Cover Page
2013 Annual Report
CORPORATE DIRECTORY
TABLE OF CONTENTS
Corporate Directory
Chairman‟s Address
Review of Operations
Directors' Report
Auditor‟s Independence Declaration
Income Statement and Statement of Comprehensive Income
Statement of Financial Position
Statement of Cash Flows
Statement of Changes in Equity
Notes to the Consolidated Interim Financial Statements
Directors' Declaration
Independent Auditor‟s Report
Corporate Governance Statement
Additional Information
Tenement Schedule
DIRECTORS
Christopher Rowe (Non-Executive Chairman)
Bill Beament (Managing Director)
John Fitzgerald (Non-Executive Director)
Michael Fotios (Non-Executive Director)
Peter O‟Connor (Non-Executive Director)
COMPANY SECRETARY
Liza Carpene
REGISTERED OFFICE/
PRINCIPAL PLACE OF BUSINESS
Level 1
1 Puccini Court
Stirling WA 6021
Australia
Telephone: +61 8 6188 2100
Facsimile:
+61 8 6188 2111
Website: www.nsrltd.com
Email: info@nsrltd.com
Cover photograph: Lynn Mills, Truck Driver at Paulsens Gold Mine
Photographer: Evan Collis
PAGE
Inside Cover
1
2
7
19
20
21
22
23
24
51
52
54
59
60
SHARE REGISTRY
Advanced Share Registry Limited
150 Stirling Highway
Nedlands WA 6009
Australia
Telephone: +61 8 9389 8033
+61 8 9389 7871
Facsimile:
Website: www.advancedshare.com.au
HOME STOCK EXCHANGE
ASX Limited
2 The Esplanade
Perth WA 6000
Australia
ASX Code: NST
AUDITORS
Rothsay Chartered Accountants
Level 1
Lincoln House
4 Ventnor Avenue
West Perth WA 6005
Australia
2013 ANNUAL FINANCIAL REPORT
Inside Cover
CHAIRMAN’S ADDRESS
Dear Shareholder
The 2013 financial year was another successful year for Northern Star, amidst turbulent market conditions and
fluctuating gold prices. In November 2012, the Company achieved the significant milestone of being admitted to
the S&P/ASX 200 Index which is a reflection of its strong performance and acceptance in the investment market.
Northern Star‟s cornerstone asset, the Paulsens Gold Mine, continues to deliver positive results for the Company.
During the 2013 financial year, the Paulsens Gold Mine produced record physicals of 88,614 ounces of gold,
increased its Mineral Resources from 403,000 ounces of gold to 532,000 ounces1, an increase of 32%, and
enhanced its strong safety record.
The Company continues to demonstrate strong profitability and recorded a net profit after tax of $28.3 million for the
2013 financial year which was a 29% increase on the 2012 result of $22 million. Earnings per share grew by 29%
on the previous year to 6.6 cents per share as did earnings before interest and tax (EBITDA) of $63.8 million.
At 30 June 2013, Northern Star had $61 million in cash at bank, bullion and investments. During the year, the
Company paid its maiden dividend of 2.5 cents per share in September 2012 and an interim dividend of 1 cent per
share in April 2013 placing the Company on a 6% fully franked yield at a closing price of 58.5 cents per share.
Subsequent to the period end, the Company declared a dividend of 2.5 cents per share payable on 27 September
2013 as part of its commitment to delivering returns to Shareholders.
The Company remains excited by its exploration prospects and underground success in its near mine development
work at the Paulsens Gold Mine, including the recent Titan discovery subsequent to the end of the period.
The Regional Exploration Team remains focused on developing significant organic growth through our substantial
tenement package which now covers 8,610km2 of land stretching from the 1Moz Paulsens Gold Mine to its 2Moz
Ashburton Project some 200km away. This land holding includes ground accessed via joint venture arrangements
following the successful execution of a deal with Fortescue Metals Group in January 2013 to acquire and farm-in on
the non-iron ore mineral rights over key geological corridors on highly prospective tenements around its Paulsens
Gold Mine and Ashburton Gold Project.
The Board and Staff remain committed to managing the Company‟s activities in a safe, sustainable manner,
socially and environmentally responsible, with minimal impact on the communities in which it operates. Northern
Star‟s primary objective is to grow the Company‟s Shareholder value, resource/reserve base and build long term
profitability which will be achieved through operational excellence, exploration, organic growth and strategic
opportunities.
The Board would like to thank all of our Shareholders, Employees, Stakeholders, Contractors and Suppliers who
have contributed to our achievements during the year. In particular, the strong focus and commitment of our
Managing Director and his Executive Team has successfully positioned the Company for further growth as a long-
term profitable gold producer.
Yours sincerely
CHRIS ROWE
Chairman
8 October 2013
1 Gold Mineral Resources as at 30 June 2013 released to the ASX on 5 August 2013.
2013 ANNUAL FINANCIAL REPORT
Page 1
REVIEW OF OPERATIONS
OVERVIEW
Northern Star Resources Limited (Northern Star) is an ASX 200 gold (Au) production and exploration company with a resource base of over
2.2 million ounces, located in the highly prospective Ashburton-Pilbara region of Western Australia with a total land package of 8,610km2.
Northern Star remains focussed on its growth strategy to increase the production rate at its Paulsens Gold Mine to greater than 100,000
ounces per annum, and in parallel, progressing its exploration activities with the goal of building a second 100,000 ounce per annum
operation at the Ashburton Project when market conditions improve. The Company maintains a strong business development focus and will
advance its activities through a structured and disciplined approach to assessing new opportunities.
HEALTH AND SAFETY, ENVIRONMENT AND COMMUNITY
Northern Star values the health and safety of its employees and contractors, and continues to drive initiatives to further improve safety in
the workplace. This on-going focus and commitment to a safe environment has resulted in a notable improvement in safety performance
and is a fundamental measure of success for the business. At the end of June 2013, the Paulsens mine site had achieved 354 days Lost
Time Injury free and this excellent performance has continued into the 2014 financial year.
The Company is committed to managing its activities in an environmentally responsible manner. Through effective management practices,
and the commitment of its employees and contractors, Northern Star will ensure its activities have a minimum impact on the environment.
Northern Star proactively engages with the Communities in which it operates, and believes that the support and endorsement of its activities
by these Communities is fundamental to the long-term success of its business. Northern Star‟s employees and contractors embrace an
inclusive culture and continue to strengthen relationships with all stakeholders.
2013 ANNUAL FINANCIAL REPORT
Page 2
REVIEW OF OPERATIONS
MINE PRODUCTION
All ore to date has been sourced from the Paulsens Gold Mine. In the 2013 financial year, a total of 103,566 ounces Au were mined. Cash
costs for the period were $680 per ounce Au which included State Government Royalties of $38 per ounce. The total mine is now mining
ore at a rate which exceeds the production capacity of the processing plant.
During the period 412,360 tonnes were milled at an average head grade of 7.3 gpt Au for 88,614 ounces Au recovered. Unprocessed ore
stocks available for mill feed at the end of the period totalled 118,054 tonnes containing 9,976 ounces Au. Gold in circuit at the end of the
period totalled 1,741 ounces. Bullion on hand amounted to 2,214 ounces, and was subsequently sold in July 2013 realising $3.0 million.
Both of these items are reflected in the accounts as gold in circuit at cost.
PAULSENS
Ore Hoisted
Mined Grade
Gold in Ore Hoisted
Low Grade Hoisted
Grade
Gold in Low Grade
Total Ore Hoisted
Mined Grade
Gold in Ore Hoisted
PAULSENS
Milled Tonnes
Head Grade
Ounces Produced
Recovery
Gold Recovered
Ounces Poured
Ounces Sold
Average Gold Price
Revenue
Cash Operating Cost
Total Operating Cost
UNITS
Tonnes
gpt Au
Oz
Tonnes
gpt Au
Oz
Tonnes
gpt Au
Oz
SEP QTR
107,805
DEC QTR
116,051
MAR QTR
103,491
JUN QTR
127,392
6.53
22,634
19,724
1.07
678
127,529
5.69
23,312
7.08
26,418
11,194
1.45
522
127,245
6.59
26,940
7.29
24,273
10,864
1.03
360
114,355
6.70
24,633
6.90
28,263
11,238
1.13
407
138,628
6.43
28,681
UNITS
SEP-12 QTR
DEC-12 QTR
MAR-13 QTR
JUN-13 QTR
Tonnes
gpt Au
Oz
%
Oz
Oz
Oz
A$/oz
A$M
A$/oz
A$/oz
90,581
6.97
20,303
93
18,862
18,953
23,539
1,580
37.2
679
890
89,244
7.74
22,231
92
20,515
20,720
19,728
1,663
32.8
600
921
115,715
7.18
26,716
89
23,817
23,631
24,492
1,569
38.4
642
921
116,820
7.24
27,260
94
25,421
25,348
25,036
1,423
35.6
795
1,140
FY2013
454,739
6.95
101,588
53,020
1.15
1,967
507,757
6.34
103,566
FY2013
412,360
7.27
96,510
92
88,614
88,652
92,795
1,552
144.1
680
977
FINANCIAL RESULT
For the year ended 30 June 2013, the Company produced 88,614 ounces Au at an average cash cost of $680 per ounce Au which included
State Government Royalty of $38 per ounce. Revenue totalled $144 million, at an average gold sale price of $1,552 per ounce. Net profit
after tax for the year was $28 million.
Revenue
EBITDA(1)
EBIT(2)
NPAT(3)
FINANCIAL YEAR
END 30 JUNE 2013
‘000
FINANCIAL YEAR
END 30 JUNE 2012
‘000
%
CHANGE
144,236
63,785
37,560
28,328
99,525
49,373
31,973
21,964
45%
29%
17%
29%
(1) EBITDA is calculated as follows: Profit before Income Tax plus depreciation and amortisation plus finance cost
(2) EBIT is calculated as follows: Profit before Income Tax plus finance costs
(3) NPAT is calculated as follows: Net Profit after taxation
2013 ANNUAL FINANCIAL REPORT
Page 3
REVIEW OF OPERATIONS
CORPORATE
Key milestones during the period included:
The Company was admitted to the ASX 200 on 16 December 2012.
A fully franked maiden dividend of 2.5 cents per share was paid in September 2012.
A fully franked interim dividend of 1 cent per share was paid in April 2013.
Mr John Fitzgerald was appointed as an independent Non-Executive Director on 30 November 2012, and assumed the role of Chair of
the Audit Committee.
Mr Peter Farris did not stand for re-election as a Non-Executive Director at the Company‟s Annual General Meeting held on the
30 November 2012. Mr Farris had served as a Director of the Company since April 2009.
Ms Liza Carpene was appointed as full time Company Secretary on 15 April 2013, replacing Miss Karen Brown who had been the
Company Secretary since May 2000.
BUSINESS DEVELOPMENT
During the period, Northern Star executed a deal to acquire and farm-in on the non-iron ore mineral rights over key geological corridors on
highly prospective tenements around its Paulsens mine and Ashburton Gold Project from Fortescue Metals Group (Fortescue). The deal,
which provides for Northern Star to initially acquire 25%, then earn a further 35% of the non-iron ore rights over two years to provide
Northern Star with a 60% JV interest and a total tenement package of 8,610km2 of land stretching from Paulsens to its 1.7Moz Ashburton
Project ~200km away. After the initial 60% earn-in, Fortescue must co-contribute otherwise it will dilute down to an eventual 2% net smelter
return (NSR).
EXPLORATION
Paulsens in Mine Drilling
By the end of the period, Northern Star had increased the Resource base at the Paulsens Project by 32% to 532,000oz (refer Table 1).
Underground drilling was focussed predominantly on the Voyager 1, the newly discovered high grade Voyager 1 Extension down plunge,
Voyager 2 and the recently discovered Gabbro Veins. Numerous drill holes were also completed in the Upper Levels of Paulsens.
Paulsens Group
The Paulsens Corridor generated new targets from aeromagnetic surveys that have been followed up with reconnaissance targeted soil
programs, as well as drill planning on existing high ranked exploration targets such as the Gabbro Offset and the Belvedere prospect with a
high degree of success to date. The Belvedere deposit is located just 8km from the Paulsens‟ processing plant, whilst the Gabbro Offset
target is within 250 metres of the existing Paulsens‟ mine infrastructure
Ashburton Group
During the year, Northern Star‟s strategy to establish a second 100,000 ounce-a-year operation continued at its Ashburton Project with new
discoveries highlighted at Cheela, Sparta and extensions to the known mineralisation at Mount Olympus, Peake Extension and Waugh
prospects. This resulted in resources for the project increasing by 66% to 1.7Moz. Further greenfield targets have been generated to source
new oxide and sulphide targets.
Subsequent to the period end, Northern Star announced that it had temporarily reduced its regional exploration and project development
expenditure which involves delaying the Ashburton Gold Project pending improvement in the gold price and general market conditions.
Northern Star will continue to meet its expenditure commitments to ensure that tenements remain in good standing.
RESOURCES & RESERVES
The following tables detail the Mineral Resources established as at 30 June 2013. The change to Mineral Resources at the Paulsens Gold
Project was an increase of 32% from 403,000oz at 30 June 2012 to 532,000oz as at 30 June 2013. Reserves on the Paulsens Gold Project
also increased from 113,000oz at 30 June 2012 to 204,000oz at 31 December 2012. This represented an 80% increase in Reserves.
At the Ashburton Project, Mineral Resources increased by 66% from 1 million ounces at 30 June 2012 to 1.7 million ounces at 30 June
2013. Total JORC gold reported Resource ounces for the Company stand at 2.2 million ounces as per Table 1, and total JORC gold
reported Reserve ounces for the Company stand at 257,000 ounces as per Table 2.
2013 ANNUAL FINANCIAL REPORT
Page 4
REVIEW OF OPERATIONS
Table 1 - Paulsens and Ashburton Mineral Resources inclusive of Reserves effective 30 June 2013
Table 2 - Paulsens and Ashburton Mineral Reserves effective 31 December 2012
2013 ANNUAL FINANCIAL REPORT
Page 5
GOLD MINERAL RESOURCES 1As at 30 June 2013Tonnes Grade Ounces Tonnes Grade Ounces Tonnes Grade Ounces Tonnes Grade Ounces Based on attributable ounces(000's) (gpt) (000's) (000's) (gpt) (000's) (000's) (gpt) (000's) (000's) (gpt) (000's) SurfacePaulsens- - - 573 2.5 47 169 3 14 742 2.5 61 1.0 gpt AuBelvedere- - - 168 3.6 19 99 5 16 267 4.2 35 1.0 gpt AuMerlin- - - ---523 1 24 523 1.4 24 1.0 gpt AuMt Clement (20%)- - - ---226 2 13 226 1.8 13 0.5 gpt AuUnderground Upper Paulsens63 9.7 20 98 13.1 41 119 8 31 280 10.2 92 2.5 gpt Au Voyager UG517 12.1 201 173 11.9 66 61 13 26 751 12.2 293 2.5 gpt Au Stockpiles118 2.6 10 - - - - - - 118 2.6 10 1.0 gpt Au Gold in Circuit/Transit--4 - - - - - - --4 Subtotal Paulsens698 10.5 235 1,012 5.3 173 1,197 3.2 124 2,907 5.6 532 SurfaceMt Olympus- - - 6,038 2.3 448 9,138 2.2 632 15,176 2.2 1,080 0.7 gpt AuPeake- - - 113 5.2 19 3,544 3.3 380 3,657 3.3 399 0.9 gpt AuWaugh- - - 347 3.6 40 240 3.6 28 587 3.6 68 0.9 gpt AuZeus- - - 508 2.1 34 532 2.2 38 1,040 2.2 72 0.9 gpt AuElectric Dingo- - - 98 1.6 5 444 1.2 17 542 1.3 22 0.9 gpt AuRomulus- - - - - - 329 2.6 27 329 2.6 27 0.9 gpt AuSubtotal Ashburton- -- 7,104 2.4 546 14,227 2.5 1,122 21,331 2.4 1,668 TOTAL RESOURCES698 10.5 235 8,116 2.8 719 15,424 2.5 1,246 24,238 2.8 2,200 1 Resources are inclusive of Reserves2 Rounding errors may occurPAULSENS GOLD PROJECTASHBURTON GOLD PROJECTMEASURED (M) INDICATED (I) INFERRED (Inf)TOTAL (MI&Inf)Cut Off GradeGOLD MINERAL RESERVES1As at 31 December 2012Tonnes Grade Ounces Tonnes Grade Ounces Tonnes Grade Ounces Based on attributable ounces(000's) (gpt) (000's) (000's) (gpt) (000's) (000's) (gpt) (000's) SurfacePaulsens- - - 424 2.3 31 424 2.3 31 Belvedere- - - 129 3.2 13 129 3.2 13 Underground Upper Paulsens- - - 36 6.9 8 36 6.9 8 Voyager UG328 8.0 84 149 11.1 53 477 8.9 137 Stockpiles102 3.3 11 - - - 102 3.3 11 Gold in Circuit/Transit- - 4 - - - - - 4 Subtotal Paulsens430 6.9 99 738 4.4 105 1,168 5.3 204 SurfaceMt Olympus248 3.6 29 113 3.6 13 361 3.6 42 Peake- - - 47 5.0 8 47 5.0 8 Zeus- - - 38 2.4 3 38 2.4 3 Subtotal Ashburton248 3.6 29 198 3.8 24 446 3.7 53 TOTAL RESERVES678 5.9 128 936 4.3 129 1,614 5.0 257 1 Rounding errors may occurPROVEDPROBABLEPROVED and PROBABLE PAULSENS GOLD PROJECTASHBURTON GOLD PROJECT
REVIEW OF OPERATIONS
Competent Persons Statements
The information in this announcement that relates to Paulsens and Ashburton mineral resource estimations, exploration results, data quality, geological
interpretations, potential for eventual economic extraction and estimates of exploration potential, is based on information compiled by or under the supervision of
Brook Ekers, who is an AIG member who is a full-time employee of Northern Star Resources Limited. Mr Ekers has sufficient experience which is relevant to the style
of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition
of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Mr Ekers consents to the inclusion in the report of the matters
based on his information in the form and context in which it appears.
Information in this announcement that relates to the Paulsens Project Ore Reserves has been compiled by or under the supervision of Darren Stralow, General
Manager – Paulsens Gold Mine, who is a full-time employee of Northern Star Resources Limited. Mr Stralow has sufficient experience which is relevant to the style of
mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of
the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Mr Stralow is a Member of the Australasian Institute of Mining
and Metallurgy and consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.
Information in this announcement that relates to the Ashburton Ore Reserves has been compiled by Shane McLeay, Principal Engineer – Entech Pty Limited, who has
sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a
Competent Person as defined in the 2012 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Shane
McLeay is a Member of the Australasian Institute of Mining and Metallurgy and consents to the inclusion in the report of the matters based on his information in the
form and context in which it appears.
Forward Looking Statements
Northern Star Resources Limited has prepared this announcement based on information available to it. No representation or warranty, express or implied, is made as
to the fairness, accuracy, completeness or correctness of the information, opinions and conclusions contained in this announcement. To the maximum extent
permitted by law, none of Northern Star Resources Limited, its directors, employees or agents, advisers, nor any other person accepts any liability, including, without
limitation, any liability arising from fault or negligence on the part of any of them or any other person, for any loss arising from the use of this announcement or its
contents or otherwise arising in connection with it.
This announcement is not an offer, invitation, solicitation or other recommendation with respect to the subscription for, purchase or sale of any security, and neither
this announcement nor anything in it shall form the basis of any contract or commitment whatsoever. This announcement may contain forward looking statements that
are subject to risk factors associated with gold exploration, mining and production businesses. It is believed that the expectations reflected in these statements are
reasonable but they may be affected by a variety of variables and changes in underlying assumptions which could cause actual results or trends to differ materially,
including but not limited to price fluctuations, actual demand, currency fluctuations, drilling and production results, reserve estimations, loss of market, industry
competition, environmental risks, physical risks, legislative, fiscal and regulatory changes, economic and financial market conditions in various countries and regions,
political risks, project delay or advancement, approvals and cost estimates.
2013 ANNUAL FINANCIAL REPORT
Page 6
DIRECTORS’ REPORT
The Directors of Northern Star Resources Limited (Northern Star) present their report together with the consolidated financial report for the
year ended 30 June 2013.
DIRECTORS
The Directors in office at the date of this report, and at any time during the financial year, are as follows. Directors were in office for the
entire year unless otherwise stated.
Name and Qualifications
Experience, Special Responsibilities and Other Directorships
Christopher K G Rowe
BA, MA Economics and Law -
Independent Non-Executive Chairman
Appointed: 20 February 2003
William J (Bill) Beament
B.Eng-Mining (Hons) -
Managing Director
Appointed: 20 August 2007
Michael G Fotios
BSc (Hons), MAusIMM -
Non-Executive Director
Appointed: 4 September 2009
Mr Rowe has practised as a lawyer both in the United Kingdom and in Western Australia before
becoming a full time consultant to the mining and oil and gas industry. He has been chairman or
deputy chairman of a number of public listed mining and oil and gas related companies in
Australia and North America, holding both executive and non-executive positions.
Mr Rowe is currently Chairman of Target Energy Limited (since January 2010) and was
previously a director of Tangiers Petroleum Limited (from April 2008 to October 2010).
Mr Rowe is a member of the Audit Committee, and Chair of the Nomination and Remuneration
Committees.
Mr Beament is a mining engineer with more than 19 years‟ experience in the resource sector.
Previously he held several senior management positions, including General Manager of
Operations for Barminco Limited with overall responsibility for 12 mine sites across Western
Australia, and General Manager of the Eloise Copper Mine in Queensland. Mr Beament is the
current President of Western Australian School of Mines Graduate Association representing over
3,000 graduates.
Mr Beament is a member of the Nomination Committee.
Mr Fotios has qualifications in Geology specialising in Economic Geology with extensive
experience in exploration throughout Australia working with gold, base metals, tantalum, tin and
nickel from exploration to feasibility over the last 26 years. He previously held positions with
Homestake Australia Limited and Sons of Gwalia Limited.
Mr Fotios is currently Executive Director of Redbank Copper Limited (from September 2012) and
Non-Executive Director of Swan Gold Mining Limited (from September 2012), General Mining
Corporation Limited (from June 2012), Horseshoe Metals Limited (from May 2012) and Pegasus
Metals Limited (from December 2009). Mr Fotios was previously a director of Stirling Resources
Limited (from September 2012 to November 2012).
Mr Fotios is a member of the Nomination and Remuneration Committees.
Peter O’Connor
MA, Economics and Political Science,
Trinity College, Dublin University;
Barrister-at Law, The Kings Inn, Dublin
Independent Non-Executive Director
Mr O‟Connor has extensive global experience in the funds management industry, both in public
and private companies in developed and emerging economies. He was co-founder, director and
deputy chairman of IMS Selection Management Ltd which had $10 billion under management or
advice from 1998-2008. Following the sale of IMS to BNP Paribas in 2008, he was deputy
chairman of FundQuest UK Ltd with $35 billion of assets under management from 2008-2010.
Appointed: 21 May 2012
John D Fitzgerald
CA, Fellow FINSIA, GAICD
Independent Non-Executive Director
Appointed: 30 November 2012
Mr O‟Connor was previously a Director and Chairman of ASX listed Brazilian Metals Group
Limited (from May 2011 to October 2012), LSE listed Advance Developing Markets Fund (from
October 1998 to April 2012) and TSX listed NEO Material Technologies Inc (from December
1993 to June 2012).
Mr O‟Connor is a member of the Audit, Nomination and Remuneration Committees.
Mr John Fitzgerald has over 25 years resource financing experience and has provided project
finance and corporate advisory services to a large number of companies in the resource sector.
Mr Fitzgerald is the Managing Director of Optimum Capital Pty Ltd, a corporate advisory
business focussed on the mining sector. He has previously held senior positions at NM
Rothschild & Sons, Investec Bank Australia, Commonwealth Bank and HSBC Precious Metals.
Mr Fitzgerald is a Chartered Accountant, a Fellow of the Financial Services Institute of
Australasia and a graduate member of the Australian Institute of Company Directors.
Mr Fitzgerald is a Non-Executive Director of Mungana Goldmines Limited (from June 2009) and
was previously Chairman of Integra Mining Limited.
Mr Fitzgerald is the Chair of the Audit Committee (from 30 November 2012) and a member of the
Nomination and Remuneration Committees (from 30 November 2012).
2013 ANNUAL FINANCIAL REPORT
Page 7
DIRECTORS’ REPORT
Peter C P Farris
Diploma Business Perth Tech, Diploma
Business RMIT, MAICD
Non-Executive Director
Appointed: 22 April 2009
Ceased: 30 November 2012
COMPANY SECRETARY
Liza Carpene
MBA, ACSA, ACIS, GAICD
Appointed: 15 April 2013
Karen V E Brown
BEc(Hons)
Appointed: 23 May 2000
Resigned: 15 April 2013
DIRECTORS’ MEETINGS
Mr Farris is a highly credentialed businessman in the Perth real estate industry and corporate
advisory services.
Mr Farris did not stand for re-election as a Director at the Annual General Meeting on
30 November 2012.
Ms Carpene has worked in the mining industry for more than 17 years and has significant
experience in corporate administration, human resources, IT and community relations. Most
recently, Ms Carpene was Company Secretary/CFO for listed explorer Venturex Resources
Limited and previously held various site and Perth based management roles with Great Central
Mines, Normandy Mining, Newmont Australia, Agincourt Resources and Oxiana.
Miss Brown is an Honours Degree graduate in economics from the University of Western
Australia. Miss Brown has considerable experience in corporate administration of public listed
companies over a period spanning 25+ years, primarily in the resources sector and is currently
the company secretary for Excelsior Gold Limited and a joint company secretary for Alkane
Resources Ltd and General Mining Corporation Limited.
The number of Directors‟ meetings and number of meetings attended by each Director in the capacity of a Director of the Company from the
beginning to the end of the period are:
DIRECTORS’ MEETINGS
AUDIT
REMUNERATION
NOMINATION
Director
Attended
Held
Attended
Held
Attended
Held
Attended
Held
MEETINGS OF COMMITTEES
Christopher Rowe
Bill Beament
John Fitzgerald
Michael Fotios
Peter O'Connor
Peter Farris
11
11
7
10
10
4
* Not a member of the relevant committee
** Not a Director at that time
11
11
7
11
11
4
2
*
1
*
2
1
2
*
1
*
2
1
4
*
3
4
4
1
4
*
3
4
4
1
1
1
**
1
1
1
1
1
**
1
1
1
2013 ANNUAL FINANCIAL REPORT
Page 8
DIRECTORS’ REPORT
CORPORATE STRUCTURE
Northern Star Resources Limited is a company limited by shares that is incorporated and domiciled in Australia. Northern Star Resources
Limited has prepared a consolidated financial report incorporating the entities that it controlled during the financial year as follows:
Northern Star Resources Limited – parent entity
Northern Star Mining Services Pty Limited – 100% owned subsidiary
PRINCIPAL ACTIVITIES
The principal activities of the Group are:
mining of gold deposits at Paulsens,
construction and development of extensions to existing gold mining operations at Paulsens Gold Mine, and
exploration and development of gold deposits in the Ashburton region of Western Australia.
The entity‟s operations are discussed in the Review of Operations section at the front of this report.
EARNINGS PER SHARES
Basic Earnings per Share was 6.7 cents (2012: 6.1 cents).
DIVIDENDS
Dividends paid to Members during the 2013 financial year were as follows:
Dividend Rate
2.5 cents per share
1.0 cent per share
Record Date
Payment Date
5 September 2012
12 September 2012
14 March 2013
4 April 2013
Franking
100% franked
100% franked
After the balance date, the following dividend was proposed by the Directors:
Dividend Rate
2.5 cent per share
Record Date
Expected Payment Date
16 August 2013
27 September 2013
Franking
100% franked
The financial effect of this dividend has not been brought to account in the financial statement for the period ended 30 June 2013, and will
be recognised in subsequent financial reports.
FINANCIAL POSITION
The profit of the Group for the financial year, after providing for income tax, amounted to $28.3 million (June 2012: $22 million). At the end
of the financial year, the Group had $55 million in cash (June 2012: $65 million) and $3 million in gold bullion (June 2012: $10 million). The
positive cash flow generated through operating activities was reinvested in growth projects and used to pay dividends to Shareholders. A
summary of major expenditure included:
increasing the processing plant capacity from 350,000 tonnes per annum to 450,000 tonnes per annum ($6.7 million)
acceleration of exploration to increase the resource inventory ($15 million),
constructing a paste plant to expand the underground operations ($8.2 million),
paying a fully franked maiden dividend of 2.5 cents per share ($10.6 million), and
paying a fully franked interim dividend of 1 cent per share ($4.2 million).
The gold bullion mentioned above is the market value based on 2,214 ounces of gold which was sold at A$1,372 per ounce.
SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS
There were no significant changes in the state of affairs of the Consolidated Entity that occurred during the 2013 financial year not
otherwise disclosed in this Directors‟ Report or the financial statements.
2013 ANNUAL FINANCIAL REPORT
Page 9
DIRECTORS’ REPORT
SUBSEQUENT EVENTS
Subsequent to the period end, the Company announced:
a final dividend of 2.5 cents per share to Shareholders on the record date of 16 August 2013 , payable on 27 September 2013; and
an updated Resources Statement effective as at 30 June 2013 (refer Table 1 on page 5).
There are no other matters or circumstances that have arisen since 30 June 2013 that have or may significantly affect the operations,
results, or state of affairs of the Group in future financial years.
ENVIRONMENTAL REGULATION AND PERFORMANCE
The Company holds licences and abides by Acts and Regulations issued by the relevant mining and environmental protection authorities.
The Company has a policy of at least complying with, but in most cases exceeding, its statutory environmental performance obligations.
These licences, Acts and Regulations specify limits and regulate the management of various environmental management issues, including
discharges to the air, surface water and groundwater associated with the Company‟s mining operations as well as the storage and use of
hazardous materials.
All environmental performance obligations are monitored by the Board and subjected from time to time to Government agency audits and
site inspections. No environmental breaches have occurred or have been notified by any Government agencies during the year ended
30 June 2013.
DIRECTORS’ INTERESTS
The relevant interest of each Director in the share capital as notified by the Directors to the Australian Securities Exchange in accordance
with Section 205G(1) of the Corporations Act 2001, at the date of this report is as follows:
NAME OF DIRECTOR
Christopher Rowe
Bill Beament
John Fitzgerald
Michael Fotios
Peter O‟Connor
FULLY PAID
ORDINARY SHARES
3,986,195
12,314,735
-
28,192,474
200,000
OPTIONS
-
EXERCISE
PRICE
-
DETAILS OF OPTIONS
-
2,000,000
$0.91
Unlisted Options Expiring 28/06/14
-
-
-
-
-
-
750,000
$0.91
Unlisted Options Expiring 28/06/14
Note: Details of relevant interest of each Director are outlined at Note 23 to the financial statements.
SHARE OPTIONS
Unissued ordinary shares of the Company under option at the date of this report are as follows:
Employee Options
Employee Options
Employee Options
Employee Options
Employee Options
Employee Options
Employee Options
Employee Options
Employee Options
Employee Options
Employee Options
NUMBER
333,334
333,333
333,333
2,000,000
750,000
250,000
250,000
125,000
125,000
250,000
250,000
EXERCISE PRICE
EXPIRY DATE
$1.20
$1.50
$1.81
$0.91
$0.91
$1.05
$1.22
$1.05
$1.22
$0.95
$1.05
Expiring on 27 Feb 2014
Expiring on 27 Feb 2015
Expiring on 27 Feb 2016
Expiring on 28 June 2014
Expiring on 28 June 2014
Expiring on 27 Aug 2014
Expiring on 27 Aug 2015
Expiring on 1 Nov 2014
Expiring on 1 Nov 2015
Expiring on 15 Apr 2015
Expiring on 15 Apr 2016
2013 ANNUAL FINANCIAL REPORT
Page 10
DIRECTORS’ REPORT
REMUNERATION REPORT (AUDITED)
A. Introduction
This report details the nature and amount of remuneration for each Director and Executive of Northern Star Resources Limited. The
information provided in the Remuneration Report includes remuneration disclosures that are audited as required by Section 308(3C) of the
Corporations Act 2001.
For the purposes of this report, Key Management Personnel (KMP) of the Group are defined as those persons having authority and
responsibility for planning, directing and controlling the major activities of the Group, directly or indirectly, including any Director (whether
Executive or otherwise) of the parent company. Northern Star‟s KMP are defined as: Directors, Chief Financial Officer and Company
Secretary.
For the purposes of this report the term “Executive” includes the Managing Director, the Chief Financial Officer and the Company Secretary.
Details of KMP during the Year:
NON-EXECUTIVE DIRECTORS
Christopher Rowe
Michael Fotios
Peter O‟Connor
John Fitzgerald
Peter Farris
EXECUTIVE
Bill Beament
Raymond Parry
Liza Carpene
Karen Brown
B. Remuneration Governance
Board Oversight
Non-Executive Chairman
Non-Executive Director
Non-Executive Director
Non-Executive Director (appointed 30 November 2012)
Non-Executive Director (did not stand for re-election 30 November 2012)
Managing Director
Chief Financial Officer
Company Secretary (appointed 15 April 2013)
Company Secretary (resigned 15 April 2013)
The Board is responsible for ensuring that the Group‟s remuneration structures are aligned with the long-term interests of the Company and
its Shareholders. Accordingly, the Board has an established Remuneration Committee to assist it in making decisions in relation to KMP
remuneration.
Remuneration Committee
The Remuneration Committee currently comprises all Non-Executive Directors. Between 1 July 2012 and 30 November 2012, this included
two independent Non-Executive Directors and two non-Independent Non-Executive Directors. From 30 November 2012 and until the end of
the period, the Remuneration Committee comprised of three independent Non-Executive Directors and one non-independent Non-
Executive Director.
In order to ensure that this Committee is fully informed when making remuneration recommendations, the Committee receives reports from
Management, independent sources, empirical market data and may draw on services from a range of other external sources if required.
The Remuneration Committee is responsible for reviewing and recommending to the Board:
the Company‟s Remuneration Policy and framework (including determining short term incentives (STIs) and long term incentives (LTIs)
key performance indicators and hurdles, and vesting of STIs/LTIs),
senior executives‟ remuneration and incentives (including KMP and other senior executives),
superannuation arrangements, and
remuneration by gender.
Non-Executive remuneration reviews are also undertaken by the Remuneration Committee, providing recommendations to the full Board.
Executive remuneration is reviewed annually having regard to individual and business performance, relevant comparative information and
internal and independent external information.
The remuneration review undertaken during the 2013 year included a review of the performance and remuneration of all personnel
including the KMP. The Committee reviewed industry data from the April 2012 Australasian Gold & General Mining Industry Remuneration
2013 ANNUAL FINANCIAL REPORT
Page 11
DIRECTORS’ REPORT
Report by McDonald & Company (Australasia) Pty Ltd. In addition, the Managing Director presented the performance reviews undertaken
on KMP and other senior executives to the Remuneration Committee.
Use of Remuneration Consultants
The Remuneration Committee consulted with PriceWaterhouseCoopers during the period to provide remuneration information, including
assistance in developing an LTI plan and providing market information for remuneration and remuneration mix.
During the year ended 30 June 2013 no remuneration recommendations, as defined by the Corporations Act, were provided by
PriceWaterhouseCoopers.
Company's 2012 Annual General Meeting Feedback
Following the 2012 Annual General Meeting, the Board has addressed a number of concerns raised by Shareholders in relation to its 2012
Remuneration Report, including:
the Company has altered its position with regard to granting share options or performance rights to Non-Executive Directors which was
undertaken in the past to attract high calibre Directors and to encourage share ownership for newly appointed Non-Executive Directors,
Executive management will no longer be eligible to receive performance rights which vest immediately, or are based solely on
continued service,
Northern Star is revising its remuneration framework and is in the process of finalising a new LTI program to apply to the 2014 period,
and
the Board of Directors has now been structured so that it is comprised of a majority of independent Non-Executive Directors, with three
out of five Directors now being independent Non-Executive Directors.
C. Principles Used to Determine the Nature and Amount of Remuneration
Remuneration Philosophy
The performance of the Company depends upon the quality of its Directors and Executives. To succeed and endure, the Company must
attract, motivate and retain highly skilled Directors and Executives.
To this end, the Company embodies the following principles in its remuneration framework:
provides for competitive rewards to attract and retain high calibre Executives;
aligns the incentives of Executives with the long-term interests of Company Shareholders by linking rewards to Shareholder value; and
establishes appropriate key performance indicators and hurdles in relation to variable Executive remuneration.
In accordance with best practice corporate governance, the structure of Non-Executive Director and Executive management remuneration
is separate and distinct.
Non-Executive Director Remuneration
The Board‟s objective is to set aggregate remuneration at a level which provides the Company with the ability to attract and retain Directors
of the highest calibre, whilst incurring a cost which is acceptable to Shareholders.
Non-Executive Directors‟ fees are paid within an aggregate limit (currently $500,000 per annum) which is approved by the Shareholders
from time to time. Retirement payments, if any, are agreed to be determined in accordance with the rules set out in the Corporations Act as
at the time of a Director‟s retirement or termination.
The amount of aggregate remuneration sought to be approved by Shareholders and the manner in which it is apportioned amongst Non-
Executive Directors is reviewed annually at the discretion of the Board. When undertaking the annual review process, the Board considers
the amount of Non-Executive Director fees being paid by comparable companies within the S&P ASX 200 & S&P ASX 300 with similar
market capitalisation, responsibilities and experience of the Non-Executive Directors.
Executive Director and Senior Executive Remuneration
The Board‟s objective is to reward Executives with a level and mix of remuneration commensurate with their position and responsibilities
within the Company and so as to:
motivate and reward Executives for company and individual performance,
ensure continued availability of experienced and effective management, and
ensure total remuneration is competitive by market standards.
In reviewing the level and make-up of Executive total remuneration, the Remuneration Committee ensures remuneration reflects the market
salary for a position and individual of comparable responsibility and experience. Remuneration is compared with the external market by
reviewing industry salary surveys, sourcing empirical market data and other evaluation methods during the recruitment process. Target
positioning of total remuneration against market is between the 50th and 75th percentile. If required, the Remuneration Committee may
engage an external consultant to provide independent advice in the form of a written report detailing market levels of remuneration for
comparable Executive roles.
2013 ANNUAL FINANCIAL REPORT
Page 12
DIRECTORS’ REPORT
Total remuneration consists of a mix of:
fixed remuneration; and
“at risk” variable remuneration, comprising STIs and LTIs.
REMUNERATION
COMPONENT
Fixed
Remuneration
CONSISTS OF
Base salary / consulting
fees, superannuation and
other non-cash benefits
Short-term
Incentives (STI)
Cash payments
OBJECTIVE
To provide a base level of
is both
remuneration which
appropriate to the position and
is competitive in the market.
To provide an “at risk” incentive
to
in a
reward Executives
this
manner which aligns
element of remuneration with
the creation of Shareholder
wealth
the
annual
achievement
performance measures.
provide
through
of
market
To
a
Long Term
Incentives (LTI)
Performance rights / Share
options / Share loans
competitive STI opportunity.
To provide an “at risk” grant to
incentivise
motivate
and
Executives to pursue the long
term growth and success of the
Company.
To
provide
a
market
competitive LTI opportunity.
To
support
of
Executives and key personnel.
retention
LINK TO PERFORMANCE 2013
Annual performance of company and
individual performance.
safety,
Specific Company Key Performance
Indicators (KPIs) were set in the following
performance areas:
/
production, reserves / resources and share
price appreciation.
Individual KPIs also included performance in
investor
including
corporate matters,
relations and corporate strategy.
financial
The focus was on performance and growth,
both of
the share price and company
projects.
A new LTI plan for the 2014 period is
currently being developed and is being
performance
incorporate
designed
hurdles relating to:
Relative Total Shareholder Return; and
with appropriate vesting conditions.
internal milestone targets
to
D. Non-Executive Director Remuneration
2013 Remuneration of Non-Executive Directors
Aggregate remuneration payable to all Non-Executive Directors, as approved by Shareholders, is not to exceed $500,000 per annum.
Directors‟ fees cover all regular Board activities and membership of Committees. Historically, Non-Executive Directors were also provided
with share options upon joining the Northern Star Board. Prior to Northern Star discontinuing this practice, 750,000 share options were
granted and vested to Mr O‟Connor following Shareholder approval on 30 November 2012. These options expire on 28 June 2014 and have
an exercise price of 91 cents.
For the 2013 period, the Non-Executive Directors were paid base fees associated with their duties as Directors and membership of Board
Committees. The policy for Non-Executive Director base fees is $135,000 per annum for the Non-Executive Chairman and $85,000 per
annum for other Non-Executive Directors, inclusive of a 10% superannuation contribution. The Chair of the Audit Committee receives an
additional $25,000 per annum in recognition of the additional level of commitment and responsibility. Refer to the following table for
amounts paid for the period.
2013 ANNUAL FINANCIAL REPORT
Page 13
DIRECTORS’ REPORT
Total Non-Executive Director Remuneration - 2013
Total remuneration paid or payable to Non-Executive Directors for the period ended 30 June 2013 was:
SALARY /
CONSULTING
FEES
STI CASH
PAYMENT^
SUPER
OPTIONS
TOTAL
REMUNERATION
CONSISTING OF
OPTIONS DURING
THE YEAR
Year
$
$
$
$
$
%
2013
2012
2013
2012
2013
2012
2013
2013
2012
126,250
109,638
77,500
53,333
85,710
7,671
57,197
29,164
56,329
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
5,530
-
-
-
126,250
1,537
111,175
-
15,373
77,500
68,706
162,071
247,781
-
-
-
2,335
7,671
62,727
29,164
58,664
0.0%
1.4%
0.0%
22.4%
65.4%
0.0%
0.0%
0.0%
4.0%
Directors
Christopher Rowe
Michael Fotios
Peter O‟Connor
John Fitzgerald
Peter Farris
Non-Executive Directors – Current Remuneration
NAME
Christopher Rowe
Michael Fotios
Peter O‟Connor
John D Fitzgerald
BASE
SALARY
(at 30/6/13)
$135,000
$85,000
$85,000
$110,000
TERMINATION
BENEFIT
None
None
None
None
E. Executive Remuneration
2013 Executive Remuneration
Remuneration for the 2013 period consisted of a mix of:
fixed remuneration
variable remuneration, comprising STIs and LTIs*.
*In the 2013 period, only one LTI allocation was made to an Executive, being Liza Carpene who joined the Company on 15 April 2013.
Fixed Remuneration
In December 2012, the Board approved salary increases for Executives with an effective date 1 July 2012. These increases were approved
after considering performance reviews and industry data from the April 2012 Australasian Gold & General Mining Industry Remuneration
Report by McDonald & Company (Australasia) Pty Ltd. The McDonald report is based on data collected from 164 organisations in a survey
group representing gold and other mining companies. This comparator group reflects the key talent market for Northern Star and therefore
competitiveness against this group is required to attract and retain key talent. Fixed remuneration is targeted between the 50th and 75th
percentile of the market comparator group, with consideration of individual performance reviews determining final remuneration. The
remuneration for Messrs Beament and Parry was adjusted to bring their fixed remuneration comparable to the median for their equivalent
roles based on this industry data.
2013 ANNUAL FINANCIAL REPORT
Page 14
DIRECTORS’ REPORT
NAME
Bill Beament
Raymond Parry
Liza Carpene
Karen Brown
POSITION
Managing Director
Chief Financial Officer
Company Secretary (Appointed 15 April 2013)
Company Secretary (Resigned 15 April 2013)
BASE SALARY INCREASE
(%) FOR 2012/2013
BASE SALARY
(at 30/6/13)
7.0%
13.8%
N/A
N/A
495,000
287,000
227,273
33,000
Variable Remuneration – STIs
STIs paid in the 2013 financial year were for the performance by eligible Executives in the 2012 period. The overall target STI amount
available for 2012 was up to 50% of Total Fixed Remuneration (TFR) for each Executive. The STI was made up of a site performance
measure and growth bonus of up to 35% (see below table) and an additional bonus of 15% of TFR should ounces produced exceed budget
by greater than 10% and the market capitalisation of Northern Star increased by greater than 50% for the financial year period. The Board,
however, retained absolute discretion to increase the STI to reward exceptional performance, and to reduce the award depending on the
Company‟s performance.
KPIs (corporate and individual) for the 2012 financial year were:
KEY PERFORMANCE INDICATORS
MEASURE
Safety Metrics
Production Budget
Production Growth
To ensure a safe working environment in terms of Loss Time Injuries and Total Recordable
Injuries
Attainment of tonnes, grade and ounces for the financial year budget
Grow production profile to 400ktpa
Reserve and Resource Metrics
Increase reserves to 150koz and resources to 1.0moz
Business Development
Share Price Metrics
Confidential KPI
Share price increase by 25% over the financial year
The Remuneration Committee met in September 2012 to discuss the performance reviews of the KMPs and in response to KPIs achieved,
awarded an STI payment of 30.05% based on the KMP‟s TFR.
As a result, STI payments for Executive KMP were recommended as follows:
NAME
Bill Beament
Raymond Parry
Liza Carpene
Karen Brown
POSITION
Managing Director
Chief Financial Officer
Company Secretary (Appointed 15 April 2013)
Company Secretary (Resigned 15 April 2013)
STI PAYMENT FOR YEAR
ENDED 30 JUNE 2013
150,223
90,134
N/A
N/A
The KPIs for 2013 financial year are of a similar structure to the 2012 financial year, and are currently being evaluated.
Variable Remuneration – LTIs
During the 2013 financial year, only one new LTI allocation was made to Executive staff which was to the incoming Company Secretary
(Liza Carpene) who joined the Company on 15 April 2013.
The Board, at its discretion, elected to vest Executive and Management options in the first half of the 2013 financial year in advance of
vesting dates in recognition of superior personal and Company performance since acquiring the Paulsens Gold Mine in 2010. This resulted
in incentive options being converted to ordinary shares. Refer Note 23 of the Notes to the Financial Statements.
Company Performance & Remuneration
The Company earnings (EBITDA), profit (NPAT) and earnings per share (EPS), shown in the following graphs, reflect Company
performance during the previous four financial years, including the current year ended 30 June 2013.
2013 ANNUAL FINANCIAL REPORT
Page 15
DIRECTORS’ REPORT
0
0
0
$
'
70,000
60,000
50,000
40,000
30,000
20,000
10,000
-
(10,000)
0
0
0
$
'
30,000
25,000
20,000
15,000
10,000
5,000
-
(5,000)
e
r
a
h
S
/
s
t
n
e
C
7.0
6.0
5.0
4.0
3.0
2.0
1.0
-
(1.0)
(2.0)
EBITDA Growth
63,785
45,359
49,373
(1,295)
FY 10
FY 11
FY 12
FY 13
NPAT Growth
28,328
21,964
16,285
(1,280)
FY 10
FY 11
FY 12
FY 13
EPS Growth
6.6
5.1
4.3
(0.8)
FY 10
FY 11
FY 12
FY 13
2013 ANNUAL FINANCIAL REPORT
Page 16
DIRECTORS’ REPORT
Total Remuneration - 2013
Total remuneration paid or payable to KMP for the year ended 30 June 2013 was:
SALARY /
CONSULTING
FEES
OTHER
BENEFITS
(1)
STI CASH
PAYMENT^
SUPER OPTIONS
TOTAL
REMUNERATION
CONSISTING OF
OPTIONS
DURING THE
YEAR
EXECUTIVE
Year
$
$
$
$
$
$
%
Executive Directors
Bill Beament
Other Executives
Raymond Parry
Liza Carpene*
Karen Brown**
* Appointed 15 April 2013
** Resigned 15 April 2013
2013
2012
2013
2012
2013
2013
2012
493,939
460,855
19,961
27,417
150,223
27,121
257,457
948,701
129,867
24,979
6,045
649,163
287,000
252,273
48,369*
26,033**
33,000
2,071
1,926
357
-
-
90,134
25,000
14,553
418,758
57,732
29,091
26,413
367,435
-
-
-
4,837
10,973
64,536
17.1%
-
-
-
26,033
274
33,274
0.0%
0.8%
27.7%
1.0%
3.5%
7.2%
(1)Other Benefits include: vehicle allowance, telephone allowance, salary continuance insurance and professional membership fees.
Executive Contracts
EXECUTIVE
TERM OF AGREEMENT
BASE
SALARY
(at 30/6/13)
TERMINATION
NOTICE
TERMINATION
BENEFIT
Executive Directors
Bill Beament
Other Executives
Raymond Parry
Liza Carpene*
Karen Brown**
* Appointed 15 April 2013
** Resigned 15 April 2013
Commencing 30 July 2010 – open ended
495,000
3 Months
12 Months
Commencing 4 October 2010 – open ended
Commencing 15 April 2013 – open ended
Terminated 15 April 2013
287,000
227,273
$33,000
1 Month
1 Month
1 Month
None
None***
None
*** If terminated before 15 October 2013, a payment of three months‟ salary is applicable.
F. Share-Based Compensation
The following options were granted as equity compensation benefits to KMP during the period. These options were issued free of charge.
Each option entitles the holder to subscribe for one fully paid ordinary share in the Company at various exercise prices with various expiry
dates.
NAME
Peter O‟Connor
Liza Carpene
Liza Carpene
NUMBER
750,000
250,000
250,000
EXERCISE PRICE
ISSUE DATE
EXPIRY DATE
$0.91
$0.95
$1.05
30 November 2012
15 April 2013
15 April 2013
28 June 2014
15 April 2015
15 April 2016
The assessed fair values of the options with an exercise price were determined using a Black Scholes option pricing model, taking into
account the exercise price, term of option, the share price at grant date and expected price volatility of the underlying share, expected
dividend yield and the risk-free interest rate for the term of the option.
< This is the end of the audited Remuneration Report. >
2013 ANNUAL FINANCIAL REPORT
Page 17
DIRECTORS’ REPORT
INDEMNIFICATION AND INSURANCE OF OFFICERS
The Company has paid a premium to insure the Directors and Officers of the Company and its controlled entities. Details of the premium
are subject to a confidentiality clause under the contract of insurance. The liabilities insured are costs and expenses that may be incurred in
defending civil or criminal proceedings that may be brought against the Directors and Officers in their capacity as officers of entities in the
Group.
AUDITOR INDEPENDENCE
The Auditor‟s independence declaration for year ended 30 June 2013 under Section 307C of the Corporations Act 2001 has been received
and can be found on the next page.
NON-AUDIT SERVICES
No other services were provided by the Auditor.
ROUNDING
The amounts contained in this report and in the financial statements have been rounded to the nearest $1,000 (where rounding is
applicable) as permitted under ASIC Class Order 98/0100. The Company is an entity to which the Class Order applies.
Signed in accordance with a resolution of the Directors.
BILL BEAMENT
Managing Director
Perth, Western Australia
2 August 2013
2013 ANNUAL FINANCIAL REPORT
Page 18
AUDITOR’S INDEPENDENCE DECLARATION
2013 ANNUAL FINANCIAL REPORT
Page 19
INCOME STATEMENT AND STATEMENT OF
COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2013
Revenue from operations
Mine operating costs
Gross profit
Other revenue
Government Royalty expense
Depreciation and amortisation
Administration expenses
Exploration expenses
Net loss on financial assets held at fair value through profit or loss
Finance costs
Profit before Income Tax
Income tax expense
Profit for the Period
Other comprehensive income
NOTES
2 (a)
3 (a)
GROUP
30 JUNE 2013
$'000
144,236
30 JUNE 2012
$'000
99,525
(60,960)
83,276
(42,542)
56,983
2 (b)
2,253
2,567
(3,353)
(26,225)
(6,790)
(5,854)
(5,747)
(783)
36,777
(2,570)
(17,400)
(5,477)
(2,060)
(70)
(529)
31,444
5
(8,449)
(9,481)
28,328
21,964
-
-
Total Comprehensive Income for the Period
28,328
21,964
Total Comprehensive Income Attributed to:
Owners of the Company
28,328
21,964
Earnings Per Share
Basic earnings/(loss) per share (cents per share)
Diluted earnings/(loss) per share (cents per share)
The above Statement of Comprehensive Income should be read in conjunction with the accompanying notes.
CENTS PER
SHARES
CENTS PER
SHARES
4
4
6.7
6.6
6.1
5.1
2013 ANNUAL FINANCIAL REPORT
Page 20
STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2013
ASSETS
Current Assets
Cash and cash equivalents
Trade and other receivables
Inventory
Other current assets
Total Current Assets
Non-Current Assets
Investments
Property, plant & equipment
Exploration tenements
Mine Development
Deferred tax assets
Total Non-Current Assets
TOTAL ASSETS
LIABILITIES
Current Liabilities
Trade and other payables
Financial Liabilities
Provisions
Current tax liabilities
Other liabilities
Total Current Liabilities
Non-Current Liabilities
Financial Liabilities
Provisions
Deferred tax liabilities
Total Non-Current Liabilities
TOTAL LIABILITIES
NET ASSETS
EQUITY
Contributed equity
Reserves
Retained earnings
TOTAL EQUITY
GROUP
NOTES
30 JUNE 2013
$'000
30 JUNE 2012
$'000
7 (a)
8
9
10
11
12
13
14
6 (a)
15
16 (a)
17 (a)
6 (c)
15
16 (b)
17 (b)
6 (b)
18
19
55,775
1,713
12,405
4
69,897
2,224
42,876
30,462
8,813
3,077
87,452
157,349
64,962
1,817
9,077
162
76,018
6,653
19,883
24,785
5,654
1,013
57,988
134,007
14,449
14,967
6,163
1,297
4,620
610
4,708
986
3,633
(9)
27,139
24,285
5,069
2,902
11,904
19,875
47,014
4,719
2,827
7,668
15,213
39,499
110,335
94,508
66,765
691
42,879
110,335
64,613
503
29,393
94,508
The above Statement of Financial Position should be read in conjunction with the accompanying notes.
2013 ANNUAL FINANCIAL REPORT
Page 21
STATEMENT OF CASH FLOWS
AS AT 30 JUNE 2013
Cash Flows From Operating Activities
Receipts from customers (inclusive of GST)
Payments to suppliers and employees (inclusive of GST)
Interest received
Finance costs
Net Income taxes paid
Net Cash From Operating Activities
7 (b)
Cash Flows From Investing Activities
Payments for property, plant & equipment
Payments for equity investments
Proceeds from sale of property, plant and equipment
Payments for development of mining properties
Exploration and evaluation expenditure
Net Cash Used In Investing Activities
Cash Flows From Financing Activities
Proceeds from issue of shares and conversion of options
Payments for dividends
Payments for share issue costs
Proceeds from financing facility
Repayment of financing facility
Net Cash From Financing Activities
Net Decrease In Cash And Cash Equivalents Held
Cash and Cash Equivalents at 1 July
Cash And Cash Equivalents at 30 June
The above Statement of Cash Flows should be read in conjunction with the accompanying notes.
7 (a)
GROUP
30 JUNE 2013
30 JUNE 2012
NOTES
$'000
$'000
144,375
(74,590)
2,147
(750)
(5,290)
65,892
(30,363)
(1,318)
8
(16,649)
(15,229)
(63,551)
1,368
(14,842)
-
8,556
(6,610)
(11,528)
(9,187)
64,962
55,775
99,844
(47,435)
2,098
(521)
(2,924)
51,062
(9,408)
(6,523)
23
(21,587)
(16,508)
(54,004)
48,244
-
(2,250)
7,989
(2,652)
51,331
48,388
16,574
64,962
2013 ANNUAL FINANCIAL REPORT
Page 22
STATEMENT OF CHANGES IN EQUITY
GROUP
NOTES
3 (b)
Balance at 1 July 2011
Equity issues net of transaction costs
Equity issues – Treasury Shares
Share based payments
Transfer from option reserve
Total comprehensive income for the period
SHARE
CAPITAL
RESERVES
RETAINED
EARNINGS
$'000
18,306
-
51,031
(5,038)
64
249
-
$'000
392
-
-
-
360
(249)
$'000
7,429
-
-
-
-
-
TOTAL
EQUITY
$'000
26,127
-
51,031
(5,038)
424
-
-
21,964
21,964
Balance at 30 June 2012
64,613
503
29,393
94,508
Equity issues net of transaction costs
Equity issues – Treasury Shares
Share based payments
Transfer from option reserve
Dividend Paid
Total comprehensive income for the period
3 (b)
1,368
-
71
713
-
-
-
-
901
(713)
-
-
-
-
-
-
1,368
-
972
-
(14,842)
28,328
(14,842)
28,328
Balance at 30 June 2013
66,765
691
42,879
110,335
The above Statement of Changes in Equity should be read in conjunction with the accompanying notes.
2013 ANNUAL FINANCIAL REPORT
Page 23
NOTES TO THE FINANCIAL STATEMENTS
1. ACCOUNTING POLICIES
(i) Basis of Preparation
These financial statements are general purpose financial statements, which have been prepared in accordance with the requirements of the
Corporations Act 2001, Australian Accounting Standards and other authoritative pronouncements of the Australian Accounting Standards
Board including the Australian Accounting Interpretations. The financial statements have been prepared on a historical cost basis with the
exception of derivative financial instruments and investments which have been measured at fair value.
The financial statements are presented in Australian dollars, which is the parent company‟s functional and presentation currency, and all
values are rounded to the nearest thousand dollars ($‟000) unless otherwise stated. The Group is of a kind referred to in Class Order
98/0100, issued by the Australian Securities and Investments Commission, relating to the “rounding off” of amounts in the financial report.
Amounts in the financial report have been rounded off in accordance with that class order to the nearest thousand dollars.
(ii) Statement of Compliance
The financial statements comply with Australian Accounting Standards and International Financial Reporting Standards (IFRS).
(iii) Adoption of New and Revised Standards
Early adoption of accounting standards
The Group has not elected to apply any pronouncements before their operative date in the annual reporting period beginning 1 July 2012.
New and amended standards adopted by the Group
None of the new standards and amendments to standards that are mandatory for the first time for the financial year beginning 1 July 2012
affected any of the amounts recognised in the current period or any prior period and are not likely to affect future periods.
Certain new accounting standards and interpretations have been published that are not mandatory for 30 June 2013 reporting periods. The
Group‟s assessment of the impact of these new standards and interpretations that may have an impact on the Group is set out below:
AASB 9 Financial Instruments (effective from 1 January 2015)
AASB 9 Financial Instruments addresses the classification, measurement and derecognition of financial assets and financial liabilities.
There is no material impact for Northern Star.
AASB 10 Consolidated Financial Statements (effective from 1 January 2013)
This standard will have no impact on Northern Star as the group has no special purpose entities.
AASB 11 Joint Arrangements (effective from 1 January 2013)
AASB 11 clarifies the accounting treatments for joint arrangements. There is no material impact for Northern Star.
AASB 12 Disclosure of Interests in Other Entities (effective from 1 January 2013) AASB 12 is a disclosure standard only which may
require additional disclosures for interests in other entities, including joint arrangements.
AASB 13 Fair Value Measurement (effective from 1 January 2013)
AASB 13 establishes a single framework for measuring fair value of financial and non-financial items. Northern Star has not yet made
an assessment of the impact of these amendments.
AASB 2011-9 Presentation of Items of Other Comprehensive Income (effective from 1 July 2012) When this standard was first adopted
for the year ended 30 June 2013, there was no impact on amounts recognised for transactions and balances for 30 June 2013 (and
comparatives). However, the statement of comprehensive income will include name changes and include subtotals for items. Impact is
disclosure only.
AASB 119 Employee Benefits (effective from 1 January 2013)
AASB 119 includes amendments to the timing for recognition of liabilities for termination benefits. Northern Star currently calculates its
liability for annual leave employee benefits on the basis that it is due to be settled within 12 months of the end of the reporting period
because employees are entitled to use this leave at any time. The amendments require that such liabilities be calculated on the basis of
when the leave is expected to be taken, i.e. expected settlement. Northern Star has not yet made an assessment of the impact of these
amendments.
IAS 16 Property, Plant and Equipment (effective from 1 January 2013)
IAS 16 requires that items such as spare parts, stand-by or servicing equipment be classified as property, plant and equipment when
they meet the definition of property, plant and equipment. Otherwise they are required to be classified as inventory. Northern Star will
need to assess its inventory and reclassify relevant items, such as capital spares as plant and equipment. Cash outflows for relevant
items will also be classified as investing activities rather than operating activities. Northern Star has not yet determined the quantum of
the reclassifications.
2013 ANNUAL FINANCIAL REPORT
Page 24
NOTES TO THE FINANCIAL STATEMENTS
Significant Accounting Estimates and Assumptions
Significant accounting judgments
In the process of applying the Group‟s accounting policies, management has made the following judgments, apart from those involving
estimations, which have the most significant effect on the amounts recognised in the financial statements.
Exploration and evaluation assets
The Group‟s accounting policy for exploration and evaluation expenditure is set out at Note 1(v). The application of this policy necessarily
requires management to make certain estimates and assumptions as to future events and circumstances. Any such estimates and
assumptions may change as new information becomes available. If, after having capitalised expenditure under the policy, it is concluded
that the expenditures are unlikely to be recovered by future exploitation or sale, then the relevant capitalised amount will be written off to the
statement of comprehensive income.
Critical accounting estimates and assumptions
The carrying amounts of certain assets and liabilities are often determined based on estimates and assumptions of future events. The key
estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of certain assets and
liabilities within the next annual reporting period are:
Impairment of assets
In determining the recoverable amount of assets, in the absence of quoted market prices, estimations are made regarding the present value
of future cash flows using asset-specific discount rates and the recoverable amount of the asset is determined. Value-in-use calculations
performed in assessing recoverable amounts incorporate a number of key estimates.
The recoverable amounts of cash generating units and individual assets have been determined based on the higher of value-in-use
calculations and fair values. The calculations require the use of estimates and assumptions. It is reasonably possible that the gold price
assumption may change which may then impact our estimated life of mine determinant and may then require a material adjustment to the
carrying value of tangible assets.
The Group reviews and tests the carrying value of assets when events or changes in circumstances suggest that the carrying amount may
not be recoverable. Assets are grouped at the lowest level for which identifiable cash flows are largely independent of cash flows of other
assets and liabilities. If there are indications that impairment may have occurred, estimates are prepared for future cash flows of the mining
assets. Expected future cash flows used to determine the value in use of tangible assets are inherently uncertain and could materially
change over time. They are significantly affected by a number of factors including reserves and production estimates, together with
economic factors such as spot gold prices, discount rates, estimates of costs to produce reserves and future capital expenditure.
Provisions for restoration costs
Restoration costs are a normal consequence of mining, and the majority of this expenditure is incurred at the end of a mine‟s life. In
determining an appropriate level of provision consideration is given to the expected future costs to be incurred, the timing of these expected
future costs (largely dependent on the life of the mine), and the estimated future level of inflation.
The ultimate cost of restoration is uncertain and costs can vary in response to many factors including changes to the relevant legal
requirements, the emergence of new restoration techniques or experience at other mine-sites. The expected timing of expenditure can also
change, for example in response to changes in reserves or to production rates.
Changes to any of the estimates could result in significant changes to the level of provisioning required, which would in turn impact future
financial results.
Share-based payment transactions
The Group measures the cost of equity-settled transactions with employees by reference to the fair value of the equity instruments at the
date at which they are granted. The fair value is determined using the Black-Scholes model. Should the assumptions used in these
calculations differ, the amounts recognised could significantly change.
Commitments - Exploration
The Group has certain minimum exploration commitments to maintain its right of tenure to exploration permits. These commitments require
estimates of the cost to perform exploration work required under these permits. These have been disclosed in Note 21.
Determination of Mineral Resources and Ore Reserves
The Group reports its Mineral Resources and Ore Reserves in accordance with the Joint Ore Reserves Committee (JORC) “Australasian
Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves” – the JORC Code. The information on Mineral Resources
and Ore Reserves is prepared by Competent Persons as defined by the JORC Code.
There are numerous uncertainties inherent in estimating Mineral Resources and Ore Reserves. Assumptions that are valid at the time of
estimation may change significantly when new information becomes available.
2013 ANNUAL FINANCIAL REPORT
Page 25
NOTES TO THE FINANCIAL STATEMENTS
Changes in the forecast prices of commodities, exchange rates, production costs or recovery rates may change the economic status of
reserves and may, ultimately, result in the reserves being restated. Such changes may impact asset carrying values, depreciation and
amortisation rates, deferred stripping costs and provisions for restoration.
Recoverability of deferred income tax assets
The Group recognises deferred income tax assets in respect of tax losses and temporary differences to the extent that the future utilisation
of these losses and temporary differences is considered probable. Assessing the future utilisation of these losses and temporary
differences requires the Group to make significant estimates related to expectations of future taxable income.
Estimates of future taxable income are based on forecast cash flows from operations and the application of existing tax laws. To the extent
that future cash flows and taxable income differ significantly from estimates, this could result in significant changes to the deferred income
tax assets recognised, which would in turn impact future financial results.
Fair value of derivative financial instruments
The Group assesses the fair value of its financial derivatives in accordance with the accounting policy stated in Note 1(v). Fair values have
been determined based on well established valuation models and market conditions existing at the reporting date. These calculations
require the use of estimates and assumptions. Changes in assumptions concerning gold prices and volatilities could have significant impact
on the fair valuation attributed to the Group‟s financial derivatives. When these assumptions change or become known in the future, such
differences will impact asset and liability carrying values in the period in which they change or become known.
The Company does not have any hedging in place at the end of the financial period.
(iv) Summary of Significant Accounting Policies
Basis of consolidation
The consolidated financial statements include the financial statements of Northern Star Resources Limited (“the Company”), and its
subsidiary (“the Group” or “Group”). The financial statements of subsidiaries are prepared for the same reporting period as the parent
company, using consistent accounting policies. Adjustments are made to bring into line any dissimilar accounting policies that may exist.
Where an entity has been acquired during the year, its results are included in consolidated results from the date control commenced.
Unrealised gains and losses and inter-entity balances resulting from transactions with or between controlled entities are eliminated in full on
consolidation.
Segment reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief financial decision maker. The chief
financial decision maker, who is responsible for allocating resources and assessing performance of the operating segments, has been
identified as the board of directors that makes strategic decisions.
Cash and cash equivalents
Cash and short-term deposits in the statement of financial position comprise cash at bank and in hand and short-term deposits with an
original maturity of three months or less. For the purposes of the statement of cash flows, cash and cash equivalents consist of cash and
cash equivalents as defined above, net of outstanding bank overdrafts.
Trade and other receivables
Receivables are initially recognised at fair value and subsequently measured at amortised cost, less allowance for doubtful debts. Current
receivables for GST are due for settlement within 30 days and other current receivables within 12 months. Cash on deposit is not due for
settlement until rights of tenure are forfeited or performance obligations are met.
Inventories
Gold in circuit and ore stockpiles are physically measured or estimated and valued at the lower of cost or net realisable value. The stockpile
amount is determined by reference to mining cost, including amortisation at the relevant stage of production.
Consumables and spares are valued at the lower of cost and net realisable value. Any provision for obsolescence is determined by
reference to specific stock items identified.
Derivatives
The Group periodically participates in derivative financial instruments such as gold options and gold forward contracts to manage the risks
associated with commodity price fluctuations.
Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently measured to their fair
value. Changes in the fair value of derivatives are recorded in the statement of comprehensive income.
2013 ANNUAL FINANCIAL REPORT
Page 26
NOTES TO THE FINANCIAL STATEMENTS
The fair value of derivative financial instruments that are traded on an active market is based on quoted market prices at the statement of
financial position date. The fair value of financial instruments not traded on an active market is determined using appropriate valuation
techniques. Refer to Note 27 for Financial Risk Management.
Plant and equipment
Plant and equipment is stated at cost less accumulated depreciation and any impairment in value. Depreciation is calculated on a straight
line basis to write off the net cost of each item of plant and equipment over its expected useful life. Other items of plant are amortised over
life of mine. The life of mine expectation is reviewed periodically.
Exploration and Evaluation Expenditure
Costs related to the acquisition of properties that contain resources are allocated separately to specific areas of interest. These costs are
capitalised until the viability of the area of interest is determined.
Exploration and evaluation expenditure is stated at cost and is accumulated in respect of each identifiable area of interest. Such costs are
only carried forward to the extent that they are expected to be recouped through the successful development of the area of interest (or
alternatively by its sale), or where activities in the area have not yet reached a stage which permits a reasonable assessment of the
existence or otherwise of economically recoverable reserves, and active operations are continuing. Accumulated costs in relation to an
abandoned area are written off to the statement of comprehensive income in the period in which the decision to abandon the area is made.
The company reviews the carrying value of each area of interest at each reporting date and any exploration expenditure which no longer
satisfies the above policy is written off.
Restoration costs expected to be incurred are provided for as part of exploration, evaluation, development or production phases that give
rise to the need for restoration.
Development expenditure
When the technical and commercial feasibility of extracting a mineral resource has been demonstrated the resource enters its development
phase. The costs of the assets are transferred from exploration and evaluation expenditure and reclassified into development expenditure
and include past exploration and evaluation costs and development costs. Although development expenditure is not amortised, it is tested
annually for impairment.
Mine Development expenses
Capitalised development costs are amortised on a unit-of-production basis over the economically recoverable resources of the mine. The
unit of account will be ounces produced.
Capitalised development costs include exploration and evaluation expenditure previously deferred relating to that ore body. Separate
calculations are undertaken for each ore body.
Impairment of assets
At each reporting date, the Group assesses whether there is any indication that an asset may be impaired. Where an indicator of
impairment exists, the Group makes a formal estimate of recoverable amount. Where the carrying amount of an asset exceeds its
recoverable amount the asset is considered impaired and is written down to its recoverable amount.
Recoverable amount is the greater of fair value less costs to sell and value in use. It is determined for an individual asset, unless the asset‟s
value in use cannot be estimated to be close to its fair value less costs to sell and it does not generate cash inflows that are largely
independent of those from other assets or groups of assets, in which case, the recoverable amount is determined for the cash-generating
unit to which the asset belongs. When the carrying amount of an asset or cash-generating unit exceeds its recoverable amount, the asset or
cash-generating unit is written down to its recoverable amount.
In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects
current market assessments of the time value of money and the risks specific to the asset.
Derecognition of financial assets and liabilities
A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is derecognised when:
the rights to receive cash flows from the asset have expired;
the Company retains the right to receive cash flows from the asset, but has assumed an obligation to pay them in full without material
delay to a third party; or
the Company has transferred its rights to receive cash flows from the asset and either
has transferred substantially all the risks and rewards of the asset, or
has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.
A financial liability is derecognised when the obligation under the liability is discharged, cancelled or expired. When an existing financial
liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially
2013 ANNUAL FINANCIAL REPORT
Page 27
NOTES TO THE FINANCIAL STATEMENTS
modified, such an exchange or modification is treated as a derecognition of the original liability and the recognition of a new liability. The
difference in the respective carrying amounts is recognised in the statement of comprehensive income.
Restoration, rehabilitation, and environmental costs
The Group recognises any legal restoration obligation as a liability at the time a legal liability exists. The carrying amount of the long lived
assets to which the legal obligation relates is increased by the restoration obligation costs and amortised over the producing life of the
asset. A provision is raised for the restoration and rehabilitation of each mine site. Restoration and rehabilitation works can include facility
decommissioning and dismantling; removal or treatment of waste materials; land rehabilitation; and site restoration. The extent of the work
required and the associated costs are dependent on the relevant regulatory requirements and the group‟s environmental policies.
Investments
Investments in listed entities are categorised as financial assets at fair value through profit or loss. Designation is re-evaluated at each
reporting date, but there are restrictions on reclassifying to other categories. When these financial assets are recognised initially, they are
measured at fair value. At each reporting date, gains or losses on these financial assets are recognised in profit or loss.
Trade and other payables
Trade payables and other payables are recognised initially at fair value and subsequently at amortised cost and represent liabilities for
goods and services provided to the Group prior to the end of the financial year that are unpaid and arise when the Group becomes obliged
to make future payments in respect of the purchase of these goods and services. The amounts are unsecured and usually paid within 30
days of recognition.
Borrowings
All borrowings are initially recognised at the fair value of the consideration received less directly attributable transaction costs. After initial
recognition, interest-bearing borrowings are subsequently measured at amortised cost using the effective interest method. Fees paid on the
establishment of loan facilities that are yield related are included as part of the carrying amount of the borrowings.
Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least 12
months after the reporting date.
Provisions
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that an
outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the
amount of the obligation. Where the Group expects some or all of a provision to be reimbursed, for example under an insurance contract,
the reimbursement is recognised as a separate asset but only when the reimbursement is virtually certain. The expense relating to any
provision is presented in the statement of comprehensive income net of any reimbursement. If the effect of the time value of money is
material, provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments
of the time value of money and, where appropriate, the risks specific to the liability. Where discounting is used, the increase in the provision
due to the passage of time is recognised as a finance cost.
Employee benefits
Liabilities for wages and salaries, including non-monetary benefits, annual leave, and any other employee entitlements expected to be
settled within twelve months of the reporting date are measured at their nominal amounts based on remuneration rates which are expected
to be paid when the liability is settled. Long service leave liabilities are measured at current cost for those employees with greater than 5
years‟ service up to the reporting date. Consideration is given to future wage and salary levels, experience of employee departures and
period of service. Employee entitlements expenses and revenues arising in respect of wages and salaries, non-monetary benefits, annual
leave, long service leave, sick leave and other entitlements are charged against profits on a net basis. Contributions are made to employee
superannuation plans and are charged as expenses when incurred.
Share-based payment transactions
The Group may provide benefits to employees (including directors) of the Group in the form of share based payment transactions, whereby
employees render services in exchange for shares or rights over shares („equity-settled transactions‟).
The cost of these equity-settled transactions with employees is measured by reference to the fair value at the date at which they are
granted.
Share-based payments – options and performance rights with an exercise price:
The fair value of these payments is determined using a Black-Scholes option pricing model that takes into account the exercise price, the
term of the option, the impact of dilution, the share price at grant date and expected price volatility of the underlying share, the expected
dividend yield and the risk free interest rate for the term of the option. The fair value of the options granted is adjusted to reflect market
conditions, but excludes the impact of any non-market vesting conditions. Non-market vesting conditions, if any, are included in
assumptions about the number of options likely to be exercisable.
2013 ANNUAL FINANCIAL REPORT
Page 28
NOTES TO THE FINANCIAL STATEMENTS
Share-based payments – Employee Shares.
The fair value of these payments is determined based on the share price at the date the rights have been accepted by employees.
Jointly controlled interest
The proportionate interests in the assets, liabilities and expenses of a joint interest activity have been incorporated in the financial
statements under the appropriate headings. Details of the joint ventures are set out in Note 26.
Revenue recognition
Revenues are recognised at fair value of the consideration received net of the amount of goods and services tax (GST) payable to the
taxation authority. Exchanges of goods or services of the same nature and value without any cash consideration are not recognised as
revenues.
Interest revenue
Interest revenue is recognised as it accrues, taking into account the effective yield on the financial asset.
Borrowing costs
Borrowing costs are recognised in the statement of comprehensive income in the period in which they are incurred except borrowing costs
that are directly attributable to the acquisition, construction, or production of a qualifying asset that necessarily takes a substantial period to
get ready for its intended use or sale. In this case, borrowing costs are capitalised as part of the cost of such a qualifying asset.
Tax consolidations
Northern Star Resources Limited is the head entity in the tax-consolidated group comprising its wholly-owned subsidiary. The effective date
of implementation was 9 March 2011 for the tax-consolidated group. Northern Star Resources Limited accounts for the consolidated group‟s
current and deferred tax amounts. These tax amounts are measured as if each entity in the tax consolidated group continues to be a
standalone taxpayer in its own right. In addition to its own current and deferred tax amounts, Northern Star Resources Limited also
recognises the current tax liabilities (or assets) and the deferred tax assets arising from unused tax losses and unused tax credits assumed
from controlled entities in the tax consolidated group.
Income tax
Current tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or paid to the
taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted by the
statement of financial position date.
Deferred income tax is provided on all temporary differences at the statement of financial position date between the tax bases of assets and
liabilities and their carrying amounts for financial reporting purposes. Deferred income tax liabilities are recognised for all taxable temporary
differences, except where the deferred income tax liability arises from the initial recognition of an asset or liability in a transaction that is not
a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss.
Deferred income tax assets are recognised for all deductible temporary differences, carry-forward of unused tax assets and unused tax
losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry-
forward of unused tax assets and unused tax losses can be utilised, except where the deferred income tax asset relating to the deductible
temporary difference arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the
time of the transaction, affects neither the accounting profit nor taxable profit or loss.
The carrying amount of deferred income tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable
that sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be utilised.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realised or
the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date.
Unrecognised deferred income tax assets are reassessed at each reporting date and are recognised to the extent that it has become
probable that future taxable profit will allow the deferred tax asset to be recovered.
Income taxes relating to items recognised directly in equity are recognised in equity and not in the statement of comprehensive income.
Deferred tax assets and deferred tax liabilities are offset only if a legally enforceable right exists to set off current tax assets against current
tax liabilities and the deferred tax assets and liabilities relate to the same taxable entity and the same taxation authority.
Other taxes
Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable
from the taxation authority. In these circumstances the GST is recognised as part of the cost of acquisition of the asset or as part of an item
of the expense as applicable.
2013 ANNUAL FINANCIAL REPORT
Page 29
NOTES TO THE FINANCIAL STATEMENTS
Receivables and payables are stated with the amount of GST included. The net amount of GST recoverable from, or payable to, the
taxation authority is included as part of receivables or payables in the statement of financial position. Cash flows are included in statement
of cash flows on a gross basis. The GST components of cash flows arising from investing and financing activities that are 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.
Contributed equity
Ordinary shares
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of ordinary shares and share options are
recognised as a deduction from equity, net of any tax effects. Dividends on ordinary shares are recognised as a liability in the period in
which they are declared.
Treasury shares
The Company operates the Northern Star Employee Share Trust (Trust). The main purpose of the Trust is to hold unvested employee
incentive shares as part of Northern Star‟s Employee Share Scheme. Under AASBs, the Trust qualifies as an equity compensation plan
special purpose entity and its results are included in those for the Consolidated Entity. Any shares held by the Trust are accounted for as
treasury shares and treated as a reduction in the number of publicly held shares of the Company and the Consolidated Entity.
Earnings per share (EPS)
Basic EPS is calculated as net profit attributable to members, adjusted to exclude costs of servicing equity (other than dividends) and
preference share dividends, divided by the weighted average number of ordinary shares, adjusted for any bonus element. Diluted earnings
per share are determined when the Company has on issue potential ordinary shares which are dilutive. It is calculated by dividing net profit
attributable to members, adjusted to exclude costs of servicing equity (other than dividends) and any expenses associated with dividends
and interest of dilutive potential ordinary shares, by the weighted average number of ordinary shares (both issued and potentially dilutive)
adjusted for any bonus element.
2. REVENUE
(a) Revenue from operations
Sale of gold
Sale of silver
(b) Other revenue
Interest revenue
Other
Total Revenue
GROUP
30 JUNE 2013
$'000
30 JUNE 2012
$'000
144,057
179
144,236
2,200
53
2,253
99,370
155
99,525
2,098
469
2,567
146,489
102,092
2013 ANNUAL FINANCIAL REPORT
Page 30
NOTES TO THE FINANCIAL STATEMENTS
3. EXPENSES
(a) Mine operating costs
Mining Expenses
Processing Expenses
Admin Expenses
(b) Operating costs
Government Royalty expense
Depreciation
Amortisation
Administration expenses
Administration – Shares based payments
Exploration expenses
Net loss on financial assets held at fair value through profit or loss
Finance costs
Total Expenses
4. EARNINGS PER SHARE
Basic profit/(loss) per share (cents)
Diluted profit/(loss) per share (cents)
GROUP
30 JUNE 2013
$'000
30 JUNE 2012
$'000
32,575
19,311
9,073
60,960
3,353
7,486
18,740
5,818
972
5,854
5,747
783
48,753
109,713
20,005
14,422
8,114
42,542
2,570
5,584
11,816
5,053
424
2,060
70
529
28,106
70,647
GROUP
30 JUNE 2013
30 JUNE 2012
6.7
6.6
6.1
5.1
Profit/(loss) used to calculate earnings per share ($'000)
28,328
21,964
Weighted average number of ordinary shares during the period used in calculation of basic
profit/(loss) per share
Weighted average number of ordinary shares during the period used in calculation of diluted
profit/(loss) per share
421,050,679
360,654,100
429,279,762
430,016,079
2013 ANNUAL FINANCIAL REPORT
Page 31
NOTES TO THE FINANCIAL STATEMENTS
5. INCOME TAX
(a) Income tax expense
Current tax
Adjustment for current tax of prior periods
Income tax expense
(b) Numerical reconciliation of income tax expense to prima facie tax payable
Profit (Loss) before income tax
Tax at the Australian tax rate of 30%
Tax effect of amounts which are not deductible/ (taxable) in calculating taxable income:
Share-based payments
Tax offset - Research and Development
Employee share trust
Sundry items
Adjustments for current tax of prior periods
6. NET DEFERRED TAX ASSET/(LIABILITY)
(a) Deferred tax assets
At 1 July 2011
(Charged)/credited to Profit or loss
As at 30 June 2012
(Charged)/credited to Profit or loss
As at 30 June 2013
Investments
$'000
-
-
-
1,724
1,724
Employee
Benefits
$'000
206
102
308
116
424
The balance comprises temporary differences attributable to:
Employee benefits
Investments
Sundry accruals
As at 30 June 2013
GROUP
30 JUNE 2013
$'000
30 JUNE 2012
$'000
10,179
(1,730)
8,449
9,549
(68)
9,481
36,777
31,444
11,033
9,433
292
(298)
(767)
(81)
10,179
(1,730)
8,449
Other
$'000
522
183
705
224
929
127
(12)
9,549
(68)
9,481
Total
$'000
728
285
1,013
2,064
3,077
424
1,724
929
3,077
2013 ANNUAL FINANCIAL REPORT
Page 32
NOTES TO THE FINANCIAL STATEMENTS
6. NET DEFERRED TAX ASSET/(LIABILITY) (continued)
(b) Deferred tax liabilities
At 1 July 2011
(Charged)/credited to Profit or loss
As at 30 June 2012
(Charged)/credited to Profit or loss
As at 30 June 2013
The balance comprises temporary differences attributable to:
Prepayments
$'000
(1,191)
Inventories
$'000
(275)
(6,105)
(7,296)
(4,101)
(11,397)
(96)
(371)
(135)
(506)
Prepayments
Inventories
As at 30 June 2013
(c) Income tax liability
Opening Balance
Tax paid
Current Tax
Adjustments for current tax of prior periods
Current charges deferred tax assets
Total income tax liability
Total
$'000
(1,466)
(6,201)
(7,667)
(4,236)
(11,904)
(11,397)
(506)
(11,904)
GROUP
30 JUNE 2013
30 JUNE 2012
$'000
3,633
(8,321)
10,179
1,301
(2,172)
4,620
$'000
2,992
(2,924)
9,549
(68)
(5,915)
3,633
The Deferred Tax Asset brought to account for the period will only be obtained if:
(i) the Company derives future assessable income of a nature and of an amount sufficient to enable the benefit to be realised;
(ii) the Company continues to comply with the conditions for deductibility imposed by tax legislation; and
(iii) the Company is able to meet the continuity of ownership and/or continuity of business tests under tax legislation
Northern Star Resources Limited and its wholly-owned Australian entity have implemented the tax consolidation legislation. The accounting
policy in relation to this legislation is set out in Note 1(v).
On adoption of the tax consolidation legislation, the entities in the tax consolidation group entered into a tax sharing agreement which, in the
opinion of the directors, limits the joint and several liability of the wholly-owned entities in the case of a default by the head entity, Northern
Star Resources Limited.
The entities have also entered into a tax funding agreement under which the wholly-owned entity will fully compensate Northern Star
Resources Limited for any current tax payable assumed and are to be compensated by Northern Star Resources Limited for any current tax
receivable and deferred tax assets relating to unused tax losses or unused tax credits that are transferred to Northern Star Resources
Limited under the tax consolidation legislation. The funding amounts are determined by reference to the amounts recognised in the wholly-
owned entity‟s financial statements.
The amounts receivable/payable under the proposed tax funding agreement is due upon receipt of the funding advice from the head entity,
which is issued as soon as practicable after the end of each financial year.
2013 ANNUAL FINANCIAL REPORT
Page 33
NOTES TO THE FINANCIAL STATEMENTS
7. CASH AND CASH EQUIVALENTS
(a) Cash and Cash Equivalents
Cash at bank
Cash on Deposit
Total Cash and Cash Equivalents
GROUP
30 JUNE 2013
$'000
30 JUNE 2012
$'000
19,163
36,612
55,775
18,340
46,622
64,962
The Group‟s exposure to interest rate risk is discussed in Note 27. The maximum exposure to credit risk at the end of the reporting period is
the carrying amount of each class of cash and cash equivalents mentioned above.
(b) Reconciliation of Net Profit/(Loss) after Tax to Net Cash From Operations
Profit/(Loss) after income tax for the year
Non-Cash Items:
Depreciation and amortisation
Acquisition Royalty Payments
Net (gain)/loss on sale of non-current assets
Net (gain)/loss on sale of Exploration Tenements
Interest Income
Share-based payments
Movements in Provisions
Exploration expenditure written off
(Increase)/Decrease in Assets:
Trade and other receivables
Inventories
Deferred taxes
Prepaid expenses
Increase/(Decrease) in Liabilities:
Trade and other payables
Deferred taxes
Provisions
Net Cash From Operating Activities
28,328
-
26,233
-
(8)
-
(53)
972
6,133
4,303
53
(3,328)
(2,064)
158
(58)
4,236
987
65,892
21,964
-
17,477
-
(23)
553
0
424
428
-
(141)
(4,266)
(285)
492
7,597
6,201
642
51,062
2013 ANNUAL FINANCIAL REPORT
Page 34
NOTES TO THE FINANCIAL STATEMENTS
8. TRADE AND OTHER RECEIVABLES
Amounts receivable from:
Trade Debtors
Sundry debtors
Goods and services tax recoverable
Fuel Rebates
Other receivables
Total Trade and other receivables
GROUP
30 JUNE 2013
$'000
30 JUNE 2012
$'000
107
40
906
195
465
1,713
122
-
1,338
354
3
1,817
Fair Value and Risk Exposure
(a) Due to the short term nature of these receivables, their carrying value is assumed to approximate their fair value.
(b) The maximum exposure to credit risk is the fair value of receivables. Collateral is not held as security.
(c) Details regarding interest risk exposure are disclosed in Note 27.
(d) Other receivables generally have repayments between 30 and 90 days.
(e) Transactions between Northern Star Resources Limited and its subsidiary consist of intercompany loans, upon which no interest is
charged and no repayment schedule exists. The intercompany loans have no set repayment date and the fair value approximates the
carrying value of the receivable.
9. INVENTORY
Consumables and spares
Ore Stockpiles
Gold In Circuit
Total Inventory
10. OTHER CURRENT ASSETS
Prepayments
GROUP
30 JUNE 2013
$'000
30 JUNE 2012
$'000
1,688
5,680
5,037
12,405
1,236
2,355
5,486
9,077
GROUP
30 JUNE 2013
$'000
30 JUNE 2012
$'000
4
162
2013 ANNUAL FINANCIAL REPORT
Page 35
NOTES TO THE FINANCIAL STATEMENTS
11. INVESTMENTS
GROUP
30 JUNE 2013
$'000
30 JUNE 2012
$'000
Investment in listed entities – at fair value
2,224
6,653
2012 Reconciliation of Other Financial Assets
Balance bought forward
Shares acquired for cash
Shares and options acquired under tenement sale agreement
Fair value loss at year end
Investment in listed entities – at fair value
12. PROPERTY, PLANT AND EQUIPMENT
Plant and equipment at cost
Accumulated depreciation
Motor Vehicles at Cost
Accumulated depreciation
Office equipment at cost
Accumulated depreciation
Buildings at cost
Accumulated depreciation
6,653
1,318
-
(5,747)
2,224
6,523
200
(70)
6,653
GROUP
30 JUNE 2013
$'000
30 JUNE 2012
$'000
53,586
(14,603)
38,983
1,722
(689)
1,033
824
(264)
560
3,904
(1,604)
2,300
42,876
26,701
(8,559)
18,143
1,387
(615)
772
497
(101)
396
1,603
(1,031)
572
19,883
2013 ANNUAL FINANCIAL REPORT
Page 36
NOTES TO THE FINANCIAL STATEMENTS
12. PROPERTY, PLANT AND EQUIPMENT (continued)
2013 Reconciliation of property, plant and equipment
Plant and
equipment
$'000
Motor
Vehicles
$'000
Office
equipment
$'000
Buildings
$'000
Total
$'000
Carrying amount at beginning of the year
18,143
772
396
572
19,883
Additions
Disposals
Depreciation charge
27,306
548
333
2,301
30,488
(421)
(6,045)
(212)
(75)
(6)
(163)
-
(639)
(573)
(6,856)
Carrying amount at end of the year
38,983
1,033
560
2,300
42,876
2012 Reconciliation of property, plant and equipment
Carrying amount at beginning of the year
Additions
Disposals
Depreciation charge
Carrying amount at end of the year
13. EXPLORATION AND EVALUATION COSTS
Exploration costs brought forward
Exploration costs this year
Exploration costs now written off
Transfer to development expenditure
Exploration tenements sold
Exploration costs carried forward
9,764
13,375
(91)
(4,905)
18,143
837
398
(4)
(459)
772
73
407
(7)
(77)
396
291
426
(2)
(143)
572
10,966
14,606
(104)
(5,584)
19,883
GROUP
30 JUNE 2013
$'000
30 JUNE 2012
$'000
24,785
15,229
(4,303)
(5,249)
-
30,462
9,029
16,508
-
-
(753)
24,785
Ultimate recoupment of exploration and evaluation expenditure carried forward is dependent on successful development and commercial
exploitation or, alternatively, sale of the respective areas.
Exploration costs now written off
Exploration and evaluation expenditure written off during the year relates to various tenements. This is due to the low level of current and
planned activity to assess the existence of economically recoverable reserves of the tenements.
2013 ANNUAL FINANCIAL REPORT
Page 37
NOTES TO THE FINANCIAL STATEMENTS
14. DEVELOPMENT EXPENDITURE
Development expenditure brought forward (acquired)
Transfer from exploration and evaluation costs
Development expenditure this year
Accumulated amortisation
Development expenditure carried forward
15. TRADE AND OTHER PAYABLES
Trade payables
Other payables
Total Trade and other payables
Fair Value and Risk Exposures
GROUP
30 JUNE 2013
$'000
30 JUNE 2012
$'000
5,654
5,249
47,319
(49,409)
8,813
1,053
-
35,271
(30,670)
5,654
GROUP
30 JUNE 2013
$'000
30 JUNE 2012
$'000
14,449
610
15,059
14,967
(9)
14,958
(i) Due to the short term nature of these payables, their carrying value is assumed to approximate their fair value.
(ii) Details regarding liquidity risk are disclosed in Note 27.
(iii) Trade and other payables are unsecured and usually paid within 60 days of recognition.
16. FINANCIAL LIABILITIES
(a) Current
Hire Purchase / Loan Agreements
Total Financial Liabilities
(b) Non-Current
Hire Purchase / Loan Agreements
Total Financial Liabilities
GROUP
30 JUNE 2013
$'000
30 JUNE 2012
$'000
6,163
6,163
5,069
5,069
4,708
4,708
4,719
4,719
Risk Exposures
Details of the group‟s exposure to risks arising from financial liabilities are set out in Note 27.
The Group has entered into various Hire Purchase / Loan Agreements for the Purchase of Plant and Equipment. The interest rates are
fixed and are payable over a period of up to 36 months.
2013 ANNUAL FINANCIAL REPORT
Page 38
NOTES TO THE FINANCIAL STATEMENTS
17. PROVISIONS
(a) Current
Provision for annual leave
Total Provisions
(b) Non-Current
Provision for long service leave
Provision for rehabilitation
Total Provisions
Reconciliation of provision for rehabilitation:
Carrying amount at beginning of the year
Increase during the year
Accretion
Carrying amount at end of the year
GROUP
30 JUNE 2013
$'000
30 JUNE 2012
$'000
1,297
1,297
226
2,676
2,902
986
986
151
2,676
2,827
2,676
2,676
-
-
-
-
2,676
2,676
The provision for rehabilitation represents the legal obligation for rehabilitation over tenement areas acquired and other non-current assets
acquired. The timing of the provision is based on licences in existence at the end of the financial year.
18. CONTRIBUTED EQUITY
(a) Issued Capital
Ordinary shares fully paid
(b) Movements in Ordinary Share Capital
GROUP
30 JUNE 2013
30 JUNE 2012
424,279,762
402,358,752
Number of
Shares
304,830,925
56,570,720
47,457,107
-
(6,500,000)
-
402,358,752
58,859
21,862,151
-
-
-
424,279,762
Summary of Movements
Company
Closing Balance at 30 June 2011
Placements
Exercise of Options
Transfer from Option Reserve
Less: Treasury Shares
Less: Cost of Issue
Closing Balance at 30 June 2012
Placements
Exercise of Options
Transfer from Option Reserve
Less: Treasury Shares
Less: Cost of Issue
Closing Balance at 30 June 2013
$'000
18,306
50,101
3,244
249
(5,038)
(2,250)
64,613
71
1,368
713
-
-
66,765
2013 ANNUAL FINANCIAL REPORT
Page 39
NOTES TO THE FINANCIAL STATEMENTS
18. CONTRIBUTED EQUITY (continued)
(c) Unlisted Options
Northern Star had the following unlisted options on issue as at 30 June 2013:
Employee Options
Employee Options
Employee Options
Unlisted Options
Unlisted Options
Employee Options
Employee Options
Employee Options
Employee Options
Employee Options
Employee Options
Number
333,334
333,333
333,333
2,000,000
750,000
250,000
250,000
125,000
125,000
250,000
250,000
Issue Price of
Shares
$1.20
$1.50
$1.81
$0.91
$0.91
$1.05
$1.22
$1.05
$1.22
$0.95
$1.05
Expiry Date
Expiring on 27 Feb 2014
Expiring on 27 Feb 2015
Expiring on 27 Feb 2016
Expiring on 28 June 2014
Expiring on 28 June 2014
Expiring on 27 Aug 2014
Expiring on 27 Aug 2015
Expiring on 1 Nov 2014
Expiring on 1 Nov 2015
Expiring on 15 Apr 2015
Expiring on 15 Apr 2016
During the financial year, no unlisted options were forfeited, 638,801 unlisted options expired, 125,000 options were cancelled,
23,893,526 options were exercised and 2,000,000 unlisted options were granted during the year.
(d) Terms and Conditions of Issued Capital
Ordinary shares have the right to receive dividends as declared and, in the event of winding up the Company, to participate in the
proceeds from the sale of all surplus assets in proportion to the number of and amounts paid up on shares held.
Ordinary shares entitle their holder to one vote, either in person or by proxy, at a meeting of the Company.
(e) Capital Management
When managing capital, management‟s objective is to ensure the entity continues as a going concern as well as to maintain optimal
returns to Shareholders and benefits for other stakeholders. Management also aims to maintain a capital structure that ensures the
lowest cost of capital Management may in the future adjust the capital structure to take advantage of favourable costs of capital and
issue further shares in the market. Management has no current plans to adjust the capital structure.
Total capital is equity as shown in the statement of financial position.
The Group is not subject to any externally imposed capital requirements.
19. SHARE-BASED OPTION RESERVE
Balance at the beginning of the year
Option exercised
Option forfeited
Option expense
Balance at the end of the year
Nature and purpose of the reserve:
GROUP
30 JUNE 2013
$'000
30 JUNE 2012
$'000
503
(665)
(48)
901
691
392
(238)
(11)
360
503
The Share-based option reserve is used to recognise the fair value of options issued but not exercised.
2013 ANNUAL FINANCIAL REPORT
Page 40
NOTES TO THE FINANCIAL STATEMENTS
20. INTEREST IN SUBSIDIARY
The Group consist of the Company and its wholly-owned controlled entity as follows:
Northern Star Mining Services Pty Ltd
Related party transactions
Loan to subsidiary
Movement in loans to subsidiary
Opening balance
Loans advanced
Closing balance
COUNTRY OF
INCORPORATION
Australia
6,000
6,000
6,000
-
6,000
6,000
-
6,000
The Parent company guarantees all commitments and financial obligations of its subsidiary.
21. COMMITMENTS AND CONTINGENT LIABILITIES
GROUP
30 JUNE 2013
$'000
30 JUNE 2012
$'000
(a) Operating Commitments:
Commitments in relation to hire purchase arrangements under a master agreement with various banks
and lending institutions contracted for at the reporting date.
Within one year
Later than one year but not more than five years
Future Finance Charges
Commitments in relation to term purchase arrangements under a master agreement with Toyota
Financial Services contracted for at the reporting date.
Within one year
Later than one year but not more than five years
Future Finance Charges
(b) Capital Commitments:
Commitments in relation to purchase of Property Plant and Equipment contracted for at the reporting
date, but not recognised as liabilities.
Within one year
Later than one year but not more than five years
5,771
4,217
9,988
(631)
9,357
212
2
214
(7)
207
493
-
493
4,680
5,032
9,712
(709)
9,003
242
214
456
(33)
423
4,680
5,032
9,712
.
2013 ANNUAL FINANCIAL REPORT
Page 41
NOTES TO THE FINANCIAL STATEMENTS
21. COMMITMENTS AND CONTINGENT LIABILITIES (continued)
(c) Operating Lease Expenditure Commitments:
The Company leases its Head Office property located at level 1, 1 Puccini Court, Stirling W.A. under an
operating lease. The lease runs for a period of 3 years commencing on the 1st of May 2012, with an
option to renew the lease for a further 5 years commencing on the 1st of May 2015. Lease payments are
increased every year to reflect market rentals, currently CPI plus 1%.
Within one year
Later than one year but not more than five years
(d) Tenement Expenditure Commitments:
The Company and the Group are required to maintain current rights of tenure to tenements, which
require outlays of expenditure in 2012/2013. Under certain circumstances these commitments are
subject to the possibility of adjustment to the amount and/or timing of such obligations, however, they
are expected to be fulfilled in the normal course of operations. Estimated minimum required expenditure
on mining, exploration and prospecting leases for 2012/2013.
Within one year
Later than one year but not more than five years
Later than five years
297
272
569
238
436
674
3,806
9,159
897
13,862
1,517
2,597
1,866
5,980
(e) Contingencies:
It is possible that native title, as defined in the Native Title Act 1993, might exist over land in which the Company has an interest. It is
impossible at this stage to quantify the impact (if any) that the existence of native title may have on the operations of the Company. However,
at the date of these accounts, the Directors are aware that applications for native title claims have been accepted by the Native Title Tribunal
over tenements held by the Company.
22. EMPLOYEE INCENTIVE SCHEME AND OTHER SHARE-BASED PAYMENTS
An employee incentive scheme has been established by Northern Star Resources Limited to provide eligible employees with a potential
ownership interest in the Company for the purpose of:
providing them with an opportunity to share in the growth in value of the Company,
encouraging them to improve the longer-term performance of the Company and its returns to Shareholders, and
assisting in the attraction, reward and retention of employees of the Company and its subsidiary.
These options/shares are granted at the discretion of the Board, who may take into account skills, experience, length of service with the
Company, remuneration level and such other criteria as considered appropriate. Shares and Options issued pursuant to the scheme are
issued free of charge. Shares issued under the Employee Share Plan are held in voluntary escrow. Where options are issued, the option
exercise price and expiry date, and the date(s) on which the rights may be exercised, is determined by the Board. Options are unlisted and
not quoted on the ASX, and transfers are restricted applied.
(a) Set out below are the summaries of employee shares granted as share based payments.
Balance at start
of the year
Granted during
the year
Forfeited or Cancelled
during the year
Balance at the
end of the year
Grant Date
2013
10/1/2013
2012
18/01/2012
2013 ANNUAL FINANCIAL REPORT
70,720
58,859
-
70,720
-
-
129,579
70,720
Page 42
NOTES TO THE FINANCIAL STATEMENTS
22. EMPLOYEE INCENTIVE SCHEME AND OTHER SHARE-BASED PAYMENTS (continued)
(b) Set out below are the summaries of options granted as share based payments.
Expiry
Date
Exercise
Price
Balance at
start of the
year
Granted
during the
year
Exercised
during the
year
Forfeited,
Expired or
Cancelled
during the
year
Balance at
the end of
the year
Vested and
exercisable
at the end
of the year
15/04/2015
15/04/2015
1/11/2015
1/11/2014
27/08/2015
27/08/2014
28/06/2014
28/06/2014
14/05/2013
30/06/2013
27/02/2014
27/02/2015
27/02/2016
17/10/2012
17/10/2013
17/10/2014
11/10/2013
11/10/2014
4/11/2012
4/11/2013
4/11/2014
30/07/2013
30/07/2013
30/07/2013
30/07/2013
4/09/2012
4/09/2012
4/09/2013
4/09/2013
4/09/2013
4/09/2013
1.05
0.95
1.22
1.05
1.22
1.05
0.91
0.91
0.80
0.80
1.20
1.50
1.81
0.35
0.50
0.65
0.20
0.25
0.15
0.20
0.25
0.20
0.20
0.20
0.20
0.05
0.05
0.10
0.10
0.10
0.10
-
-
-
-
-
-
-
250,000
250,000
125,000
125,000
250,000
250,000
750,000
2,000,000
375,000
375,000
333,334
333,333
333,333
333,334
333,333
333,333
333,333
333,333
333,334
333,333
333,333
250,000
250,000
250,000
250,000
500,000
333,333
500,000
6,500,000
5,000,000
333,333
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(375,000)
(250,000)
-
-
-
(333,334)
(333,333)
(333,333)
(333,333)
(333,333)
(333,334)
(333,333)
(333,333)
(250,000)
(250,000)
(250,000)
(250,000)
(500,000)
(333,333)
(500,000)
(6,500,000)
(5,000,000)
(333,333)
-
-
-
-
-
-
-
-
-
(125,000)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
250,000
250,000
125,000
125,000
250,000
250,000
750,000
2,000,000
-
-
333,334
333,333
333,333
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
2,000,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Grant Date
2013
15/04/2013
15/04/2013
10/01/2013
10/01/2013
10/01/2013
10/01/2013
3/12/2012
29/06/2012
15/05/2012
15/05/2012
2/03/2012
2/03/2012
2/03/2012
25/08/2011
25/08/2011
25/08/2011
28/10/2010
28/10/2010
18/11/2010
18/11/2010
18/11/2010
30/07/2010
30/07/2010
30/07/2010
30/07/2010
11/09/2009
11/09/2009
11/09/2009
11/09/2009
11/09/2009
11/09/2009
2013 ANNUAL FINANCIAL REPORT
Page 43
NOTES TO THE FINANCIAL STATEMENTS
22. EMPLOYEE INCENTIVE SCHEME AND OTHER SHARE-BASED PAYMENTS (continued)
Forfeited,
Expired or
Cancelled
during the
year
Balance at
start of the
year
Exercised
during the
year
Granted
during the
year
Exercise
Price
Expiry
Date
Balance at
the end of
the year
Vested and
exercisable
at the end
of the year
Grant Date
2012
29/06/2012
15/05/2012
15/05/2012
2/03/2012
2/03/2012
2/03/2012
25/08/2011
25/08/2011
25/08/2011
28/10/2010
28/10/2010
28/10/2010
18/11/2010
18/11/2010
18/11/2010
30/07/2010
30/07/2010
30/07/2010
30/07/2010
30/07/2010
30/07/2010
30/07/2010
30/07/2010
18/06/2007
2/09/2008
2/09/2008
2/09/2008
2/09/2008
2/09/2008
11/09/2009
11/09/2009
11/09/2009
11/09/2009
11/09/2009
11/09/2009
11/09/2009
11/09/2009
11/09/2009
11/09/2009
20/10/2009
20/10/2009
20/10/2009
8/12/2009
28/06/2014
14/05/2013
14/05/2014
27/02/2014
27/02/2015
27/02/2016
17/10/2012
17/10/2013
17/10/2014
11/10/2012
11/10/2013
11/10/2014
4/11/2012
4/11/2013
4/11/2014
30/07/2012
30/07/2012
30/07/2012
30/07/2012
30/07/2013
30/07/2013
30/07/2013
30/07/2013
18/06/2012
2/09/2011
2/09/2011
2/09/2011
2/09/2011
2/09/2011
4/09/2011
4/09/2011
4/09/2012
4/09/2012
4/09/2012
4/09/2012
4/09/2013
4/09/2013
4/09/2013
4/09/2013
20/10/2011
20/10/2012
20/10/2013
8/12/2013
0.91
0.80
0.80
1.20
1.50
1.81
0.35
0.50
0.65
0.15
0.20
0.25
0.15
0.20
0.25
0.10
0.10
0.10
0.10
0.20
0.20
0.20
0.20
0.20
0.20
0.20
0.25
0.20
0.30
0.03
0.03
0.05
0.05
0.05
0.05
0.10
0.10
0.10
0.10
0.06
0.06
0.06
0.06
-
-
-
-
-
-
-
-
-
333,334
333,333
333,333
333,334
333,333
333,333
250,000
250,000
250,000
250,000
250,000
250,000
250,000
250,000
100,000
400,000
150,000
150,000
150,000
150,000
1,210,000
333,334
500,000
6,500,000
5,000,000
333,333
500,000
6,500,000
5,000,000
333,333
250,000
250,000
250,000
250,000
2,000,000
375,000
375,000
333,334
333,333
333,333
333,334
333,333
333,333
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(333,334)
-
-
-
-
-
(250,000)
(250,000)
(250,000)
(250,000)
-
-
-
-
(100,000)
(200,000)
(75,000)
(75,000)
(75,000)
(75,000)
(1,210,000)
(333,334)
-
(6,500,000)
(5,000,000)
-
-
-
-
-
(250,000)
(250,000)
(250,000)
(250,000)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(200,000)
(75,000)
(75,000)
(75,000)
(75,000)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
2,000,000
375,000
375,000
333,334
333,333
333,333
333,334
333,333
333,333
-
333,333
333,333
333,334
333,333
333,333
-
-
-
-
250,000
250,000
250,000
250,000
-
-
-
-
-
-
-
-
500,000
-
-
333,333
500,000
6,500,000
5,000,000
333,333
-
-
-
-
2,000,000
375,000
-
-
-
-
333,334
-
-
-
-
-
333,334
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
500,000
-
-
333,333
-
-
-
-
-
-
-
-
2013 ANNUAL FINANCIAL REPORT
Page 44
NOTES TO THE FINANCIAL STATEMENTS
23. KEY MANAGEMENT PERSONNEL DISCLOSURES
(a) Key management personnel compensation
Short-term employee benefits - cash fees and bonus
Post-employment benefits - superannuation
Equity based payments
GROUP
30 JUNE 2013
$'000
30 JUNE 2012
$'000
1,482
62
445
1,161
54
52
(b) Equity Instruments Disclosures Relating to Key Management Personnel
(i) Share Holdings
The number of ordinary shares in the Company held during the financial year by each Director of Northern Star Resources Limited and any
other key management personnel of the Group, including their personally related parties, are as follows
2013
Name
Directors
Christopher Rowe
Bill Beament
John Fitzgerald
Michael Fotios
Peter O‟Connor
Peter Farris (as at 30 November 2012)
Key Management Personnel
Ray Parry
Liza Carpene
Karen Brown (as at 15 April 2013)
2012
Name
Directors
Christopher Rowe
Bill Beament
Peter Farris
Michael Fotios
Peter O‟Connor
Key Management Personnel
Ray Parry
Karen Brown
Balance at
beginning
of the year
Net change
during
the year
Balance
at end of
the year
5,410,514
(1,424,319)
3,986,195
14,670,000
(2,385,265)
12,284,735
-
-
-
49,539,374
(20,489,000)
29,050,374
100,000
999,998
100,000
(750,000)
200,000
249,998
378,334
526,479
904,813
-
-
-
1,191,666
735,332
1,926,998
Balance at
beginning
of the year
Net change
during
the year
Balance
at end of
the year
6,445,833
9,500,000
1,049,998
(1,035,319)
5,410,514
5,170,000
14,670,000
(50,000)
999,998
67,771,054
(18,231,680)
49,539,374
100,000
-
100,000
45,000
1,191,666
333,334
378,334
-
1,191,666
2013 ANNUAL FINANCIAL REPORT
Page 45
NOTES TO THE FINANCIAL STATEMENTS
23. KEY MANAGEMENT PERSONNEL DISCLOSURES (continued)
(ii) Option Holdings
The number of options over ordinary shares in the Company held during the financial year by each Director of Northern Star Resources
Limited and any other key management personnel of the Group, including their personally related parties, are as follows:
2013
Name
Directors
Christopher Rowe
Bill Beament
Michael Fotios
Peter O‟Connor
Peter Farris
Key Management Personnel
Ray Parry
Liza Carpene
Karen Brown
2012
Name
Directors
Balance at
start of
the year
Granted during
the year
Exercised
during
the year
1,864,681
8,500,000
5,000,000
-
-
666,666
-
-
-
(1,864,681)
(6,500,000)
(5,000,000)
750,000
-
-
-
-
(666,666)
-
500,000
-
735,332
-
(735,332)
Forfeited,
Expired or
Cancelled
during the
year
Balance at the
end of the year
Vested and
exercisable at
the end of the
year
-
-
-
-
-
-
-
-
-
-
2,000,000
2,000,000
-
-
750,000
750,000
-
-
500,000
-
-
-
-
-
Balance at
start of
the year
Granted during
the year
Exercised
during
the year
Forfeited,
Expired or
Cancelled
during the
year
Balance at the
end of the year
Vested and
exercisable at
the end of the
year
Christopher Rowe
2,729,362
-
(864,681)
Bill Beament
Peter Farris
Michael Fotios
Peter O‟Connor
Key Management Personnel
Ray Parry
Karen Brown
15,370,000
2,000,000
(8,870,000)
250,000
31,869,320
-
1,000,000
735,332
-
-
-
-
-
(250,000)
(26,869,320)
-
(333,334)
-
-
-
-
-
-
-
-
1,864,681
8,500,000
1,864,681
8,500,000
-
-
5,000,000
5,000,000
-
-
666,666
735,332
-
735,332
2013 ANNUAL FINANCIAL REPORT
Page 46
NOTES TO THE FINANCIAL STATEMENTS
23. KEY MANAGEMENT PERSONNEL DISCLOSURES (continued)
(c) Other Related Party Transactions with Key Management Personnel
Michael Fotios is a related party, and is:
a Shareholder and director of Delta Resources Management Pty Ltd. During the year an amount of $562 was paid to Delta Resources for
professional services at normal commercial rates, and
a Shareholder and director of Investmet Limited. During the year an amount of $58,400 was paid to this business for corporate advice at
normal commercial rates.
Bill Beament is a related party, and:
is a director and has a beneficial interest in a shareholding of Australian Underground Drilling Pty Ltd. During the year an amount of
$6,886,439 was paid to this business for mining services at normal commercial rates,
has a beneficial interest in a shareholding in Premium Mining Personnel Pty Ltd. During the year and amount of $5,327,172 was paid to
this business for mining services at normal commercial rates,
is the sole director and has a beneficial interest in a shareholding in Mining & Infrastructure Group Pty Ltd. During the year an amount of
$18,800 was paid to this business for serviced vehicle expenses at normal commercial rates in relation to Mr Beament‟s remuneration
contract, and
had a short term personal loan with the Company as at 30 June 2013 to the value of $31,318.65 which was extinguished subsequent to
the balance date .
24. AUDITOR'S REMUNERATION
During the year the following fees were paid or payable for services provided by the auditor of the parent
entity, its related practices and non-related audit firms:
Rothsay Chartered Accountants - Auditors for the Group
25. SEGMENT INFORMATION
GROUP
30 JUNE 2013
$'000
58
30 JUNE 2012
$'000
61
Management has determined the operating segments based on the reports reviewed by the Board of Directors that are used to make
strategic decisions. The Group does not have any operating segments with discrete financial information. All the Group‟s assets and liabilities
are located within Australia. The Board of Directors review internal management reports on a monthly basis that is consistent with the
information provided in the statement of comprehensive income, statement of financial position and statement of cash flows. As a result no
reconciliation is required because the information as presented is what is used by the Board to make strategic decisions.
26. JOINT VENTURES
The Group has the following interest in unincorporated joint ventures:
JOINT VENTURE
Fortescue Metals Group
Cullen Exploration Pty Ltd - Hardey Junction Joint Venture
Artemis Resources Ltd - Mt Clement Joint Venture
PRINCIPAL
ACTIVITIES
Exploration
Exploration
Exploration
GROUP
30 JUNE 2013
30 JUNE 2012
25%
80%
20%
-
80%
20%
The joint ventures are not separate legal entities. They are contractual arrangements between participants for the sharing of costs and
outputs and do not in themselves generate revenue and profit. The joint ventures are of the type where initially one party contributes
tenements with the other party earning a specified percentage by funding exploration activities; thereafter the parties often share exploration
and development costs and output in proportion to their ownership of joint venture assets. The joint ventures do not hold any assets and
accordingly the Company‟s share of exploration evaluation and development expenditure is accounted for in accordance with the policy set
out in Note 1.
2013 ANNUAL FINANCIAL REPORT
Page 47
NOTES TO THE FINANCIAL STATEMENTS
27. FINANCIAL RISK MANAGEMENT
The Group‟s principal financial instruments comprise cash, short-term deposits and borrowings. The main purpose of these financial
instruments is to provide working capital for the Group‟s operations and mine development. The Group has various other financial
instruments such as listed investments, trade debtors and trade creditors, which arise directly from its operations.
The main risks arising from the Group‟s financial instruments are interest rate risk, liquidity risk, foreign currency risk, commodity price risk
and credit risk. The Board reviews and agrees on policies for managing each of these risks.
The Group holds the following financial instruments:
Financial assets
Cash and cash equivalents
Trade and other receivables
Other financial assets – investments
Financial liabilities
Trade payables
Financial Liabilities
GROUP
30 JUNE 2013
$'000
30 JUNE 2012
$'000
55,775
1,713
2,224
14,449
11,232
64,962
1,817
6,653
14,967
9,426
(a) Interest rate risk
At balance date the Group‟s exposure to market risk for changes in interest rates relates primarily to the Company‟s short-term cash
deposits and borrowings. The Group constantly analyses its exposure to interest rates, with consideration given to potential renewal of
existing positions, the mix of fixed and variable interest rates and the period to which deposits may be fixed.
The Group had the following financial instruments exposed to interest rates:
Financial assets
Cash and cash equivalents
Financial liabilities
Finance Leases
Net exposure
GROUP
30 JUNE 2013
$'000
30 JUNE 2012
$'000
55,775
64,962
(11,232)
44,543
(9,426)
55,536
Sensitivity
At 30 June 2013, if interest rates had increased/decreased by 0.75% from the year end variable rates with all other variables held constant,
post tax profit and equity for the Group and Parent would have been $334,000 higher/lower (2012: $694,000 higher/$694,000 lower).
The 0.75% sensitivity is based on reasonably possible changes, over a financial year, using an observed range of historical RBA
movements over the last year.
2013 ANNUAL FINANCIAL REPORT
Page 48
NOTES TO THE FINANCIAL STATEMENTS
27. FINANCIAL RISK MANAGEMENT (continued)
(b) Liquidity risk
The Group manages liquidity risk by monitoring immediate and forecast cash requirements and ensuring adequate cash reserves are
maintained. A maturity analysis of financial liabilities is disclosed in the table below.
Maturity analysis of financial liabilities:
Non-Interest Bearing
Trade payables
Fixed Rate
Financial Liabilities
GROUP
30 JUNE 2013
$'000
30 JUNE 2012
$'000
14,449
14,449
14,967
14,967
11,232
9,426
(c) Foreign Currency Risk
As a result of exposure to the gold commodity market, the Company has exposure to the USD. The Company manages this exposure by
selling gold in AUD.
(d) Commodity Price Risk
The Group is exposed to movements in the gold price. As part of the risk management policy of the Group, a variety of financial instruments
(such as gold forward sales contracts and gold put options) are used from time to time to minimise the risk of AUD denominated gold prices
falling below the cash costs of production by providing price certainty over a portion of the forecast production at an acceptable margin in
excess of the forecast cash cost of production. Hedging programs undertaken are structured with the objective of retaining as much upside
to the gold price as possible, but in any event, by limiting hedging commitments to no more than 70% of the Group‟s quarterly forecast
production.
The value of these financial instruments at any given point in time, will in times of volatile market conditions, show substantial variation over
the short term. The hedging facilities provided by the Group‟s various hedging counterparties do not contain margin calls. The Group does
not hedge account for these instruments. At balance date the Group did not have any hedging commitments.
(e) Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Group. The Group
has adopted the policy of dealing with creditworthy counterparties and obtaining sufficient collateral or other security where appropriate, as
a means of mitigating the risk of financial loss from defaults. Cash is deposited only with institutions with a minimum credit rating of AA (or
equivalent) as determined by a reputable credit rating agency e.g. Standard & Poor. The Group does not have any other significant credit
risk exposure to a single counterparty or any group of counterparties having similar characteristics.
The credit quality of financial assets that are neither past due nor impaired can be assessed by reference to external credit ratings (if
available) or to historical information about counterparty default rates:
GROUP
30 JUNE 2013
$'000
30 JUNE 2012
$'000
Cash and cash equivalents
55,775
64,962
The Group measures credit risk on a fair value basis. The carrying amount of financial assets recorded in the financial statements, net of
any provision for losses, represents the Group‟s maximum exposure to credit risk. All receivables noted above are due within 30 days.
None of the above receivables are past due.
2013 ANNUAL FINANCIAL REPORT
Page 49
NOTES TO THE FINANCIAL STATEMENTS
28. PARENT ENTITY INFORMATION
(a) Information relating to Northern Star Resources Limited:
Results of the parent entity
Profit/(Loss) for the period
Other comprehensive income for the year
Total comprehensive income for the year
Financial position of the parent entity at year end
Current assets
Non-current assets
Total assets
Current liabilities
Noncurrent liabilities
Total liabilities
Net assets
Contributed equity
Reserves
Retained earnings
Total equity
PARENT ENTITY
30 JUNE 2013
$'000
30 JUNE 2012
$'000
23,106
22,773
-
-
23,106
22,773
69,334
77,109
75,812
54,076
146,443
129,888
23,522
14,806
38,328
108,115
66,765
691
40,659
108,115
21,883
10,495
32,378
97,510
64,612
503
32,395
97,510
(b) Details of any guarantees entered into by the parent entity in relation to the debts of its subsidiary
Refer to Note 21.
(c) Details of any contingent liabilities of the parent entity
Refer to Note 21.
(d) Details of any contractual commitments by the parent entity for the acquisition of plant, and equipment
There are no contractual commitments by the parent entity for the acquisition of property, plant and equipment as at reporting date.
(e) Tax Consolidation
The Company and its 100% owned controlled entity have formed a tax consolidated group. Members of the group entered into a tax sharing
arrangement in order to allocate income tax expense to the wholly owned controlled entities. The head entity of the consolidated group is
Northern Star Resources Limited.
29. EVENTS SUBSEQUENT TO YEAR END
There are no other matters or circumstances other than the future development of the production site that have arisen since 30 June 2013
that have or may significantly affect the operations, results, or state of affairs of the Group in future financial years.
2013 ANNUAL FINANCIAL REPORT
Page 50
DIRECTORS’ DECLARATION
In accordance with a resolution of the Board of Directors, I state that:
In the opinion of the Directors:
1.
(a)
the financial statements, notes and audited remuneration disclosures included in the directors‟ report of the Company
and the Group are in accordance with the Corporations Act 2001, including:
i.
giving a true and fair view of the Group‟s financial position at 30 June 2013 and of the performance for the year
ended on that date; and
ii.
complying with Accounting Standards and Corporations Regulations 2001; and
(b)
(c)
there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due
and payable; and
the remuneration disclosures set out in the Directors‟ Report (as part of the audited Remuneration Report) for the year
ended 30 June 2013 comply with Section 300A of the Corporations Act 2001.
2.
3.
The Company has included in the notes to the financial statements an explicit and unreserved statement of compliance with
International Financial Reporting Standards (IFRS).
This declaration has been made after receiving the declarations required to be made to the Directors in accordance with Section
295A of the Corporations Act 2001 for the financial year ending 30 June 2013.
On behalf of the Board
BILL BEAMENT
Managing Director
Perth, Western Australia
2 August 2013
2013 ANNUAL FINANCIAL REPORT
Page 51
INDEPENDENT AUDITOR’S REPORT
2013 ANNUAL FINANCIAL REPORT
Page 52
INDEPENDENT AUDITOR’S REPORT
2013 ANNUAL FINANCIAL REPORT
Page 53
CORPORATE GOVERNANCE STATEMENT
Approach to Corporate Governance
The Company has
Northern Star Resources Limited (Company) has established a
corporate governance framework, the key features of which are set
out in this statement. In establishing its corporate governance
framework, the Company has referred to ASX Corporate Governance
Council Principles and Recommendations 2nd edition (Principles &
followed each
Recommendations).
recommendation where
the
considered
the Board
recommendation to be an appropriate benchmark for its corporate
governance practices. Where the Company's corporate governance
practices follow a recommendation, the Board has made appropriate
statements reporting on the adoption of the recommendation. In
compliance with the "if not, why not" reporting regime, where, after
due consideration, the Company's corporate governance practices
do not follow a recommendation, the Board has explained it reasons
for not following the recommendation and disclosed what, if any,
alternative practices the Company has adopted instead of those in
the recommendation.
has
following governance-related documents are
The
located on
Company's website under the “Corporate Governance” section
(http://www.nsrltd.com/corporate/corporategovernance.html).
Charters
Board
Audit Committee
Nomination Committee
Remuneration Committee
Policies and Procedures
Policy and Procedure for Selection and (Re) Appointment of
Directors
Process for Performance Evaluation
Policy on Assessing the Independence of Directors
Diversity Policy (summary)
Code of Conduct (summary)
Policy on Continuous Disclosure (summary)
Compliance Procedures (summary)
Procedure for the Selection, Appointment and Rotation of
External Auditor
Shareholder Communication Policy
Risk Management Policy (summary)
Policy for Trading in Company Securities
The Company reports below on whether it has followed each of the
recommendations during the 2012/2013 financial year (Reporting
Period). The information in this statement is current at 8 October
2013.
Board
Roles and responsibilities of the Board and Senior Executives
(Recommendations: 1.1, 1.3)
The Company has established the functions reserved to the Board,
and those delegated to senior executives and has set out these
functions in its Board Charter, which is disclosed on the Company‟s
website.
The Board is collectively responsible for promoting the success of the
Company through its key functions of overseeing the management of
the Company, providing overall corporate governance of
the
Company, monitoring the financial performance of the Company,
engaging appropriate management commensurate with
the
Company's structure and objectives, involvement in the development
of corporate strategy and performance objectives, and reviewing,
ratifying and monitoring systems of risk management and internal
control, codes of conduct and legal compliance.
Senior executives are responsible for supporting the Managing
Director and assisting the Managing Director in implementing the
running of the general operations and financial business of the
Company in accordance with the delegated authority of the Board.
Senior executives are responsible for reporting all matters which fall
within the Company's materiality thresholds at first instance to the
Managing Director or, if the matter concerns the Managing Director,
directly to the Chair or the lead independent director, as appropriate.
The lead independent director is the Chair of the Audit Committee,
John Fitzgerald.
Skills, experience, expertise and period of office of each Director
(Recommendation: 2.6)
A profile of each Director setting out their skills, experience, expertise
and period of office is set out in the Directors' Report on page 7.
The mix of skills and diversity for which the Board is looking to
achieve in membership of its Board is represented in its current
composition. The Board includes Directors with skills and substantial
experience in operational management, exploration and geology,
mining engineering, corporate
resource
listed
companies, equity markets and global funds management.
finance,
law,
Director independence
(Recommendations: 2.1, 2.2, 2.3, 2.6)
For the period 1 July 2012 to 30 November 2012, the Board did not
have a majority of directors who were independent. Whilst the Board
considered that its size and composition represented an appropriate
mix of skills and expertise relevant to the Company‟s business, it is
aware of the importance of independent judgement and considers
independence when new appointments are made to the Board. On
30 November 2012, Peter Farris, a non-independent director, did not
seek re-election to the Board at the Annual General Meeting and
independent non-executive director was
John Fitzgerald, an
appointed which resulted
the Board having a majority of
independent directors.
in
relationships
The Board considers the independence of directors having regard to
the
the Principles &
Recommendations and the Company's materiality thresholds. The
Board has agreed on the following guidelines, as set out in the
Company's Board Charter for assessing the materiality of matters:
in Box 2.1 of
listed
Balance sheet items are material if they have a value of more
than 10% of pro-forma net asset.
Profit and loss items are material if they will have an impact on
the current year operating result of 10% or more.
Items are also material if they impact on the reputation of the
Company, involve a breach of legislation, are outside the
ordinary course of business, could affect the Company‟s rights to
its assets, if accumulated would trigger the quantitative tests,
involve a contingent liability that would have a probable effect of
10% or more on balance sheet or profit and loss items, or will
have an effect on operations which is likely to result in an
increase or decrease in net income or dividend distribution of
more than 10%.
Contracts will be considered material if they are outside the
ordinary course of business, contain exceptionally onerous
provisions in the opinion of the Board, impact on income or
distribution in excess of the quantitative tests, there is a
likelihood that either party will default, and the default may trigger
2013 ANNUAL FINANCIAL REPORT
Page 54
CORPORATE GOVERNANCE STATEMENT
any of the quantitative or qualitative tests, are essential to the
activities of the Company and cannot be replaced, or cannot be
replaced without an increase in cost which triggers any of the
quantitative tests, contain or trigger change of control provisions,
are between or for the benefit of related parties, or otherwise
trigger the quantitative tests.
The independent directors of the Company are Christopher Rowe
(Chair), Peter O‟Connor and John Fitzgerald
(appointed 30
November 2012). These directors are independent as they are non-
executive directors who are not members of management and who
are free of any business or other relationship that could materially
interfere with, or could reasonably be perceived to materially interfere
with, the independent exercise of their judgment.
The non-independent directors of the Company are William (Bill)
Beament (Managing Director), Michael Fotios (a director and
significant shareholder of
InvestMet Limited, a substantial
shareholder of the Company) and Peter Farris (retired 30 November
2012), also a director of InvestMet Limited.
The independent Chair of the Board is Christopher Rowe.
The Managing Director is Bill Beament.
Independent professional advice
(Recommendation: 2.6)
To assist directors with independent judgement, it is the Board's
policy that if a director considers it necessary to obtain independent
professional advice to properly discharge the responsibility of their
office as a director then, provided the director first obtains approval
from the Chair for incurring such expense, the Company will pay the
reasonable expenses associated with obtaining such advice.
Selection and (Re)Appointment of Directors
(Recommendation: 2.6)
In determining candidates for the Board, the Nomination Committee
(or equivalent) follows a prescribed process whereby it evaluates the
mix of skills, experience and expertise of the existing Board. In
particular, the Nomination Committee (or equivalent) is to identify the
particular skills that will best increase the Board's effectiveness.
Consideration is also given to the balance of independent directors.
Potential candidates are identified and, if relevant, the Nomination
Committee (or equivalent) recommends an appropriate candidate for
appointment to the Board. Any appointment made by the Board is
subject to ratification by shareholders at the next general meeting.
The Board recognises that Board renewal is critical to performance
and the impact of Board tenure on succession planning. An election
of directors is held each year. Each director other than the Managing
Director, must not hold office (without re-election) past the third
annual general meeting of the Company following the director's
appointment or three years following that director's last election or
However, a director
appointment (whichever
appointed to fill a casual vacancy or as an addition to the Board must
not hold office (without re-election) past the next annual general
meeting of the Company. At each annual general meeting a
minimum of one director or one third of the total number of directors
must resign. A director who retires at an annual general meeting is
eligible for re-election at that meeting. Re-appointment of directors is
not automatic.
longer).
the
is
The Company‟s Policy and Procedure for the Selection and Re
(Appointment) of Directors is disclosed on the Company‟s website.
Board Committees
Nomination Committee
(Recommendations: 2.4, 2.6)
The Board has not established a separate Nomination Committee.
Given the current size and composition of the Board, the Board
believes that there would be no efficiencies gained by establishing a
separate Nomination Committee. Accordingly, the Board performs
the role of the Nomination Committee. Items that are usually
required to be discussed by a Nomination Committee are marked as
separate agenda items at Board meetings when required. When the
Board convenes as the Nomination Committee it carries out those
functions which are delegated to it in the Company‟s Nomination
Committee Charter. The Board deals with any conflicts of interest
that may occur when convening in the capacity of the Nomination
Committee by ensuring that the director with conflicting interests is
not party to the relevant discussions.
The full Board, in its capacity as the Nomination Committee, held one
(1) meeting during the Reporting Period. Details of director
attendance at the meeting of the full Board, in its capacity as the
Nomination Committee, during the Reporting Period are set out in a
table in the Directors‟ Report on page 8. Informal nomination-related
discussions occurred from time to time during the year as required
during other Board meetings.
The Board has adopted a Nomination Committee Charter which
describes the role, composition, functions and responsibilities of the
full Board in its capacity as the Nomination Committee.
The Company‟s Nomination Committee Charter is disclosed on the
Company‟s website.
Audit Committee
(Recommendations: 4.1, 4.2, 4.3, 4.4)
The Board has established an Audit Committee.
For the period 1 July 2012 to 30 November 2012, the Audit
Committee comprised Peter O‟Connor (Chair), Christopher Rowe
and Peter Farris and was structured
in compliance with
Recommendation 4.2. On 30 November 2012, Peter Farris did not
seek re-election at the Annual General meeting and retired from the
Audit Committee, and John Fitzgerald was appointed
the
committee. Mr Fitzgerald took over as Chair of the Audit Committee
on 17 December 2012. The Audit Committee now comprises three
independent non-executive directors and
is chaired by John
Fitzgerald who is not also Chair of the Board in compliance with
Recommendation 4.2.
to
The Company has adopted an Audit Committee Charter which
describes the role, composition, functions and responsibilities of the
Audit Committee.
The Audit Committee held two (2) meetings during the Reporting
Period. Details of director attendance at Audit Committee meetings
during the Reporting Period are set out in a table in the Directors‟
Report on page 8.
themselves
Details of each of the director's qualifications are set out in the
Directors' Report on page 7. All members of the Audit Committee
consider
literate and have an
understanding of the industry in which the Company operates. Mr
Fitzgerald, who joined the Audit Committee on 30 November 2012,
and took over as Chair of the Audit Committee on 17 December
2012, is a Chartered Accountant.
financially
to be
The Company has established a Procedure for the Selection,
Appointment and Rotation of its External Auditor. The Board is
2013 ANNUAL FINANCIAL REPORT
Page 55
CORPORATE GOVERNANCE STATEMENT
responsible for the initial appointment of the external auditor and the
appointment of a new external auditor when any vacancy arises, as
recommended by the Audit Committee (or its equivalent). Candidates
for the position of external auditor must demonstrate complete
independence from the Company through the engagement period.
The Board may otherwise select an external auditor based on criteria
relevant
the Company's business and circumstances. The
performance of the external auditor is reviewed on an annual basis
by the Audit Committee and any recommendations are made to the
Board.
to
The Company‟s Audit Committee Charter and Procedure
for
Selection, Appointment and Rotation of External Auditor are
disclosed on the Company‟s website.
Remuneration Committee
(Recommendations: 8.1, 8.2, 8.3, 8.4)
The Board has established a Remuneration Committee, which
comprises the Board‟s non-executive directors. Accordingly, the
Remuneration Committee is, and was at all times during the
Reporting Period structured in compliance with ASX Listing Rule
12.8.
However, the Remuneration Committee was not structured in
accordance with Recommendation 8.2 at all times during the
Reporting Period. The members of the Remuneration Committee for
the period 1 July 2012 to 30 November 2012 were: Christopher
Rowe (Chair), Michael Fotios, Peter Farris and Peter O‟Connor.
Whilst all members were non-executive directors, only two members
(including the Chair) were independent. The Board is of the opinion
that the widest representation of the full Board is advantageous to
the operation of the Remuneration Committee regardless of the
independence of the committee members.
from
On 30 November 2012, Mr Farris did not stand for re-election at the
Annual General Meeting and retired
the Remuneration
Committee, and Mr Fitzgerald was appointed to the committee, from
which date the Remuneration Committee has been structured in
The Remuneration
accordance with Recommendation 8.2.
Committee comprises three independent non-executive directors and
one non-independent non-executive director and is chaired by an
independent director.
The Remuneration Committee held four (4) meetings during the
Reporting Period. Details of director attendance at Remuneration
Committee meetings during the Reporting Period are set out in a
table in the Directors‟ Report on page 8.
The Board has adopted a Remuneration Committee Charter which
describes the role, composition, functions and responsibilities of the
Remuneration Committee.
fixed
remuneration,
Details of
the Company‟s policy on
including
remuneration, are contained in the “Remuneration Report” which
forms of part of the Directors‟ Report and commences on page 11.
The Company's policy on remuneration clearly distinguishes the
structure of non-executive directors‟ remuneration from that of
executive directors and senior executives. Non-executive directors
time, commitment and
fee
are remunerated at a
responsibilities. Remuneration for non-executive directors is not
linked to individual performance. From time to time the Company
may grant options to non-executive directors as a means of attracting
and retaining suitably qualified non-executive directors. Options
proposed to be issued to non-executive directors are subject to
approval by shareholders in general meeting. The Board has
refrained from issuing options to non-executive directors since the
2012 Annual General Meeting. Pay and rewards for executive
directors and senior executives consists of a base salary and
for
performance incentives. Short term performance incentives may
include cash bonuses, which is designed to encourage and reward
superior performance. Long term performance incentives may
include options granted at the discretion of the Board and subject to
obtaining the relevant approval. The grant of options is designed to
recognise and reward efforts as well as to provide additional
incentive and may be subject to the successful completion of
performance hurdles. Executives are offered a competitive level of
base pay at market rates and are reviewed annually to ensure
market competitiveness.
There are no termination or retirement benefits for non-executive
directors (other than for superannuation).
includes a
The Company's Remuneration Committee Charter
statement of the Company's policy on prohibiting transactions in
associated products which limit the risk of participating in unvested
entitlements under any equity based remuneration schemes.
The Company‟s Remuneration Committee Charter is disclosed on
the Company‟s website.
Performance Evaluation
Senior Executives
(Recommendations: 1.2, 1.3)
It is the responsibility of the Managing Director to manage and
implement performance evaluation of other senior executives and
management, reporting to the Board (as the Nomination Committee)
and the Remuneration Committee at least annually.
The current size and structure of the Company allows the Managing
Director to conduct informal evaluation of other senior executives and
management personnel on a regular basis, conducting a formal
evaluation annually in conjunction with a remuneration review. This
formal evaluation follows a structured format including interviews,
self-assessment and measurement of performance of the individual
and the Company against a set of parameters and benchmarks.
Open and regular communication with senior staff and consulting
personnel allows
that key
performance indicators are identified and met, and to provide
feedback and guidance, particularly where performance or
mismanagement issues are evident.
the Managing Director
to ensure
A performance evaluation of senior executives took place during the
Reporting Period in accordance with the process disclosed.
Board, its Committees and Individual Directors
(Recommendations: 2.5, 2.6)
Evaluation of the Board and its members is carried out by way of an
ongoing review by the Chair (please refer to the Company‟s Process
for Performance Evaluation on its website for more details of the
means by which the review is conducted), discussing issues as they
arise, and periodically conducting interviews with each director. This
ongoing process has remained in-house and informal throughout the
year, relying on discussion and consultation summarised with an
annual report from the Chair in preference to more formal means of
evaluation. The full Board (acting as the Nomination Committee)
reviews the performance of the Managing Director on an ongoing
basis.
During the Reporting Period, the Chair performed an evaluation of
the Board, its committees, and individual directors (including the
Managing Director but excluding the Chair) which was summarised in
a report. A review of the Chair was not undertaken during the year.
The Board has committed to undertaking an annual review of the
Board, its committees and individual directors (including the Chair)
commencing in the second quarter of the 2014 financial year by way
2013 ANNUAL FINANCIAL REPORT
Page 56
CORPORATE GOVERNANCE STATEMENT
of a formal questionnaire and evaluation to be completed by all
directors. The results of the review, once compiled, will be
considered by the full Board (acting as the Nomination Committee).
The Managing Director‟s evaluation will be completed in June of
each year in line with other senior executives.
The Company‟s Process for Performance Evaluation is disclosed on
the Company‟s website.
Ethical and Responsible Decision Making
Code of Conduct
(Recommendations: 3.1, 3.5)
The Company has established a Code of Conduct as to the practices
necessary to maintain confidence in the Company's integrity, the
practices necessary to take into account its legal obligations and the
reasonable expectations of its stakeholders and the responsibility
and accountability of individuals for reporting and investigating
reports of unethical practices.
A summary of the Company‟s Code of Conduct is disclosed on the
Company‟s website.
Diversity
(Recommendations: 3.2, 3.3, 3.4, 3.5)
The Company has established a Diversity Policy, which includes
requirements for the Board to establish measurable objectives for
achieving gender diversity and for the Board to assess annually both
the objectives and progress towards achieving them.
The following measurable objectives for achieving gender diversity
were set by the Board in accordance with the Diversity Policy on 28
June 2013.
Progress towards
achieving
To be measured 30
June 2014.
Recruitment
processes are being
modified to encourage
greater female
participation.
To be measured 30
June 2014.
To be measured 30
June 2014.
Recruitment
processes are being
modified to encourage
greater female
participation.
No vacancies have
become available to
date.
Development of the
succession planning
system / policy has
commenced.
Objectives
Increase the % proportion of women
in the Northern Star total workforce
as at 30 June 2013
Target/
Timeframe
5% increase
by 30 June
2015
Maintain % proportion of women in
executive positions as at 30 June
2013
Increase the % proportion of women
in senior positions as at 30 June
2013 (ie. senior professional levels)
20%
maintained by
30 June 2015
5% increase
by 30 June
2015
By 30 June
2015 subject
to a vacancy
becoming
available and
merit/skills
matrix fit
By 30 June
2014
Recruit a female Director to the
Board of the Company (or its
subsidiary)
Introduce a succession planning
system/policy which actively seeks
to provide development opportunities
and pathways for promotion to
senior management and Board
positions, proactively targeting
women candidates
Review the Company‟s suite of HR
and Corporate Policies, and
articulate/socialise the Company‟s
Corporate Culture which supports
workplace diversity
By 30 June
2014
The review process
has commenced.
The proportion of women employees in the whole organisation,
women in senior executive positions and women on the Board as at
30 June 2013 are set out in the following table:
Employees in whole organisation
Senior executive positions1
Board
Proportion of Women
21 out of 112 (18.75%)
1 out of 4 (25%)
0 out of 5 (0%)
1At 30 June 2013, “Senior executive positions” excludes the
Managing Director and includes: Chief Financial Officer, Company
Secretary, General Manager – Business Development & Technical
Services, and General Manager – Exploration.
A summary of the Company‟s Diversity Policy is disclosed on the
Company‟s website.
Continuous Disclosure
(Recommendations: 5.1, 5.2)
The Company has established written policies and procedures
designed to ensure compliance with ASX Listing Rule disclosure
requirements and accountability at a senior executive level for that
compliance.
A summary of the Company‟s Policy on Continuous Disclosure and
Compliance Procedures are disclosed on the Company‟s website.
Shareholder Communication
(Recommendations: 6.1, 6.2)
The Company has designed a communications policy for promoting
effective communication with shareholders and encouraging
shareholder participation at general meetings.
The Company‟s Shareholder Communication Policy is disclosed on
the Company‟s website.
Risk Management
Recommendations: 7.1, 7.2, 7.3, 7.4)
The Board has adopted a Risk Management Policy, which sets out
the Company's risk profile. Under the policy, the Board is responsible
for approving
the Company's policies on risk oversight and
management and satisfying itself that management has developed
and implemented a sound system of risk management and internal
control.
Under the policy, the Board delegates day-to-day management of
risk to the Managing Director, who is responsible for identifying,
assessing, monitoring and managing risks. The Managing Director is
also responsible for updating the Company's material business risks
to reflect any material changes, with the approval of the Board.
In fulfilling the duties of risk management, the Managing Director may
have unrestricted access to Company employees, contractors and
records and may obtain independent expert advice on any matter
they believe appropriate, with the prior approval of the Board.
The Board has established a separate Audit Committee to monitor
and review the integrity of financial reporting and the Company's
internal financial control systems and risk management systems.
In addition, the following risk management measures have been
adopted by the Board to manage the Company's material business
risks:
the Board has established authority limits for management,
which, if proposed to be exceeded, requires prior Board
approval;
2013 ANNUAL FINANCIAL REPORT
Page 57
CORPORATE GOVERNANCE STATEMENT
the Board has adopted a compliance procedure for the purpose
of ensuring compliance with
the Company's continuous
disclosure obligations; and
the Board has adopted a corporate governance manual which
contains other policies to assist the Company to establish and
maintain its governance practices.
The Company‟s risk management system includes the use of
corporate risk register to identify the Company‟s material business
risks and risk management strategies for these risks. In addition, the
process of management of material business risks has been
allocated to members of senior management. The risk register is
reviewed quarterly and updated, as required.
The categories of risk reported on as part of the Company‟s risk
management system are: operational risks; exploration, evaluation
and environmental risks; general economic and share market risks;
commodity price risks; native title and tenure risks; risks relating to
joint venture parties, agents and contractors; risks associated with
future capital requirements and with potential acquisitions; risk
relating
associated with reliance on key personnel.
to resource and mineralisation estimations; and risk
The Board has required management to design, implement and
maintain risk management and internal control systems to manage
the Company's material business risks. The Board also requires
management to report to it confirming that those risks are being
managed effectively. The Board has received a report
from
management as to the effectiveness of the Company's management
of its material business risks for the Reporting Period.
The Managing Director and the Chief Financial Officer have provided
a declaration to the Board in accordance with section 295A of the
Corporations Act and have assured the Board that such declaration
is founded on a sound system of risk management and internal
control and that the system is operating effectively in all material
respects in relation to financial reporting risks.
A summary of the Company‟s Risk Management Policy is disclosed
on the Company‟s website.
2013 ANNUAL FINANCIAL REPORT
Page 58
ADDITIONAL INFORMATION
Additional information required by the ASX Listing Rules and not shown elsewhere in this report is as follows. The information is current as at
8 October 2013.
EQUITY SECURITIES HOLDER INFORMATION
Ordinary Shares
424,279,762 quoted fully paid ordinary shares (NST). All ordinary shares carry one vote per share.
Distribution of Fully Paid Ordinary Shares
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,000+
Total Holders
No of Holders
No of Shares % of Issued Capital
1,072
2,741
1,711
2,577
299
8,400
677,175
8,249,723
14,082,478
78,969,126
322,301,260
424,279,762
0.160
1.944
3.319
18.613
75.964
100.000
451 Shareholders held less than a marketable parcel (<$500) of ordinary fully paid shares based on the current market price ($0.83).
Twenty Largest Holders of Ordinary Fully Paid Shares
1.
2.
3.
4.
5.
6.
7.
8.
9.
10. Wyllie Group Pty Ltd
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
TOTAL
National Nominees Limited
HSBC Custody Nominees (Australia) Limited
J P Morgan Nominees Australia Limited
Investmet Limited
Citicorp Nominees Pty Limited
Mr William James Beament
AMP Life Limited
BNP Paribas Noms Pty Ltd
Delta Resource Management Pty Ltd
Lujeta Pty Ltd
CS Fourth Nominees Pty Ltd
Leefab Pty Ltd
Little Breton Nominees Pty Ltd
Kyim Pty Ltd
Multi Metal Consultants Pty Ltd
Brispot Nominees Pty Ltd
Mrs Catherine Anne Wilkinson
Navigator Australia Ltd
QIC Limited
No of Shares
55,434,912
39,021,573
38,257,384
21,946,900
16,980,118
12,059,735
8,700,431
6,138,071
5,374,000
3,500,000
3,200,000
3,006,884
2,499,998
2,486,195
2,448,000
2,200,000
2,189,400
2,165,000
2,071,208
2,003,677
231,683,486
% Issued Capital
13.066
9.197
9.017
5.173
4.002
2.842
2.051
1.447
1.267
0.825
0.754
0.709
0.589
0.586
0.577
0.519
0.516
0.510
0.488
0.472
54.607
Options
5,000,000 unlisted options with various exercise prices and expiry dates (refer table below). Options do not carry a right to vote. Voting rights will
be attached to the unissued shares when the options have been exercised.
Expiry Date
27/2/2014
28/6/2014
27/8/2014
1/11/2014
27/2/2015
15/4/2015
27/8/2015
1/11/2015
27/2/2016
15/4/2016
No of Options
333,334
2,750,000
250,000
125,000
333,333
250,000
250,000
125,000
333,333
250,000
Substantial Shareholders
Exercise Price
No of Holders
$1.20
$0.91
$1.05
$1.05
$1.50
$0.95
$1.22
$1.22
$1.81
$1.05
1
2
1
1
1
1
1
1
1
1
Holding >20%
Issued under employee incentive scheme
72.7% – B Beament / 27.3% – P O‟Connor
Issued under employee incentive scheme
Issued under employee incentive scheme
Issued under employee incentive scheme
Issued under employee incentive scheme
Issued under employee incentive scheme
Issued under employee incentive scheme
Issued under employee incentive scheme
Issued under employee incentive scheme
The substantial Shareholders as disclosed in the substantial shareholding notices received by the Company are:
Name
BlackRock Group
Investmet Limited
Van Eck Associates Corporation
Restricted Securities
No of Shares
21,475,284
21,946,900
28,408,283
Currently there are no securities subject to either ASX imposed or voluntary restrictions.
On-Market Buy-Back
Currently there is no on-market buy-back of the Company‟s securities.
2013 ANNUAL FINANCIAL REPORT
Page 59
TENEMENT SCHEDULE
TENEMENT NO.
E52/1941
M52/639
M52/640
M52/734
M52/735
P52/1420
E08/2232
E08/2240
E08/2472
E08/2474
E08/2475
E08/2487
E51/1391
E08/1650
E08/2310
E08/2393
E08/2456
P08/646
E08/1628
E08/1629
E08/1630
E08/1631
E08/1632
E08/1633
E08/1741
E08/1878
E08/1915
E08/1916
E08/1949
E08/1950
E08/1961
E08/1985
E08/1986
E08/1992
E08/2000
E08/2003
E08/2034
E08/2038
E08/2039
E08/2065
E08/2067
E08/2114
E08/2250
E08/2258
E08/2280
E08/2281
E08/2282
E08/2293
E08/2294
E08/2295
E08/2296
E08/2353
E08/2354
E08/2364
E47/1395
E47/1396
E47/1535
E47/1549
E47/1677
E47/1735
E47/1773
E47/1833
E47/1879
E47/2035
INTEREST %
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
25
PROJECT NAME AND LOCATION
Ashburton, Peak Hill, WA
Ashburton, Peak Hill, WA
Ashburton, Peak Hill, WA
Ashburton, Peak Hill, WA
Ashburton, Peak Hill, WA
Ashburton, Peak Hill, WA
Ashburton Regional, Ashburton, WA
Ashburton Regional, Ashburton, WA
Ashburton Regional, Ashburton, WA
Ashburton Regional, Ashburton, WA
Ashburton Regional, Ashburton, WA
Ashburton Regional, Ashburton, WA
Cheroona, Murchison, WA
Electric Dingo, Ashburton WA
Electric Dingo, Ashburton WA
Electric Dingo, Ashburton WA
Electric Dingo, Ashburton WA
Electric Dingo, Ashburton WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, Ashburton, WA
FMG JV, West Pilbara, WA
FMG JV, West Pilbara, WA
FMG JV, West Pilbara, WA
FMG JV, West Pilbara, WA
FMG JV, West Pilbara, WA
FMG JV, West Pilbara, WA
FMG JV, West Pilbara, WA
FMG JV, West Pilbara, WA
FMG JV, West Pilbara, WA
FMG JV, West Pilbara, WA
TENEMENT NO.
E47/2171
E47/2236
E47/2292
E47/2587
E47/2636
E52/2484
E52/2730
E52/2786
P08/647
P47/1237
E52/2509
E80/2612
E08/1166
E08/1189
E08/1763
E08/1842
E08/1843
E08/1844
E08/1606
M08/191
M08/192
M08/193
E08/1187
E08/1649
E08/1744
E08/1745
E08/1845
E08/2251
E08/2252
E08/2395
E08/2499
E47/1134
E47/1553
L08/103
L08/113
L08/12
L08/13
L08/14
L08/15
L08/81
L08/91
L08/92
M08/196
M08/222
M08/99
P08/516
P08/543
P08/544
P08/546
P08/565
P08/625
P08/626
P08/653
P08/655
P47/1313
P47/1637
E80/4001
INTEREST %
25
25
25
25
25
25
25
25
25
25
100
100
80
80
80
80
80
80
PROJECT NAME AND LOCATION
FMG JV, West Pilbara, WA
FMG JV, West Pilbara, WA
FMG JV, West Pilbara, WA
FMG JV, West Pilbara, WA
FMG JV, West Pilbara, WA
FMG JV, Peak Hill, WA
FMG JV, Peak Hill, WA
FMG JV, Peak Hill, WA
FMG JV, Ashburton, WA
FMG JV, West Pilbara, WA
Beatty Park, Peak Hill, WA
Emull (Red Billabong), Kimberley, WA
Hardey Junction JV, Ashburton, WA
Hardey Junction JV, Ashburton, WA
Hardey Junction JV, Ashburton, WA
Hardey Junction JV, Ashburton, WA
Hardey Junction JV, Ashburton, WA
Hardey Junction JV, Ashburton, WA
20 free carried Mt Clement JV, Ashburton, WA
20 free carried Mt Clement JV, Ashburton, WA
20 free carried Mt Clement JV, Ashburton, WA
20 free carried Mt Clement JV, Ashburton, WA
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Paulsens, Ashburton, WA
Wilson River, Kimberley, WA
2013 ANNUAL FINANCIAL REPORT
Page 60
This page has been left blank intentionally.
2013 ANNUAL FINANCIAL REPORT
Page 61
2013 ANNUAL FINANCIAL REPORT
Page 62