SWAN GOLD MINING LIMITED
ABN 69 100 038 266
FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2013
SWAN GOLD MINING LIMITED
ABN 69 100 038 266
CORPORATE DIRECTORY
CORPORATE DIRECTORY
CONTENTS
Corporate Directory........................................... 1
Directors’ report ................................................ 2
Auditor’s independence declaration ................ 16
Consolidated statement of comprehensive
income ............................................................ 17
Consolidated statement of financial position... 18
Consolidated statement of changes in equity . 19
Consolidated statement of cash flows ............ 20
Notes to the financial statements .................... 21
Directors’ declaration ...................................... 58
Independent auditor’s report ........................... 59
Corporate governance statement ................... 61
Tenement statement ....................................... 66
ASX additional information.............................. 72
BOARD OF DIRECTORS
Michael Fotios
John Poynton
Craig Readhead
Wayne Zekulich
Executive Chairman
Non Executive Director
Non Executive Director
Non Executive Director
COMPANY SECRETARY
Wayne Zekulich
REGISTERED OFFICE
24 Mumford Place
BALCATTA
WA 6021
Telephone: (61-8) 6241 1802
Facsimile: (61-8) 6241 1811
admin@swangoldmining.com.au
Web-site: www.swangoldmining.com.au
SHARE REGISTRY
Computershare Investor Services Pty Ltd
Level 2, 45 St. George’s Terrace
Perth WA 6000
Telephone: (61-8) 9323 2000
Facsimile:
(61-8) 9323 2033
E-mail: perth.services@computershare.com.au
Web-site: www.computershare.com.au
AUDITORS
Ernst & Young
SOLICITORS
Allion Legal
BANKERS
National Australia Bank Limited
STOCK EXCHANGE LISTING
Shares in Swan Gold Mining Limited are listed on the
Australian Stock Exchange under the trading code
SWA.
This financial report covers the consolidated financial statements for the consolidated entity, consisting of
Swan Gold Mining Limited and its subsidiaries.
The annual financial report is presented in Australian dollars.
Swan Gold Mining Limited is a company limited by shares, incorporated and domiciled in Australia.
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SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
30 JUNE 2013 FULL YEAR REPORT
DIRECTORS’ REPORT
The directors of Swan Gold Mining Limited (previously named Monarch Gold Mining Company Limited) (“Swan Gold”
or “Company”) present their report on the results and state of affairs of the consolidated entity, being the Company
and its controlled entities (“Group”) for the financial year ended 30 June 2013.
DIRECTORS
The names of the directors of Swan Gold in office during the course of the financial year and up to the date of this
report are as follows:
Michael Fotios
John Poynton
Craig Readhead
Wayne Zekulich
Martin Depisch
Damian Paul Delaney
Gerhard Kornfeld
Thomas Styblo
Peter Farris
Keith John Vuleta
Allan Richard Brown
Ian Leslie Price
(appointed 14 September 2012)
(appointed 27 March 2013)
(appointed 27 March 2013)
(appointed 27 March 2013)
(appointed 25 July 2012, resigned 27 March 2013)
(appointed 25 July 2012, resigned 27 March 2013)
(appointed 25 July 2012, resigned 27 March 2013)
(appointed 14 September 2012, resigned 27 March 2013)
(appointed 14 September 2012, resigned 4 February 2013)
(resigned 25 July 2012)
(resigned 25 July 2012)
(resigned 25 July 2012)
Unless otherwise indicated, all directors held their position as a director throughout the entire financial year and up to
the date of this report.
OPERATING AND FINANCIAL REVIEW
This review, provides to shareholders with an overview of Swan Gold’s 2013 operations, financial position, business
strategies and prospects.
The review also provides contextual information, including the impact of key events that have occurred during 2013
and material business risks faced by the business so that shareholders can make an informed assessment of the
results and prospects of the Group. The review compliments the financial report and has been prepared in
accordance with recently released guidance set out in RG 247.
1. Swan Gold Operations
Core Business
Swan Gold, via its subsidiaries, is the 100% owner of the Davyhurst Gold Project located in 120km north-west of
Kalgoorlie, and the Mt Ida Gold Project located 200km north-west of Kalgoorlie. Processing infrastructure exists and
includes a 1.2Mtpa processing plant, two camps (Davyhurst Central and Mt Ida), mains power and working bore
fields.
The Group also holds a substantial tenement position (1,420 square kilometres, 150km strike length), surrounding the
existing infrastructure.
Principal Activities and Significant Changes in those Activities
The principal activity of the Group during the financial year was mineral exploration and evaluation, and care and
maintenance of its historically producing gold mines being the Davyhurst Gold Project and the Mt Ida Gold Project.
There was no significant change in the nature of this activity during the year.
2. Operating Financial Results
The Company’s financial performance and result is attributable to its ongoing exploration, evaluation and
development costs, project care and maintenance costs and corporate administration costs.
The Groups net loss after tax for the year was $24,887,000 (2012: $4,413,000).
Financial Position
At 30 June 2013 total Group assets were $8,836,000 (2012: $35,431,000) and net deficits were $27,101,000 (2012:
$5,215,000)
Liquidity and Capital Resources
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SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
30 JUNE 2013 FULL YEAR REPORT
DIRECTORS’ REPORT
Performance Measures
FY 2013
FY 2012
FY 2011
FY 2010
FY 2009
Net assets/ (liabilities)
Current assets
Cash
Shareholders’ equity
Accumulated losses
$’000
(27,101)
5,836
236
$’000
(5,215)
467
259
$’000
(802)
454
159
$’000
3,761
546
16
$’000
(14,835)
9,885
1,445
167,666
164,666
164,666
164,666
137,474
(200,101)
(175,215)
(170,802)
(166,239)
(157,174)
The increase in net liabilities was primarily driven by the write off of historical capitalised exploration costs totalling
$21,499,000 and impairment to property, plant and equipment of $5,223,000 which was partially offset by the
reduction in loans payable resulting from the Investmet Transaction totalling $6,530,000 (refer below to significant
changes in the state of affairs).
The increase in shareholders’ equity is the result of issuing 150,000,000 ordinary shares at $0.02 per share as full
payment of a working capital loan provided by Investmet Limited (refer below to significant changes in the state of
affairs).
3. Key Developments
Significant Changes in the State of Affairs
On 18 August 2011, Swan Gold executed a conditional agreement with global commodity company DCM DECOmetal
GmbH (“DCM”) to acquire Swan Gold’s subsidiaries that own the Carnegie and Mt Ida gold projects (“DCM
transaction”).
The main conditions of that agreement which was subject to shareholder and regulatory approval, as necessary,
would see:
• DCM acquire the debt and associated rights of the Mt Ida Trust for $1,000,000;
• DCM pay a total amount of $10,000,000 to the Group Trust with $1,000,000 payable upon signing of the
agreement and $9,000,000 payable within 6 months;
• Under separate arrangement DCM acquire the debt and associated rights of the Territory Trust of
$6,700,000;
• All debts due by Swan Gold to the Mt Ida Trust, Group Trust, Territory Trust and Stirling Resources Ltd be
extinguished by DCM at settlement;
• Amounts to be paid to Swan Gold of $5,000,000 at settlement;
• All shareholdings held by Stirling, Territory Resources Limited and DCM in Swan Gold be cancelled at
settlement;
• Under this agreement DCM was to fund the ongoing operations of Swan Gold until the transaction was
completed; and
• Settlement was due on or before 31 March 2012, subject to subsequent extensions.
With effect from 27 March 2013 this agreement was no longer in place.
On 3 May 2012, the Company announced to the ASX, that following extensive negotiations, a binding Terms Sheet,
and subsequently a Restructure Deed, had been entered into by the Company, DCM and Investmet Limited and/or its
nominees (Investmet), with the execution of a formal agreement, being the Restructure Deed, on 16 May 2012 (“the
Investmet transaction”).
Investmet has advised it intends to recapitalize Swan and provide sufficient funding to complete a review into
recommencement of operations at the Carnegie and Mt Ida gold projects, including amongst other items thorough
geological and economic reviews of resources, project data, exploration activities as required, and mine planning.
The main terms and conditions of the Restructure Deed were as follows:
• Swan Gold would conduct a share placement to sophisticated investors to raise working capital of a minimum
of $7,500,000 by the issue of new ordinary shares at $0.02 effective on completion of the transaction
(“Completion”). The issue would be fully underwritten by Investmet on terms reasonably satisfactory to
Investmet and the Company;
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SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
30 JUNE 2013 FULL YEAR REPORT
DIRECTORS’ REPORT
• DCM would transfer 39,849,657 Swan Gold shares to Investmet in consideration for a cash payment by
Investmet to the Trustee of the Territory Trust of $6,700,000 in satisfaction of all claims by the Territory Trust;
• The Group Trustee would transfer 134,483,578 Swan Gold shares to Investmet as consideration for the
payment by Investmet to the Group Trust of $10,000,000; the payment would also extinguish all claims by
the Group Trust under the recapitalization deed;
Investmet would pay $144,240 to the Trustee of the Group Trust on behalf of Swan Gold to repay the loan
made by the Trustee to Swan Gold. Swan Gold agreed to repay Investmet on interest free terms $144,240
within two business days of a written demand by Investmet;
Investmet would advance $1,230,000 to DCM in consideration of DCM discharging the existing charge over
the Mt Ida assets. A fresh security would be granted by Swan Gold as required to Investmet;
•
•
• Under the Restructure Deed DCM were to fund the ongoing operations of Swan Gold until Completion; and
• The Conditions of the Restructure Deed were to be satisfied or waived on or before 31 October 2012, with
the exception of shareholder and regulatory approvals, and Loan Syndicate Arrangements which were to be
finalised by 31 December 2012. Beyond these dates an alternative restructure or extension period was to be
negotiated in good faith, but should no agreement be made within 5 Business Days then either party may
terminate the Restructure Deed without incurring any liability.
The conditions for Completion to occur included amongst other items, all necessary shareholder, third party or
regulatory approvals.
This transaction was also conditional on the completion of inter-related transactions between Investmet, DCM and
each of Stirling Resources Limited and Redbank Copper Limited, the terms of which had been finalised but not
released.
On 12 November 2012 the Company announced to the ASX that Stirling had received advice from the ASX that
based on the terms of the Restructure Deed, Stirling would need to re-comply with the full ASX admission criteria.
Consequently it was agreed by all parties to the Investmet Transaction, that as this event was a conditions precent of
the transaction, Stirling would not be able to participate in the proposed transaction.
Swan Gold announced to the ASX on 14 December 2012 that DCM and Investmet had executed an Amended and
Restated Restructure Deed (‘Restructure Deed”) which in effect removed Stirling from the Investmet Transaction.
The terms of the Investmet Transaction, which was previously announced to the ASX, have been varied such that:
1. Stirling no longer forms part of the inter-conditional transaction.
2. The capital raising to be undertaken by Swan Gold will be up to $15,000,000. This amount may increase to
$17,500,000 with prior consent of Stirling. The capital raising is currently expected to be via a placement of
new shares at $0.02 per share. Investmet agrees to underwrite $7,500,000 of the placement.
3. At Completion, $10,664,240 of the $20,664,240 debt to Investmet (“Investmet Debt”) which is expected to
arise from the completion of the Investmet Transaction, will be converted into ordinary Swan Gold shares at a
deemed issue price of $0.02 per share. The Investmet Debt converted comprises $8,074,240 of the trust
debts, and $2,590,000 of debt acquired from Stirling.
4. Under the Loan Syndicate Arrangements Investmet may elect to convert a further $5,000,000 of the balance
of the $10,000,000 Investmet Debt owing. If Investmet elects to convert the additional debt to shares then
Stirling will be entitled to convert a proportionate amount of the $5,000,000 debt owed to Stirling. Stirling may
only convert a maximum amount of $2,500,000 of debt.
5. The proceeds of the capital raising will be used partially to repay debts of $4,200,000 to DCM.
6.
Investmet waived the condition precedent to completion which required any plaint proceedings relating to the
tenements of Swan Gold and its subsidiaries to be discontinued or withdrawn on terms satisfactory to
Investmet. However, should the decision of the Warden in relation to Exemption Hearing No. 371130 not be
n favour of Siberia Mining Corporation Pty Ltd, a wholly owned subsidiary of Swan Gold, Swan Gold will,
subject to shareholder approval, allot and issue 37,500,000 Swan Gold shares to Investmet for nil cost.
Swan Gold has also agreed as part of the Investmet Transaction and associated revised terms that:
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SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
30 JUNE 2013 FULL YEAR REPORT
DIRECTORS’ REPORT
•
•
•
•
the Swan Gold Notice of Meeting be lodged for review with the regulatory bodies on 30 November 2012;
the Notice of Meeting must be mailed to Shareholders by 15 December 2012;
the Shareholders’ Meeting to approve the Investmet Transaction must be held by 15 January 2013; and
the Investmet Transaction was to be complete by 28 February 2013 (refer below for further details).
To date, Swan Gold has complied with the above revised terms or as revised through subsequent Amendment
Deeds. A General Meeting of the shareholders’ was held on 15 January 2013 during which resolutions in relation to
the placement of shares under the Investmet Transaction were approved. On 13 February 2013 Swan Gold
announced to the ASX a Prospectus for the placement to sophisticated and professional investors to raise a minimum
of $15,000,000 at $0.02 per share and up to a maximum of $17,500,000 by the issue of up to 875,000,000 shares
before costs of the offer.
A supplementary Prospectus was lodged with the ASIC extending the Closing Date of the placement Offer from 26
February 2013 to 11 April 2013 and extending the Offer to investors who do not fall within an exception to section 708
of the Corporations Act 2001. On 13 May 2013 the placement Offer was further extended to 31 May 2013 subject to
approval from ASIC and ASX.
On 31 May 2013 the Company announced that it had been notified by ASIC that the application for relief to extend the
placement closing was refused. The placement offer was withdrawn as neither the subscription condition of
$15,000,000 nor the 3 month quotation of the Offer was met as required by the Corporations Act 2001. Shares in
Swan were not allotted or issued pursuant to the placement Offer and all application monies have been refunded to
the applicants, in accordance with the terms of the Offer and the Corporations Act. The Company is at present
considering its options moving forward and will provide an update as soon as additional information is available.
In addition to executing the amended Restructure Deed, Swan Gold and Investmet also executed a Deed of
mendment and Restatement to the Loan Agreement (“Amended Loan Agreement”). Investmet and Swan Gold have
agreed to amend the Loan Agreement such that drawdowns will be on an “as required” basis. Investmet has agreed
to provide Swan Gold with a facility for working capital funding up to approximately $3,000,000. Investmet has to date
loaned the Company the full funding of $3,000,000 of this facility.
Investmet and DCM intend to establish syndicated loan arrangements with Swan Gold to include general security
interests over its assets, incorporating a two year moratorium on principal repayments and any accrued interest and
at the end of the two year moratorium, Swan Gold may elect to repay the debt or require conversion at a price to be
agreed between the parties at that time
Investmet will also work with the current board of Swan Gold towards finalizing the application for re-listing of the
shares of Swan Gold on the ASX\ as soon as possible after completion.
Upon completion of the Investmet transaction, the DCM Share Sale agreement will be terminated and all of the
Company’s liabilities and obligations under the DCM Share Sale agreement and the Recapitalisation Deed will be
discharged.
On 27 March 2013 the Company announced that it had executed agreements to revise the terms of the Swan Gold
Restructure Deed (“Transactions”), to allow for the early debt purchase by Investmet of certain debts owed by Swan
Gold to Stirling, DCM and MGMC Pty Ltd (as trustee for the Group Trust and Territory Trust)(“MGMC”).
Pursuant to the early debt purchase:
MGMC Debt:
1.
Investmet has made payments of $18,074,240 to MGMC. Investmet was required to purchase the debts
owed by Swan Gold to MGMC.
2. The security held by MGMC with respect to the debts owed by Swan Gold to MGMC has been assigned to a
security trustee to be held on behalf of Investmet and other purchasers of that debt.
Stirling Debt:
1.
Investmet has paid $2,590,000 to Stirling and, in turn, Stirling has assigned to Investmet $2,590,000 of the
$7,590,000 debt owed by Swan to Stirling. Swan Gold continues to owe $5,000,000 to Stirling.
2. Stirling has procured Stirling Gold Pty Ltd to transfer to Investmet 88,053,475 shares in Swan Gold.
DCM Debt:
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SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
30 JUNE 2013 FULL YEAR REPORT
DIRECTORS’ REPORT
1. Swan Gold had intended to pay DCM $4,200,000 out of the proceeds of the current placement. However,
under the early debt purchase agreements, Investmet has now paid $4,200,000 to DCM in consideration of
DCM assigning to Investmet the debt owed by Swan Gold to DCM.
2. Swan Gold will now repay the $4,200,000 to Investmet out of the proceeds of the placement.
3. $1,230,000 to DCM in consideration of DCM discharging or procuring that the Trustee of the Mt Ida Trust
discharges, all security held by the Trustee of the Mt Ida Trust in or over Swan Gold, or any of its subsidiaries
and any of its assets.
4. The security held by MGMC with respect to the Mt Ida trust has been assigned to a security trustee to be
held on behalf of Investmet and other purchasers of that debt.
The inter-conditionality of the Swan Gold and Redbank Copper Limited (“Redbank”) Transactions, being a condition in
each of the Swan Gold and Redbank Restructure Deeds, has been waived by Investmet, who had the sole benefit of
the condition. This means that the Swan Gold and Redbank Transactions can now complete separately.
Following the early debt purchase, completion of the transactions as contemplated in the Restructure Deed remains
outstanding. Accordingly Swan Gold has executed an Amendment Deed to the Swan Gold Restructure Deed with
Stirling, Investmet and DCM. The effect of which is to amend the “Completion Date” for the Transaction to the date
on which settlement of the Swan Gold placement is to occur.
The loan amount of $3,000,000 outstanding as at 31 December 2012, under the Interim Loan Agreement between the
Company and Investmet, has been converted into fully paid ordinary shares in Swan Gold at a price of $0.02 per
share, which has resulted in the Company issuing 150,000,000 shares to Investmet in accordance with shareholder
approval obtained at the recent general meeting of Swan Gold shareholders.
A Deed of Termination and Release for the Recapitalisation Deed dated 21 July 2009 has been executed and was
subject to Investmet making the payments to MGMC referred to above, which has since been completed. A Deed of
Termination and Release for the share sale agreement between Swan Gold and DCM dated 18 August 2011 was
also executed and completed on 27 March 2013.
Status of the Restructure as at 30 June 2013
At the date of this report, whilst the loan Amendment Deed as a whole remains incomplete, the summarised position
at 30 June 2013 is as follows:
- Nil is payable to MGMC and DCM,
-
-
$5,000,000 is payable to Stirling, and
$24,864,240 is payable to the Investmet Ltd
Key terms of the Stirling debt
The Stirling debt represents an unsecured loan which is non-interest bearing and repayable on demand. Accordingly,
the loan payable has been classified as current as at 30 June 2013.
Key terms of the Investmet debt
The Investmet debt represents an unsecured loan which is non-interest bearing and repayable on demand. Again, the
loan payable has been classified as current as at 30 June 2013.
4. Other Developments
Swan Gold is awaiting the recommendation of the Warden regarding applications for exemption from expenditure that
were heard in August 2012 in respect of M16/262-264 held by Siberia Mining (which tenements are also the subject
of applications for forfeiture). An application for forfeiture of M24/352 held by Siberia Mining has been settled.
Siberia Mining will lodge a minute of consent with Warden’s Court.
The ability of the Group to maintain tenure to its tenements is dependent upon it continuing to meet the minimum
expenditures on the tenements or obtaining exemptions for tenements in which the minimum expenditures have not
been met.
In the opinion of the directors, there is no additional information available as at the date of this report on any likely
developments which may materially affect the operations of the consolidated entity and the expected results of those
operations in subsequent years.
Significant Events after Balance Date
Lady Bountiful Settlement
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SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
30 JUNE 2013 FULL YEAR REPORT
DIRECTORS’ REPORT
On the 14 November Swan Gold’s wholly owned subsidiary Carnegie Gold Pty Ltd (“Carnegie”) reached an
agreement to relinquish its right to explore and mine tenement M24/862 (Lady Bountiful) with Norton Gold Fields
Limited (“Norton”), Paddington Gold Pty Ltd (“Paddington”) and Neil Edward Newman. In accordance with that
agreement, Carnegie removed the caveat currently registered on M24/862 and consented to the dismissal of the
action currently before the Wardens Court in return for net proceeds of $1.4 million from Norton. The current
agreement between Carnegie and Neil Edward Newman for the rights to explore and mine M24/862 will cease upon
completion.
Mining Rehabilitation Fund
Swan Gold successfully applied to the Western Australian Department of Mines and Petroleum (“DMP”) for the Mining
Rehabilitation Fund (“MRF”) which saw the retirement of the Company’s Environmental Bonds (‘Bonds”). The DMP
has to the date of this report approved the retirement of all Bonds totalling $5.2 million after a total levy fee of
$251,000. The levy was calculated by the DMP and is based on 1% disturbance of the environment.
Other than the above, no matter or circumstance has arisen that has significantly affected, or may significantly affect,
the operations of the Group, the results of those operations or the state of affairs of the Group in subsequent years
not otherwise disclosed in this report or the consolidated financial statements.
Withdrawal of Prospectus
Swan Gold advised that its placement to sophisticated and professional investors to raise a minimum of $15 million
and a maximum of up to $17.5 million pursuant to the prospectus dated 13 February 2013 and supplementary
prospectus dated 27 March 2013 (Offer) has been withdrawn. As referred to in its announcement on 13 May 2013,
the Company had sought to extend the closing date of the Offer, subject to ASIC and ASX relief being granted.
On 28 May 2013, the Company was notified by ASIC the application for relief to extend the placement closing date
was refused. Accordingly, as neither the minimum subscription condition of $15 million, nor the 3 month quotation
condition of the Offer were met, as required by the Corporations Act 2001 (Cth) (Corporations Act), the Offer has
been withdrawn. No shares were allotted nor issued pursuant to the Offer and all application monies received have
been refunded by the Company to all of the applicants, in accordance with the terms of the Offer and the
Corporations Act. The Company is at present considering its options moving forward and will provide an update as
soon as additional information is available.
4. Business Strategies and Prospects (Incorporating Likely Developments and Expected Results)
Swan Gold is committed to growing its gold inventories through ongoing exploration activities. In addition, the
Company is committed to recommencing gold operations at the Davyhurst and Mt Ida Gold Projects.
Over the next 12 months the Company is focussing on:
- Having its ordinary shares readmitted to official quotation on the ASX,
- Recapitalising the Company through:
the conversion of its existing loans payable to ordinary shares,
issuing new shares as part of an equity fund raising exercise, and
o
o
o establishing a debt facility
- Upon recapitalisation, the funds will be applied to further the Groups exploration efforts, to refurbish the
Davyhurst Gold project allowing for the processing of up to 1.2 mtpa of third party ore, Company ore or a
combination of both.
DIVIDENDS
No amounts were paid by way of dividend since the end of the previous financial year. The directors do not
recommend the payment of a dividend.
INFORMATION ON DIRECTORS
Director
Qualifications, experience and special responsibilities
Michael Fotios
Non-Executive
BSc (Hons) MAusIMM
A director since September 2012, Mr Fotios is a Geologist specialising in Economic Geology
with 27 years extensive experience in exploration throughout Australia for gold, base metals,
tantalum, tin and nickel and taking projects from exploration to feasibility. He previously held
positions with Homestake Australia Limited and Sons of Gwalia Limited. He was Managing
Director and a Director with Tantalum Australia NL (now ABM Resources Ltd) from September
1999 to October 2005. His last position was as Managing Director of Galaxy Resources Limited.
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SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
30 JUNE 2013 FULL YEAR REPORT
DIRECTORS’ REPORT
Michael Fotios is founder and current Executive Chairman of Investmet and regarded as having
control of Investmet for the purposes of the Corporations Act 2001.
Other current directorships: Northern Star Resources Limited (from September 2009 to October
2013), Pegasus Metals Limited (from December 2009), Horseshoe Metals Limited (from May
2012), General Mining Corporation Limited (from June 2012), Redbank Copper Limited (from
September 2012) and Stirling Resources Limited (from September 2012 to November 2012).
Former directorships in the last three years: Galaxy Resources Limited (from December 2006 to
December 2008).
John Poynton
Non-Executive
Director
AM Cit WA
John is the Chairman of Azure Capital Limited.
He is a Director of the Future Fund Board of Guardians and Crown Perth. In the not-for-profit
arena, John is the Chairman of Council of Christ Church Grammar School, Giving West and
Celebrate WA. He is also a member of Social Ventures Australia.
Previously, John was a Chairman of ASX Perth, Fleetwood, Alinta and the West Australian
Museum Foundation – Deputy Chairman of Austal Limited – Director of Multiplex; Member of
the Higher Education Endowment Fund Advisory Board, Payments System Board of the
Reserve Bank of Australia, EFIC and of the Business School at the University of Western
Australia.
John is a Life Member and Senior Fellow of the Financial Services Institute of Australasia
(FINSIA), a Fellow of the Australian Institute of Company Directors (AICD) and of the Australian
Institute of Management (AIM).
John is a Member in the General Division of the Order of Australia and is a past recipient of a
WA Citizen of the Year award in the industry and commerce category.
John holds a Bachelor of Commerce and an honorary Doctor of Commerce from the University
of Western Australia.
Craig Readhead
Non-Executive
Director
B Juris Lib
Mr Readhead is one of WA’s leading mining and resource lawyers with over 33 years legal and
corporate advisory experience specialising in the resources sector, including the implementation
of large scale mining projects both in Australia and overseas. In 2009, Craig was identified as
one of the top ten Best Mining Lawyers in Australia published by the Australian Financial Review.
Craig is a Partner of law firm, Allion Legal.
Wayne Zekulich
Non-Executive
Director
Current directorships: Heron Resources Limited, Beadell Resources Limited, General Mining
Corporation Limited and Redbank Copper Limited.
Former directorships in the last three years: Galaxy Resources Limited to November 2013, Mt.
Gibson Iron Limited to December 2012 and Frankland River Olive Company Limited to
December 2012.
BBus, FCA, FFTP
Mr Zekulich holds a Bachelor of Business Degree, is a Fellow of the Institute of Chartered
Accountants and a Fellow of the Finance and Treasury Association Limited. He has a broad
range of experience covering advice on mergers and acquisitions, arranging and underwriting
project financings, privatisations and major acquisitions requiring extensive capital raisings in
both debt and equity capital markets. He spent 4 years with the Commonwealth Bank as
Executive Vice President WA, SA and NT and prior to that was Head of the Perth office of NM
Rothschild & Sons and Director and Head of Deutsche Bank in Perth.
Currently, Wayne is Chief Financial Officer of Gindalbie Metals Limited, Chairman of Tesla
Corporation, Director of Jaxon Construction, a committee member of Celebrate WA, a member
of the Curtin Business School of Accounting Advisory Board and a member of the University of
Western Australia Audit Committee.
Martin Depisch
Masters Degree in Economics and Social Sciences (Mag.rer.soc.oec)
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SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
30 JUNE 2013 FULL YEAR REPORT
DIRECTORS’ REPORT
Non-Executive
Chairman
A director from July 2012 to March 2013, Mr Depisch is an Austrian national who completed his
Master in Business Administration with emphasis on Finance at Karl-Franzens University in Graz
Austria. Mr Depisch has over 15 years experience in financing and project management in the
mining sector.
Other current directorships: Redbank Copper Limited (from November 2011) and Stirling
Resources Limited (from November 2011).
Mr Depisch has not held directorships in any other listed companies in the last three years.
Damian Delaney
Non-Executive
Director
CA
A director from July 2012 to March 2013, Mr Delaney is a chartered accountant with many years’
experience working with international listed companies.
Other current directorships: Redbank Copper Ltd (from July 2012) and Genesis Minerals
Limited (from March 2012).
Former directorships in the last three years: Nimrodel Resources Ltd (from January 2010 to
August 2011) and Stirling Resources Limited (from July 2012 to November 2012).
Gerhard Kornfeld
Non-Executive
Director
PhD in Economic and Social Sciences (Dr. rer. soc. oec)
A director from July 2012 to March 2013, Dr Kornfeld is an Austrian national who completed his
PhD at the University of Economics in Vienna and has been involved in various executive
positions throughout Europe. Before joining DCM as CEO in May 2012, he had been acting as
CEO of VA TECH EZ, based in Prague and CEO of Mondi Russia, based in Syktyvkar.
Other current directorships: Australian Zircon NL (from August 2012), Stirling Resources Limited
(from September 2012) and Redbank Copper Limited (from September 2012).
Thomas Styblo
Non-Executive
Director
Mr Kornfeld has not held directorships in any other listed companies in the last three years.
L.L.M. Mag.rer.soc.oec
Mr Styblo is Director of Finance with DCM DECOmetal GmbH. He is an Executive Master of
Laws (L.L.M) and holds a Masters Degree in Economics and Social Science (Mag.rer.soc.oec).
Other current directorships: Australian Zircon NL (from February 2012), Redbank Copper
Limited (from April 2012) and Stirling Resources Limited (from April 2012).
Mr Styblo has not held directorships in any other listed companies in the last three years.
Peter Farris
Non-Executive
Director
Diploma Business Tech, Diploma Business RMIT, MAICD
A director from September 2012 to February 2013, Mr Farris is a well respected and highly
credentialed businessman in the Perth real estate industry and corporate advisory services. He
has managed and developed major real estate companies with turnovers in excess of $200
million and has extensive experience in company management.
Allan Brown
Non-Executive
Chairman
Other current directorships: Northern Star Resources Limited (April 2009), Redbank Copper
Limited (from September 2012) and Stirling Resources Limited (from September 2012 to
November 2012).
Mr Farris has not held directorships in any other listed companies in the last three years.
B.Sc (Hons), CP (Met) NSW, FAusIMM
A director from February 2010 to July 2012 and Chairman from June 2010 to July 2013. Mr
Brown is a metallurgist with more than 40 years industry experience, specialising in the design,
testing, commissioning and operation of base metal processing projects. He has worked as an
industry consultant on metal processing projects in Australia and overseas for a range of local
and global organisations including AngloGold, Newcrest and CBH Resources. Prior to his
consulting career, he worked as Project and Mine Manager for a number of gold and base
metal developers including Wiluna Gold, Sally Malay Nickel and Murchison Zinc.
Other current directorships: Mutiny Gold Limited (from July 2003).
Former directorships in the last three years: Redbank Copper Limited (from December 2009 to
November 2011).
9
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
30 JUNE 2013 FULL YEAR REPORT
DIRECTORS’ REPORT
Keith Vuleta
Non-Executive
Director
B.Bus (Acc & Com Law), C.A., MAICD
A Chartered Accountant for more than 20 years, having trained with Ernst & Young. He has
held positions as Finance Director, Chief Financial Officer and Company Secretary for public
companies in the mining, engineering and financial services industries.
Ian Price
Non-Executive
Director
Other current directorships: Matilda Zircon Limited (from May 2009).
Former directorships in the last three years: Redbank Copper Limited (from October 2009 to
November 2011).
B. Eng, FAusIMM
A director from February 2010 to July 2012. Mr Price is a mining engineer with more than 30
years experience in mine operations, public company management and consulting. He has
been involved in all aspects of mining from exploration, feasibility studies, permitting, project
development and construction through to operations, corporate management and project
financing. He also has experience in base metals, gold and coal mining and processing and
has a strong background in underground mining working throughout Australasia and Asia.
Other current directorships: Anchor Resources Limited (from June 2011).
Former directorships in the last three years: Redbank Copper Limited (from October 2009 to
February 2011).
Interests in the shares and options of Swan Gold
Details of directors’ interests in the securities of Swan Gold as at the date of this report are as follows:
Director
Fully paid shares
Unlisted options
Michael Fotios (1)
John Poynton
Craig Readhead
Wayne Zekulich
412,386,710
10,000,000
-
-
-
-
-
-
(1) The shares are held by Invesmet Limited, of which Mr Fotios is the Executive Chairman and substantial shareholder.
COMPANY SECRETARIES
Wayne Zekulich BBus, FCA, FFTP
Mr Zekulich holds a Bachelor of Business Degree, is a Fellow of the Institute of Chartered Accountants and a Fellow of
the Finance and Treasury Association Limited. He has a broad range of experience covering advice on mergers and
acquisitions, arranging and underwriting project financings, privatisations and major acquisitions requiring extensive
capital raisings in both debt and equity capital markets. He spent 4 years with the Commonwealth Bank as Executive
Vice President WA, SA and NT and prior to that was Head of the Perth office of NM Rothschild & Sons and Director
and Head of Deutsche Bank in Perth.
Currently, Wayne is Chief Financial Officer of Gindalbie Metals Limited, Chairman of Tesla Corporation, Director of
Jaxon Construction, a committee member of Celebrate WA, a member of the Curtin Business School of Accounting
Advisory Board and a member of the University of Western Australia Audit Committee.
Linda Paini B.Bus (Accounting), CPA
Company Secretary from 24 October 2012 to 15 January 2014. Ms Paini is a Certified Practising Accountant and
holds a Bachelor of Business Degree from the Edith Cowan University. She has more than 16 years accountancy
and corporate secretarial experience, with a focus in the last seven years on the resource sector. Ms Paini has
previously provided company secretary support for a number of listed corporations.
Ildiko Wowesny B.Bus.
Company Secretary from 26 February 2010 to 24 October 2012. Ms Wowesny is a qualified Accountant with
experience in company secretarial roles together with corporate management, accounting and financial areas. She
has served as Company Secretary for ASX listed resource companies for some considerable time together with 5
years at Deloitte Touche Tohmatsu and also a period in the United Kingdom with resource groups.
10
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
30 JUNE 2013 FULL YEAR REPORT
DIRECTORS’ REPORT
MEETINGS OF DIRECTORS
The number of meetings of the Board of Directors held during the year and the number of meetings attended by each
director was as follows:
No. held whilst in office
Board
No.
attended
Allan Brown
Keith Vuleta
Ian Price
Damian Delaney
Martin Depisch
Gerhard Kornfeld
Michael Fotios
Peter Farris
Thomas Styblo
Craig Readhead
John Poynton
Wayne Zekulich
-
-
-
4
4
4
5
2
2
3
3
3
-
-
-
4
4
4
4
1
2
3
3
3
11
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
30 JUNE 2013 FULL YEAR REPORT
DIRECTORS’ REPORT
REMUNERATION REPORT (audited)
This Remuneration Report outlines the director and executive remuneration arrangements of the Group in
accordance with the requirements of the Corporations Act 2001 and its Regulations. For the purposes of this report
Key Management Personnel 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.
Details of key management personnel during the year up to the date of this report:
Directors
Name
Michael Fotios
John Poynton
Craig Readhead
Wayne Zekulich
Martin Depisch
Damian Paul Delaney
Gerhard Kornfeld
Thomas Styblo
Peter Farris
Keith John Vuleta
Allan Richard Brown
Ian Leslie Price
Executives
Ildiko Wowesny
Linda Paini
Position
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Appointed
14 September 2012
27 March 2013
27 March 2013
27 March 2013
25 July 2012
25 July 2012
25 July 2012
14 September 2012
14 September 2012
Resigned
27 March 2013
27 March 2013
27 March 2013
27 March 2013
4 February 2013
25 July 2012
25 July 2012
25 July 2012
Company Secretary
Company Secretary
24 October 2012
24 October 2012
15 January 2014
Principles used to determine the nature and amount of remuneration
Directors and executives remuneration
Overall remuneration policies are determined by the Board of Directors and are adapted to reflect competitive market
and business conditions. Within this framework, the board considers remuneration policies and practices generally,
and determines specific remuneration packages and other terms of employment for executive directors and senior
management. Executives may be provided with longer-term incentives through participation in option schemes,
which serve to align the interests of the executives with those of shareholders. Executive remuneration and other
terms of employment are reviewed annually by the remuneration committee having regard to performance, relevant
comparative information and expert advice.
Non-executive directors’ remuneration
The Company’s Policy is to remunerate non- executive directors at market rates (for comparable companies) for time
commitment and responsibilities. Fee’s for non-executive directors are not linked to the performance of the company,
however to align directors interest with shareholders interest directors are encouraged to hold shares in the
Company. The amount of aggregate remuneration sought to be approved by shareholders and the fee structure is
reviewed annually against fees paid to NED’s of comparable companies.
Payments to non-executive directors reflect the demands that are made on, and the responsibilities of the NED’s.
Non-executive director’s fee and payments are reviewed annually by the remuneration committee. The Company’s
constitution and the ASX listing rules specify that the NED fee pool shall be determined from time to time by a general
meeting.
In accordance with current corporate governance practices, the structure for the remuneration of non-executive
directors and senior executives is separate and distinct. Shareholders approve the maximum aggregate
remuneration for non-executive directors, with the current approved limit being $500,000. The Board determines the
actual payments to directors. The Board approves any consultancy arrangements for non-executive directors who
provide services outside of and in addition to their duties as non-executive directors.
During the year ended 30 June 2013 the current Board of Directors did not receive remuneration for time and effort
served.
12
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
30 JUNE 2013 FULL YEAR REPORT
DIRECTORS’ REPORT
Details of remuneration
The following table discloses details of the nature and amount of each element of the emoluments of each director of
Swan Gold and each of the officers receiving the highest emoluments for the year ended 30 June 2013.
REMUNERATION REPORT (audited)
30 June 2013
Name
Directors
Michael Fotios
John Poynton
Craig Readhead
Wayne Zekulich
Damian Delaney
Martin Depisch
Dr Gerhard Kornfeld
Peter Farris
Thomas Styblo
Allan Brown
Keith Vuleta
Ian Price
Executives
Linda Paini
Ildiko Wowesny
30 June 2012
Name
Directors
Allan Brown
Keith Vuleta
Ian Price
Executives
Ildiko Wowesny (i)
Primary (short-term)
Post-employment
Equity
(share-
based
payments)
Salary and
directors
fees
$
Consulting
fees
$
Non-
monetary
benefits
$
Superannuation
$
$
Total
$
-
-
-
-
-
-
-
-
-
5,450
4,360
4,360
-
-
13,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,170
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
5,450
4,360
4,360
-
-
14,170
Primary (short-term)
Post-employment
Equity
(share-
based
payments)
Salary and
directors
fees
$
Consulting
fees
$
Non-
monetary
benefits
$
Superannuation
$
$
75,000
63,291
60,000
40,744
-
-
-
-
-
-
-
-
-
-
6,750
5,696
5,400
-
17,846
Total
$
81,750
68,987
65,400
40,744
256,881
-
-
-
-
-
Total
239,035
(i) Company secretarial services were provided by Stirling Resources Ltd from 1 July 2011 to 30 October 2011
as is also included in the management fee detailed in Note 22 to the financial report.
There were no proportions of any elements of Key Management Personnel remuneration that related to performance.
Other than directors of Swan Gold, there were no other executive officers of the consolidated entity during the year.
There were no options granted to key management personnel during the year (2012: nil).
No shares were issued during the year as a result of the exercise of options granted as part of remuneration. There
were no alterations to the terms and conditions of options granted as remuneration since their grant date. There were
no forfeitures during the period.
13
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
30 JUNE 2013 FULL YEAR REPORT
DIRECTORS’ REPORT
REMUNERATION REPORT (audited)
Information on any benefits received by directors of Swan Gold by reason of a contract made by the consolidated
entity with a director or a director-related entity is contained in Note 22 of the financial report.
Service agreements
The terms of employment for executive directors and specified executives were not formalised in service agreements
during the year ended 30 June 2013.
Company performance
The table below shows the performance of the consolidated entity as measured by its earnings per share. Swan Gold
shares have been suspended from trading since Voluntary Administrators were appointed on 10 July 2008. In the
past five years the consolidated entity has incurred losses and no dividends have been paid. Any improvement to
earnings is viewed as a long term position that is not yet fully determinable.
30 June
2013
Cents
30 June
2012
Cents
30 June
2011
Cents
30 June
2010
Cents
30 June
2009
Cents
Earnings/(loss) per share
(0.30)
(0.59)
(0.61)
(1.38)
(5.94)
End of Remuneration Report (audited)
14
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
30 JUNE 2013 FULL YEAR REPORT
DIRECTORS’ REPORT
ENVIRONMENTAL REGULATIONS
The consolidated entity is subject to significant environmental regulation in respect to its mineral exploration activities.
These obligations are regulated under relevant government authorities within Australia. The consolidated entity is a
party to exploration and mine development licences. Generally, these licences specify the environmental regulations
applicable to exploration and mining operations in the respective jurisdictions. The consolidated entity aims to ensure
that it complies with the identified regulatory requirements in each jurisdiction in which it operates.
Compliance with environmental obligations is monitored by the Board of Directors. No environmental breaches have
been notified to the consolidated entity by any government agency during the year ended 30 June 2013.
NON-AUDIT SERVICES
Non-audit services provided by Ernst & Young during their period as external auditors for taxation consulting advice
was nil (2012: $30,196). Further details of remuneration of the auditors are set out at Note 19.
The board has considered the non-audit services provided during the year and is satisfied that the provision of those
services is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001
and did not compromise the auditor independence requirements of the Corporations Act 2001, for the following
reasons:
- all non-audit services were subject to the corporate governance guidelines adopted by Swan Gold;
- non-audit services have been reviewed by the audit committee to ensure that they do not impact the impartiality or
-
objectivity of the auditor; and
the non-audit services provided do not undermine the general principles relating to auditor independence as set
out in Professional Statement F1, Professional Independence, as they did not involve reviewing or auditing the
auditor’s own work, acting in a management or decision making capacity, acting as an advocate for Swan Gold or
jointly sharing economic risks and rewards.
AUDITOR INDEPENDENCE
A copy of the auditor’s independence declaration as required under section 307C of the Corporations Act 2001 is
included immediately following the Directors’ Report and forms part of this Directors’ Report.
INDEMNIFICATION AND INSURANCE OF DIRECTORS AND OFFICERS
The Company has entered into indemnity agreements with each of the directors and officers of the Company. Under
the agreements, the Company will indemnify those officers against certain claims or for any expenses or costs which
may arise as a result of work performed in their respective capacities as officers of the Company or any related
entities.
The Company has taken out an insurance policy insuring Directors and Officers of the Company against any liability
arising from a claim bought by a third party against the Company or its Directors or Officers, and against liabilities for
costs and expenses incurred by them in defending any legal proceedings arising out of their conduct while acting in
their capacity as a Director or Officer of the Company, other than conduct involving a wilful breach of duty in relation
to the Company.
During the year, the Company paid premiums in respect of the above insurance policy. The contract prohibits the
disclosure of the nature of the liabilities and/or the amount of the premium.
ROUNDING
The amounts contained in this report and in the financial report have been rounded to the nearest $1,000 (where
rounding is applicable) under the option available to Swan Gold under the ASIC Class Order 98/0100. Swan Gold is
an entity to which the Class Order applies.
Signed in accordance with a resolution of the directors.
Michael Fotios
Executive Chairman
Perth, Western Australia
1 April 2014
15
Ernst & Young
11 Mounts Bay Road
Perth WA 6000 Australia
GPO Box M939 Perth WA 6843
Tel: +61 8 9429 2222
Fax: +61 8 9429 2436
ey.com/au
Auditor’s Independence Declaration to the Directors of Swan Gold
Mining Limited
In relation to our audit of the financial report of Swan Gold Mining Limited and its controlled entities
for the financial year ended 30 June 2013, to the best of my knowledge and belief, there have been no
contraventions of the auditor independence requirements of the Corporations Act 2001 or any
applicable code of professional conduct.
Ernst & Young
G H Meyerowitz
Partner
1 April 2014
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
GHM:MM:SWAN:006
16
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Revenue
Other income
Employee and directors – remuneration expense
Raw materials and consumables used
Administrative expenses
Other expenses
Finance costs
Depreciation
Exploration expenditure
Impairment of Property, Plant and Equipment
Capitalised exploration write off
CONSOLIDATED
NOTE
2013
$’000
2012
$’000
5(a)
5(b)
5(c)
5(d)
5(e)
5(f)
74
6,718
(636)
(349)
(981)
(46)
(69)
(81)
(2,795)
(5,223)
(21,499)
124
239
(738)
(674)
(790)
(82)
(75)
(728)
(1,689)
-
-
Loss before income tax expense
(24,887)
(4,413)
Income tax expense
Loss for the year
Other comprehensive income for the year
6
-
-
(24,887)
(4,413)
-
-
Total comprehensive loss for the year
(24,887)
(4,413)
Attributable to:
- Members of Swan Gold
- Non-controlling interest
Basic and diluted loss per share (cents per share)
28
(24,887)
-
(24,887)
0.03
(4,413)
-
(4,413)
0.59
The above statement should be read in conjunction with the accompanying notes.
17
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
AS AT 30 JUNE 2013
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
CONSOLIDATED
NOTE
2013
$’000
2012
$’000
CURRENT ASSETS
Cash and cash equivalents
Trade and other receivables
Prepayments
Inventory
TOTAL CURRENT ASSETS
NON-CURRENT ASSETS
Receivables
Property, plant and equipment
Deferred exploration expenditure
TOTAL NON-CURRENT ASSETS
TOTAL ASSETS
CURRENT LIABILITIES
Trade and other payables
Loans and borrowings
Provisions
Obligations to the Group Trust
Obligations to the Mt Ida Trust
Obligations to the Territory Trust
TOTAL CURRENT LIABILITIES
NON-CURRENT LIABILITIES
Provisions
TOTAL NON-CURRENT LIABILITIES
TOTAL LIABILITIES
NET LIABILITIES
SHAREHOLDERS DEFICIT
Contributed equity
Accumulated losses
Reserves
TOTAL PARENT ENTITY INTEREST
Non-controlling interest
27
7
8
9
10
11
12
13
14
14
14
236
5,524
13
63
5,836
-
3,000
-
3,000
8,836
1,648
30,114
27
-
-
-
31,789
259
182
-
26
467
5,162
8,303
21,499
34,964
35,431
314
11,683
41
9,970
1,013
13,477
36,498
13
4,148
4,148
4,148
35,937
(27,101)
167,666
(200,101)
5,292
4,148
40,646
(5,215)
164,666
(175,215)
5,292
(27,143)
(5,257)
42
42
15
16
17
TOTAL DEFICIENCY IN SHAREHOLDER FUNDS
(27,101)
(5,215)
The above statement should be read in conjunction with the accompanying notes.
18
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Consolidated
At 1 July 2011
Attributable to equity holders of the parent entity
Contributed
equity
$’000
Accumulated
losses
$’000
Reserves
$’000
Total
$’000
Non-
controlling
interests
$’000
Total
equity
$’000
164,666
(170,802)
5,292
(844)
42
(802)
Other comprehensive loss
Loss for the year
Total comprehensive loss for the
year
-
-
-
-
(4,413)
(4,413)
-
-
-
-
(4,413)
(4,413)
-
-
-
-
(4,413)
(4,413)
At 30 June 2012
164,666
(175,215)
5,292
(5,257)
42
(5,215)
Other comprehensive loss
Loss for the year
Total comprehensive loss for the
year
Issued of ordinary shares
-
-
-
3,000
-
(24,887)
(24,887)
-
-
-
-
-
-
(24,887)
(24,887)
3,000
-
-
-
-
-
(24,887)
(24,887)
3,000
At 30 June 2013
167,666
(200,101)
5,292
(27,143)
42
(27,101)
The above statement should be read in conjunction with the accompanying notes.
19
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
CONSOLIDATED STATEMENT OF CASH FLOWS
CONSOLIDATED
NOTE
2013
$’000
2012
$’000
Cash flows from operating activities
Receipts from customers
Payments to suppliers and employees
Payments for mineral exploration expenditure
Interest received
Interest paid
Net cash outflow from operating activities
27
Cash flows from investing activities
Payments for purchase of property, plant and equipment
Payments for rental and security bonds
Net cash outflow from investing activities
Cash flows from financing activities
Proceeds from share issue
Loan proceeds from other parties
Net cash inflow from financing activities
Net increase / (decrease) in cash and cash equivalents
Cash and cash equivalents at the beginning of the financial year
Cash and cash equivalents at the end of the financial year
27
(146)
(568)
(2,833)
74
(16)
(3,489)
-
(34)
(34)
3,000
500
3,500
(23)
259
236
124
(2,663)
(1,715)
124
(75)
(4,205)
(34)
-
(34)
-
4,339
4,339
100
159
259
The above statement should be read in conjunction with the accompanying notes
20
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
1.
CORPORATE INFORMATION
The financial report of Swan Gold for the year ended 30 June 2013 was authorised for issue in accordance
with a resolution of the Directors on the date of signing of the Directors’ Report. Swan Gold is a company
limited by shares that is incorporated and domiciled in Australia.
2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a)
(b)
(c)
Basis of preparation
The financial report is a general-purpose financial report which has been prepared in accordance with the
requirements of the Corporations Act 2001, Australian Accounting Standards and Interpretations. The financial
report has been prepared on a historical cost basis. The financial report is presented in Australian dollars, and
all values are rounded to the nearest thousand dollars ($’000) unless otherwise stated.
Statement of compliance
The financial report complies with Australian Accounting Standards and International Financial Reporting
Standards (IFRS) as issued by the International Accounting Standards Board.
Adoption of New and Revised Standards
In the year ended 30 June 2013, the Group has adopted all of the new and revised Standards and
Interpretations issued by the AASB. None have had an impact on the accounting policies of the Group or the
Group’s financial position or performance. Australian Accounting Standards and Interpretations that have
recently been issued or amended but are not yet effective have not been adopted by the Group for the
annual reporting period ended 30 June 2013. Except as otherwise outlined below, the impact of these
standards has not yet been determined.
Application date
of standard*
Application date
for Group*
1 Jan 2013
1 July 2013
1 January 2013
1 July 2013
Reference
Title
Summary
AASB 10
Consolidated
Financial
Statements
AASB 11
Joint
Arrangements
AASB 10 establishes a new control model that applies to all entities.
It replaces parts of AASB 127 Consolidated and Separate Financial
Statements dealing with the accounting for consolidated financial
statements and UIG-112 Consolidation - Special Purpose Entities.
The new control model broadens the situations when an entity is
considered to be controlled by another entity and includes new
guidance for applying the model to specific situations, including
when acting as a manager may give control, the impact of potential
voting rights and when holding less than a majority voting rights may
give control.
Consequential amendments were also made to this and other
standards via AASB 2011-7 and AASB 2012-10.
There will be no impact on the Group from this standard as all
subsidiaries are wholly owned.
AASB 11 replaces AASB 131 Interests in Joint Ventures and UIG-
113 Jointly- controlled Entities - Non-monetary Contributions by
Ventures.
AASB 11 uses the principle of control in AASB 10 to define joint
control, and therefore the determination of whether joint control
exists may change. In addition it removes the option to account for
jointly controlled entities (JCEs) using proportionate consolidation.
Instead, accounting for a joint arrangement is dependent on the
nature of the rights and obligations arising from the arrangement.
Joint operations that give the venturers a right to the underlying
assets and obligations themselves is accounted for by recognising the
share of those assets and obligations. Joint ventures that give the
venturers a right to the net assets is accounted for using the equity
method.
Consequential amendments were also made to this and other
standards via AASB 2011-7, AASB 2010-10 and amendments to
AASB 128.
The Group currently has a Joint Arrangement that meets the
definition of a Joint Operation under AASB 11. Accordingly there
will be no change to the accounting treatment applied.
21
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
Application date
of standard*
Application date
for Group*
1 January 2013
1 July 2013
1 January 2013
1 July 2013
1 January 2013
1 July 2013
1 January 2013
1 July 2013
Reference
Title
Summary
AASB 12
Disclosure of Interests in
Other Entities
AASB 13
Fair Value Measurement
AASB 119
(Revised 2011)
Employee Benefits
Interpretation 20
Stripping Costs in the
Production Phase of a
Surface Mine
AASB 12 includes all disclosures relating to an entity's
interests in subsidiaries, joint arrangements, associates
and structured entities. New disclosures have been
introduced about the judgments made by management
to determine whether control exists, and to require
summarised information about joint arrangements,
associates, structured entities and subsidiaries with non-
controlling interests.
AASB 13 establishes a single source of guidance for
determining the fair value of assets and liabilities.
AASB 13 does not change when an entity is required to
use fair value, but rather, provides guidance on how to
determine fair value when fair value is required or
permitted. Application of this definition may result in
different fair values being determined for the relevant
assets.
AASB 13 also expands the disclosure requirements for
all assets or liabilities carried at fair value. This includes
information about the assumptions made and the
qualitative impact of those assumptions on the fair
value determined.
Consequential amendments were also made to other
standards via AASB 2011-8.
There will be no recognition or measurement impact on
the Group from this standard as it does not change the
way the Group estimates the fair value of its financial
assets and financial liabilities. The Group will be
required to include additional disclosures including a
comparison of the carrying value and the fair value for
the Groups financial assets and financial liabilities. As
at 30 June 2013, the carrying value of the Groups
financial assets and financial liabilities approximate
their fair value.
The revised standard changes the definition of short-
term employee benefits. The distinction between short-
term and other long-term employee benefits is now
based on whether the benefits are expected to be settled
wholly within 12 months after the reporting date.
Consequential amendments were also made to other
standards via AASB 2011-10.
This interpretation applies to stripping costs incurred
during the production phase of a surface mine.
Production stripping costs are to be capitalised as part
of an asset, if an entity can demonstrate that it is
probable future economic benefits will be realised, the
costs can be reliably measured and the entity can
identify the component of an ore body for which access
has been improved. This asset is to be called the
"stripping activity asset".
The stripping activity asset shall be depreciated or
amortised on a systematic basis, over the expected
useful life of the identified component of the ore body
that becomes more accessible as a result of the stripping
activity. The units of production method shall be
applied unless another method is more appropriate.
Consequential amendments were also made to other
standards via AASB 2011-12.
The impact of this standard has not yet been determined
by management as the Group is currently not in the
production phase. Upon completion of the Investmet
Transaction, and the recommencement of mine
operations, management will review Interpretation 20
and assess the impact.
22
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
Reference
Title
Summary
AASB 2012-2
AASB 2012-5
AASB 2012-9
AASB 2011-4
AASB 1053
Amendments to Australian
Accounting Standards -
Disclosures - Offsetting
Financial Assets and
Financial Liabilities
Amendments to Australian
Accounting Standards
arising from Annual
Improvements 2009-2011
Cycle
Amendment to AASB
1048 arising from the
withdrawal of Australian
Interpretation 1039
Amendments to Australian
Accounting Standards to
Remove Individual Key
Management Personnel
Disclosure Requirements
[AASB 124]
Application of Tiers of
Australian Accounting
Standards
AASB 2012-3
Amendments to Australian
Accounting Standards -
Offsetting Financial Assets
and Financial Liabilities
Interpretation 21
Levies
AASB 2012-2 principally amends AASB 7 Financial
Instruments: Disclosures to require disclosure of the
effect or potential effect of netting arrangements. This
includes rights of set-off associated with the entity's
recognised financial assets and liabilities on the entity's
financial position, when the offsetting criteria of AASB
132 are not all met.
AASB 2012-5 makes amendments resulting from the
2009-2011 Annual Improvements Cycle. The standard
addresses a range of improvements, including the
following:
► Repeat application of AASB 1 is permitted (AASB 1)
► Clarification of the comparative information
requirements when an entity provides a third balance
sheet (AASB 101 Presentation of Financial
Statements).
AASB 2012-9 amends AASB 1048 Interpretation of
Standards to evidence the withdrawal of Australian
Interpretation 1039 Substantive Enactment of Major
Tax Bills in Australia.
This amendment deletes from AASB 124 individual
key management personnel disclosure requirements for
disclosing entities that are not companies. It also
removes the individual KMP disclosure requirements
for all disclosing entities in relation to equity holdings,
loans and other related party transactions.
This standard establishes a differential financial
reporting framework consisting of two tiers of reporting
requirements for preparing general purpose financial
statements:
(a) Tier 1: Australian Accounting Standards
(b) Tier 2: Australian Accounting Standards - Reduced
Disclosure Requirements
Tier 2 comprises the recognition, measurement and
presentation requirements of Tier 1 and substantially
reduced disclosures corresponding to those
requirements.
The following entities apply Tier 1 requirements in
preparing general purpose financial statements:
(a) For-profit entities in the private sector that have
public accountability (as defined in this standard)
(b) The Australian Government and State, Territory and
Local governments
The following entities apply either Tier 2 or Tier 1
requirements in preparing general purpose financial
statements:
(a) For-profit private sector entities that do not have
public accountability
(b) All not-for-profit private sector entities
(c) Public sector entities other than the Australian
Government and State, Territory and Local
governments.
Consequential amendments to other standards to
implement the regime were introduced by AASB
2010-2, 2011-2, 2011-6, 2011-11, 2012-1, 2012-7 and
2012-11.
AASB 2012-3 adds application guidance to AASB 132
Financial Instruments: Presentation to address
inconsistencies identified in applying some of the
offsetting criteria of AASB 132, including clarifying the
meaning of "currently has a legally enforceable right of
set-off" and that some gross settlement systems may be
considered equivalent to net settlement.
This Interpretation confirms that a liability to pay a levy
is only recognised when the activity that triggers the
payment occurs. Applying the going concern
assumption does not create a constructive obligation.
23
Application date
of standard*
Application date
for Group*
1 January 2013
1 July 2013
1 January 2013
1 July 2013
1 January 2013
1 July 2013
1 July 2013
1 July 2013
1 July 2013
1 July 2013
1 January 2014
1 July 2014
1 January 2014
1 July 2014
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
Application date
of standard*
Application date
for Group*
1 Jan 2015
1 July 2015
Reference
Title
Summary
AASB 9
Financial Instruments
AASB 9 includes requirements for the classification
and measurement of financial assets. It was further
amended by AASB 2010-7 to reflect amendments to
the accounting for financial liabilities.
These requirements improve and simplify the approach
for classification and measurement of financial assets
compared with the requirements of AASB 139. The
main changes are described below.
(a) Financial assets that are debt instruments will be
classified based on (1) the objective of the entity's
business model for managing the financial assets; (2)
the characteristics of the contractual cash flows.
(b) Allows an irrevocable election on initial rec
investments in equity instruments that are not held for
trading in other comprehensive income. Dividends in
respect of these investments that are a return on
investment can be recognised in profit or loss and there
is no impairment or recycling on disposal of the
instrument.
(c) Financial assets can be designated and measured at
fair value through profit or loss at initial recognition if
doing so eliminates or significantly reduces a
measurement or recognition inconsistency that would
arise from measuring assets or liabilities, or recognising
the gains and losses on them, on different bases.
(d) Where the fair value option is used for financial
liabilities the change in fair value is to be accounted for
as follows:
► The change attributable to changes in credit risk are
presented in other comprehensive income (OCI)
► The remaining change is presented in profit or loss
If this approach creates or enlarges an accounting
mismatch in the profit or loss, the effect of the changes
in credit risk are also presented in profit or loss.
Further amendments were made by AASB 2012-6
which amends the mandatory effective date to annual
reporting periods beginning on or after 1 January 2015.
AASB 2012-6 also modifies the relief from restating
prior periods by amending AASB 7 to require
additional disclosures on transition to AASB 9 in some
circumstances.
Consequential amendments were also made to other
standards as a result of AASB 9, introduced by
AASB 2009-11 and superseded by AASB 2010-7 and
2010-10.
* Designates the beginning of the applicable annual reporting period unless otherwise stated
^ The AASB have not yet issued the Australian equivalent of this Interpretation.
24
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
(d) Going concern
As at 30 June 2013, the Group’s current liabilities exceeded its current assets by $25.95 million and the groups
Shareholders’ deficit totalled $27.1 million. The consolidated entity recorded a loss of $24.9 million for the year
ended 30 June 2013.
At the date of this report a Loan Facility Agreement between Swan Gold, Investmet, M6 Securities and Stirling
is being prepared and once executed will result in:
-
-
$24,864,240, being the full amount of the Investmet debt, converting to ordinary shares at a price of $0.02
per ordinary share resulting in the issue 1,243,212,000 ordinary Swan Gold shares, and
$2,500,000, being the 50% of the Stirling debt, converting to ordinary shares at a price of $0.02 per
ordinary share resulting in the issue of 125,000,000 ordinary Swan Gold shares.
The Company is working towards the re-admission of its ordinary shares to official quotation on the ASX. As
part of the re-admission process, the Company will look to raise upward of $20 million via a placement to
institutional sophisticated investors. Whilst there is strong appetite for the placement at this stage no binding
term sheet exists nor is there any certainty that the placement will occur
The ability of the Group to operate as a going concern and meet its debts as and when they fall due is primarily
dependent upon the Directors meeting the terms and conditions under the Investmet transaction and
successfully recapitalising the Group. Failure to do so may result in the Group being unable to meet its debts
as and when they fall due and realise its assets and settle its liabilities in the ordinary course of business. The
financial report has been prepared on the basis that the consolidated entity will continue to meet their
commitments and can therefore continue normal business activities and the realisation of assets and the
settlement of liabilities in the ordinary course of business.
The directors believe that at the date of signing the financial report there are reasonable grounds to believe that
having regard to the matters set out above, the consolidated entity will be able meet the terms and conditions
under the Investmet transaction and successfully recapitalise the Group.
Should the consolidated entity not achieve the matters set out above, there is significant uncertainty whether the
consolidated entity will continue as a going concern and therefore whether it will realise its assets and extinguish
its liabilities in the normal course of business and at the amounts stated in the financial statements.
The financial report does not include any adjustments relating to the recoverability and classification of recorded
asset amounts or to the amounts and classification of liabilities that might be necessary should the consolidated
entity not be able to continue as a going concern.
(e)
Principles of consolidation
The consolidated financial statements comprise the financial statements of Swan Gold and its subsidiaries (as
outlined in Note 24) (the Group) as at and for the period ended 30 June each year.
Subsidiaries are all those entities over which the Group has the power to govern the financial and operating
policies so as to obtain benefits from their activities. The existence and effect of potential voting rights that are
currently exercisable or convertible are considered when assessing whether a group controls another entity.
The financial statements of the subsidiaries are prepared for the same reporting period as the parent company,
using consistent accounting policies. In preparing the consolidated financial statements, all intercompany
balances, transactions, unrealised gains and losses resulting from intra-group transactions and dividends have
been eliminated in full.
25
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
Subsidiaries are fully consolidated from the date on which control is obtained by the Group and cease to be
consolidated from the date on which control is transferred out of the Group.
Investments in subsidiaries held by Swan Gold are accounted for at cost in the separate financial statements of
the parent entity less any impairment charges. Dividends received from subsidiaries are recorded as a
component of other revenues in the separate income statement of the parent entity, and do not impact the
recorded cost of the investment. Upon receipt of dividend payments from subsidiaries, the parent will assess
whether any indicators of impairment of the carrying value of the investment in the subsidiary exist.
Where such indicators exist, to the extent that the carrying value of the investment exceeds its recoverable
amount, an impairment loss is recognised.
The acquisition of subsidiaries which are businesses is accounted for using the acquisition method of
accounting. The acquisition method of accounting involves recognising at acquisition date, separately from
goodwill, the identifiable assets acquired, the liabilities assumed and any non-controlling interest in the
acquiree. The identifiable assets acquired and the liabilities assumed are measured at their acquisition date
fair values.
The difference between the above items and the fair value of the consideration (including the fair value of any
pre-existing investment in the acquiree) is goodwill or a discount on acquisition.
After initial recognition, goodwill is measured at cost less any accumulated impairment losses. For the purpose
of impairment testing, goodwill acquired in a business combination is, from the acquisition date, allocated to
each of the Group’s cash-generating units that are expected to benefit from the combination, irrespective of
whether other assets or liabilities of the acquiree are assigned to those units.
Where goodwill forms part of a cash-generating unit and part of the operation within that unit is disposed of, the
goodwill associated with the operation disposed of is included in the carrying amount of the operation when
determining the gain or loss on disposal of the operation. Goodwill disposed of in this circumstance is
measured based on the relative values of the operation disposed of and the portion of the cash-generating unit
retained.
Non-controlling interests are allocated their share of net profit after tax in the statement of comprehensive
income and are presented within equity in the consolidated statement of financial position, separately from the
equity of the owners of the parent. Losses are attributed to the non-controlling interest even if that results in a
deficit balance.
A change in the ownership interest of a subsidiary that does not result in a loss of control is accounted for as
an equity transaction.
If the Group loses control over a subsidiary, it:
- Derecognises the assets (including goodwill) and liabilities of the subsidiary
- Derecognises the carrying amount of any non-controlling interest
- Derecognises the cumulative translation differences, recorded in equity
- Recognises the fair value of the consideration received
- Recognises the fair value of any investment retained
- Recognises any surplus or deficit in profit or loss
- Reclassifies the parent's share of components previously recognised in other comprehensive income to
profit or loss, or retained earnings, as appropriate
26
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
(f)
Revenue recognition
Revenue is recognised to the extent that it is probable that the economic benefit will flow to the consolidated
entity and the revenue can be reliably measured. Revenue is measured at the fair value of the consideration
received or receivables taking into account contractually defined terms of payment and excluding taxes or duty.
The following specific recognition criteria must also be met before revenue is recognised.
Interest
Revenue is recognised as the interest accrues using the effective interest rate method (which is the rate that
exactly discounts estimated future cash receipts through the expected life of the financial instrument to the net
carrying amount of the financial asset).
(g)
Property, plant and equipment
All assets acquired, including property, plant and equipment are initially recorded at their cost of acquisition,
being the fair value of the consideration provided plus incidental costs directly attributable to the acquisition.
Property, plant and equipment located on a mine site is included at cost less provision for depreciation and any
impairment in value. All such assets are depreciated over the estimated remaining economic life of the mine,
using a unit of production basis.
All other property, plant and equipment is included at cost less provision for depreciation and any impairment in
value and depreciated on a straight-line basis commencing from the time the asset is held ready for use.
An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are
expected from its use or disposal. Any gain or loss arising on derecognition of the asset (calculated as the
difference between net disposal proceeds and the carrying amount of the asset) is included in profit or loss in the
year the asset is derecognised.
(h) Other financial assets
Financial assets in the scope of AASB 139 “Financial Instruments – Recognition and Measurement” are
classified as either financial assets at fair value through profit or loss, loans and receivables, held to maturity
investments or available for sale investments as appropriate. When financial assets are recognised initially,
they are measured at fair value, plus, in the case of investments not at fair value through profit or loss, directly
attributable transaction costs. The consolidated entity determines the classification of its financial assets at
initial recognition.
All regular way purchases and sales of financial assets are recognised on the trade date (the date that the
consolidated entity commits to purchase the asset). Regular way purchases or sales are purchases or sales of
financial assets under contracts that require delivery of the assets within the period established generally by
regulation or convention in the market place.
Loans, receivables and security deposits
Loans, receivables and security deposits are non-derivative financial assets with fixed or determinable
payments that are not quoted in an active market. Such assets are carried at amortised cost using the
effective interest method. Gains and losses are recognised in profit or loss when the loans and receivables are
derecognised or impaired as well as through the amortisation process.
The fair values of investments that are actively traded in organised financial markets are determined by
reference to quoted market bid prices at the close of business on the reporting date. For investments with no
active market, fair values are determined using valuation techniques. Such techniques include: using recent
arm’s length market transactions; reference to the current market value of another instrument that is
substantially the same; discounted cash flow analysis; and option pricing models, making as much use of
available and supportable market data as possible and keeping judgemental inputs to a minimum.
(i)
Deferred exploration and evaluation expenditure
Once the legal right to explore has been acquired, exploration and evaluation costs are expensed to the
Statement of Comprehensive Income as incurred unless the Directors conclude that a future economic benefit
is more likely than not to be realised. Costs incurred during this phase are expensed in the Statement of
Comprehensive Income as ‘exploration and evaluation expenditure’. In evaluating if expenditures meet the
criteria to be capitalised, several different sources of information are utilised. The information that is used to
determine the probability of future economic benefits depends on the extent of exploration and evaluation that
has been performed.
27
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
Impairment
The carrying value of capitalised exploration and evaluation expenditure is assessed for impairment whenever
facts and circumstances suggest that the carrying amount of the asset may exceed its recoverable amount.
The recoverable amount of capitalised exploration and evaluation expenditure is the higher of fair value less
costs to sell and value in use. 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.
For an asset that does not generate largely independent cash inflows, recoverable amount is determined for
the cash-generating unit to which the asset belongs, unless the asset’s value in use can be estimated to be
close to its fair value.
An impairment exists when the carrying amount of an asset or cash-generating unit exceeds its estimated
recoverable amount. The asset or cash-generating unit is then written down to its recoverable amount. Any
impairment losses are recognised in profit or loss.
(j)
Impairment of non-financial assets
At each reporting date, the consolidated entity assesses whether there is any indication that an asset may be
impaired. Where an indicator of impairment exists, the consolidated entity 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. 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.
(k)
Jointly controlled assets
The Group has an interest in a joint venture that is a jointly controlled assets. A joint venture is a contractual
arrangement whereby two or more parties undertake an economic activity that is subject to joint control. The
Group recognises its interest in the jointly controlled assets by recognising its interest in the assets and the
liabilities of the joint venture. The Group also recognises the expenses that it incurs and its share of the income
that it earns from the use and output of the jointly controlled assets.
(l)
Income tax
Deferred income tax is provided on all temporary differences at the balance sheet 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:
•
•
When the deferred income tax liability arises from the initial recognition of goodwill or of an asset or
liability in a transaction that is not a business combination and that, at the time of the transaction, affects
neither the accounting profit nor taxable profit or loss.
In respect of taxable temporary differences associated with investments in subsidiaries, associates and
interests in joint ventures, when the timing of the reversal of the temporary differences can be controlled
and it is probable that the temporary differences will not reverse in the foreseeable future.
Deferred tax assets are recognised for all deductible temporary differences, the carry forward of unused tax
credits and any unused tax losses. Deferred tax assets are recognised 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 credits and unused tax losses can be utilised, except:
•
When the deferred 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.
28
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
•
In respect of deductible temporary differences associated with investments in subsidiaries, associates
and interests in joint ventures, deferred tax assets are recognised only to the extent that it is probable
that the temporary differences will reverse in the foreseeable future and taxable profit will be available
against which the temporary differences can be utilised.
The carrying amount of deferred 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 tax asset to
be utilised. Unrecognised deferred tax assets are reassessed at each reporting date and are recognised to the
extent that is has become probable that future taxable profits will allow the deferred tax asset to be recovered.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in 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.
Deferred tax relating to items recognised outside profit or loss is recognised outside profit or loss. Deferred tax
items are recognised in correlation to the underlying transaction either in other comprehensive income or
directly in equity.
Deferred tax assets and deferred tax liabilities are offset if a legally enforceable right exists to set off current tax
assets against current income tax liabilities and the deferred taxes relate to the same taxable entity and the
same taxation authority.
(m) Trade and other receivables
Trade receivables, which generally have 30 to 90 day terms, are recognised initially at fair value and
subsequently measured at amortised cost using the effective interest method less an allowance for impairment.
An allowance for doubtful debts is made when there is objective evidence that the consolidated entity will not
be able to collect the debts. Bad debts are written off when identified.
(n)
(o)
Collectability of trade receivables is reviewed on an ongoing basis. Financial difficulties of the debtor, default
payments or debts more than 180 days overdue are considered objective evidence of impairment. The amount of
the impairment loss is the receivable carrying amount compared to the present value of estimated future cash
flows, discounted at the original effective interest rate.
Trade and other payables
Trade payables and other payables are carried at amortised cost and represent liabilities for goods and services
provided to the consolidated entity prior to the end of the financial year that are unpaid and arise when the
consolidated entity becomes obliged to make future payments in respect of the purchase of these goods and
services.
Interest bearing loans and borrowings
All loans and borrowings are initially recognised at cost, being the fair value of the consideration received net of
issue costs associated with the borrowing. After initial recognition, interest-bearing loans and borrowings are
subsequently measured at amortised cost using the effective interest method. Amortised cost is calculated by
taking into account any issue costs, and any discount or premium on settlement. Gains and losses are
recognised in the statement of comprehensive income when the liabilities are derecognised as well as through the
amortisation process.
(p)
Contributed equity
Ordinary share capital is recognised at the fair value of the consideration received. Any transaction costs arising
on the issue of ordinary shares are recognised directly in equity as a reduction of the share proceeds received.
29
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
(q) Goods and services tax
Revenues, expenses and assets are recognised net of goods and services tax (GST), except where the amount
of GST incurred is not recoverable. In these circumstances the GST is recognised as part of the cost of
acquisition of the asset or as part of the expense item.
Receivables and payables are stated with the amount of GST included. The net amount of GST recoverable from
or payable to the tax authority is included as a current asset or liability in the statement of financial position. Cash
flows are included in the statement of cash flows on a gross basis. The GST components of cash flows arising
from investing and financing activities which are recoverable from or payable to the tax authority are classified as
operating cash flows.
(r)
Employee benefits
Provision for employee benefits represents the amount which the consolidated entity has a present obligation to
pay resulting from employees’ service provided up to the balance date.
Liabilities arising in respect of employee benefits expected to be settled within twelve months of the balance date
are measured at their nominal amounts based on remuneration rates which are due to be paid when the liability is
settled. All other employee benefit liabilities are measured at the present value of the estimated future cash
outflow to be made in respect of services provided by employees up to the balance date.
(s)
Share based payments
The consolidated entity may provide benefits to employees (including directors) in the form of share-based
payments, 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 they are granted. The value is determined using a binomial model. The cost of equity settled
transactions is recognised, together with a corresponding increase in equity, over the period in which the
performance conditions are fulfilled, ending on the date on which the relevant employees become fully entitled to
the award (“vesting date”). The cumulative expense recognised for equity settled transactions at each reporting
date until vesting date reflects the extent to which the vesting period has expired and the number of awards that,
in the opinion of the directors, will ultimately vest.
No adjustment is made for the likelihood of market performance conditions being met as the effect of these
conditions is included in the determination of fair value at grant date. No expense is recognised for awards that do
not ultimately vest, except for awards where vesting is conditional upon a market condition. Where an equity-
settled award is cancelled, it is treated as if it had vested on the date of cancellation, and any expense not yet
recognised for the award is recognised immediately. However, if a new award is substituted for the cancelled
award, and designated as a replacement award on the date that it is granted, the cancelled and new award are
treated as if they were a modification of the original award, as described in the previous paragraph.
(t)
Leases
Leases are classified at their inception as either operating or finance leases based on the economic substance
of the agreement so as to reflect the risks and benefits incidental to ownership.
Operating leases
The minimum lease payments of operating leases, where the lessor effectively retains substantially all of the
risks and benefits of ownership of the leased item, are recognised as an expense on a straight-line basis.
Finance leases
Leases which effectively transfer substantially all the risks and benefits incidental to ownership of the leased
item to the consolidated entity are capitalised at the present value of the minimum lease payments and
disclosed as plant and equipment under lease. A lease liability of equal value is also recognised. Capitalised
lease assets are depreciated over the shorter of the estimated useful life of the assets and the lease term.
30
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
(u)
Rehabilitation costs
Full provision for rehabilitation costs is made based on the net present value of the estimated cost of restoring
the environmental disturbance that has occurred up to the balance date. Increases due to additional
environmental disturbances are capitalised and amortised over the remaining lives of the operations. These
increases are accounted for on a net present value basis.
Rehabilitation provisions are discounted using a current pre-tax rate that reflects the risks specific to the
liability. When discounting is used, the increase in the provision due to the passage of time is recognised as a
financing cost. The estimated costs of rehabilitation are reviewed annually and adjusted as appropriate for
changes in legislation, technology or other circumstances.
(v)
Inventories
Ore and Gold stocks are valued at the lower of cost and net realisable value. Cost comprises direct materials,
direct labour and an appropriate proportion of variable and fixed overhead expenditure relating to mining
activities, the latter being allocated on the basis of normal operating capacity. Costs are assigned to individual
items of inventory on the basis of weighted average costs. Net realisable value is the estimated selling price in
the ordinary course of business, less the estimated costs of completion and the estimated costs necessary to
make the sale.
(w) Borrowing costs
Borrowing costs directly attributable to the acquisition, construction or production of a qualifying asset (i.e. an
asset that necessarily takes a substantial period of time to get ready for its intended use or sale) are capitalised
as part of the cost of that asset. All other borrowing costs are expensed in the period they occur. Borrowing
costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds. Swan
Gold does not currently hold qualifying assets but, if it did, the borrowing costs directly associated with this
asset would be capitalised (including any other associated costs directly attributable to the borrowing and
temporary investment income earned on the borrowing).
(x)
Earnings per share
Basic earnings per share is determined by dividing net operating results after income tax attributable to
members of the parent entity, excluding any costs of servicing equity other than ordinary shares, by the
weighted average number of ordinary shares outstanding during the financial year.
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into
account the after income tax effect of interest and other financing costs associated with dilutive potential
ordinary shares and the weighted average number of shares assumed to have been issued for no
consideration in relation to potential ordinary shares.
(y)
Cash and cash equivalents
Cash and cash equivalents in the statement of financial position comprise cash at bank and short-term
deposits with an original maturity of three months or less that are readily convertible to known amounts of cash
and which are subject to an insignificant risk of changes in value.
For the purposes of the statement of cash flows, cash includes deposits at call which are readily convertible to
cash on hand and which are used in the cash management function on a day to day basis, net of outstanding
bank overdrafts.
31
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
3.
FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
Refer to Note 23 for details.
4.
(a)
JUDGEMENTS IN APPLYING ACCOUNTING POLICIES AND KEY SOURCES OF ESTIMATION
UNCERTAINTY
Significant accounting judgements
In the process of applying the consolidated entity’s accounting policies, management has made the following
judgements, apart from those involving estimations, which have the most significant effect on the amounts
recognised in the financial statements:
Capitalisation of exploration expenditure
The application of the Group’s accounting policy for exploration and evaluation expenditure requires judgement
in determining whether it is likely that future economic benefits are likely either from future exploitation or sale
or where activities have not reached a stage which permits a reasonable assessment of the existence of
reserves.
The determination of Joint Ore Reserves Committee (JORC) resource is in itself an estimation process that
requires varying degrees of uncertainty depending on sub-classification and these estimates directly impact the
point of deferral of exploration and evaluation expenditure.
The deferral policy requires management to make certain estimates and assumptions about future events or
circumstances, in particular whether an economically viable extraction operation can be established. Estimates
and assumptions made may change if new information becomes available. If, after expenditure is capitalised,
information becomes available suggesting that the recovery of expenditure is unlikely, the amount capitalised is
written off in the statement of comprehensive income in the period when the new information becomes
available.
(b)
Significant 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
Assets, including property, plant and equipment, receivables and goodwill, are reviewed for impairment if there
is any indication that the carrying amount may not be recoverable. Where a review for impairment is
conducted, the recoverable amount is assessed by reference to the higher of “value in use” (being the net
present value of expected future cash flows of the relevant cash generating unit) and “fair value less costs to
sell”.
Impairment of deferred exploration expenditure
The future recoverability of deferred exploration expenditure is dependent on a number of factors, including
whether the Group decides to exploit the related tenement itself or, if not, whether it successfully recovers the
related exploration asset through sale.
To the extent that deferred exploration expenditure is determined not to be recoverable in the future, this will
reduce profits and net assets in the period in which this determination is made.
32
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
Provision for decommissioning and restoration costs
Decommissioning and restoration costs are a normal consequence of mining and the majority of this
expenditure is incurred as 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 decommissioning and 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 consolidated entity 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 binomial model using the assumptions detailed in the financial statements.
33
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
CONSOLIDATED
2013
$’000
2012
$’000
74
74
181
6,530
7
6,718
636
636
332
17
349
69
89
270
4
181
226
142
981
53
16
69
124
124
-
-
239
239
738
738
627
47
674
94
30
138
8
87
96
337
790
48
27
75
5. REVENUE AND EXPENSES
(a) Revenue
- interest
(b) Other income
- Management fees
- Gain on loan forgiveness
- sundry income
(c)
Employee and directors’ benefits expenses
- wages and salaries
(d)
Raw materials and consumables used
- care and maintenance expenses
- contractors and subcontractors
(e)
Corporate and administration expenses
- audit and accounting fees
- consulting fees
- legal fees
- travel and accommodation expenses
- regulatory
- insurance
- management fees
(f)
Finance costs
- bank fees
- interest expense
34
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
6.
INCOME TAX
a.
The components of tax expense comprise:
Current tax
Deferred tax
Income tax expense reported in statement of comprehensive income
CONSOLIDATED CONSOLIDATED
2013
$’000
2012
$’000
-
-
-
-
-
-
b.
The prima facie tax benefit on loss from ordinary activities before income
tax is reconciled to the income tax as follows:
Prima facie tax benefit on loss from ordinary activities before income tax at 30%
(2012: 30%)
(7,466)
(1,324)
-
-
-
-
-
1
1
-
1,324
1,123
-
-
(1,324)
4
1
5
-
42,811
43,410
256
3,437
1,262
83
256
1,870
1,263
33
47,849
46,832
Add/(less) tax effect of:
- Losses and other deferred tax balances not recognised
- Non-allowable items
- Non-assessable items
Income tax expense reported in Statement of Comprehensive Income
c.
Deferred tax recognised:
Deferred tax liabilities:
Accrued interest
Other
Deferred tax assets:
Carry forward revenue losses
Net deferred tax
d.
Unrecognised deferred tax assets:
Carry forward revenue losses
Exploration tenements & rehabilitation
Property, Plant & Equipment
Provisions & accruals
Other
The tax benefits of the above deferred tax assets will only be obtained if:
(a) the company derives future assessable income of a nature and of an
amount sufficient to enable the benefits to be utilised;
(b) the company continues to comply with the conditions for deductibility
imposed by law; and
(c) no changes in income tax legislation adversely affect the company in
utilising the benefits.
e.
Tax consolidation:
35
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
Swan Gold and its wholly owned Australian resident subsidiary have formed a tax consolidated group. Swan Gold is
the head entity of the tax consolidated group.
7. TRADE AND OTHER RECEIVABLES CURRENT
Trade debtors
Security deposits (i)
Other
CONSOLIDATED
2013
$’000
2012
$’000
139
5,196
189
5,524
80
-
102
182
(i) Security deposits are held in a 90 day term deposit that is rolled over at each maturity date. The deposit is not
available for use until the consolidated entity has been released from any rehabilitation obligations in regard to
tenements to which the security deposit relates. During the year the Group applied to the Western Australian
Department of Mines and Petroleum (“DMP”) for the release of the Group’s environmental bonds. The application
was successful and funds were released to the Group subsequent to year end. Accordingly, the Group has
classified the security deposits as current as at 30 June 2013.
At 30 June, the ageing analysis of trade and other receivables is as follows:
2013
Consolidated
2012
Consolidated
* Past due not impaired (PDNI)
** Considered impaired (CI)
Total
0-180 Days
+ 181 Days
PDNI *
+ 181 Days
CI **
328
182
328
182
-
-
-
-
Receivables past due but not considered impaired are nil (2012: nil).
8. RECEIVABLES NON-CURRENT
Security deposits (i)
Sundry receivables – joint venturer (ii)
Allowance for non-recovery
CONSOLIDATED
2013
$’000
2012
$’000
-
6,534
(6,534)
-
5,162
6,534
(6,534)
5,162
36
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
Reconciliation of allowance for non-recovery
Opening balance
Movement in allowance
CONSOLIDATED
2013
$’000
2012
$’000
(6,534)
-
(6,534)
(6,534)
-
(6,534)
(i) Security deposits are held in a 90 day term deposit that is rolled over at each maturity date. The deposit is
not available for use until the consolidated entity has been released from any rehabilitation obligations in regard
to tenements to which the security deposit relates.
(ii) Sundry receivables comprise of debts due from a joint venture partner - Refer to Note 25.
CONSOLIDATED
2013
$’000
2012
$’000
14,116
(5,893)
(5,223)
3,000
-
-
-
3,000
8,152
-
133
(62)
(5,223)
3,000
151
(133)
(18)
-
15,175
(2,884)
(4,139)
8,152
614
(463)
151
8,303
8,704
33
-
(585)
-
8,152
294
-
(143)
151
9. PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment
At cost
Less accumulated depreciation
Less impairment
Plant and equipment – under finance lease
At cost
Less accumulated depreciation
Total property, plant and equipment
Reconciliation
Property, plant and equipment
Carrying amount at beginning of period
Additions
Transfer from Plant and equipment – under finance lease
Depreciation
Impairment
Plant and equipment – under finance lease
Carrying amount at beginning of period
Transfer from Plant and equipment – under finance lease
Depreciation expense
37
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
Impairment of Property, Plant and Equipment
The processing plant is currently held in care and maintenance. During the period the Company obtained a
market valuation report from an independent third party. The report contained an upper, preferred and lower
valuation based on a trade sale. The carrying value of the property, plant and equipment at year end has
been impaired to the lower valuation contained in the report to ensure the carrying value reflects the risk of
pricing uncertainty due to current second hand market conditions and to cover costs to sell.
10. DEFERRED EXPLORATION EXPENDITURE
Cost
Less: accumulated impairment
CONSOLIDATED
2013
$’000
2012
$’000
27,967
(27,967)
-
27,967
(6,468)
21,499
The ultimate recoupment of deferred exploration expenditure carried forward is dependent upon the successful
development and exploitation, or alternatively sale, of the respective areas of interest at an amount greater than
or equal to the carrying value.
Impairment of Deferred Exploration Expenditure
Due to current global equity market conditions, there can be no certainty the Group will be able to obtain funding
to undertake future exploration programmes. The Group has determined that the fair value of the deferred
exploration expenditure is nil as at 30 June 2013 and accordingly an impairment charge of $21.5 million has
been recognised in the statement of comprehensive income for the year ended 30 June 2013.
11. TRADE AND OTHER PAYABLES
CURRENT
Trade payables and accruals
CONSOLIDATED
2013
$’000
2012
$’000
1,648
1,648
314
314
Trade creditors and accruals are non-interest bearing and generally settled on 60 day terms.
38
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
12. LOANS AND BORROWINGS
CURRENT
Non-interest Bearing
Secured loans (i)
Unsecured loan (ii)
Unsecured loan (ii) - Investmet
-
5,250
24,864
30,114
144
11,539
-
11,683
(i) The secured loan is a non-interest bearing working capital loan from the Group Trust, secured by the fixed
and floating charge granted under the Recapitalisation Deed on 26 February 2010.
(ii) $5,000,000 of the unsecured loan is a working capital loan from Stirling Resources Ltd which is non-interest
bearing and will not be recalled until such time as Swan Gold has sufficient working capital. The balance of the
unsecured loan is also a working capital loan from Investmet Limited which has been lent under the same
terms and conditions.
(iii) $24,864,240 represent an unsecured loan from Investmet Limited which is non-interest bearing and
repayable on demand. Accordingly, the loan has been classified as current as at 30 June 2013.
Also, refer to Note 22 relating to unsecured loans by related parties. Refer to note 14 for details of the
unsecured loan.
13. PROVISIONS
CURRENT
Employee benefits
NON-CURRENT
Rehabilitation
Opening balance
Rehabilitation amount provided in current year
Closing balance
27
41
4,148
-
4,148
4,148
-
4,148
The Group makes full provision for the future cost of rehabilitating mine sites and related production facilities on a
discounted basis on the development of mines or installation of those facilities.
The rehabilitation provision represents the present value of rehabilitation costs relating to mine sites. These
provisions have been created based on Swan Gold’s internal estimates. Assumptions, based on the current
economic environment, have been made which management believes are a reasonable basis upon which to
estimate the future liability. These estimates are reviewed regularly to take into account any material changes to the
assumptions. However, actual rehabilitation costs will ultimately depend upon future market prices for necessary
decommissioning works required which will reflect market conditions at the relevant time. Furthermore, the timing of
rehabilitation is likely to depend on when the mines cease to produce at economically viable rates. This, in turn, will
depend upon future gold prices, which are inherently uncertain.
39
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
14. OBLIGATIONS TO CREDITORS TRUSTS
On 14 December 2012 the Amended and Restated Swan Gold Restructure Deed was executed between DCM
DECOmetalGmbH, Investmet Ltd, Swan Gold and Stirling Resources Ltd.
As a result of executing the above deed, Investmet made the following payments:
-
-
-
-
-
-
$10,000,000 to MGMC Pty Ltd (Trustee) as trustee of the Group Trust in consideration for, amongst other
things, the assignment to Investmet of the debt owed to the Trustee of the Group Trust by Swan Gold;
$144,240 to the Trustee of the Group Trust as payment on behalf of Swan Gold to repay in full a loan made
by the Trustee of the Group Trust to Swan Gold;
$6,700,000 to the Trustee of the Territory Trust in consideration for, amongst other things, assigning to
Investmet all of the debt owed by Swan Gold in respect of the Territory Trust;
$1,230,000 to DCM in consideration of DCM discharging or procuring that the Trustee of the Mt Ida Trust
discharges, all security held by the Trustee of the Mt Ida Trust in or over Swan Gold, or any of its
subsidiaries and any of its assets.
$4,200,000 to DCM in order to repay on behalf of Swan Gold, the debt owed by Swan Gold to DCM; and
$2,590,000 to Stirling in consideration of Stirling assigning to Investmet $2,590,000 of debt owed by Swan
Gold to Stirling.
It was also acknowledged that these were the full face value of the debts. As a result of Investmet making the
above payments, Swan Gold owed a total of $24,864,240 to Investmet and $5,000,000 to Stirling and all of Swan
Gold’sobligations to the creditors’ trusts were extinguished.
The obligations to the Creditor’s trusts and Investmet at 30 June 2013 are as follows:
CURRENT
Group Trust
Instalments pursuant to the Recapitalisation
Deed
Additional costs incurred until Completion
Mt Ida Trust
Instalments pursuant to the Recapitalisation
Deed
Territory Trust
Outstanding claim of trust at Completion
Proceeds from disposal of Minjar Gold assets
(Note 24), after interest received and expenses
incurred by the Minjar Gold Creditor’s Trust
40
CONSOLIDATED
2013
$’000
2012
$’000
-
-
-
-
-
-
-
9,628
342
9,970
1,013
22,572
(9,095)
13,477
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
Reconciliation of the Movement in the Creditors Trust and Loans and Borrowings
Obligations to Group Trust
Opening
Amount assigned to Investmet
Debt forgiveness
Closing
Obligations to Mt Ida Trust
Opening
Amount assigned to Investmet
Debt forgiveness
Closing
Obligations to Territory Trust
Opening
Amount assigned to Investmet
Debt forgiveness
Closing
Current - Loans and Borrowings
Opening
Amounts borrowed from DCM during the period
Amount assigned to Investmet
Amounts borrowed from Investmet
Converted to ordinary shares
Debt forgiveness
Closing
Current - Loans and Borrowings
Opening
Amount assigned to Investmet
Closing
9,970
(9,970)
-
-
1,013
(1,013)
-
-
13,477
(6,947)
(6,530)
-
11,683
250
(6,933)
3,250
(3,000)
-
5,250
-
24,864
24,864
41
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
15. CONTRIBUTED EQUITY
(a) Share capital
892,820,993 (2012: 742,820,993) ordinary
fully paid shares
(b) Movements in ordinary share capital
Balance 30 June 2011
Balance 30 June 2012
- Shares issued i)
Balance 30 June 2013
CONSOLIDATED
2013
$’000
2012
$’000
167,666
164,666
Shares
$’000
742,820,993
164,666
742,820,993
164,666
150,000,000
3,000
892,820,993
167,666
i)
During the period Investmet and Swan Gold entered into an interim loan agreement whereby Investmet agreed
to provide Swan Gold with a facility for working capital funding up to approximately $3,000,000. On 15 April
2013 the loan amount of $3,000,000 owing from Swan Gold to Investmet was converted into fully paid ordinary
shares in Swan Gold at a price of $0.02 per share, which resulted in the Company issuing 150,000,000 shares
to Investmet.
Ordinary shares entitle the holder to participate in dividends in proportion to the number of and amounts paid on the
shares held. On a show of hands, every holder of ordinary shares present at a meeting in person or by proxy is entitled
to one vote, and upon a poll each share is entitled to one vote.
Capital Management
When managing capital, management’s objective is to safeguard the entity’s ability to continue as a going concern as
well as to maintain optimum returns to shareholders and benefits to other stakeholders. Management also aims to
maintain a capital structure that ensures the lowest cost of capital available to the entity. In order to sustain these
objectives Management:
• Appointed Voluntary Administrators in July 2008;
• Negotiated the recapitalisation of the Company in February 2010;
• Executed an agreement with global commodity company DCM DECOmetal GmbH (DCM) to acquire Swan Gold’s
subsidiaries that own the Carnegie and Mt Ida gold projects;
• Executed a Restructure Deed with Investmet Limited (Investmet) and DCM which replaced the DCM agreement
with a plan to recapitalise Swan Gold to fund a review into the recommencement of operations at the Carnegie and
Mt Ida gold projects (Refer to note 14).
Capital is comprised of shareholders’ equity as disclosed in the statement of financial position.
In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders,
return capital to shareholders, issue new shares or sell assets to reduce debt.
Management has no current plans to reduce the capital structure through a share buy-back.
The Group is not subject to any externally imposed capital restrictions.
42
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
16. RESERVES
Option premium and share-based payments reserve
CONSOLIDATED
2013
$’000
5,292
2012
$’000
5,292
2013
2012
No
WAEP $
No
WAEP $
Movements in share options
Outstanding at beginning of the
year
Expired
Outstanding at end of the year
-
-
No options over ordinary fully paid shares were outstanding at year end.
115,000,000
0.07
122,633,334
(115,000,000)
0.07
(7,633,334)
115,000,000
0.07
0.40
0.07
Nature and purpose of reserve
The option premium and share-based payment reserve represents the premium paid to the parent entity by option
holders, the value of equity benefits provided to directors, employees as part of their remuneration and the value of
services provided to the Group paid for by the issue of equity.
17. NON-CONTROLLING INTERESTS
Interest in:
Share capital
18. KEY MANAGEMENT PERSONNEL
(a) Compensation of key management personnel
Remuneration by category
Key management personnel
Short-term
Post-employment
CONSOLIDATED
2013
$’000
2012
$’000
42
42
CONSOLIDATED
2013
$
2012
$
13,000
1,170
14,170
239,035
17,846
256,881
43
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
(b) Option holdings of key management personnel (consolidated)
30 June 2013
Directors
Michael Fotios
John Poynton
Craig Readhead
Wayne Zekulich
Damian Delaney
Martin Depisch
Dr
Kornfeld
Peter Farris
Thomas Styblo
Allan Brown
Keith Vuleta
Ian Price
Gerhard
Executives
Linda Paini
Ildiko Wowesny
Balance at
1 July 2012
Granted
as
remuneration
Options
exercised
Net change
other
Balance at
30 June 2013
Balance vested
and exercisable at
30 June 2013
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Other changes during the year include the expiration of options.
During the year ended 30 June 2013 there were no individuals (other than the directors) who were responsible for
the strategic direction and management of the consolidated entity, hence no executives are named above in respect
of this period.
(c) Option holdings of key management personnel (consolidated)
30 June 2012
Directors
Allan Brown
Keith Vuleta
Ian Price
Balance at
1 July 2011
Granted
as
remuneration
Options
exercised
Net change
other
Balance at
30 June 2012
Balance vested
and exercisable at
30 June 2012
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Other changes during the year include allocations of options issued pursuant to the Recapitalisation Deed, effect
upon resignation and expiration of options.
During the year ended 30 June 2012 there were no individuals (other than the directors) who were responsible for
the strategic direction and management of the consolidated entity, hence no executives are named above in respect
of this period.
44
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
(d) Shareholdings of key management personnel (consolidated)
30 June 2013
Directors
Michael Fotios
John Poynton
Craig Readhead
Wayne Zekulich
Damian Delaney
Martin Depisch
Dr Gerhard Kornfeld
Peter Farris
Thomas Styblo
Allan Brown
Keith Vuleta
Ian Price
Executives
Linda Paini
Ildiko Wowesny
30 June 2012
Directors
Allan Brown
Keith Vuleta
Ian Price
Balance at
1 July 2012
On the
exercise of options
Net change other
Balance at
30 June 2013
-
10,000,000
-
-
-
-
-
-
-
-
333,334
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
10,000,000
-
-
-
-
-
-
-
-
333,334
-
-
Balance at
1 July 2011
On the
exercise of options
Net change other
Balance at
30 June 2012
-
333,334
-
-
-
-
-
-
-
-
333,334
-
Other changes during the year include allocations of shares issued pursuant to the Recapitalisation Deed and effect
upon resignation.
Except for equity issued as part of remuneration, all equity transactions with key management personnel have been
entered into under terms and conditions no more favourable than those the consolidated entity would have adopted if
dealing at arm’s length.
(e) Loans to key management personnel
There were no loans to key management personnel during the financial year.
(f) Other transactions with directors
Transactions during the year between the consolidated entity and directors or their director-related entities are
set out in Note 22.
19. REMUNERATION OF AUDITORS
Amounts paid or due and payable to the auditors for:
Auditing and reviewing the financial reports
Taxation advisory services
CONSOLIDATED
2013
$
2012
$
30,000
-
30,000
63,364
30,196
93,560
45
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
20. EXPENDITURE COMMITMENTS
(b) Capital expenditure commitments
Under the terms of mineral tenement licences held by the consolidated entity, minimum annual expenditure
obligations of $4,120,263 (2012: $4,278,228) may be required to be expended during the forthcoming financial
year in order for the tenements to maintain a status of good standing. This expenditure may be incurred by the
consolidated entity or its joint venture partners and may be subject to variation from time to time in accordance
with Department of Industry and Resources regulations.
21. SEGMENT INFORMATION
The Group has identified its segments based on the internal management reporting that is used by the executive
management team in assessing performance and allocating resources. Segments have been identified as the
ongoing care and maintenance and mine development work segment and exploration segment. The Group operates
in one geographical segment – Australia.
The accounting policies used by the Group in reporting segment information internally, is the same as those contained
in Note 2 to the financial statements.
The following items and associated assets and liabilities are not allocated to operating segments as management do
not consider these to be part of the core operations of both segments:
Impairment of assets
(i)
(j) Corporate assets and liabilities
(k) Administrative expenses.
46
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
Segments
Mine Under
Care and
Maintenance
Exploration
Consolidated
Year ended 30 June 2013
$’000
$’000
$’000
Segment revenue
Segment loss
Impairment of property, plant & equipment
Write-off of capitalised exploration expenditure
Gain on loan forgiveness
Other unallocated corporate costs
Total loss
Segment assets
Other unallocated assets
Total assets
Segment liabilities
Other unallocated liabilities
Total liabilities
Included within segment loss:
Interest expense
Interest revenue
Unallocated interest expense
Additions to non-current assets
32
(2,226)
-
-
-
-
7,294
-
(4,595)
-
-
(22)
32
-
42
(1,195)
-
-
-
-
1,149
-
(356)
-
-
(29)
42
-
* Corporate segment liabilities include the following amounts:
- $872,000 Provisions and trade and other payables
- $5,000,000 Loan from Stirling Resources Ltd
- $250,000 Loan from Investmet Ltd (Current)
- $24,864,000 Loan from Investmet Ltd (Non-current)
74
(3,421)
(5,223)
(21,499)
6,530
(1,274)
24,887
8,443
393
8,836
(4,951)
*(30,986)
(35,937)
(51)
74
(18)
-
47
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
Segments
Year ended 30 June 2012
Segment revenue
Unallocated revenue
Total revenue
Segment profit/(loss)
Other unallocated corporate costs
Total loss
Segment Assets
Other unallocated assets
Total assets
Segment Liabilities
Other unallocated liabilities
Total liabilities
Included within segment loss:
Interest expense
Interest revenue
Unallocated interest expense
Unallocated interest revenue
Additions to non-current assets
Mine Under Care
and Maintenance
$’000
Exploration
Consolidated
$’000
$’000
49
-
(1,531)
-
12,414
-
(4,188)
-
(37)
50
33
68
-
(1,649)
-
22,646
-
(49)
-
(26)
68
-
117
7
124
(3,180)
(1,233)
(4,413)
35,060
371
35,431
(4,237)
*(36,409)
(40,646)
(63)
118
(12)
6
33
* Corporate segment liabilities include the following amounts:
- $333,000 Provision and trade and other payables
- $9,970,000 Obligations to Group Trust
- $1,013,000 Obligation to Mt Ida Trust
- $13,477,000 Obligation to Territory Trust
- $7,589,000 Loan from Stirling Resources Ltd
- $3,950,000 Loan from DCM Decometal
48
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
22. RELATED PARTIES
(a) Transactions with related parties
i. During the period management fees totalling $119,830 (2012: $23,411) were charged by Stirling Resources Ltd.
The management fees were charged for services and facilities provided by Stirling Resources Ltd, based upon
an agreed monthly rate.
ii. During the period Investmet and Swan Gold entered into an interim loan agreement whereby Investmet agreed
and did provide Swan Gold with a facility for working capital funding. During the period Swan Gold drew down
$3,250,000 of the loan. On 15 April 2013 $3,000,000 owing from Swan Gold to Investmet was converted into
fully paid ordinary shares in Swan Gold at a price of $0.02 per share, which resulted in the Company issuing
150,000,000 shares to Investmet. At 30 June 2013 Swan Gold owed to Investment $250,000.
iii. On 14 March 2013 the Company announced that it had executed agreements to revise the terms of the Swan
Gold Restructure Deed (“Transactions”), to allow for the early debt purchase by Investmet of certain debts
owed by Swan Gold to Stirling, DCM and MGMC Pty Ltd (as trustee for the Group Trust and Territory
Trust)(“MGMC”).
Pursuant to the early debt purchase, the following payments were made by Investmet:
-
$10,000,000 to MGMC Pty Ltd (Trustee) as trustee of the Group Trust in consideration for, amongst other
things, the assignment to Investmet of the debt owed to the Trustee of the Group Trust by Swan Gold;
$144,240 to the Trustee of the Group Trust as payment on behalf of Swan to repay in full a loan made by the
Trustee of the Group Trust to Swan Gold;
$6,700,000 to the Trustee of the Territory Trust in consideration for, amongst other things, assigning to
Investmet all of the debt owed by Swan Gold in respect of the Territory Trust;
$1,230,000 to DCM in consideration of DCM discharging or procuring that the Trustee of the Mt Ida Trust
discharges, all security held by the Trustee of the Mt Ida Trust in or over Swan Gold, or any of its subsidiaries
and any of its assets.
$4,200,000 to DCM in order to repay on behalf of Swan Gold, the debt owed by Swan to DCM; and
$2,590,000 to Stirling in consideration of Stirling assigning to Investmet $2,590,000 of debt owed by Swan to
Stirling.
-
-
-
-
-
As a result of Investmet making the above payments, Swan Gold owed a total of $24,864,240 to Investmet and
$5,000,000 to Stirling.
Other transactions with directors and specified executives are set out in Note 18.
49
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
23. FINANCIAL INSTRUMENTS
(a) Financial Risk Management Policies and Objectives
The consolidated entity’s principal financial instruments are cash and short term deposits and loans. The main
purpose of these financial instruments is to provide working capital and raise finance for the consolidated entity’s
operations. The consolidated entity has various other financial assets and liabilities such as receivables and trade
payables, which arise directly from its operations. The main risks arising from the consolidated entity’s financial
instruments are interest rate risk and credit risk. The Board reviews and agrees policies for managing each of
these risks.
The Group’s activities expose it to a variety of financial risks: market risk (including commodity risk), credit risk,
liquidity risk, and interest rate risk. The Group’s overall risk management program focuses on the
unpredictability of financial markets and seeks to minimise potential adverse effects on financial performance
without limiting the Group’s potential upside.
The Group uses different methods to measure and manage different types of risks to which it is exposed. These
include monitoring levels of exposure to gold price risk and assessments of market forecasts for gold prices.
Liquidity risk is measured through the development of rolling future cash flow forecasts at various gold prices.
Risk management is carried out by executive management with guidance from the Audit Committee under
policies approved by the Board. The Board also monitors risk regularly at Board meetings and provides
guidance where necessary for overall risk management, including guidance on specific areas, such as
mitigating commodity price, interest rate and credit risks where applicable.
Primary responsibility for identification and control of financial risks rests with the Board. The Board reviews and
agrees policies for managing each of the risks identified below, including the setting of limits for any hedging
coverage of gold, credit allowances, and future cash flow forecast projections.
(b) Net Fair Values
The carrying amounts of financial assets and financial liabilities recorded in the financial statements represent
their respective amortised costs net of impairment. As at 30 June 2013 the fair value of the Groups financial
assets and financial liabilities approximate their carrying value.
(c) Credit Risk
Credit risk relates to the risk that a counter party will default on its contractual obligations resulting in financial
loss to the consolidated entity. The exposure of the consolidated entity to credit risk at balance date in relation
to each class of recognised financial asset is the carrying amount of the assets as indicated in the statement of
financial position.
Credit risk represents the loss that would be recognised if counterparties failed to perform as contracted. The
Group’s maximum exposure to credit risk at reporting date in relation to each class of financial asset is the
carrying amount of those assets as indicated in the Statement of Financial Position.
In relation to managing potential credit risk exposures, the Group has in place policies that aim to ensure that
cash transactions are limited to high credit quality financial institutions and that the amount of credit exposure to
any one financial institution is limited as far as is considered commercially appropriate.
(d) Interest Rate Risk
The Group’s exposure to the risk of changes in market interest rates is minimal and relates primarily to finance
leases with fixed rates of interest.
Interest rate risk represents the risk that the value of a financial instrument will fluctuate as a result of changes
in market interest rates. The exposure of the consolidated entity to interest rate risk and the effective weighted
average interest rate for classes of financial assets and liabilities is set out below.
50
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
CONSOLIDATED
30 June 2013
$’000
30 June 2012
$’000
Financial assets
Floating rate
Cash
Security deposits
Fixed rate
Sundry receivables
Financial assets
Floating rate
Cash
Security deposits
Fixed rate
Sundry receivables
236
5,196
-
Total
5,432
Total
Financial liabilities
Fixed rate
Finance lease liability
Unsecured loans
Floating rate
Unsecured loans
Total
Financial liabilities
Fixed rate
Finance lease liability
Unsecured loans
Floating rate
Unsecured loans
Total
-
-
-
-
259
5,162
-
5,421
-
-
-
-
The Group’s policy is to manage its exposure to interest rate risk by holding cash on short term, fixed rate deposits
and variable rate deposits with reputable high credit quality financial institutions.
The Group constantly analyses its interest rate exposure. Consideration is given to potential renewals of existing
positions, alternative financing and the mix of fixed and variable interest rates.
51
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
(e) Sensitivity Analysis
The following tables summaries the sensitivity of the Group’s financial assets and liabilities to interest rate
risk. Had the relevant variables, as illustrated in the tables, moved, with all other variables held constant, post
tax profit and equity would have been affected as shown. The analysis has been performed on the same
basis for 2013 and 2012.
CONSOLIDATED
Interest rate risk
-1% (i)
Interest rate risk
+1% (i)
Interest rate risk
-1% (i)
Interest rate risk
+1% (i)
30 June 2013
30 June 2012
Profit
$'000
Equity
$'000
Profit
$'000
Equity
$'000
Profit
$'000
Equity
$'000
Profit
$'000
Equity
$'000
Financial assets
Cash
Security deposits
Financial
liabilities
Unsecured loans
Total
increase/(decreas
e)
(2)
(52)
(54)
-
-
-
2
52
-
-
(3)
(52)
-
54
0
(55)
-
-
-
-
3
52
-
55
-
-
-
-
The rate of 1% applied in the above analysis for 2013 and 2012 is based on management’s expected
movement for the interest rate over the next financial year.
(g) Liquidity risk
The Group’s objective is to maintain a balance between continuity of funding and flexibility through the use of
loans and other available lines of credit. The Group manages liquidity risk by monitoring forecast cash flows.
The table below reflects all contractually fixed pay-offs and receivables for settlement, repayments and
interest resulting from recognised financial assets and liabilities as of 30 June 2013. Cash flows for financial
assets and liabilities without fixed amount or timing are based on the conditions existing at 30 June 2013.
Subsequent to 30 June 2013, the consolidated entity continued to meet their commitments with funds provided
by Investmet Limited (Investmet) whereby Investmet plans to recapitalise Swan Gold to fund a review into the
recommencement of operations at the Carnegie and Mt Ida gold projects.
Maturity analysis of financial assets and liabilities based on management’s expectations
Trade payables and other financial liabilities mainly originate from the financing of assets used in our ongoing
operations. These assets are considered in the Group’s overall liquidity risk. To monitor existing financial assets
and liabilities as well as to enable an effective controlling of future risks, the Company has established
comprehensive risk reporting covering its business that reflects expectations of management of expected
settlement of financial assets and liabilities.
52
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
(g) Liquidity risk (continued)
CONSOLIDATED
30 June 2013
Financial assets
Trade and other receivables
Financial liabilities
Trade and other payables
Non- interest bearing loans &
borrowings - Current
Loan from Stirling Resources
Ltd
Loan from Invesmet Ltd
Loan from Investmet Ltd
CONSOLIDATED
30 June 2012
Financial assets
Trade and other receivables
Financial liabilities
Trade and other payables
Non-interest bearing loans &
borrowings - Current
Loan from Group Trust
Loan from Stirling Resources Ltd
Loan from DCM DECOmetal GMBH
< 6
months
$’000
6 - 12
months
$’000
1 - 5
years
$’000
>5
years
$’000
Total
$’000
-
-
(1,648)
-
-
-
-
-
-
(5,000)
(250)
(24,864)
(1648)
(30,114)
5,196
5,196
-
-
-
-
-
-
-
(314)
-
-
-
-
-
-
(144)
(7,589)
(3,950)
5,162
5,162
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
5,196
5,196
(1,648)
(5,000)
(250)
(24,864)
(31,762)
(26,566)
Total
5,162
5,162
(314)
(144)
(7,589)
(3,950)
(9,970)
(1,013)
(13,477)
(36,457)
(31,295)
Net Maturity
(1,648)
(30,114)
5,196
< 6
months
6 - 12
months
1 - 5
years
>5
years
Obligations to the Group Trust
Obligations to the Mt Ida Trust
Obligations to the Territory Trust
(9,970)
(1,013)
(13,477)
-
-
-
(24,774)
(11,683)
Net Maturity
(24,774)
(11,683)
5,162
53
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
24. INVESTMENTS IN CONTROLLED ENTITIES
Name of entity
Monarch Nickel Pty Ltd
Monarch Gold Pty Ltd
Carnegie Gold Pty Ltd
Siberia Mining Corporation Pty Ltd
Mt Ida Gold Pty Ltd
Country of
incorporation
Class
of shares
Australia
Australia
Australia
Australia
Australia
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Controlled entities of Siberia Mining Corporation Pty Ltd
Ida Gold Operations Pty Ltd
Pilbara Metals Pty Ltd
Siberia Gold Operations Pty Ltd
Australia
Australia
Australia
Ordinary
Ordinary
Ordinary
Equity holding
2013
100
80
100
100
100
100
100
100
2012
100
80
100
100
100
100
100
100
25. INTERESTS IN JOINTLY CONTROLLED ASSETS
The consolidated entity entered into a joint arrangement with Kingsday Holdings Pty Ltd for the operation of the Mt
Ida Excluded Area joint venture. Under the agreement Swan Gold retains a 70% interest in the asset. The
consolidated entity contributes 100% of the funding of the joint venture with the other participant’s share repayable
from the gold production of the asset. Swan Gold will be paid interest on the funds used and in relation to the other
participant’s share of costs at a rate of 30% per annum during periods where mining operations are accruing on the
Mt Ida Excluded Area. The face value of the amount receivable as at 30 June 2013 is $6,534,000 with an
applicable notional interest rate of 30%, subject to an interest free period of 20 months when Swan Gold had yet to
recommence mining operations. This balance continues to be fully impaired as at 30 June 2013 as the recovery of
this balance is dependent on gold production and remains uncertain. There are no assets employed by the joint
venture and the Group’s expenditure in respect of the joint venture is brought to account initially as exploration and
evaluation through profit and loss.
The joint venture has no contingent liabilities or capital commitments.
26. CONTINGENT LIABILITIES
There were no contingent liabilities identified as at 30 June 2013.
54
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
27. CASH FLOW STATEMENT
a) Reconciliation of cash
Cash balances comprise:
Cash at bank
For the purpose of the cash flow statement, cash and cash equivalents
consist of cash and cash equivalents as defined above, net of outstanding
bank overdrafts.
b) Reconciliation of net cash outflow from operating activities to
loss after income tax
Loss after income tax
Adjusted for non- cash items
Depreciation
Historic exploration expenditure written off
Forgiveness of Creditors Trust obligations
Impairment of property, plant and equipment
Changes in operating assets and liabilities
(Increase)/decrease in receivables
Increase/(decrease) in payables
(Increase)/decrease of prepayments
Increase/(decrease) of provisions
(Increase)/decrease of inventory
CONSOLIDATED
2013
$’000
2012
$’000
236
259
(24,887)
(4,413)
81
21,499
(6,529)
(5,223)
(146)
1,334
(12)
(14)
(38)
728
-
-
-
(50)
(617)
163
10
(26)
Net cash outflow from operating activities
(3,489)
(4,205)
Payments to suppliers and employees include creditors held in the creditors’ trust. These payments include a
mix of operating and financing creditors which could not be separated and have been included in operating
cash flows.
Non-cash financing and investing activities
During the prior year the consolidated entity entered into non-cash financing and investing transactions which
are not reflected in the statement of cash flows. These related to the recapitalisation of the Group. Refer to
Note 15.
55
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
CONSOLIDATED
2013
$’000
2012
$’000
28. EARNINGS PER SHARE
Loss used in the calculation of basic earnings per share
24,887
4,413
Weighted average number of ordinary shares on issue used in the calculation of
basic earnings per share
Effect of dilution:
Share options
Number
Number
777,361,209
742,820,993
nil
nil
Weighted average number of ordinary shares on issue adjusted for the effect of
dilution
777,361,209
742,820,993
There were no options on issue at balance date.
There were no other movements in ordinary shares and options which occurred subsequent to balance date.
29. SUBSEQUENT EVENTS
Lady Bountiful Settlement
On 14 November 2013 Swan Gold’swholly owned subsidiary Carnegie Gold Pty Ltd (“Carnegie”) reached an
agreement to relinquish its right to explore and mine tenement M24/862 (Lady Bountiful) with Norton Gold Fields
Limited (“Norton”), Paddington Gold Pty Ltd (“Paddington”) and Neil Edward Newman. Per the agreement, Carnegie
removed the caveat currently registered on M24/862 and consented to the dismissal of the action currently before
the Wardens Court in return for net proceeds of $1.4 million from Norton. The current agreement between Carnegie
and Neil Edward Newman for the rights to explore and mine M24/862 will cease upon completion.
Mining Rehabilitation Fund
Swan Gold successfully applied to the Western Australian Department of Mines and Petroleum (“DMP”) for the
Mining Rehabilitation Fund (“MRF”) which saw the retirement of the Company’s Environmental Bonds (‘Bonds”). The
DMP has to the date of this report approved the retirement of all performance bonds totalling $5.2 million after a total
levy fee of $251,000. The levy was calculated by the DMP and is based on 1% disturbance of the environment.
Withdrawal of Prospectus
Swan Gold advises that its placement to sophisticated and professional investors to raise a minimum of $15 million
and a maximum of up to $17.5 million pursuant to the prospectus dated 13 February 2013 and supplementary
prospectus dated 27 March 2013 (Offer) has been withdrawn. As referred to in its announcement on 13 May 2013,
the Company had sought to extend the closing date of the Offer, subject to ASIC and ASX relief being granted.
On 28 May 2013, the Company was notified by ASIC the application for relief to extend the placement closing date
was refused. Accordingly, as neither the minimum subscription condition of $15 million, nor the 3 month quotation
condition of the Offer were met, as required by the Corporations Act 2001 (Cth) (Corporations Act), the Offer has
been withdrawn. No shares were allotted nor issued pursuant to the Offer and all application monies received have
been refunded by the Company to all of the applicants, in accordance with the terms of the Offer and the
Corporations Act. The Company is at present considering its options moving forward and will provide an update as
soon as additional information is available.
The ability of the Group to maintain tenure to its tenements is dependent upon it continuing to meet the minimum
expenditures on the tenements or obtaining exemptions for tenements in which the minimum expenditures have not
been met.
In the opinion of the directors there is no additional information available as at the date of this report on any likely
developments which may materially affect the operations of the consolidated entity and the expected results of those
operations in subsequent years.
56
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
NOTES TO THE FINANCIAL STATEMENTS
30. PARENT ENTITY INFORMATION
(a) Financial Position
Assets
Current assets
Non-current assets
Total assets
Liabilities
Current liabilities
Non- Current liabilities
Total liabilities
Equity/(Deficit)
Contributed equity
Accumulated losses
Reserves
Total equity/(deficit)
(b) Financial performance
Profit/(Loss) for the year
Other comprehensive income
Total loss for the year
2013
$’000
2012
$’000
392
27,163
27,555
6,122
24,864
30,986
243
30,911
31,154
36,410
-
36,410
167,666
(176,389)
5,292
(3,431)
164,666
(175,214)
5,292
(5,256)
(1,175)
-
(1,175)
(1,233)
-
(1,233)
Guarantees
Swan Gold and its subsidiaries have entered into a Deed of Cross Guarantee. The effect of the deed is that Swan Gold
has guaranteed to pay any deficiency in the event of winding up of any controlled entity or if they do not meet their
obligations under the terms of loans, leases or other liabilities subject to the guarantee. The controlled entities have
also given a similar guarantee in the event that Swan Gold is wound up or if it does not meet its obligations under the
terms of loans, leases or other liabilities subject to the guarantee.
Tax consolidation
For the purposes of income taxation, Swan Gold and its 100% owned subsidiaries have formed a tax consolidated
group. Swan Gold is the head entity of the tax consolidated group.
(i) Members of the tax consolidated group and the tax sharing agreement
Swan Gold and its 100% owned Australian resident subsidiaries formed a tax consolidated group with effect
from 1 July 2002. Swan Gold is the head entity of the tax consolidated group. Members of The Group have
entered into a tax sharing agreement that provides for the allocation of income tax liabilities between the
entities should the head entity default on its tax payment obligations. No amounts have been recognised in the
financial statements in respect of this agreement on the basis that the possibility of default is remote.
(ii) Tax effect accounting by members of the tax consolidated group.
The head entity and the controlled entities in the tax consolidated group continue to account for their own
current and deferred tax amounts. The Group has applied The Group allocation approach in determining the
appropriate amount of current taxes and deferred taxes to allocate to members of the tax consolidated group.
The current and deferred tax amounts are measured in a systematic manner that is consistent with the broad
principles in AASB 112 Income Taxes.
57
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
DIRECTORS’ DECLARATION
In accordance with a resolution of the directors of Swan Gold Mining Limited, I state that:
1. In the opinion of the directors:
a. The financial statements, notes and the additional disclosures included in the directors’ report designed as
audited, of the consolidated entity are in accordance with the Corporations Act 2001, including:
i. Giving a true and fair view of the consolidated entity’s financial position as at 30 June 2013 and of its
performance for the year ended on that date.
ii. Complying with Accounting Standards (including the Australian Accounting Interpretations) and
Corporations Regulations 2001.
b. The financial statements and notes also comply with International Financial Reporting Standards as
disclosed in Note 2(b).
c. Subject to the matters disclosed in Note 2(d), there are reasonable grounds to believe that the Company will
be able to pay its debts as and when they become due and payable.
2. 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 ended 30 June 2013.
On behalf of the board
Michael Fotios
Director
Perth, Western Australia
1 April 2014
58
Ernst & Young
11 Mounts Bay Road
Perth WA 6000 Australia
GPO Box M939 Perth WA 6843
Tel: +61 8 9429 2222
Fax: +61 8 9429 2436
ey.com/au
Independent auditor's report to the members of Swan Gold Mining Limited
Report on the financial report
We have audited the accompanying financial report of Swan Gold Mining Limited, which comprises the
consolidated statement of financial position as at 30 June 2013, the consolidated statement of
comprehensive income, the consolidated statement of changes in equity and the consolidated statement of
cash flows for the year then ended, notes comprising a summary of significant accounting policies and other
explanatory information, and the directors' declaration of the consolidated entity comprising the company
and the entities it controlled at the year's end or from time to time during the financial year.
Directors' responsibility for the financial report
The directors of the company are responsible for the preparation of the financial report that gives a true and
fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such
internal controls as the directors determine are necessary to enable the preparation of the financial report
that is free from material misstatement, whether due to fraud or error. In Note 2, the directors also state, in
accordance with Accounting Standard AASB 101 Presentation of Financial Statements, that the financial
statements comply with International Financial Reporting Standards.
Auditor's responsibility
Our responsibility is to express an opinion on the financial report based on our audit. We conducted our audit
in accordance with Australian Auditing Standards. Those standards require that we comply with relevant
ethical requirements relating to audit engagements and plan and perform the audit to obtain reasonable
assurance about whether the financial report is free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
financial report. The procedures selected depend on the auditor's judgment, including the assessment of the
risks of material misstatement of the financial report, whether due to fraud or error. In making those risk
assessments, the auditor considers internal controls relevant to the entity's preparation and fair presentation
of the financial report in order to design audit procedures that are appropriate in the circumstances, but not
for the purpose of expressing an opinion on the effectiveness of the entity's internal controls. An audit also
includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting
estimates made by the directors, as well as evaluating the overall presentation of the financial report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
qualified audit opinion.
Independence
In conducting our audit we have complied with the independence requirements of the Corporations Act 2001.
We have given to the directors of the company a written Auditor’s Independence Declaration, a copy of which
is included in the directors’ report.
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
GHM:MNM:SWAN:004
Opinion
In our opinion:
a.
the financial report of Swan Gold Mining Limited is in accordance with the Corporations Act 2001,
including:
i
ii
giving a true and fair view of the consolidated entity's financial position as at 30 June 2013 and
of its performance for the year ended on that date; and
complying with Australian Accounting Standards and the Corporations Regulations 2001; and
b.
the financial report also complies with International Financial Reporting Standards as disclosed in
Note 2.
Emphasis of Matter
Without qualifying our audit opinion, we draw attention to Note 2 (d) which describes the principal conditions
that raise doubt about the consolidated entity’s ability to continue as a going concern. These conditions
indicate the existence of a material uncertainty that may cast significant doubt about the consolidated
entity’s ability to continue as a going concern and therefore, the consolidated entity may be unable to realise
its assets and discharge its liabilities in the normal course of business.
Report on the remuneration report
We have audited the Remuneration Report included within the directors' report for the year ended 30 June
2013. The directors of the company are responsible for the preparation and presentation of the
Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to
express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian
Auditing Standards.
Opinion
In our opinion, the Remuneration Report of Swan Gold Mining Limited for the year ended 30 June 2013,
complies with section 300A of the Corporations Act 2001.
Ernst & Young
G H Meyerowitz
Partner
Perth
1 April 2014
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
GHM:MNM:SWAN:004
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
CORPORATE GOVERNANCE STATEMENT
The Board of Directors of Swan Gold is responsible for the establishment of a corporate governance framework that
has regard to the best practice recommendations set by the ASX Corporate Governance Council. Swan Gold’s
objective is to achieve best practice in corporate governance, having due regard to the practicality of implementation
of the best practice recommendations given the current nature and scale of the Company’s activities, and the
Company’s Board, senior executives and employees are committed to achieving this objective.
This statement summarises the corporate governance practices that have been adopted by the Board and reports on
an “if not, why not” basis those recommendations the Company has opted not to follow. In addition to the information
contained in this statement, the Company’s website at www.swangoldmining.com.au contains additional details of its
corporate governance procedures and practices.
These practices, unless otherwise stated, were in place for the entire financial year.
Board of Directors
The Board is responsible for guiding and monitoring the Company on behalf of shareholders by whom they are
elected and to whom they are accountable. The Board’s primary responsibility is to oversee the Company’s business
activities and management for the benefit of shareholders. Day to day management of the Company’s affairs and the
implementation of corporate strategies and policy initiatives are formally delegated by the Board to the Executive
Director and senior executives, as set out in the Company’s Board charter.
Board composition
The Board charter states that:
•
•
•
the Board is to comprise an appropriate mix of both executive and non-executive directors.
the roles of Chairman and Executive Director are not combined.
the Chairman is elected by the full Board and is required to meet regularly with the Executive Director.
Board members should possess complementary business disciplines and experience aligned with the Company’s
objectives, with a number of directors being independent and where appropriate, major shareholders and executives
are being represented on the Board. Consequently, at various times there may not be a majority of directors
classified as being independent, according to ASX guidelines. However, where any director has a material personal
interest in a matter, the director will not be permitted to be present during discussions or to vote on the matter.
Directors’ independence
Having regard to the share ownership structure of the Company, it is considered appropriate by the Board that a
major shareholder may be represented on the Board. Mr Michael Fotios is a nominee Director of Investmet Limited,
who has signed the Restructure Deed and Amended Restructure Deed for the proposed restructure and
recapitalisation of the Company. Such appointment would not be deemed to be independent under ASX guidelines,
however, the Company considers this satisfactory in the Company’s current position, pending restructure and
recapitalisation.
The Chairman is expected to bring independent thought and judgement to his role in all circumstances. Where
matters arise in which there is a perceived conflict of interest, the Chairman must declare his interest and abstain
from any consideration or voting on the relevant matter.
The Board has adopted ASX recommended principles in relation to the assessment of directors’ independence.
Financial materiality thresholds used in the assessment of independence are set at 10% of the annual gross
expenditure of the Company and/or 25% of the annual income or business turnover of the Company.
Board performance review
The Board has adopted a formal process for an annual self assessment of its collective performance and the
performance of individual directors. The Board is required to meet annually with the purpose of reviewing the role of
the Board, assessing its performance over the previous 12 months and examining ways in which the Board can better
perform its duties. Due to changes in the composition of the Board during the period, no formal assessment was
undertaken during the year ended 30 June 2013. It is anticipated this review will take place following completion of
the restructure and recapitalisation process.
61
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
CORPORATE GOVERNANCE STATEMENT
Trading in Company securities by directors, officers and employees
Trading of shares is covered by, amongst other things, the Corporations Act and the ASX Listing Rules. The Board
has established a Securities Trading Policy that establishes strict guidelines as to when a Director, officer or an
employee can deal in Company securities. The policy prohibits trading in the Company’s securities whilst the
Director, officer or employee is in the possession of price sensitive information or the Company is in a closed period,
as defined.
The Company prohibits Directors and employees from entering into transactions in associated products which limit
the economic risk of participating in the unvested entitlements under any equity based remuneration schemes.
For details of shares held by Directors please refer to the Directors’ Report in these Financial Statements.
The Company’s Securities Trading Policy can be found on the Company’s website.
Independent advice
A director is free to seek independent professional advice at the Company’s expense concerning any aspect of his
duties about which he feels obliged. There have been no instances of this recently.
General risk management
The Company conducts a regular annual review of its insurance requirements, coupled with implementation of
insurance from time to time to cover specific projects or specific locations.
Shareholder communication
The board aims to ensure that shareholders and investors have equal access to the Company’s information. The
Company has policies and procedures designed to ensure compliance with ASX Listing Rules. This disclosure policy
includes identification and recognition of matters which may have a material effect on the price of the Company’s
shares and notifying them to ASX. The Company also has in place a strategy to disseminate information to
shareholders and encourage effective participation at shareholder meetings, as well as to communicate material to
regulatory authorities and the broader community.
Review of corporate governance
The Board has reviewed its current practices in light of the ASX Principles, with a view to making amendments where
applicable, after taking into account the Company’s size and the resources it has available. As the Company’s
activities develop, further consideration will be given to increasing the size of the Board and the implementation of
additional governance committees.
Diversity
The Company has established a Diversity Policy having regard to the suggestions set out in the ASX Principles. The
Diversity Policy covers gender, age, ethnicity and cultural background. It includes a requirement that the Board
establish measurable objectives for achieving gender diversity, with progress in achieving these objectives assessed
annually by the Board. Due to the current nature and scale of the Company’s activities, the Board has not established
measurable objectives for achieving gender diversity but will review this position on a regular basis going forward. At
the date of this report the company has 8 employees and 1 employee is a woman. There are no female Directors on
the Board.
62
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
CORPORATE GOVERNANCE STATEMENT
ASX Best Practice Recommendations
The table below identifies the ASX Best Practice Recommendations and whether or not the Company has complied
with the recommendations during the reporting period:
Principle
Action taken and reasons if not
adopted
1.1
1.2
1.3
2.1
2.2
2.3
2.4
2.5
2.6
Principle 1: Lay solid foundation for management and oversight
Formalise and disclose the functions reserved to the Board and
those delegated to management
Disclose the process for evaluating the performance of directors
Provide the information indicated in the Guide to reporting on
Principle 1
Adopted
Principle 2: Structure the Board to add value
A majority of the Board should be independent
The chairperson should be an independent director
The roles of chairperson and chief executive officer should not be
exercised by the same individual
The Board should establish a nomination committee
Disclose the process for evaluating the performance of the Board, its
committees and individual directors
Provide the information indicated in Guide to reporting on Principle 2
Adopted except:
of whom
2
independent.
2.1 The Company comprises 4
are
directors,
The
considered
Company intends to revisit Director
independence following completion
of the proposed restructure and
recapitalisation as announced on 3
May 2012.
that
2.2 The current Chairman is Mr
Michael Fotios who
not
is
independent.
considered
the current
Notwithstanding
Chairman does not meet
the
requirements of ASX Principle 2.2,
the Board considers
the
current Chairman possesses an
appropriate level of expertise and
can make quality judgements in the
best interest of the Company on all
relevant issues.
that
the
justify
2.4. The Board considers that the
Company is not currently of a size
to
formation of a
Nomination Committee. The Board
as a whole undertakes the process
of reviewing the skill base and
experience of existing Directors to
enable identification or attributes
required in new Directors.
3.1
3.1.1
3.1.2
3.1.3
3.2
3.3
Principle 3: Promote ethical and responsible decision making
Establish a code of conduct to and disclose the code or a summary
of the code as to:
the practices necessary to maintain confidence in the Company’s
integrity
the practices necessary to take into account their legal obligations
and reasonable expectations of their stakeholders
The responsibility and accountability of individuals for reporting and
investigating reports of unethical practices
Companies should establish a policy concerning trading in the
Company’s securities by directors, officers and employees.
Companies should establish a policy concerning diversity and
disclose the policy or a summary of that policy. The policy should
include requirements for the Board to establish measureable
63
Adopted except:
3.3 While the company has
established a Diversity Policy as
recommended, due to the current
nature and scale of the Company’s
activities, the Company has not
established the measureable
objectives and has therefore
reported on progress on achieving
these objectives.
3.5 Due to its nature the Board has
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
CORPORATE GOVERNANCE STATEMENT
3.4
3.5
4.1
4.2
objectives for achieving gender diversity and for the Board to assess
annually both the objectives and progress in achieving them.
Companies should disclose in each annual report the proportion of
women employees in the whole organisation, women in senior
executive positions and women on the board.
Provide the information indicated in Guide to Reporting on Principle 3
Principle 4: Safeguard integrity in financial reporting
The Board should establish an Audit Committee
Structure the audit committee so that it consists of:
• Only non-executive directors
• A majority of independent directors
• An independent chairperson who is not the chairperson of
the Board
• At least three members
4.3
4.4
The audit committee should have a formal operating charter
Provide the information indicated in Guide to reporting on Principle 4
Principle 5: Make timely and balanced disclosure
Establish written policies and procedures designed
to ensure
compliance with ASX Listing Rule disclosure requirements and to
that
ensure accountability at a senior management
compliance
Provide the information indicated in the ‘Guide to reporting on
Principle 5
level
for
not yet set measureable objectives,
or reported progress against those
objectives.
Not Adopted:
4.1. The Board considers that the
Company is not of a size, nor are
its
such
complexity to justify the formation
of an Audit Committee.
financial affairs of
The Board as a whole undertakes
the selection and proper application
of accounting policies, the integrity
of
the
identification and management of
risk and review of the operation of
the internal control systems.
reporting,
financial
When the Company has grown to a
sufficient size to warrant it, the
Board intends to establish an Audit
Committee to assist the Board in
monitoring and
reviewing any
matters of significance affecting
financial reporting and compliance.
Adopted
Principle 6: Respect the rights of shareholders
Design and disclose a communications strategy to promote effective
communication with shareholders and encourage effective
participation at general meetings
Provide the information indicated in Guide to reporting on Principle 6
Adopted
Principle 7: Recognize and manage risk
Establish and disclose policies for the oversight and management of
material business risks
The Board should require management to design and implement the
risk management and internal control system to manage the
company’s material business risks and report to it on whether those
risks are being managed effectively.
The Board should disclose whether it has received assurance from
the chief executive officer (or equivalent) and the chief financial
officer (or equivalent) that the declaration provided in accordance
with section 295A of the Corporations Act 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.
64
Adopted except:
7.3 While the executives assess,
analyse and report to the Board on
risk, the Board is yet to establish a
formal
risk management and
reporting policy
5.1
5.2
6.1
6.2
7.1
7.2
7.3
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
CORPORATE GOVERNANCE STATEMENT
Principle 8: Encourage enhanced performance
8.1
8.2
8.3
8.4
The Board should establish a Remuneration Committee
The Remuneration Committee should be structured so that it:
•
•
•
Clearly distinguish
remuneration from that of executive directors and senior executives
Provide the information indicated in Guide to reporting on Principle 8
consists of a majority of independent Directors;
is chaired by an independent Director; and
has at least 3 members.
the structure of non-executive directors’
Adopted except:
8.1 and 8.2 The Board considers
that the Company is not currently of
a size, nor are it’s affairs of such
complexity to justify the formation
of a Remuneration Committee. The
Board as a whole is responsible for
the remuneration arrangements for
Directors and executives of the
Company and considers is more
appropriate to set aside time at
Board meetings each year
to
specifically address matters that
would
a
fall
ordinarily
Remuneration Committee.
to
65
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
TENEMENT SCHEDULE
TENEMENT NO.
INTEREST %
PROJECT NAME AND LOCATION
E 16/252
E 16/327
E 16/332
E 16/337
E 16/344
E 16/347
E 16/355
E 16/400
E 16/412
E 16/413
E 16/414
E 29/640
E 29/641
E 29/647
E 29/657
E 30/332
E 30/333
E 30/334
E 30/335
E 30/336
E 30/338
E 30/449
L 15/223
L 15/224
L 16/58
L 16/62
L 16/68
L 16/72
L 16/73
L 16/77
L 24/100
L 24/101
L 24/107
L 24/115
L 24/123
L 24/124
L 24/127
L 24/128
L 24/170
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
100
100
100
100
Lady Ida, Coolgardie, WA
Lady Ida, Coolgardie, WA
Lady Ida, Coolgardie, WA
Lady Ida, Coolgardie, WA
Lady Ida, Coolgardie, WA
Lady Ida, Coolgardie, WA
Lady Ida, Coolgardie, WA
Lady Ida, Coolgardie, WA
Lady Ida, Coolgardie, WA
Lady Ida, Coolgardie, WA
Lady Ida, Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Siberia, North Coolgardie, WA
Riverina, North Coolgardie, WA
Riverina, North Coolgardie, WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Lady Ida, Coolgardie, WA
Davyhurst Central, Coolgardie, WA
Lady Ida, Coolgardie, WA
Lady Ida, Coolgardie, WA
Lady Ida, Coolgardie, WA
Lady Ida, Coolgardie, WA
Lady Ida, Coolgardie, WA
Lady Ida, Coolgardie, WA
Lady Ida, Broad Arrow, WA
Lady Ida, Broad Arrow, WA
Lady Ida, Broad Arrow, WA
Lady Ida, Broad Arrow, WA
Lady Ida, Broad Arrow, WA
Lady Ida, Broad Arrow, WA
Lady Ida, Broad Arrow, WA
Lady Ida, Broad Arrow, WA
Lady Ida, Broad Arrow, WA
66
L 24/174
L 24/188
L 24/189
L 24/85
L 24/98
L 24/99
L 29/34
L 29/38
L 29/40
L 29/71
L 29/72
L 29/74
L 30/19
L 30/21
L 30/23
L 30/35
L 30/36
L 30/37
L 30/38
L 30/41
L 30/43
L 30/9
M 16/220
M 16/262
M 16/263
M 16/264
M 16/268
M 16/470
M 24/115
M 24/159
M 24/208
M 24/290
M 24/352
M 24/376
M 24/39
M 24/427
M 24/51
M 24/633
M 24/754
M 24/755
M 24/830
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
TENEMENT SCHEDULE
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
100
100
100
100
100
100
Lady Ida, Broad Arrow, WA
Lady Ida, Broad Arrow, WA
Lady Ida, Broad Arrow, WA
Lady Ida, Broad Arrow, WA
Lady Ida, Broad Arrow, WA
Lady Ida, Broad Arrow, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, Coolgardie, WA
Lady Ida, Coolgardie, WA
Lady Ida, Coolgardie, WA
Lady Ida, Coolgardie, WA
Lady Ida, Coolgardie, WA
Davyhurst Central, Coolgardie, WA
Siberia, Broad Arrow, WA
Siberia, Broad Arrow, WA
Siberia, Broad Arrow, WA
Siberia, Broad Arrow, WA
Siberia, Broad Arrow, WA
Siberia, Broad Arrow, WA
Siberia, Broad Arrow, WA
Siberia, Broad Arrow, WA
Siberia, Broad Arrow, WA
Siberia, Broad Arrow, WA
Siberia, Broad Arrow, WA
Siberia, Broad Arrow, WA
Siberia, Broad Arrow, WA
67
M 24/845
M 24/846
M 24/847
M 24/848
M 29/165
M 29/2
M 29/422
M 30/1
M 30/100
M 30/102
M 30/103
M 30/106
M 30/107
M 30/108
M 30/109
M 30/111
M 30/122
M 30/123
M 30/126
M 30/127
M 30/129
M 30/131
M 30/132
M 30/133
M 30/135
M 30/137
M 30/148
M 30/150
M 30/157
M 30/159
M 30/16
M 30/178
M 30/182
M 30/187
M 30/21
M 30/34
M 30/39
M 30/42
M 30/43
M 30/44
M 30/48
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
TENEMENT SCHEDULE
100
100
100
100
95
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
100
Siberia, Broad Arrow, WA
Siberia, Broad Arrow, WA
Siberia, Broad Arrow, WA
Siberia, Broad Arrow, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Riverina, North Coolgardie, WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Riverina, North Coolgardie, WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Riverina, North Coolgardie, WA
Davyhurst Central, North Coolgardie,WA
Riverina, North Coolgardie, WA
Riverina, North Coolgardie, WA
Riverina, North Coolgardie, WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Riverina, North Coolgardie, WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
68
M 30/5
M 30/59
M 30/60
M 30/63
M 30/7
M 30/72
M 30/73
M 30/74
M 30/75
M 30/80
M 30/84
M 30/97
M 30/98
P 16/2500
P 16/2501
P 16/2502
P 16/2503
P 16/2504
P 16/2505
P 16/2506
P 16/2507
P 16/2514
P 16/2518
P 16/2550
P 16/2551
P 16/2774
P 16/2775
P 24/4182
P 24/4750
P 24/4751
P 24/4752
P 24/4753
P 24/4754
P 29/1938
P 29/1939
P 29/1940
P 29/1941
P 29/1942
P 29/1943
P 29/1944
P 29/1945
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
TENEMENT SCHEDULE
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
100
100
100
100
100
100
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Riverina, North Coolgardie, WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Riverina, North Coolgardie, WA
Riverina, North Coolgardie, WA
Riverina, North Coolgardie, WA
Lady Ida, Coolgardie, WA
Lady Ida, Coolgardie, WA
Lady Ida, Coolgardie, WA
Lady Ida, Coolgardie, WA
Lady Ida, Coolgardie, WA
Lady Ida, Coolgardie, WA
Lady Ida, Coolgardie, WA
Lady Ida, Coolgardie, WA
Davyhurst Central, Coolgardie, WA
Lady Ida, Coolgardie, WA
Lady Ida, Coolgardie, WA
Lady Ida, Coolgardie, WA
Lady Ida, Coolgardie, WA
Lady Ida, Coolgardie, WA
Siberia, Broad Arrow, WA
Siberia, Broad Arrow, WA
Siberia, Broad Arrow, WA
Siberia, Broad Arrow, WA
Siberia, Broad Arrow, WA
Siberia, Broad Arrow, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
69
P 29/1946
P 29/1947
P 29/1948
P 29/1949
P 29/1950
P 29/2310
P 29/2311
P 29/2312
P 29/2313
P 29/2314
P 29/2315
P 29/2317
P 29/2318
P 29/2319
P 29/2320
P 29/2321
P 29/2322
P 29/2323
P 29/2324
P 29/2325
P 29/2326
P 29/2327
P 29/2328
P 30/1012
P 30/1013
P 30/1014
P 30/1015
P 30/1016
P 30/1017
P 30/1018
P 30/1020
P 30/1021
P 30/1023
P 30/1024
P 30/1025
P 30/1026
P 30/1027
P 30/1033
P 30/1034
P 30/1038
P 30/1040
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
TENEMENT SCHEDULE
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
100
100
100
100
100
100
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Mount Ida, North Coolgardie, WA
Riverina, North Coolgardie, WA
Riverina, North Coolgardie, WA
Riverina, North Coolgardie, WA
Riverina, North Coolgardie, WA
Riverina, North Coolgardie, WA
Riverina, North Coolgardie, WA
Riverina, North Coolgardie, WA
Riverina, North Coolgardie, WA
Riverina, North Coolgardie, WA
Riverina, North Coolgardie, WA
Riverina, North Coolgardie, WA
Riverina, North Coolgardie, WA
Riverina, North Coolgardie, WA
70
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
TENEMENT SCHEDULE
P 30/1042
P 30/1043
P 30/1051
P 30/1055
P 30/1056
P 30/1060
P 30/1074
P 30/1086
P 30/1087
100
100
100
100
100
100
100
100
100
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
Riverina, North Coolgardie, WA
Davyhurst Central, North Coolgardie,WA
Davyhurst Central, North Coolgardie,WA
71
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
ASX ADDITIONAL INFORMATION
Additional information required by the Australian Securities Exchange Listing Rules and not disclosed elsewhere in
this report is set out below:
SHAREHOLDINGS (as at 14 March 2014)
Substantial shareholders
The number of shares held by substantial shareholders and their associates are set out below:
Shareholder
Number of ordinary
shares
% of issue capital
Investmet Limited 412,386,710
Stirling Gold Pty Ltd
86,238,215
46.15
9.65
Voting Rights
Each shareholder is entitled to receive notice of and attend and vote at generals meetings of the Company. At a
general meeting every shareholder present in person or by proxy, representative or attorney will have one vote on a
show of hands and on a poll, one vote for each share held.
Distribution of equity security holders
Category
1-1,000
1,001-5,000
5,001-10,000
10,001-100,000
100,001-9,999,999,999
On market buy-back
There is not currently any on market buyback.
Securities on issue
Category
Ordinary Shares
Total shareholders
430
1,510
1,038
1,553
292
4,823
Number
893,487,661
72
SWAN GOLD MINING LIMITED AND CONTROLLED ENTITIES
FOR THE YEAR ENDED 30 JUNE 2013
ASX ADDITIONAL INFORMATION
ASX Additional Information Continued
Twenty largest shareholders – 23 January 2014
CLASS GROUP: *G1/ORDINARY SHARES (GROUPED)
HOLDER NO NAME AND ADDRESS UNITS % I/C RANK
INVESTMET LIMITED 412,386,710 46.15 1
STIRLING GOLD PTY LTD 86,238,215 9.65 2
MGMC PTY LTD 43,723,382 4.89 3
MRS SUSAN KIERNAN 40,000,000 4.48 4
MGMC PTY LTD 30,625,384 3.43 5
HSBC CUSTODY NOMINEES 27,890,187 3.12 6
(AUSTRALIA) LIMITED - A/C 3
J P MORGAN NOMINEES AUSTRALIA 17,363,649 1.94 7
LIMITED
HSBC CUSTODY NOMINEES 8,581,500 0.96 8
(AUSTRALIA) LIMITED
BESPOKEN PROPERTIES GMBH 7,499,584 0.84 9
AMP LIFE LIMITED 6,625,571 0.74 10
WESTNET HOLDINGS PTY LTD 6,000,000 0.67 11
J P MORGAN NOMINEES AUSTRALIA 5,032,471 0.56 12
LIMITED
MINERAL RESOURCES LIMITED 5,000,000 0.56 13
CITICORP NOMINEES PTY LIMITED 4,162,954 0.47 14
CLIFFWAY PTY LTD 4,000,000 0.45 15
MARTIN PLACE SECURITIES 3,620,000 0.41 16
NOMINEES PTY LTD
ABBOTSLEIGH PTY LTD 3,424,862 0.38 17
DR LEON EUGENE PRETORIUS 3,000,000 0.34 18
CUNNINGHAM PETERSON SHARBANEE 2,690,000 0.30 19
SECURITIES PTY LTD
TAYCOL NOMINEES PTY LTD 2,600,000 0.29 20
REPORT TOTAL 720,464,469 80.64
REMAINDER 173,023,192 19.36
-----------------------
GRAND TOTAL 893,487,661 100.00
=======================
73