations Regulations 2001 and other mandatory professional
reporting requirements.
b. there are reasonable grounds to believe that the Consolidated Entity will be able to pay its debts as and when they become
due and payable.
c. the Company has included in the notes to the financial statements an explicit and unreserved statement of compliance with
International Financial Reporting Standards.
The Directors have been given the declarations by the Chief Executive Officer and Chief Financial Officer required by section
295A of the Corporations Act 2001 (Cth).
This declaration is made in accordance with a resolution of the Directors and is signed on their behalf by:
Brian O’Donnell
Chairman
Perth, Western Australia
19 August 2021
41
ANNUAL
FINANCIAL REPORT
For the Year Ended 30 June 2021
www.bciminerals.com.au
ABN 21 120 646 924
42
FINANCIAL STATEMENT CONTENTS
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
Preface to the notes
Note 1 – Revenue
Note 2 – Expenses
Note 3 – Impairment of Non-Financial Assets
Note 4 – Income Taxes
Note 5 – Cash and Cash Equivalents
Note 6 – Trade and Other Receivables
Note 7 – Property, Plant and Equipment
Note 8 – Exploration and Evaluation
Note 9 – Intangibles
Note 10 – Leases
Note 11 – Trade and Other Payables
Note 12 – Provisions
Note 13 – Capital risk management
Note 14 – Contributed equity
Note 15 – Reserves
Note 16 – Accumulated Losses
Note 17 – Earnings Per Share
Note 18 – Financial Risk Management
Note 19 – Subsidiaries
Note 20 – Segment Information
Note 21 – Commitments
Note 22 – Contingent Liabilities and Assets
Note 23 – Events Occurring after the Reporting Period
Note 24 – Parent Entity
Note 25 – Auditor’s Remuneration
Note 26 – Related Party Transactions
Note 27 – Share Based Payments
Note 28 – Other Accounting Policies
Independent Auditor’s Report
Auditor’s Independence Declaration
44
45
46
47
48
48
50
50
51
52
54
55
55
57
57
58
59
59
60
60
61
61
61
62
63
63
64
64
64
65
65
65
66
68
69
73
43
CONSOLIDATED STATEMENT OF
PROFIT OR LOSS AND OTHER
COMPREHENSIVE INCOME
BCI Minerals Limited and its controlled entities for the year ended 30 June 2021
Notes
2021
$000’s
2020
$000’s
Revenue from continuing operations
Sale of goods
Other revenue
Total revenue from continuing operations
Cost of sales
Administration expenses
Project development and evaluation expenditure
Loss on sale of asset
Profit on sale of exploration tenements
Impairment on sale of exploration and intangible assets
Profit / (loss) before finance cost and income tax
Finance costs
Profit / (loss) before income tax
Income tax benefit / (expense)
Profit / (loss) after income tax from continuing operations attributable to
owners of BCI Minerals Limited
Basic earnings / (loss) per share from continuing operations
Diluted earnings / (loss) per share from continuing operations
1
2
2
8,9
8,9
10
4
17
17
160,156
326
160,482
(93,630)
(8,120)
(34,487)
-
22
(2,255)
22,012
(40)
21,972
-
21,972
Cents
4.02
4.01
76,793
466
77,259
(56,231)
(6,432)
(19,342)
-
10,190
(5,030)
414
(37)
377
-
377
Cents
0.09
0.09
The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the
accompanying notes.
44
CONSOLIDATED STATEMENT OF
FINANCIAL POSITION
BCI Minerals Limited and its controlled entities as at 30 June 2021
Notes
2021
$000’s
2020
$000’s
Current assets
Cash and cash equivalents
Short term investments
Trade and other receivables
Total current assets
Non-current assets
Receivables
Property, plant and equipment
Exploration and evaluation assets
Intangibles
Right of use assets
Total non-current assets
Total assets
Current liabilities
Trade and other payables
Lease liability
Provisions
Total current liabilities
Non-current liabilities
Lease liability
Provisions
Total non-current liabilities
Total liabilities
Net assets
Shareholders’ equity
Contributed equity
Reserves
Accumulated losses
Total shareholders’ equity
5
6
6
7
8
9
10
11
10
12
10
12
14
15
16
79,435
681
56,435
136,551
15,816
49,384
9,728
15,502
827
91,257
227,808
41,548
552
16,205
58,305
12,295
39,848
6,425
18,502
745
77,815
136,120
37,548
18,345
395
791
38,734
478
15,932
16,410
55,144
172,664
313,190
6,143
231
591
19,167
541
12,295
12,836
32,003
104,117
267,303
5,455
(146,669)
(168,641)
172,664
104,117
The above consolidated statement of financial position should be read in conjunction with the accompanying notes
45
Total
$000’s
103,612
377
377
-
128
104,117
21,972
21,972
45,872
-
703
172,664
CONSOLIDATED STATEMENT OF
CHANGES IN EQUITY
BCI Minerals Limited and its controlled entities for the year ended 30 June 2021
Contributed equity
$000’s
Accumulated losses
$000’s
267,212
(169,018)
Reserves
$000’s
5,418
Balance at 1 July 2019
Profit for the year
Total comprehensive income
-
-
Transactions with equity holders in their capacity as equity holders
Performance Rights converted
Share based payments
91
-
377
377
-
-
Balance at 30 June 2020
267,303
(168,641)
Profit for the year
Total comprehensive income
-
-
Transactions with equity holders in their capacity as equity holders
Shares issued net of transaction costs
45,872
Performance Rights converted
Share based payments
15
-
21,972
21,972
-
-
-
Balance at 30 June 2021
313,190
(146,669)
-
-
(91)
128
5,455
-
-
-
(15)
703
6,143
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
46
CONSOLIDATED STATEMENT OF
CASH FLOWS
BCI Minerals Limited and its controlled entities for the year ended 30 June 2021
Notes
2021
$000’s
2020
$000’s
Cash flows from operating activities
Receipts from customers
Payments to suppliers and employees
Interest received
Income tax refund
Net cash flows provided by / (used) in operating activities
5
Cash flows from investing activities
Proceeds from disposal of exploration tenements
Proceeds from disposal of plant and equipment
Payments for short term investments
Payments for plant and equipment
Payments for exploration and evaluation assets
Net cash flows from/ (used in) investing activities
Cash flows from financing activities
Proceeds from issue of shares net of costs
Repayment of lease liabilities
Net cash flows from financing activities
Net increase / (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
5
120,822
(111,915)
320
0
9,227
0
301
(166)
(14,185)
(2,834)
(16,884)
45,872
(327)
45,545
37,887
41,548
79,435
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.
82,329
(78,412)
466
0
4,383
10,814
0
(189)
(3,312)
(3,850)
3,463
0
0
0
7,846
33,702
41,548
47
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
BCI Minerals Limited and its controlled entities for the year ended 30 June 2021
Preface to the notes
The notes include information which is required to understand the financial statements and is material and relevant to the
operations and the financial position and performance of the Company. Information is considered relevant and material if:
• The amount is significant due to its size or nature;
• The amount is important in understanding the results of the Company;
• It helps to explain the impact of significant changes in the Company’s business; or
• It relates to an aspect of the Company’s operations that is important to its future performance.
The notes are organised into the following sections:
• Basis of preparation;
• Key numbers;
• Capital;
• Risk management;
• Group structure;
• Unrecognised items; and
• Other notes.
BASIS OF PREPARATION
Corporate information
The financial statements for BCI Minerals Limited for the year ended 30 June 2021 were authorised for issue in accordance with
a resolution of the Directors on 19 August 2021. BCI Minerals Limited is a company limited by shares incorporated in Australia
whose shares are publicly traded on the Australian Securities Exchange. BCI Minerals Limited and its subsidiaries together are
referred to in these financial statements as the ‘Company’ or the ‘Consolidated Entity’.
The principal activities of the Company during the financial year were the development of assets in the Pilbara region of Western
Australia, including the Mardie Salt & Potash Project. The Company also receives revenue from the Iron Valley Iron Ore Mine
under the terms of an Iron Ore Sale and Purchase Agreement.
Basis of preparation
The principal accounting policies adopted in the preparation of the financial statements are set out in the notes to the accounts.
These policies have been consistently applied to all the financial years presented, unless otherwise stated.
These general purpose financial statements have been prepared in accordance with Australian Accounting Standards and
Interpretations issued by the Australian Accounting Standards Board (“AASB”), and the Corporations Act 2001. BCI Minerals
Limited is a for-profit entity for the purpose of preparing the financial statements.
The financial statements are presented in Australian dollars. The Company is of the kind referred to in ASIC Corporations
(Rounding in Financials/Directors’ Reports) Instrument 2016/191, and in accordance with that Corporations Instrument amounts
in the directors’ report and annual financial report are rounded off to the nearest thousand dollars, unless otherwise indicated.
Compliance with IFRS
The consolidated financial statements of BCI Minerals Limited comply with International Financial Reporting Standards (“IFRS”)
as issued by the International Accounting Standards Board.
Historical cost convention
The financial statements have been prepared under the historical cost convention, except for, where applicable, the revaluation
of financial assets and cash flow hedges at fair value through other comprehensive income.
48
New, revised or amending Accounting Standards and Interpretations adopted
New and amended standards adopted by the group
There are no new or amended standards adopted by the group during the interim reporting period.
Impact of standards issued but not yet applied by the entity
There are no new standards yet to be applied by the Group.
Changes in accounting policy, estimates disclosures, standards and interpretations
Except for matters relating to the adoption of new Australian Accounting Standards referred to above, the accounting policies
adopted and estimates made are consistent with those of the previous financial year.
Foreign currency
The financial statements are presented in Australian dollars which is the Company’s functional and presentation currency.
Foreign currency transactions are translated into Australian dollars using the exchange rates prevailing at the dates of the
transactions. Foreign exchange gains and losses resulting from the settlement of such transactions, and from the translation at
financial year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or
loss.
Comparatives
Where applicable, comparatives have been adjusted to conform with current year presentation.
Key estimates and judgements
In the process of applying the Company’s accounting policies, management has made a number of judgements and applied
estimates of future events. Judgements and estimates which are material to the financial report are found in the following notes:
Note 3: Impairment of non-financial assets
Note 4: Income taxes
Note 7: Property, plant and equipment
Note 8: Exploration and evaluation
Note 9: Intangibles
Note 12: Provisions
Note 27: Share based payments
49
KEY NUMBERS
Note 1 – Revenue
Sales – Iron Valley
Net gain / (loss) on pricing changes
Rebate – Iron Valley
Sale of Goods
Interest revenue
Other income
Total
Accounting policy
2021
$000’s
184,659
(2,300)
(22,203)
160,156
320
6
2020
$000’s
80,283
(700)
(2,790)
76,793
466
0
160,482
77,259
Revenue is recognised if it meets the criteria outlined below.
Sales – Iron Valley
Revenue from contracts with customers for the sale of goods is recognised when persuasive evidence, usually in the form of an
executed sales agreement, or an arrangement exists, indicating there has been a transfer of control to the customer, no further
work or processing is required by the Company, the quantity and quality of the goods has been determined with reasonable
accuracy, the price can be reasonably estimated, and collectability is reasonably assured.
The Company receives revenue from Mineral Resources Limited (“MIN”) based on a mine gate sale agreement based on MIN’s
realised price. The Company recognises revenue when the ore passes over the ships rail which is typically at the bill of lading.
MIN send monthly shipping information on either a provisional basis at the date of shipment or the subsequent final pricing,
which is typically once the vessel has arrived at its destination and quotation pricing has been determined. BCI recognises
revenue on provisionally priced sales based on the estimated fair value of the total consideration, adjusted for any changes
when pricing is finalised. Provisionally priced sales for which price finalisation is referenced to the relevant metal price index
have an embedded commodity derivative. The embedded derivative is carried at fair value through profit or loss as part of trade
receivables. The period between provisional pricing and final invoices is typically 30 to 90 days. As announced in the prior year,
the Company entered into a rebate agreement with MIN to rebate 40% of net royalties to MIN, up to a total value of $25M. This
value has been reached and the rebate no longer applies.
Interest revenue
Interest revenue is recognised on a time proportionate basis using the effective interest method.
Note 2 – Expenses
Amortisation of mine properties
Royalties
Cost of sales
Employee benefits expense
Depreciation and amortisation
Share based payments
Non-executive directors’ fees
Occupancy related expenses
Consultant and legal fees
Other
Administration expenses
50
2021
$000’s
3,006
90,624
93,630
2,593
1,967
703
510
237
993
1,117
8,120
2020
$000’s
2,493
53,738
56,231
3,112
872
128
390
414
454
1,062
6,432
Note 3 – Impairment of Non-Financial Assets
Accounting policy
Assets are reviewed for impairment at each reporting date or whenever events or changes in circumstances indicate that the
carrying amount may not be recoverable. An impairment loss is recognised for the amount by which an asset’s carrying amount
exceeds its recoverable amount.
The valuation used by BCI to determine recoverable amount is the higher of an asset’s fair value less costs of disposal (“FVLCD”)
and value in use (“VIU”).
Accounting standards require that the valuation technique used be consistent with one of three commonly accepted approaches
outlined below:
• Level 1 Market - The market approach uses prices and other relevant information generated by market transactions involving
identical or comparable (i.e. similar) assets, liabilities or a group of assets and liabilities, such as a business. Examples relevant
to BCI include earnings multiples or JORC reserve/resource multiples;
• Level 2 Cost - The cost approach reflects the amount that would be required currently to replace the service capacity of an
asset (often referred to as current replacement cost); and
• Level 3 Income - The income approach converts future amounts (e.g. cash flows or income and expenses) to a single current
(i.e. discounted) amount. When the income approach is used, the fair value measurement reflects current market expectations
about those future amounts. Examples include Net Present Value (“NPV”) techniques.
FVLCD is an NPV calculation which is consistent with the Level 3 income approach.
For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable
cash flows which are largely independent of the cash flows from other assets or groups of assets (cash-generating units).
An impairment loss is recognised for the amount by which an asset’s carrying amount exceeds its recoverable amount. Non-financial
assets other than goodwill that have been impaired are reviewed for possible reversal of impairment at each reporting period.
Impairment assessment
The Company has completed its annual review of its assets for impairment. Based on these assessments, the Company has
concluded that impairment of assets was not required, with the exception of impairment recognised on assets sold, refer to note
8 and 9 for further detail.
Revenue assumptions
Cash flow projections used to estimate recoverable amounts include assumptions on revenue. The assumptions used for
revenue in impairment testing are summarised below:
CFR 62% Fe iron ore price (USD/dmt, nominal)
Years 1-5
Years 6-10
Years 11-20
Foreign exchange rate (AUD:USD, nominal)
Years 1-5
Years 6-10
Years 11-20
Inflation (% per annum)
USD inflation rate
Key estimates and judgements
2021
2020
106-161
112-121
123-145
79-81
80-81
82-85
0.77-0.78
0.68-0.71
0.78
0.78
1.9
0.69
0.69
0.5
The recoverable amount of mine property, plant and equipment and intangible assets is estimated on the basis of the discounted
value of future cash flows. The estimates of future cash flows are based on significant assumptions including:
• estimates of the quantities of ore reserves and mineral resources for which there is a high degree of confidence of economic
extraction and the timing of access to these reserves and resources;
• future iron ore prices and exchange rates based on forecasts by a range of recognised economic forecasters as well as recent
spot prices and rates;
• production rates, production costs and capital expenditure based on approved budgets and projections including inflation factors;
• the timing of when production will commence from projects for which royalties are payable to the Company; and
• the asset specific discount rate applicable to the cash generating unit.
51
Note 4 – Income Taxes
Current tax expense/(benefit)
Current period
Adjustments for prior periods
Deferred tax expense/(benefit)
Origination and reversal of temporary differences
Equity deferred tax movement
De-recognition of deferred tax assets
Utilisation of carried forward tax losses now recognised
Recognition of deferred tax asset on losses and temporary adjustments now realised
Adjustments for prior periods
Income tax (expense)/benefit reported in the Consolidated statement of profit or loss and other
comprehensive income
Reconciliation of effective tax rate
Profit / (loss) before tax
Income tax at the statutory rate of 30 per cent (2020: 30 per cent)
Non-deductible expenses
Other temporary differences derecognised
Equity deferred tax movement
Recognition of carried forward tax losses previously unrecognised
Utilisation of carried forward tax losses now recognised
Temporary differences derecognised
Under/(over) provided in prior periods and other
Income tax (expense)/benefit reported in the Consolidated statement of profit or loss and other
comprehensive income
2021
$000’s
2020
$000’s
-
-
-
(1,387)
(396)
-
8,171
(6,388)
-
-
-
21,972
6,591
213
(20)
(396)
8,171
(8,171)
(6,388)
-
-
-
-
-
(127)
(80)
152
-
-
55
-
-
377
113
39
-
(80)
-
-
(127)
55
-
Accounting policy
The income tax expense on income for the financial year is the tax payable on the current financial period’s taxable income
based on the national income tax rate, adjusted by changes in deferred tax assets and liabilities attributable to temporary
differences and to unused tax losses.
Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of
assets and liabilities and their carrying amounts in the financial statements.
Deferred income tax is determined using tax rates and laws that have been enacted or substantially enacted by the statement of
financial position date and are expected to apply when the related deferred income tax asset is realised or the deferred income
tax liability is settled.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that future
taxable amounts will be available to utilise those temporary differences and losses.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities
and when the deferred tax balances relate to the same taxation authority. Current tax assets and liabilities are offset where the
entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realise the asset and settle the
liability simultaneously.
Current and deferred tax balances attributable to amounts recognised directly in equity are also recognised directly in equity.
52
Significant judgement
The Company is subject to income taxes in Australia. Significant judgement is required in determining the provisions for income
taxes. There are certain transactions and calculations undertaken during the ordinary course of business for which the ultimate tax
determination may be subject to change. The Company estimates its tax liabilities based on the Company’s understanding of the
tax law. Where the final tax outcome of these matters is different from the amounts that were initially recorded, such differences
will impact the current and deferred income tax assets and liabilities in the period in which such determination is made.
The Company recognises deferred tax assets relating to carried forward tax losses to the extent they can be utilised. The utilisation
of the tax losses depends on the ability of the entities to generate sufficient future taxable profits. At 30 June 2021, the Company
had unrecognised deferred tax assets relating to tax losses of $67.2M (2020: $73.9M). The Company has utilised all available R&D
off-sets (2020 $1.48M).
Deferred tax assets not recognised
Temporary differences
Income Tax losses
Capital losses
Deferred tax assets and liabilities
Amounts recognised in Profit or Loss:
Mine property, plant and development
Provisions
Intangibles
Exploration
Other items
Amounts recognised directly in equity:
Share issue costs in equity
Temporary differences derecognised
2021
$000’s
2020
$000’s
(2,439)
(4,063)
67,215
73,902
-
-
Assets
Liabilities
Net
2021
$000’s
2020
$000’s
2021
$000’s
2020
$000’s
2021
$000’s
2020
$000’s
-
962
-
-
-
177
-
-
1,064
802
475
2,501
-
159
1,138
-
(3,960)
(3,535)
(3,960)
(3,535)
-
-
(487)
(493)
-
(900)
(282)
(484)
962
-
(487)
571
177
(900)
(282)
318
-
-
475
159
(4,940)
(5,201)
(2,439)
(4,063)
2,439
4,063
(1,138)
2,439
4,063
-
-
Tax assets/(liabilities)
2,501
1,138
(2,501)
Movements in deferred tax assets
At 1 July 2019
(Charged)/credited
to profit or loss
to (under)/over prior period
At 30 June 2020
(Charged)/credited
to profit or loss
to (under)/over prior period
At 30 June 2021
Provisions
$000’s
Share
issue costs
$000’s
Mine
property
$000’s
113
64
177
160
(1)
159
785
316
962
475
-
-
-
-
-
-
-
Temporary
differences
derecognised
$000’s
-
-
-
-
-
-
-
Other
$000’s
529
273
-
802
262
-
1,064
Total
$000’s
802
336
-
1,138
1,363
2,501
53
Intangibles
$000’s
Mine
property
$000’s
Exploration
$000’s
Other
$000’s
Temporary
differences
derecognised
$000’s
Total
$000’s
(2,409)
(3,296)
(591)
(381)
5,875
(802)
1,509
(239)
-
-
309
-
(103)
(1,812)
(336)
-
-
-
(900)
(3,535)
(282)
(484)
4,063
(1,138)
900
(425)
(205)
-
-
(9)
-
(1,624)
(1,363)
-
-
(3,960)
(487)
(493)
2,439
(2,501)
-
-
Movement in deferred tax liabilities
At 1 July 2019
(Charged)/credited
to profit or loss
to (under)/over prior period
At 30 June 2020
(Charged)/credited
to profit or loss
to (under)/over prior period
At 30 June 2021
Note 5 – Cash and Cash Equivalents
Cash at bank
Cash on deposit
Total
Reconciliation of profit / (loss) after income tax to net cash flows from operating activities
Net Profit / (loss)
Depreciation and amortisation
Impairment on sale of exploration and intangible assets
Share based payments
Gain on disposal of exploration tenements
Gain on disposal of plant and equipment
Other
(Increase)/decrease in assets
Trade and other receivables
Increase/(decrease) in liabilities
Trade and other payables
Provisions
Net cash inflow / (outflow) from operating activities
2021
$000’s
27,221
52,214
79,435
21,972
4,973
2,255
703
(22)
0
40
2020
$000’s
9,711
31,837
41,548
377
3,147
5,000
128
(10,161)
(1)
30
(43,802)
5,805
22,630
478
9,227
(262)
320
4,383
Cash on deposit relates to 31-day term deposits held with financial institutions. See Note 18 – Financial risk management note
for further details.
Accounting policy
For statement of cash flows presentation purposes, cash and cash equivalents includes cash on hand, deposits held at call with
financial institutions, and other short-term, highly liquid investments with original maturities of three months or less that are
readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. There are no
non-cash investing or financing activities.
54
Note 6 – Trade and Other Receivables
Current
Trade receivables and prepayments
Total current
Non-current
Other receivables
Total non-current
Total trade and other receivables
2021
$000’S
2020
$000’S
56,435
56,435
15,816
15,816
72,251
16,205
16,205
12,295
12,295
28,500
Due to the short-term nature of current receivables, their carrying amount is approximate to their fair value.
As at 30 June 2021 no receivables were past due or impaired (2020: Nil).
Other non-current receivables represent an estimate of the amount payable by the operator of the Iron Valley operation for
fulfilment of rehabilitation obligations at the end of operations.
Refer to Note 18 for information on the financial risk management policy of the Company.
Accounting policy
Trade receivables are amounts due from customers for commodities sold in the ordinary course of business.
Trade Receivables that are Provisionally Priced
Trade receivables that contain an embedded derivative relating to the provisional pricing of iron ore are measured at fair value.
At each reporting date the provisional priced receivable is marked to market based on the forward selling price for the quotation
period stipulated in the contract until the quotation period expires and the change in value is recognised in the profit or loss.
Other Trade Receivables
Trade receivables that do not contain an embedded derivative are measured at the amount of consideration that is unconditional.
The Group holds trade receivables with the objective to collect the contractual cash flows and measures them at amortised cost.
The Group applies the simplified impairment methodology permitted by AASB 9, which requires expected lifetime losses to be
recognised from initial recognition of the receivables.
Note 7 – Property, Plant and Equipment
Mine Properties
$000’s
Plant and
equipment
$000’s
Office furniture,
equipment and IT
$000’s
Development
$000’s
Total
$000’s
Year ended 30 June 2020
Opening net book value
39,502
Additions
Disposals
Reclassification of assets
Depreciation and amortisation expense
Closing net book value
At 30 June 2020
Cost
Accumulated depreciation and
amortisation
Net carrying amount
-
-
-
(2,492)
37,010
51,658
(14,648)
37,010
140
2,979
(1)
5
(597)
2,526
3,853
(1,327)
2,526
41
335
-
(5)
(59)
312
957
(645)
312
-
-
-
-
-
-
-
-
-
39,683
3,314
(1)
-
(3,148)
39,848
56,468
(16,620)
39,848
55
Mine Properties
$000’s
Plant and
equipment
$000’s
Office furniture,
equipment and IT
$000’s
Development
$000’s
Total
$000’s
Year ended 30 June 2021
Opening net book value
37,010
2,526
Additions
Disposals
Reclassification of assets
Depreciation and amortisation expense
Closing net book value
At 30 June 2021
Cost
Accumulated depreciation and
amortisation
Net carrying amount
Accounting policy
-
-
-
(3,006)
34,004
51,658
(17,654)
34,004
255
(4)
-
(1,464)
1,313
4,093
(2,780)
1,313
312
937
-
(157)
(175)
917
2,821
(1904)
917
-
12,993
-
157
13,150
39,848
14,185
(4)
-
(4,645)
49,384
13,150
71,722
-
(22,338)
13,150
49,384
Mine Properties
Once a mining project has been established as commercially viable and technically feasible, expenditure other than that on land,
buildings, plant and equipment is transferred and capitalised as mine property. Mine property costs include past capitalised
exploration and evaluation costs, pre-production development costs, development excavation, development studies and other
subsurface and permanent installation expenditure pertaining to that area of interest.
Mine property costs are accumulated in respect of each separate area of interest. Costs associated with commissioning new
assets in the period before they are capable of operating in the manner intended by management, are capitalised. Mine property
costs incurred after the commencement of production are capitalised to the extent they are expected to give rise to a future
economic benefit.
When an area of interest is abandoned, or the Directors decide that it is not commercial or technically feasible, any accumulated cost
in respect of that area is written off in the financial period the decision is made. Each area of interest is reviewed at the end of each
accounting period and accumulated costs written off to the profit or loss to the extent that they will not be recoverable in the future.
Amortisation of mine property costs is charged on a unit of production basis over the life of economically recoverable reserves
once production commences.
Mine property assets are assessed for impairment if facts and circumstances suggest that the carrying amount exceeds the
recoverable amount. For the purposes of impairment testing, mine property is allocated to cash-generating units to which the
development activity relates. The cash generating unit shall not be larger than the area of interest.
Plant and equipment
Plant and equipment, including mechanical, electrical, field and computer equipment as well as furniture, fixtures and fittings,
is stated at historical cost less accumulated depreciation. Historical cost includes expenditure that is directly attributable to the
acquisition of the items. Depreciation is calculated on a straight-line basis so as to write off the net cost of each asset over either
its expected useful life of 2.5 to 5 years for furniture, computers and equipment, or the life of the mine for plant and equipment.
Spare parts, stand-by equipment and servicing equipment is classified as property, plant and equipment if they are expected to
be used during more than one period. Otherwise they are classified as inventory.
Assets acquired as part of the early construction at the Mardie project site will be depreciated on a straight line basis over 2 to 3
years depending on the useful life of the assets.
Development
Development represents expenditure necessarily incurred during establishment and construction of a mining project that is
in progress but yet to be complete. This expenditure includes the cost associated with studies and evaluation through to early
construction cost of assets or infrastructure yet to be fully formed or ready for use. As tangible assets in the form of buildings or
plant and equipment are completed, they will be transferred to the relevant classification and depreciated over their useful life.
Other expenditure on project development that is not capitalised as plant or equipment will be capitalised as mine properties
and amortised on a units of production basis over the expected life of the project.
Key judgement – ore reserves and mineral resources
Amortisation of mine property assets is based on the depletion of economically recoverable reserves. The rate of amortisation
is re-assessed on a prospective basis when ore reserves are changed for the appropriate ore body in accordance with the JORC
2012 Guidelines.
56
Note 8 – Exploration and Evaluation
Opening balance
Carrying value of tenements sold
Write down of tenements to recoverable value
Exploration earn-in
Exploration tenements acquisition
Unsuccessful exploration expenditure derecognised
Net carrying amount
Accounting policy
2021
$000’s
6,425
(275)
-
-
3,578
-
9,728
2020
$000’s
2,575
-
-
200
3,650
-
6,425
The Company accounts for exploration and evaluation activities as follows:
Acquisition and Exploration earn-in
Exploration and evaluation costs arising from acquisitions and earn-ins are carried forward where exploration and evaluation
activities have not, at reporting date, reached a stage to allow a reasonable assessment of economically recoverable reserves
otherwise they are written down to their recoverable amount.
As announced during the prior year, the Group has secured rights to additional tenement areas adjacent to the Mardie Salt and
Potash project tenement parcel. During the year ended 30 June 2021, the Group exercised its option to acquire the remaining
northern tenement area for a cash cost of $2.5M plus duties and taxes. In addition, during the financial year the Group secured
rights to a third tenement area adjacent to the Mardie project and acquired the additional tenement area via an asset transfer
agreement with a value of $0.74M recognised for the exploration asset received. The additional tenement areas acquired during
the year provide optionality for future layout optimisation and expansion of the Mardie project.
Exploration and evaluation costs
Costs arising from on-going exploration and evaluation activities are expensed as incurred.
Disposal of tenements
During the financial year, the Group disposed of iron ore tenements with a carrying value of $0.27M under normal terms
and conditions.
Key judgement – Capitalisation of exploration and evaluation expenditure
The Company has capitalised acquired exploration and evaluation expenditure and earn-in expenditure on the basis that either
it is expected to be recouped through future successful development (or alternatively sale) of the areas of interest concerned or
on the basis that it is not yet possible to assess whether it will be recouped. The future recoverability of capitalised exploration
and evaluation expenditure is dependent on a number of factors, including whether the Company decides to exploit the related
lease itself, or, if not, whether it successfully recovers the related exploration and evaluation asset through sale.
Factors that could impact the future recoverability include the level of reserves and resources, future technological changes,
costs of drilling and production, production rates, future legal changes (including changes to environmental rehabilitation
obligations) and changes to commodity prices.
BCI currently holds a 30% interest in the Carnegie Potash in a joint venture with ASX-listed potash development company,
Kalium Lakes Limited (“KLL”), who is the joint venture manager. BCI has rights to earn up to a 50% interest through sole-funding
the Pre-Feasibility Study and Feasibility Study phases.
Note 9 – Intangibles
Net carrying value of intangibles:
Royalties
Cape Preston East Port rights
Net carrying amount
The intangible assets were acquired through Iron Ore Holdings Limited as follows:
2021
$000’s
2020
$000’s
15,502
-
15,502
15,502
3,000
18,502
57
Royalties
The Company holds royalties over the Koodaideri South and North Marillana Extension tenements. The assets have a finite life
reflecting the underlying resource and will be amortised as the resource is depleted. Production has not commenced at either
Koodaideri South or North Marillana and hence the assets remain unamortised.
The Koodaideri South royalty asset has been tested for impairment with the recoverable amount assessed by reference to the
FVLCD, in line the policy in note 3 and classified as level 3 under the fair value hierarchy. FVLCD was determined using an income
approach based on the net present value of future cash flows projected over the estimated mine life of 32 years. The post-tax
nominal discount rate used in determining FVLCD was 8.2%. Forecast iron ore price, foreign exchange and inflation assumptions
used in the calculation of FVLCD are summarised in Note 3.
The North Marillana Extension royalty asset has been tested for impairment with the recoverable amount assessed by reference
to the FVLCD, in line with the policy in note 3 and classified as level 3 under the fair value hierarchy. FVLCD was determined
using an income approach based on the net present value of future cash flows projected over the estimated mine life of 10 years.
The post-tax nominal discount rate used in determining FVLCD was 8.2%. Forecast iron ore price, foreign exchange and inflation
assumptions used in the calculation of FVLCD are summarised in Note 3.
The recoverable amounts were determined to be in excess of carrying values, and there are no probable changes to key
assumptions that would cause the asset to be impaired. Refer to Note 3 for details of the key estimates and judgements applied
in determining the recoverable amount.
Cape Preston East Port Rights
As disclosed at Note 8 above, during the year the Group entered into an Asset Transfer Agreement whereby the Group received
rights to certain tenements adjacent to the Mardie Project and in return, disposed of the intangible assets associated with the
Cape Preston East Port. The net loss to the group arising from this transaction of $2.26M has been recognised in the statement
of comprehensive income.
Note 10 – Leases
Lease liabilities have been measured at amounts equal to the net present value of remaining lease payments over the remaining
term of the lease, discounted at the Group’s incremental borrowing rate. The weighted average interest rate applied was 4.7%.
The discount rate used in calculating the carrying amount of lease liabilities considers the circumstances applicable over the
underlying leased assets, in particular the lease value, the term and economic environment.
Right of use assets were measured at amounts equal to the carrying value of their respective lease liabilities on the adoption
date, adjusted for incentives, accruals and prepayments relating to the contractual agreement. Right of use assets are
depreciated over the shorter of the asset’s useful life and the lease term on a straight-line basis. There are no onerous lease
contracts that would require adjustment to the right of use assets on the adoption date.
Lease liabilities
Lease liability at 30 June 2020
Additional lease contracts entered into during the period
Add: Borrowing costs
Less: Payments
Lease liabilities as at 30 June 2021
Disclosure in Statement of Financial Position
Current lease liability
Non-current lease liability
Total Lease liability
Right of use assets at 30 June 2020
Additional right of use assets recognised
Accumulated amortisation
Right of use assets as at 30 June 2021
58
June 2021
$000’s
June 2020
$000’s
772
408
40
(347)
873
395
478
873
745
409
(327)
827
-
962
37
(227)
772
231
541
772
964
(219)
745
Note 11 – Trade and Other Payables
Current
Trade payables and accruals
Total
Accounting policy
2021
$000’s
2020
$000’s
37,548
37,548
18,345
18,345
These amounts represent liabilities for goods and services provided to the Company and royalty obligations, prior to the end of
the financial year which are unpaid. The amounts are unsecured and are usually paid within 30 days of recognition.
The Company has financial risk management policies in place to ensure that all payables are paid within the credit timeframe
(refer to Note 18).
Note 12 – Provisions
Current
Employee benefits
Total current
Non-current
Rehabilitation
Total non-current
Total
Movement in Provisions in 2021
Opening balance 1 July 2020
Additional provision recognised
Changes in rehabilitation estimate
Unwinding of discount (non-cash expense)
Amounts used during the year
Closing balance
Accounting policy
2021
$000’s
2020
$000’s
791
791
15,932
15,932
16,723
Rehabilitation
and site closure
$000’s
Employee
benefits
$000’s
12,295
600
3,377
144
(484)
15,932
591
200
-
-
-
591
591
12,295
12,295
12,886
Total
$000’s
12,886
800
3,377
144
(484)
791
16,723
Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of past events, it is
probable that an outflow of resources will be required to settle the obligation, and the amount can be reliably estimated.
Employee benefits, salaries and annual leave
Liabilities for salaries, including non-monetary benefits and annual leave expected to be settled within 12 months of the
reporting date are recognised in respect of employee’s services up to the reporting date. They are measured at the amounts
expected to be paid when the liabilities are settled.
Employee benefits – long service leave
The liability for long service leave is recognised and measured at the present value of expected future payments to be made
in respect of services provided by employees up to the reporting date using the projected unit credit method. Consideration is
given to expected future salary levels, experience of employee departures and periods of service. Expected future payments
are discounted using market yields at the reporting date on corporate bonds with terms to maturity and currency that match, as
closely as possible, the estimated future cash outflows.
The obligations are presented as current liabilities in the Statement of Financial Position if the entity does not have an
unconditional right to defer settlement for at least twelve months after the reporting date, regardless of when the actual
settlement is expected to occur.
59
Rehabilitation
The Company has obligations to dismantle and remove certain items of property, plant and equipment and to restore and
rehabilitate the land on which they are situated.
A provision is raised for the estimated cost of settling the rehabilitation and restoration obligations existing at reporting date,
discounted to present value using an appropriate discount rate. When provisions for rehabilitation are initially recognised, the
corresponding cost is capitalised as an asset within mine properties and amortised accordingly.
Where rehabilitation is conducted systematically over the life of the operation, rather than at the time of closure, costs are
charged to the profit or loss in the period in which the work is undertaken.
At each reporting date the rehabilitation liability is re-measured to account for any new disturbance, updated cost estimates,
changes to the estimated lives of operations, new regulatory requirements and revisions to discount rates. Changes to the
rehabilitation liability are added to or deducted from the related rehabilitation asset and amortised accordingly.
Key estimate – Rehabilitation
The Company’s accounting policy for the recognition of rehabilitation provisions requires significant estimates in determining the
estimated cost for the rehabilitation of disturbed areas, removal of infrastructure and site closure at a point in the future. These
uncertainties may result in future expenditure differing from the amounts currently provided.
A provision is made for the estimated cost to rehabilitate the Iron Valley site, which is offset by a receivable from Mineral
Resources Limited recognising the contractual requirement to rehabilitate the site.
Note 13 – Capital risk management
The Company’s objective when managing capital is to safeguard its ability to continue as a going concern so that it can continue
to provide returns to shareholders and benefits for other stakeholders, and to maintain an optimal capital structure to reduce
the cost of capital. In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid
to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt. The Company defines capital as
equity and net debt. Net debt is defined as borrowings less cash and cash equivalents, and equity as the sum of share capital,
reserves and accumulated losses/retained earnings. The Company had no debt as at the end of the financial year (2020: Nil).
Note 14 – Contributed equity
Share capital
Ordinary shares - fully paid
Movements in ordinary share capital
Opening balance
2021
2020
Number
$000’s
Number
$000’s
599,209,833
313,190
398,928,910
267,303
398,928,910
267,303
397,608,910
267,212
Issue of shares under Employee Performance Rights Plan
816,000
15
1,320,000
199,464,923
45,872
-
599,209,833
313,190
398,928,910
267,303
91
-
Rights Issue Net of Costs
Closing balance
Accounting policy
Ordinary shares are classified as equity. Costs directly attributable to the issue of new shares or options are recorded in equity as
a deduction, net of tax, from the proceeds.
Terms and conditions of ordinary shares
Holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote per share
at shareholders’ meetings. In the event of winding up of the Company, ordinary shareholders rank after all other shareholders
and creditors are fully entitled to any proceeds of liquidations.
60
Note 15 – Reserves
Share based payments reserve
Balance as at 1 July
Share based payments expense
Issue of shares under Employee Performance Rights Plan
Balance as at 30 June
Financial assets at fair value through other comprehensive income
Balance as at 1 July
Balance as at 30 June
Options exercised reserve
Balance as at 1 July
Balance as at 30 June
Total reserves
Nature and purpose of reserves
2021
$000’s
2020
$000’s
10,677
10,640
703
(15)
128
(91)
11,365
10,677
(9,009)
(9,009)
3,787
3,787
6,143
(9,009)
(9,009)
3,787
3,787
5,455
The share based payments reserve is used to recognise the fair value of options (not exercised), Performance Rights and equity-
settled benefits issued in settlement of share issue costs.
Changes in the fair value of investments such as equities measured at fair value through other comprehensive income, are
recognised in other comprehensive income and accumulated in a separate reserve within equity. On adoption of AASB 9 Financial
Instruments investments in listed shares previously classified as available-for-sale were reclassified as financial assets at fair value
through other comprehensive income.
The options exercised reserve is used to recognise the fair value of options exercised.
Note 16 – Accumulated Losses
Balance as at 1 July
Net profit / (loss)
Balance as at 30 June
Note 17 – Earnings Per Share
Earnings per share from continuing operations
Profit / (loss) after income tax from continuing operations
2021
$000’s
2020
$000’s
(168,641)
(169,018)
21,972
377
(146,669)
(168,641)
2021
$000’s
2020
$000’s
21,972
Number
377
Number
Weighted average number of ordinary shares used in calculating basic earnings per share
546,393,720
398,712,517
Adjustments for calculation of diluted earnings per share:
Vested Performance Rights outstanding at year end
1,989,000
-
Weighted average number of ordinary shares used in calculating diluted earnings per share
548,382,720
398,712,517
Earnings per share attributable to the ordinary equity holders of the company
Basic earnings / (loss) per share
Diluted earnings / (loss) per share
Accounting policy
Cents
4.02
4.01
Cents
0.09
0.09
Basic earnings per share is calculated by dividing net profit after income tax attributable to equity holders of the Company by the
weighted average number of ordinary shares on issue during the financial year.
61
Diluted earnings per share is calculated using net profit after income tax attributable to equity holders of the Company adjusted
for the after-tax effect of dividends and interest associated with dilutive potential ordinary shares. The weighted average number
of shares used is adjusted for the weighted average number of ordinary shares that would be issued on the conversion of all the
dilutive potential ordinary shares into ordinary shares.
RISK MANAGEMENT
Note 18 – Financial Risk Management
The Company holds the following financial instruments:
Financial assets
Cash and cash equivalents
Short term investments
Trade and other receivables
Financial liabilities
Trade and other payables
2021
$000’s
2020
$000’s
79,435
681
72,251
152,367
37,548
37,548
41,548
553
28,500
70,601
18,345
18,345
Market (including foreign exchange, commodity price and interest rate risk), credit and liquidity risks arise in the normal course
of the Company’s business. Primary responsibility for identification and control of financial risk rests with senior management
under directives approved by the Board.
a. Market risk
i, Foreign exchange risk
Foreign exchange risk arises from future commitments, assets and liabilities that are denominated in a currency that is not the
functional currency in which they are measured. The Company is not exposed to foreign exchange risk on trade receivables.
ii. Commodity price risk
The Company’s revenue is exposed to commodity price fluctuations, specifically iron ore prices. The Company measures
exposure to commodity price risk by monitoring and stress testing the Company’s forecast financial position to sustained periods
of low iron ore prices on a regular basis.
Trade receivables outstanding at year end are subject to potential changes in future iron ore prices.
b. Credit risk
Credit risk arises from cash and cash equivalents and deposits with financial institutions, and from receivables from customers for
iron ore sales. For banks and financial institutions, only independently rated parties with a minimum rating of “A” are accepted in
accordance with ratings guidelines of major global credit rating agencies. For customers, credit reference checks are undertaken.
The carrying amount of financial assets recorded in the financial statements, net of any allowances for losses, represents the
Company’s maximum exposure to credit risk without taking account of the fair value of any collateral or other security obtained.
The maximum exposure to credit risk at the reporting date is the carrying amount of the financial assets as summarised at the
beginning of this note.
The credit quality of financial assets that are neither past due nor impaired can be summarised as follows:
• Cash and cash equivalents $79.4M (2020: $41.5M) held with banks with minimum long term external credit rating of AA-.
• Short term investments $0.7M (2020: $0.5M) held with banks with a minimum long term external credit rating of AA-
• Current trade and other receivables $56.4M (2020: $16.2M) due from existing customers are backed by an agreement with
quarterly invoices paid within 5 working days. There has been no history of default in the past.
• Non-current receivables $15.8M (2020: $12.3M) due from Mineral Resources Limited under a contractual arrangement as
described in Note 6. No default is expected.
c. Liquidity risk
Prudent liquidity management involves the maintenance of sufficient cash and access to capital markets. It is the policy of
the Board to ensure that the Company is able to meet its financial obligations and maintain the flexibility to pursue attractive
investment opportunities through keeping committed credit lines available where possible, ensuring the Company has sufficient
working capital and preserving the 15% share issue limit available to the Company under the ASX Listing Rules.
Maturity analysis of financial assets and liabilities
Financial liabilities comprise trade and other payables which have a maturity of less than six months and lease liabilities with a
fixed payment commitment of up to 4 years.
62
GROUP STRUCTURE
Note 19 – Subsidiaries
The consolidated financial statements include the financial statements of BCI Minerals Limited and the subsidiaries listed in the
following table.
BC Iron Nullagine Pty Ltd
BCI (SA) Pty Ltd
BC Potash Pty Ltd
BC Gold Pty Ltd
BC Pilbara Iron Ore Pty Ltd
PEL Iron Ore Pty Ltd
Mardie Minerals Pty Ltd
Iron Valley Pty Ltd
Mal’s Ridge Pty Ltd
Maitland River Pty Ltd
BCI Exploration Pty Ltd
Accounting policy
Country of
incorporation
Functional
currency
2021
%
2020
%
Beneficial interest
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
AUD
AUD
AUD
AUD
AUD
AUD
AUD
AUD
AUD
AUD
AUD
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of BCI Minerals Limited as at
30 June 2021, and the results of all subsidiaries for the year then ended.
Subsidiaries are all entities (including structured entities) over which the Company has control. The Company controls an entity
when the Company is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to
affect those returns through its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on
which control is transferred to the group. They are deconsolidated from the date that control ceases.
Intercompany transactions, balances and unrealised gains on transactions between entities in the Consolidated Entity are
eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of the impairment of an asset
transferred. Accounting policies of subsidiaries are consistent with the policies adopted by the Consolidated Entity.
Note 20 – Segment Information
2021 Segment Information
Segment revenue
Sales revenue
Other revenue
Total
Segment results
EBITDA
Interest revenue
Finance costs
Depreciation and amortisation
Impairment of assets
Iron Valley
$000’s
Mardie
$000’s
Buckland
$000’s
Other
$000’s
Consolidated
$000’s
160,156
-
160,156
-
-
-
-
-
-
-
326
326
160,156
326
160,482
69,490
(34,419)
(2,233)
(6,173)
26,665
-
-
(3,006)
-
-
-
(1,547)
-
-
-
-
-
320
(40)
(420)
-
320
(40)
(4,973)
-
Profit / (loss) before income tax
66,484
(35,966)
(2,233)
(6,313)
21,972
Segment assets
Segment liabilities
105,021
41,924
24,312
11,032
-
-
98,475
2,188
227,808
55,144
63
2020 Segment Information
Segment revenue
Sales revenue
Other revenue
Total
Segment results
EBITDA
Interest revenue
Finance costs
Depreciation and amortisation
Impairment of assets
Iron Valley
$000’s
Mardie
$000’s
Buckland
$000’s
Other
$000’s
Consolidated
$000’s
76,793
-
76,793
-
-
-
-
-
-
-
466
466
22,968
(18,722)
9,950
(5,853)
-
-
(2,493)
-
-
-
(577)
-
-
-
-
(5,030)
4,920
-
-
466
(37)
(295)
-
(5,719)
63,425
3,144
76,793
466
77,259
8,343
466
(37)
(3,365)
(5,030)
377
136,120
32,003
Profit / (loss) before income tax
20,475
(19,299)
Segment assets
Segment liabilities
65,162
26,817
7,533
2,042
Management has determined that the Company has four reportable segments, being Iron Valley, Mardie, Buckland and Other
(Corporate and other assets).
Sales revenue comprises iron ore sales from a single location to a single customer in Australia.
Accounting policy
Operating segments are reported in a manner that is consistent with the internal reporting provided to the chief operating
decision maker. The chief operating decision maker has been identified as the Company’s Board. Internal reporting is provided to
the Board on a consolidated basis.
UNRECOGNISED ITEMS
Note 21 – Commitments
The Company has two property leases and a lease for vehicles at the Mardie project site. Future lease commitments are now
disclosed as per AASB 16 – Leases, refer to note 10 for further detail.
Note 22 – Contingent Liabilities and Assets
As at 30 June 2021, the Company has no contingent liabilities or assets other than additional cash payments it may receive in
respect of the sale of the Buckland project and Kumina tenements disclosed in prior years.
Note 23 – Events Occurring after the Reporting Period
Other than disclosed above, no matters or circumstances have arisen since the end of the financial year which significantly
affected or may significantly affect the operations of the Company, the results of those operations, or the state of affairs of the
Company in financial periods subsequent to the year ended 30 June 2021.
64
OTHER NOTES
Note 24 – Parent Entity
The following details information related to the parent entity, BCI Minerals Limited, as at 30 June 2021. The information presented
here has been prepared using accounting policies consistent with those presented in the notes to the accounts.
2021
$000’s
2020
$000’s
Statement of Financial Position
Current assets
Total assets
Current liabilities
Total liabilities
Shareholders’ equity
Issued capital
Reserves
Accumulated losses
Total shareholders’ equity
Profit / (Loss) for the year
Total comprehensive income / (loss) for the year
Included in note 21 are commitments incurred by the parent entity relating to the lease of offices.
Note 25 – Auditor’s Remuneration
The auditor of BCI Minerals Limited is BDO Audit (WA) Pty Ltd.
Amounts received or due and receivable by BDO Audit (WA) Pty Ltd for:
Audit or review of financial reports for the Company
Non-audit services – tax and remuneration advisory services
Total
Note 26 – Related Party Transactions
a. Parent entity
BCI Minerals Limited is the parent entity.
b. Subsidiaries
Interests in subsidiaries are set out in note 19.
c. Key management personnel
Disclosures relating to Key Management Personnel are set out in the Audited Remuneration Report.
Short-term employee benefits
Termination payments
Share based payments
Post-employment benefits
Total
d. Transactions with related parties
Payment for services made to other related entities
78,787
188,806
1,757
67,217
313,190
6,271
(191,641)
127,820
(6,231)
(6,231)
2021
$
62,000
91,100
153,100
39,261
172,319
2,587
13,390
267,303
5,583
(193,155)
79,731
(7,898)
(7,898)
2020
$
61,000
20,350
81,350
2021
$
2020
$
2,179,836
1,735,618
133,366
529,507
112,032
-
82,324
86,677
2,954,741
1,904,619
2021
$
2020
$
1,338,221
1,133,863
65
On 1 March 2017, Michael Blakiston was appointed as a Non-Executive Director of the Company. Mr Blakiston is a partner in the
legal firm Gilbert + Tobin. During the current financial year, the Company made legal fee payments to Gilbert + Tobin of $720K
(2020: $511K). All transactions were on normal commercial terms and conditions.
During the year, a company within the same consolidated group as Wroxby Pty Ltd, a substantial shareholder of the Company,
provided the Company with rental premises for which payments were made in the amount of $618K (2020: $623K). All transactions
were on normal terms and conditions.
Note 27 – Share Based Payments
During the current and prior financial years, the Company has provided share based payments to employees. An Employee
Performance Right Plan was initially approved at the shareholder’s annual general meeting of 19 November 2010 and a revised
Performance Right Plan and a Share Right Plan were approved at the Company’s annual general meeting held on 26 November 2019.
Under the terms of these plans, the Board may offer Performance Rights or Share Rights at no more than nominal consideration
to employees or directors (the latter subject to shareholder approval) based on a number of criteria, including contribution to
the Company, period of employment, potential contribution to the Company in the future and other factors the Board considers
relevant. These long-term incentives are provided to certain employees at the discretion of the Board to deliver long-term
shareholder returns. Set out below is a summary of the Performance Rights granted by the Company during the financial year.
Employee Performance Rights
During the year the Company issued share based payments in the form of Performance Rights to directors and employees as per
below. Refer to the Remuneration Report in the Directors’ Report for more information.
2021 – Performance Rights
Grant date
26/11/2020
31/05/2021
*Source: www.asx.com.au
Granted during
the year
Vesting date
Fair value per right
at grant date
Share price on
grant date*
Expected
dividends
7,152,888
30/06/2023
620,000
30/06/2023
$0.128
$0.285
$0.26
$0.40
0%
0%
The fair value per Performance Right on grant date was determined as follows:
Grant date
Vesting date
Grant date share price
Volatility (per cent)
Dividend yield (per cent)
Risk free rate (per cent)
2020 – Performance Rights
Grant date
27/11/2019 – Tranche 1
27/11/2019 – Tranche 2
*Source: www.asx.com.au
26/11/2020
Tranche 1
31/05/2021
Tranche 2
30/06/2023
30/06/2023
$0.26
60.0
0
0.07
$0.40
47.5
0
0.06
Granted during
the year
Vesting date
5,500,000
30/11/2020
5,500,000
30/11/2022
Fair value per
right at grant
date
$0.0186
$0.0398
Share price on
grant date*
Expected
dividends
$0.18
$0.18
0%
0%
The fair value per Performance Right on grant date was determined as follows:
Grant date
Vesting date
Grant date share price
Volatility (per cent)
Dividend yield (per cent)
Risk free rate (per cent)
66
27/11/2019
Tranche 1
27/11/2019
Tranche 2
30/11/2020
30/11/2022
$0.18
48.0
0
0.68
$0.18
60.1
0
0.68
Summary of Performance Rights on issue
-
-
-
-
Vesting date
30/11/2020
30/11/2022
30/06/2023
Opening balance
at 1 July 2020
Rights granted
during the year
Rights cancelled
/lapsed during
the year
Rights converted
to shares during
the year
Closing balance
at 30 June 2021
Rights vested since
30 June 2021
5,500,000
5,500,000
-
-
(1,600,000)
-
7,772,888
(1,276,835)
-
-
3,900,000
6,496,053
(2,695,000)
(816,000)
1,989,000
Total
11,000,000
7,772,888
(5,571,835)
(816,000)
12,385,053
Employee Share Rights
During the year the Company issued share based payments in the form of Share Rights to employees as per below. Refer to the
Remuneration Report in the Directors’ Report for more information.
2021 – Share Rights
Grant date
31/07/2020
26/11//2020
*Source: www.asx.com.au
Granted during
the year
Vesting date
Fair value per right
at grant date
Share price on
grant date*
Expected
dividends
1,445,348
04/08/2021
855,798
04/08/2021
$0.190
$0.255
$0.190
$0.255
0%
0%
The fair value per Share Right on grant date was determined as follows:
Grant date
Vesting date
Grant date share price
Volatility (per cent)
Dividend yield (per cent)
Risk free rate (per cent)
Summary of Share Rights on issue
31/07/2020
Tranche 1
26/11/2020
Tranche 2
04/08/2021
04/08/2021
$0.190
$0.255
60.0
0
0.07
60.0
0
0.07
Vesting date
04/08/2021
Total
Opening balance
at 1 July 2020
Rights granted
during the year
Rights cancelled
/lapsed during
the year
Rights converted
to shares during
the year
Closing balance
at 30 June 2021
Rights vested since
30 June 2021
-
-
2,301,146
2,301,146
-
-
-
-
2,301,146
2,301,146
2,301,146
2,301,146
a. Expenses arising from share-based payment transactions
Total expenses arising from share based payments recognised during the financial period as part of employee benefits expense
were as follows. Where Performance Rights are forfeited or cancelled due to a non-market vesting condition not being satisfied,
the previously recognised cumulative share based payment expense is reversed.
Director benefits
Employee benefits
Total
Accounting policy
2021
$
529,507
173,603
703,110
2020
$
82,324
45,675
127,999
The fair value of share based payments granted is recognised as an employee benefit expense with a corresponding increase
in equity. The fair value is measured at grant date and recognised over the period during which the employees become
unconditionally entitled to the options or Performance Rights.
A Monte Carlo simulation is used to value Performance Rights. The Monte Carlo calculation simulates the Company’s share price
and depending on the hurdle arrives at a value based on the number of Performance Rights that are likely to vest.
The employee benefit expense recognised each period takes into account the most recent estimate of the options and
Performance Rights. The impact of revision to original estimates, if any, is recognised in the profit or loss with a corresponding
adjustment to equity.
67
Key estimate: Share-based payment valuation
The value of share-based payments to financiers is measured by reference to the difference between the nominal value and net
present value of the finance facility provided. The net present value is determined based upon a market comparable discount
rate applicable to similar size companies within the mining sector.
A Monte Carlo simulation has been used to value Performance Rights. The Monte Carlo calculation simulates the returns of the
Company in relation to the peer group and arrives at a value based on the number of Performance Rights that are likely to vest.
Note 28 – Other Accounting Policies
Summary of other significant accounting policies
Goods and services tax (GST)
Revenues, expenses and assets are recognised net of the amount of associated GST, except where the GST incurred is not
recoverable from the taxation authority, in which case the GST is recognised as part of the cost of acquisition of the asset or as
part of the expense item.
Receivables and payables are stated inclusive of the amount of GST receivable or payable, where an invoice has been issued.
The net amount of GST recoverable from, or payable to, the taxation authority is included within receivables or payables in the
statement of financial position.
The GST component of cash flows arising from investing and financing activities, which is recoverable from or payable to the
taxation authority are classified as operating cash flows.
Commitments and contingencies are disclosed net of the amount of GST recoverable from or payable to the taxation authority.
Fair value
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market
participants at the measurement date. It is based on the presumption that the transaction takes place either in the principal
market for the asset or liability or, in the absence of a principal market, in the most advantageous market. The principal or most
advantageous market must be accessible to, or by, the Company. Fair value is measured using the assumptions that market
participants would use when pricing the asset or liability, assuming that market participants act in their best economic interest.
The fair value measurement of a non-financial asset takes into account the market participant’s ability to generate economic
benefits by using the asset at its highest and best use or by selling it to another market participant that would use the asset at
its highest and best use.
In measuring fair value, the Company uses valuation techniques that maximise the use of observable inputs and minimise the
use of unobservable inputs.
Tax consolidation legislation
BCI Minerals Limited and its wholly owned Australian controlled entities have entered into the tax consolidation legislation. On
adoption of the tax consolidation legislation, the entities in the tax consolidated group entered into a tax sharing agreement which,
limits the joint and several liability of the wholly owned entities in the case of a default by the head entity, BCI Minerals Limited.
The entities entered into a tax funding agreement under which the wholly owned entities fully compensate BCI Minerals
Limited for any current tax payable assumed and are compensated by BCI Minerals Limited for any current tax receivable and
deferred tax assets relating to unused tax losses or unused tax credits that are transferred to BCI Minerals Limited under the
tax consolidation legislation. The funding amounts are determined by reference to the amounts recognised in the wholly owned
entities’ financial statements.
The amounts receivable or payable under the tax funding agreement are due upon receipt of the funding advice from the head
entity, which where appropriate, is issued as soon as practicable after the end of each financial year. The head entity may also
require payment of interim funding amounts to assist with its obligations to pay tax instalments. The funding amounts are
recognised as current intercompany receivables or payables.
New, revised or amending Accounting Standards and Interpretations adopted
There are no new accounting standards, amendment of standards or interpretations that are yet to be implemented by the Group.
68
INDEPENDENT AUDITOR’S REPORT
Tel: +61 8 6382 4600
Fax: +61 8 6382 4601
www.bdo.com.au
38 Station Street
Subiaco, WA 6008
PO Box 700 West Perth WA 6872
Australia
INDEPENDENT AUDITOR'S REPORT
To the members of BCI Minerals Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of BCI Minerals Limited (the Company) and its subsidiaries (the
Group), which comprises the consolidated statement of financial position as at 30 June 2021, the
consolidated statement of profit or loss and other comprehensive income, the consolidated statement
of changes in equity and the consolidated statement of cash flows for the year then ended, and notes
to the financial report, including a summary of significant accounting policies and the directors’
declaration.
In our opinion the accompanying financial report of the Group, is in accordance with the Corporations
Act 2001, including:
(i)
Giving a true and fair view of the Group’s financial position as at 30 June 2021 and of its
financial performance for the year ended on that date; and
(ii)
Complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s responsibilities for the audit of the Financial
Report section of our report. We are independent of the Group in accordance with the Corporations
Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s
APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code)
that are relevant to our audit of the financial report in Australia. We have also fulfilled our other
ethical responsibilities in accordance with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been
given to the directors of the Company, would be in the same terms if given to the directors as at the
time of this auditor’s report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the financial report of the current period. These matters were addressed in the context of
our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide
a separate opinion on these matters.
BDO Audit (WA) Pty Ltd ABN 79 112 284 787 is a member of a national association of independent entities which are all members of BDO Australia Ltd ABN 77 050 110 275,
an Australian company limited by guarantee. BDO Audit (WA) Pty Ltd and BDO Australia Ltd are members of BDO International Ltd, a UK company limited by guarantee, and
form part of the international BDO network of independent member firms. Liability limited by a scheme approved under Professional Standards Legislation.
52
69
Carrying Value of Intangible Assets
Key audit matter
How the matter was addressed in our audit
At 30 June 2021, we note that the carrying values
Our procedures included, but were not limited to the
of Intangible Assets are significant to the financial
following:
statements, as disclosed in Note 9.
An annual impairment test is required for
Intangible Assets not being amortised under the
Australian Accounting Standards.
The assessment of the carrying values of Intangible
Assets requires management to make significant
accounting judgements and estimates to determine
whether the assets require impairment. Due to the
significance of the estimates and assumptions in
these assessments, we have identified this as a key
audit matter.
Refer to Note 3 and Note 9 for detailed disclosures,
which include the related accounting policies and
critical accounting judgements and estimates.
•
•
•
•
•
•
Analysing management’s key assumptions used in the
discounted cash flow models against external data
and market information to determine their
reasonableness;
Challenging the appropriateness of management’s
discount rates used in the discounted cash flow
models in conjunction with our internal valuation
experts;
Challenging assumptions in relation to the timing of
future cash flows;
Testing the mathematical accuracy of the discounted
cash flow models;
Performing sensitivity analysis on key assumptions to
determine if there would be a significant change to
the carrying value of the assets; and
Assessing the adequacy of the Groups’ disclosure in
respect of impairment assessment assumptions as
disclosed in Note 3 and Note 9 of the financial
report.
Other information
The directors are responsible for the other information. The other information comprises the
information in the Group’s annual report for the year ended 30 June 2021, but does not include the
financial report and the auditor’s report thereon, which we obtained prior to the date of this auditor’s
report, and the mineral resources and ore reserves information, which is expected to be made
available to us after that date.
Our opinion on the financial report does not cover the other information and we do not express any
form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit or otherwise appears to be materially misstated.
70
53
If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
When we read the mineral resources and ore reserves information, if we conclude that there is a
material misstatement therein, we are required to communicate the matter to the directors and will
request that it is corrected. If it is not corrected, we will seek to have the matter appropriately
brought to the attention of users for whom our report is prepared.
Responsibilities of the directors for the Financial Report
The directors of the Company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due to
fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the group to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the Group or to cease
operations, or has no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of this financial report.
A further description of our responsibilities for the audit of the financial report is located at the
Auditing and Assurance Standards Board website (http://www.auasb.gov.au/Home.aspx) at:
http://www.auasb.gov.au/auditors_responsibilities/ar1.pdf
This description forms part of our auditor’s report.
54
71
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 10 to 18 of the directors’ report for the
year ended 30 June 2021.
In our opinion, the Remuneration Report of BCI Minerals Limited, for the year ended 30 June 2021,
complies with section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the
Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility
is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with
Australian Auditing Standards.
BDO Audit (WA) Pty Ltd
Phillip Murdoch
Director
Perth, 19 August 2021
72
55
AUDITOR’S INDEPENDENCE DECLARATION
Tel: +61 8 6382 4600
Fax: +61 8 6382 4601
www.bdo.com.au
38 Station Street
Subiaco, WA 6008
PO Box 700 West Perth WA 6872
Australia
DECLARATION OF INDEPENDENCE BY PHILLIP MURDOCH TO THE DIRECTORS OF BCI MINERALS
LIMITED
As lead auditor of BCI Minerals Limited for the year ended 30 June 2021, I declare that, to the best of
my knowledge and belief, there have been:
1. No contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit; and
2. No contraventions of any applicable code of professional conduct in relation to the audit.
This declaration is in respect of BCI Minerals Limited and the entities it controlled during the period.
Phillip Murdoch
Director
BDO Audit (WA) Pty Ltd
Perth, 19 August 2021
BDO Audit (WA) Pty Ltd ABN 79 112 284 787 is a member of a national association of independent entities which are all members of BDO Australia Ltd ABN 77 050 110 275,
an Australian company limited by guarantee. BDO Audit (WA) Pty Ltd and BDO Australia Ltd are members of BDO International Ltd, a UK company limited by guarantee, and
form part of the international BDO network of independent member firms. Liability limited by a scheme approved under Professional Standards Legislation.
56
73
ADDITIONAL ASX INFORMATION
(as at 4 October 2021)
Substantial Shareholders
Substantial shareholders as disclosed in substantial notices given to the Company are as follows:
Shareholder
Wroxby Pty Ltd
Sandon Capital Pty Ltd
Distribution of Shareholdings
Shares held % of issued capital
236,750,238
36,277,729
39.49
6.05
Size of shareholding
Number of holders
Number of shares % of issued capital
1-1,000
1,001-5,000
5,001-10,000
10,001 – 100,000
100,001 and over
Total
1,364
2,354
1,076
1,952
403
7,149
621,920
6,498,171
8,476,778
64,784,629
519,189,672
599,571,170
0.10
1.08
1.41
10.81
86.59
100.00
Unmarketable Parcels
There were 1,599 members holding less than a marketable parcel of shares in the Company at $0.380 per share.
Twenty Largest Shareholders
#
Shareholder
1
2
3
4
5
6
7
8
9
WROXBY PTY LIMITED
RYDER CAPITAL MANAGEMENT PTY LTD
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
NORFOLK ENCHANTS PTY LTD
ONE MANAGED INVT FUNDS LTD
CITICORP NOMINEES PTY LIMITED
ONE FUND SERVICES LTD
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
MINERALOGY PTY LTD
10 ONE MANAGED INVT FUNDS LTD <1 A/C>
11
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED - A/C 2
12 MR ALWYN PETRUS VORSTER
13 MR DENNIS JONATHAN KAR QUE LUM
14 MS KAREN ANNE DAVIES + MR BRUCE DONALD MACLEAN
15
16
HEAGRA PTY LIMITED
BNP PARIBAS NOMINEES PTY LTD
17 MR RICHARD CHENG SHIH KOO + MS CINDY BEE HAR KOO
18 NATIONAL NOMINEES LIMITED
19
BNP PARIBAS NOMINEES PTY LTD SIX SIS LTD
20 PERTH CAPITAL PTY LTD
Total
Voting Rights
All issued shares carry voting rights on a one for one basis.
Unlisted Securities
Security type
Performance rights
Share rights
74
Shares held % of issued capital
236,750,238
39.49
24,373,512
23,298,816
18,333,276
18,157,751
13,232,791
11,098,555
8,227,525
6,090,000
6,000,000
5,718,987
5,305,645
4,034,407
3,275,868
3,045,000
2,307,117
2,105,380
1,776,380
1,768,815
1,650,000
4.07
3.89
3.06
3.03
2.21
1.85
1.37
1.02
1.00
0.95
0.88
0.67
0.55
0.51
0.38
0.35
0.30
0.30
0.28
396,550,063
66.14
Number
Number of holders
13,253,241
2,456,005
11
8
MINERAL RESOURCES AND ORE RESERVES
BCI’s Mineral Resources and Ore Reserves are at the Iron Valley iron ore mine. The Iron Valley tenements are 100% owned by BCI
and are being operated by Mineral Resources Limited (MIN) under a royalty-type agreement. MIN operates the mine at its cost
and purchases Iron Valley product from BCI at a price linked to MIN’s realised sale price.
Estimates for Iron Valley as at 30 June 2021 are set out below, with a comparison to 30 June 2020 figures. Mineral Resources
reduced by 8.7Mt during the year due to mining depletion offset by stockpile build-up. Ore Reserves reduced by 14.0Mt due to
production shipments, stockpile adjustments and re-optimisation based on updated price and cost assumptions.
Iron Valley Mineral Resource Estimate (100% BCI, subject to iron ore sale agreement with MIN)
Classification
Measured – In-situ
Measured – Stockpiles
Indicated – In-situ
Inferred – In-situ
Total at 30 June 2021
Total at 30 June 2020
Cut-off
(% Fe)
Tonnes
(Mt)
50
50
50
50
50
50
76.5
3.4
67.3
26.1
173.3
182.0
Fe
(%)
57.7
55.3
58.6
57.8
58.0
58.0
CaFe
(%)
62.7
59.8
63.1
61.3
62.6
62.6
SiO2
(%)
5.2
8.1
5.1
6.6
5.4
5.5
Al2O3
(%)
3.2
4.0
3.2
3.9
3.3
3.3
P
(%)
0.19
0.20
0.17
0.14
0.17
0.17
Iron Valley Ore Reserve Estimate (100% BCI, subject to iron ore sale agreement with MIN)
Classification
Proved – In-situ
Proved – Stockpiles
Probable – In-situ
Total at 30 June 2021
Total at 30 June 2020
Cut-off
(% Fe)
Tonnes
(Mt)
54
54
54
54
54
46.2
2.2
19.9
68.3
82.3
Fe
(%)
58.1
55.8
58.7
58.2
58.2
CaFe
(%)
63.1
60.2
63.3
63.1
63.0
SiO2
(%)
4.7
8.1
4.9
4.9
4.9
Al2O3
(%)
3.2
3.7
3.1
3.2
3.1
P
(%)
0.19
0.15
0.16
0.18
0.18
Notes:
• Tonnages are dry metric tonnes and have been rounded. Any small differences in totals are due to rounding.
• CaFe% is calcined Fe% calculated using the following formula: Fe% / (100% - LOI%) * 100.
• Stockpiles have been converted to dry tonnes based on a 5.5% moisture content.
• Stockpiles include 0.8Mt of post-process lump and fines products and 1.4Mt of pre-process ore.
LOI
(%)
7.9
7.4
7.1
5.6
7.3
7.3
LOI
(%)
7.9
6.8
7.3
7.7
7.6
Mineral Resources and Ore Reserves Governance
Iron Valley Mineral Resource and Ore Reserve estimates are completed by or under the guidance of a suitably qualified MIN or
independent Competent Person in accordance with JORC (2012) guidelines. BCI is satisfied with the procedures MIN has advised
it has in place for Mineral Resource and Ore Reserve estimation. BCI personnel have also reviewed the documentation and are
comfortable with the methodologies used by MIN.
The Mineral Resource and Ore Reserves statement included in the Annual Report is reviewed and approved by a suitably
qualified Competent Person prior to its inclusion.
Competent Person’s Statements
The information in this report that relates to the Mineral Resource estimate at Iron Valley is based on, and fairly represents, information
that has been compiled by Mr Matthew Watson, who is a full-time employee of Mineral Resources Limited and a Member of the
Australasian Institute of Mining and Metallurgy. Mr Watson has sufficient experience that is relevant to the style of mineralisation
and type of deposit under consideration and to the activity that is being undertaken to qualify as a Competent Person as defined
in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr Watson
consents to the inclusion in this report on the matters based on his information in the form and context in which they appear.
The information in this report that relates to the Ore Reserve estimate at Iron Valley is based on, and fairly represents,
information that has been compiled by Mr John Kirk, who is a full-time employee of Mineral Resources Limited and a Member of
the Australasian Institute of Mining and Metallurgy. Mr Kirk has sufficient experience that is relevant to the style of mineralisation
and type of deposit under consideration and to the activity that is being undertaken to qualify as a Competent Person as defined
in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr Kirk
consents to the inclusion in this report on the matters based on his information in the form and context in which they appear.
The Mineral Resources and Ore Reserves statement in this report has been approved by Mr John Kirk, who is a full-time
employee of Mineral Resources Limited and a Member of the Australasian Institute of Mining and Metallurgy. Mr Kirk consents to
the inclusion in this report of the Mineral Resources and Ore Reserves statement in the form and context in which it appears.
75
CORPORATE DIRECTORY
BCI Minerals Limited ABN 21 120 646 924
Annual General Meeting
The 2021 Annual General Meeting of BCI Minerals Limited will
be held at 2pm (AWST) on Thursday 25 November 2021 at the
offices of BDO, 38 Station Street, Subiaco, Western Australia.
Details of the business of the meeting will be provided in the
Notice of Meeting.
Copies of the Chairman’s and Managing Director’s speeches
will be available on the Company’s website.
Financial Calendar*
September 2021 quarter report:
Annual General Meeting:
Half-year results:
*Timing of events is subject to change
26 October 2021
25 November 2021
25 February 2022
Registered Office and Principal Place of Business
Level 1, 1 Altona Street
West Perth, Western Australia 6005, Australia
Telephone: +61 (08) 6311 3400
Facsimile: +61 (08) 6311 3449
Website: www.bciminerals.com.au
info@bciminerals.com.au
Email:
Postal Address
GPO Box 2811
Perth, Western Australia 6001, Australia
Executive Directors
Alwyn Vorster – Managing Director
Non-executive Directors
Brian O’Donnell – Chairman
Michael Blakiston
Jenny Bloom
Richard Court
Garret Dixon
Chris Salisbury
Joint Company Secretaries
Susan Park
Stephanie Majteles
Share Registry
Investors seeking information about their shareholdings
should contact the company’s share registry:
Computershare Investor Services Pty Limited
Level 11, 172 St Georges Terrace
Perth, Western Australia 6000
Postal address: GPO Box 2975, Melbourne Victoria 3001
Telephone:
1300 850 505 (within Australia)
+61 3 9415 4000 (outside Australia)
(03) 9473 2500 (within Australia)
+61 3 9473 2500 (outside Australia)
web.queries@computershare.com.au
www.investorcentre.com/contact
Facsimile:
Email:
Website:
The share registry can assist with queries on share transfers,
dividend payments and changes of name, address or bank
account details.
For security reasons you will need your Security Reference
Number (SRN) or Holder Identification Number (HIN) when
communicating with the share registry.
Australian Securities Exchange Listing
BCI Minerals Limited securities are listed on the Australian
Securities Exchange (ASX) under the code BCI.
76
Level 1, 1 Altona Street, West Perth,
Western Australia 6005, Australia
GPO Box 2811, Perth, WA 6001
Telephone: +61 (08) 6311 3400
Facsimile: +61 (08) 6311 3449
Email: info@bciminerals.com.au
www.bciminerals.com.au
ABN 21 120 646 924