Annual Report
2020
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ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 2
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 Corporate Directory
DIRECTORS
Peter Mansell (Non-executive Chairman)
David Quinlivan (Managing Director)
Keith Jones (Non-executive Director)
Mark Wheatley (Non-executive Director)
COMPANY SECRETARIES
Tony Brazier
Susan Hunter
REGISTERED & PRINCIPAL OFFICE ADDRESS
Level 1, 2 Kings Park Road
West Perth 6005 Australia
Telephone:
• Within Australia: 1300 035 592
• Outside Australia: +61 8 6365 4548
Email: admin@orabandamining.com.au
Website: www.orabandamining.com.au
SHARE REGISTRY
Computershare Investor Services Pty Limited
GPO Box 2975
Melbourne VIC 3001
Telephone: 1300 555 159
AUDITORS
KPMG
235 St Georges Terrace
Perth WA 6000
SECURITIES EXCHANGE LISTING
Listed on the Australian Securities Exchange
under the trading code OBM
OR A BA NDA MINI NG LI M I TED AN D I TS C ONT R OLL ED ENT I T I ES
ACN 100 038 266 A NNUAL REPORT 2020
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ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 2
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 Contents
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38
42
44
45
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DIRECTORS’ REPORT
ANNUAL MINERAL RESOURCE & ORE RESERVE STATEMENT
AUDITOR’S INDEPENDENCE DECLARATION
CONSOLIDATED STATEMENT OF PROFIT OR LOSS
AND OTHER COMPREHENSIVE INCOME
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
CONSOLIDATED STATEMENT OF CASH FLOWS
48 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
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78
83
DIRECTORS’ DECLARATION
INDEPENDENT AUDITOR’S REPORT
ASX ADDITIONAL INFORMATION
OR A BA NDA MINI NG LI M I TED AN D I TS C ONT R OLL ED ENT I T I ES
ACN 100 038 266 A NNUAL REPORT 2020
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ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020
Directors’ Report
The directors of Ora Banda Mining Limited (“Ora Banda”, “Company” or “OBM”) present their report on the results and state of affairs of
the Group, being the Company and its controlled entities for the financial year ended 30 June 2020.
DIRECTORS
The names and details of the Group’s directors in office during the financial year and until the date of this report are as follows.
Names, qualifications, experience and special responsibilities of directors & company secretaries
Director
Qualifications, experience and special responsibilities
Peter Mansell
Non-executive Chairman
Appointed 22 June 2018
B.Com, LLB, H. Dip. Tax, FAICD
Mr Mansell has extensive experience in the mining, corporate and energy sectors, both as
an advisor and independent non-executive director of listed and unlisted companies. Mr
Mansell practised law for a number of years as a partner in corporate and resources law
firms in South Africa and Australia.
David Quinlivan
Managing Director
Appointed 2 April 2019
Keith Jones
Non-executive Director
Appointed 2 April 2019
Mark Wheatley
Non-executive Director
Appointed 2 April 2019
Other current ASX directorships:
• Energy Resources Australia Limited (appointed 26 October 2015)
Former ASX directorships in the last three years:
• Tap Oil Limited (appointed 27 May 2016 / resigned 1 February 2018)
B.App Sci, Min Eng, Grad Dip Fin Serv, FAusImm, FFINSA, MMICA
Mr Quinlivan is a mining engineer and principal of Borden Mining Services. He has over
35 years’ experience on projects throughout the world including mining and executive
leadership experience gained through a number of mining development roles.
Mr Quinlivan is a Fellow of the Australian Institute of Mining and Metallurgy, Fellow of
the Financial Services Institute of Australia, Member of the Mining Industry Consultants
Association and Member of the Institute of Arbitrators & Mediators Australia.
Other current ASX directorships:
• Silver Lake Resources Limited (appointed 25 June 2015)
B.Bus, FCA, FAICD
Mr Jones is a chartered accountant with 39 years’ industry experience. He led the Western
Australian practice of Deloitte for 15 years, the Energy and Resources group, and was
Chairman of Deloitte Australia.
Former ASX directorships in the last three years:
• Gindalbie Resources Limited (appointed 27 February 2013 / resigned 23 July 2019)
B.E (Chem Eng Hons 1), MBA
Mr Wheatley is a chemical engineer with over 30 years in mining and related industries. He
has been involved as a director in both large and small companies and has led a number of
listed company exploration and production turnaround stories.
Other current ASX directorships:
• Peninsula Energy Limited (appointed 26 April 2016)
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ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020
D I R E C T O R S ’ R E P O R T
Joint Company Secretaries
Director
Tony Brazier
Appointed 2 April 2019
Qualifications, experience and special responsibilities
B.Bus, ACA, AGIA, ACIS
Mr Brazier is a chartered accountant with over 25 years’ experience across a range of
industries. He has extensive experience in project modelling and financing, process
optimisation, financial reporting and analysis, corporate governance and risk management.
Susan Hunter
B.Com, ACA, F Fin, FGIA, FCIS, GAICD
Appointed 2 April 2019
Ms Hunter has over 25 years’ experience in the corporate finance industry. She has held
senior management positions at Ernst & Young, PricewaterhouseCoopers, Bankwest and
Norvest Corporate.
Directors’ Interests in the shares and options of Ora Banda Mining Limited
Direct and indirect interests of the directors and their related parties in the Company’s shares and options
as at 25 September 2020 were:
Director
Peter Mansell
David Quinlivan
Keith Jones
Mark Wheatley
PRINCIPAL ACTIVITIES
Fully Paid
Shares
4,412,684
2,914,145
2,020,442
1,597,219
Unlisted
Incentive Options
Unlisted
Performance Options
1,185,185
2,790,123
790,123
790,123
-
600,000
-
-
The principal activities of the Group during the financial year were mineral development related to the Davyhurst Gold Project and
mineral exploration and evaluation.
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ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020
REVIEW OF OPERATIONS
Definitive Feasibility Study
On 30 June 2020 the Company announced the results of the Definitive Feasibility Study (“DFS”) to re-start production at its Davyhurst Gold
Project, located 120 kilometres north-west of Kalgoorlie within the eastern goldfields of Western Australia (“Davyhurst” or “Project”).
Underpinned by pre-existing infrastructure, including a conventional CIP process plant, the DFS confirms that Ora Banda can undertake
a rapid and low-capital path to achieving sustainable gold production at Davyhurst. Ore will be delivered to the processing plant from
a combination of open pit and underground mines all located within a 50 kilometre radius. The study demonstrates that the Project is
expected to generate strong cash flows and financial returns over a 5.2-year mine life, with average estimated pre-tax annual free cash
flows of $33.6 million ($68.8 million at A$2,550/oz), following a 14 month (seven month at $2,550/oz) payback period. Pre-development
activities commenced on publication of the DFS and to date have been focussed on the refurbishment of camp facilities, planning for
the Davyhurst plant remedial works program and early planning works for mine development at both Riverina open pit and Golden Eagle
underground mines. Plant commissioning is expected to commence in Q4, CY20 with first gold pour targeted for Q1, CY21.
The DFS declared JORC (2012) Probable Ore Reserves for the Davyhurst Project is 6.1 Mt @ 2.4 g/t Au for 460,000 ounces at 30 June 2020.
This includes a maiden JORC (2012) Probable Ore Reserves for Waihi open pit (1.5 Mt @ 2.3 g/t Au for 108,000 ounces of contained gold)
and Callion open pit (0.24 Mt @ 2.6 g/t Au for 21,000 ounces of contained gold).
Note: the Review of Operations makes numerous references to individual Mineral Resource and Ore Reserves, the full detail of which
is contained within the Annual Mineral Resource and Ore Reserve Statement on page 39 of this report.
Base Case Provides Strong Economic Returns
DFS base case estimates for the Project using a A$2,100/oz gold price show a pre-tax, free cashflow of $175 million over a 5.2-year mine
life with life of mine (“LOM”) average annual gold production of 81koz at a C1 cost of A$1,427/oz and all-in sustaining costs (“AISC”) of
A$1,566/oz.
The table below shows key DFS metrics for both Base (A$2,100/oz) and Spot (A$2,550/oz) gold prices.
Metric
Gold price
Gold produced (LOM)
Gold produced (annual average – LOM)
Gold head grade (LOM, Ore Reserve)
Gold recovery (LOM)
Pre-production capital cost (including contingencies)
Project payback
All-in sustaining costs (AISC) (LOM)
Cash costs (C1) (LOM)
Project free cashflow (pre-tax)
Pre-tax NPV (6% discount rate)
Post-tax NPV (6% discount rate)
Pre-tax IRR
Post-tax IRR
Unit
A$/oz
koz
koz/yr
g/t Au
%
A$M
Months
A$/oz
A$/oz
A$M
A$M
A$M
%
%
Base Case
Spot Case
2,100
2,550
418
81
2.4
90.3
45.1
14
1,566
1,427
174.6
137.4
137.4
109.3
109.3
418
81
2.4
90.3
45.1
7
1,578
1,427
357.8
290.7
290.7
237.8
237.8
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ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 D I R E C T O R S ’ R E P O R T
Pre-production Capital Costs
Davyhurst benefits from substantial pre-existing infrastructure, including a 1.2Mtpa processing plant, 172-person accommodation
camp, extensive haul road network, mains power and licensed working process-water borefields, all of which are under a full care and
maintenance program. This infrastructure significantly reduces the capital required to re-commence production at Davyhurst which
is set out below.
Expenditure Item
Processing plant – direct costs
Processing plant – indirect costs
Infrastructure (includes Tailings Storage Facility, site accommodation & road network)
First fills & spare parts
Development capital expenditure
Pre-production mining costs
Pre-production capital costs
Contingency (processing plant & infrastructure)
Total pre-production capital costs
LOM Operating Costs
LOM Operating Costs
Mining (including road haulage & ROM loading)
Processing
Site General & Administration
Cash costs (C1)
Royalties (at A$2,100/oz)
Sustaining capital
Corporate & exploration (including tenement rents,
rates & Mining Rehabilitation Fund)
AISC
A$M
8.7
2.6
10.4
2.1
23.8
19.3
43.1
2.0
45.1
Total (A$M)
LOM (A$/t)
LOM (A$/oz)
452
123
21
596
22
1
35
654
74.0
20.1
3.5
97.6
3.6
0.2
5.8
1,082
293
51
1,427
53
3
84
107.2
1,566
The centrally located 1.2Mtpa processing plant will be supplied by a combination of open pit and underground mines. The study
assumed power will be supplied to site via a liquefied natural gas (“LNG”) fired power station built and operated under a Build-Own-
Operate (“BOO”) contract. All gold production from the Davyhurst Gold Project is subject to a State royalty and there are several minor
third-party royalties applicable to some of the Project tenements. Royalty costs have been included where applicable.
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ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 81
110
130
110
21
440
16
16
460
AISC
(A$/oz)
1,615
1,579
1,609
1,738
1,719
860
1,566
Production Profile
A number of production sources are expected to underpin a potential long-life mining operation at the Project, with six deposits
contributing to the initial five-year mine plan, which will be mined by a combination of conventional open pit and underground
mining techniques.
The mine plan is based solely on Probable Ore Reserve contained within the six deposits set out below:
Ore (kt)
Grade (Au g/t)
Au (koz)
Deposit
Riverina
Sand King
Missouri
Waihi
Callion
Total Open Pit
Golden Eagle
Total Underground
Total
1,400
1,300
1,500
1,500
240
5,900
130
130
6,100
1.8
2.6
2.6
2.3
2.6
2.3
3.7
3.7
2.4
The ore production forecast is summarised below:
Financial Year
First production to 30 June 2021
FY22
FY23
FY24
FY25
FY26 (to end of project life)
Life of Mine
Mined Ore
(kt)
Processed
Ore
(kt)
Grade
(Au g/t)
Gold
Produced
(koz)
530
1,200
1,300
1,200
1,600
35
6,100
500
1,200
1,200
1,200
1,200
810
6,100
2.2
2.3
2.7
2.3
2.2
2.2
2.4
35
89
106
89
86
56
460
The values in the above table have been rounded.
The first phase of mining will involve the Riverina open pit and Golden Eagle underground mines. Mining of the five open pits and one
underground area will be carried out in phases to optimise cash flow over the life of the project.
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ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 RIVERINA
MISSOURI
SANDKING
WAIHI
CALLION
GOLDEN EAGLE UNDERGROUND
Figure 1 Feasibility Open Pit & Underground Designs
D I R E C T O R S ’ R E P O R T
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ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 Ore Production and Processing Schedules
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ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 Ore Production and Processing Schedules (continued)
D I R E C T O R S ’ R E P O R T
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ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 Permitting
All major approvals and permits have been obtained or are reasonably expected to be obtained in the required timeframe.
Next Steps: Optimisation and Contract Negotiations
Ora Banda will continue to optimise the DFS parameters over the next several months with a view to refining its plans, including trade
off studies and inclusion of the latest technical and cost information. Preparations for a competitive tender process for contract
mining work is in progress and is expected to be finalised by Q1 FY 2021. On 15 July 2020 the Company awarded an engineering,
procurement and construction (“EPC”) contract to GR Engineering Services Limited associated with the restart of the existing
Davyhurst gold processing plant.
The Company confirms that all material assumptions underpinning the DFS continue to apply and have not changed.
DFS Resource Base and Resource Upgrades
The mineral resource for five project areas incorporated in the DFS are set out in the following table:
MEASURED
INDICATED
INFERRED
TOTAL MATERIAL
(‘000t)
(g/t Au)
(‘000t)
(g/t Au)
(‘000t)
(g/t Au)
(‘000t)
(g/t Au)
(‘000oz.)
DEPOSIT
RIVERINA
116
1.8
2,694
Underground
226
TOTAL
116
1.8
2,920
WAIHI
Open Pit
Underground
TOTAL
SAND KING
Open Pit
Underground
TOTAL
MISSOURI
Open Pit
Underground
TOTAL
GOLDEN EAGLE
Underground
CALLION
Open Pit
Underground
TOTAL
1,948
188
2,136
1,252
438
1,690
1,460
364
1,824
247
241
255
496
RESOURCE TOTALS
116
1.8
9,313
1.8
5.7
2.1
2.4
3.7
2.5
3.4
3.7
3.5
3.4
3.4
3.4
4.1
3.7
6.0
4.9
2.9
183
502
685
131
195
326
128
698
826
17
258
275
146
28
156
184
3.0
6.1
5.3
2.9
4.0
3.5
3.3
3.8
3.7
3.5
3.4
3.4
3.4
1.6
5.5
4.9
2,993
728
3,721
2,079
383
2,462
1,380
1,136
2,516
1,477
622
2,099
393
269
411
680
2,442
4.1
11,871
1.9
5.9
2.7
2.4
3.8
2.6
3.4
3.7
3.5
3.4
3.4
3.4
3.9
3.5
5.8
4.9
3.1
183
139
322
159
47
206
150
136
286
160
68
227
49
30
77
107
1,198
Note: For total resources see Annual Mineral Resource and Ore Reserve Statement (Page 39)
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ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 D I R E C T O R S ’ R E P O R T
Exploration & Resource Drilling Operations
The Company has continued to undertake drilling programs across its highly prospective 1,350km2 landholding, covering 200
kilometres of strike length of prospective greenstone belts, focussing on:
• Resource definition drilling;
• Follow up drilling programs on near-mine prospects, including Riverina South;
• Exploration drilling on regional targets, for which Ora Banda has identified a number of high priority prospects.
Resource Definition Drilling Overview
Drilling operations at Davyhurst continued during the year with the completion of 40,197 reverse circulation drill metres and 11,696
diamond metres for a combined total of 51,893 drill metres.
As part of the DFS process the Company has remained focussed on fully evaluating both the technical and economic viability of five
advanced projects, all of which are well-understood geologically and are relatively close to the Davyhurst processing plant.
Mineral resource increases at Riverina, Waihi, Callion and Golden Eagle delivered an uplift in the Company’s Mineral Resource
statement as at 30 June 2020 to 23.7Mt @ 2.8g/t for 2.1 million ounces of contained gold, up from 1.8 million ounces, with further
updates pending. The Company’s Reserve position for the Davyhurst Gold Project increased to 6.1Mt @ 2.4g/t Au for 460,000 ounces,
up from 150,000 ounces
The primary objective of the drilling programs was to deliver
upgraded mineral resources and reserves into the DFS. The
drilling also aims to quantify the technical aspects of each of
the deposits, which included environmental, metallurgical and
geotechnical input parameters. The intensive drilling programs
progressed well during the year.
The six targeted deposits include:
• Riverina;
• Waihi;
• Callion;
• Missouri;
• Sand King; and
• Golden Eagle.
Riverina
An update to the open pit and underground Mineral Resources for
Riverina resulted in an increase of 57% (117,000 ounces) to 3.7Mt
@ 2.7g/t Au for 322,000 Au ounces. Riverina has an open pit reserve
of 1.4Mt @ 1.8g/t Au for 81,000 ounces and is scheduled to be the
first ore mined at the Davyhurst Gold Project.
Mining studies continue to evaluate the underground Resource
component (728kt @ 5.9 g/t Au for 139,000 ounces) with a view
to defining the economic viability of an underground mine that
would follow on from the initial open pit mining event.
The updated underground Mineral Resource follows further
modelling of Riverina Main Lode beneath the A$2,400 optimised
open pit shell used to constrain the Riverina open pit resource.
Historical underground mining of the Main Lode at Riverina was
via a number of shafts that produced 99,500t @ 15.8 g/t Au for
50,490 ounces1.
Gold mineralisation plunges to the south and is hosted within two
sub-parallel, sub-vertical shears separated by a distance of five to
15 metres. Drilling has demonstrated a strike of greater than one
kilometre and at depths of up to 270 metres below surface.
1. Historical production figures sourced from internal Company records
(Monarch Gold 2006)
Figure 2 Davyhurst Gold Project
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ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 Figure 3 Riverina orebody and pit design looking NE
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ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 D I R E C T O R S ’ R E P O R T
Riverina South Prospect
The Riverina South prospect area is being targeted for possible extensions to the currently defined Riverina Mine.
Exploration drilling programs have returned exciting results1 including:
• 12.0m @ 6.4 g/t from 56m (Including 7.0m @ 10.5 g/t)
• 8.0m @ 7.7 g/t from 16m (Including 4.0m @ 14.5 g/t)
• 13.0m @ 3.2 g/t from 106m
• 10.0m @ 4.1 g/t from 115m (Including 2.0m @ 14.3 g/t)
• 10.0m @ 3.9g/t from 83m
• 12.0m @ 3.0 g/t from 72m (Including 5.0m @ 5.9 g/t)
• 7.0m @ 4.6 g/t from 28m (Including 3.0m @ 9.9g/t)
• 2.0m @ 15.9 g/t from 136m
• 6.0m @ 3.6 g/t from 47m
• 1.0m @ 20.8g/t from 77m
The Riverina South prospect is a one kilometre long, highly prospective strike extension corridor immediately south of the main Riverina
mining area and has been the focus of recent resource development and exploration works. The Phase 1 drilling program comprised 32
RC holes for 3,639 metres, reaching a maximum depth of 150 metres. This first pass wide spaced drilling was conducted on 80 metre line
centres and commenced immediately south of the proposed Riverina open pit and continued to the British Lion prospect, one kilometre
to the south.
A follow up drilling program (Phase 2) has been completed, infilling the drill spacing in prospective zones along the Riverina South trend to
40 metre line spacing. A maiden mineral resource estimate for the area will follow.
1. For further details see ASX announcement dated 10 August 2020
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ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 Figure 4 Riverina Area Location Plan
ORA BA NDA MINI NG LIMI TED AN D I T S CON T ROL L ED EN T ITI ES
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ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 D I R E C T O R S ’ R E P O R T
Golden Eagle
The Golden Eagle deposit is located two kilometres from the Davyhurst processing plant. The existing Golden Eagle Resource has been
upgraded to 393,000 tonnes at 3.9 g/t Au for 49,000 ounces of contained gold reflecting the potential to mine this deposit via conventional
underground mining methods. This includes an Indicated Resource of 247,000 tonnes also at a substantially higher grade of 4.1 g/t Au for
33,000 ounces of contained gold.
The underground Ore Reserve for Golden Eagle was declared as part of the DFS and totalled 130,000 tonnes @ 3.8g/t for 16,000 ounces.
The most recent phase of underground mining operations at Golden Eagle commenced in August 2017 and was subsequently suspended
in August 2018. Approximately 2,100 metres of underground development was completed and 25,000t of ore at a grade of 3.4 g/t Au was
mined from production stopes during this period. Collectively, ore won from development and production areas was 70,150t at a grade of
2.9 g/t Au for 6,640 contained ounces of gold.
As a result of these activities, the mine is well established with capital decline development approaching 150 vertical metres (319mRL)
below the surface and 85 metres below the portal. Ore development is well established on four levels (395, 375, 355 & 335), with stope
production well established (or complete) on three (395, 375 & 355).
Between December 2019 and March 2020, eight RC holes with diamond tails were completed (2,998 metres) along strike to the north of
the Golden Eagle resource, targeting down-plunge extensions of the Golden Eagle underground mine. The northern-most line of three drill
holes was approximately 100 metres north of the Golden Eagle resource. Significant results received from this program include: 5.6m @
3.2 g/t Au from 207.4m (GEDD20001/Footwall Lode), 2m @ 6.5 g/t Au from 250m (GEDD19004/Footwall Lode), 2.3m @ 7.5 g/t Au from 343.2m
(GEDD19006/Main Lode) and 2.1m @ 12.9 g/t Au from 350.9m (GEDD19006/Footwall Lode). Mineralisation remains open to the north.
Figure 5 Golden Eagle Deposit Long Section1
1. For previous announcements relating to Golden Eagle please refer to ASX announcements dated 19 May 2016, 22 November 2017, 29 May 2019,
28 June 2019 and 29 July 2019. For further drilling details refer to the Company’s website at www.orabandamining.com.au
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ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 Siberia
Located approximately 37 kilometres from the Davyhurst processing plant, the Siberia Project incorporates both the Sand King and
Missouri open pits. A 12-hole infill drill program (1,886 metres of diamond drilling) was completed, 11 holes at Sand King and one hole
at Missouri. The program was designed to infill resource areas below the base of the existing open pit.
Missouri is a high priority mining target at the Davyhurst Gold Project, with mining scheduled to commence early in CY2021. This will be
the third mining operation to commence and will be mined in conjunction with Riverina and Golden Eagle. The Missouri deposit has
a current Mineral Resource of 2.1Mt @ 3.4 g/t Au for 227,000 ounces and an open pit Mining Reserve of 1.5Mt @ 2.6 g/t Au for 130,000
ounces Au.
The Sand King deposit has a current Mineral Resource of 2.52Mt @ 3.5 g/t Au for 286,000 ounces and an open pit Mining Reserve
estimate of 1.3Mt @ 2.6 g/t Au for 110,000 ounces Au.
Figure 6 Missouri and Sand King isometric view
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ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020
D I R E C T O R S ’ R E P O R T
Waihi
Waihi is a well-established mining centre located three kilometres to the west of Ora Banda’s processing plant and will provide
additional open pit production by way of a significant open pit cut back.
The Waihi Complex comprises the historical Waihi, Homeward Bound and Golden Pole deposits. Following an extensive resource drilling
program completed in January 2020, the Mineral Resource Estimate was updated to a published mineral resource of 2.46Mt @ 2.6g/t Au
for 206,000 ounces. This represented a 190% increase over the previously reported resource of 0.9Mt @ 2.4g/t Au for 71,000 ounces.
The DFS includes the maiden JORC (2012) Probable Ore Reserves for Waihi open pit of 1.5 Mt @ 2.3 g/t Au for 108,000 ounces of
contained gold.
Phase 1 of the Waihi resource definition infill drilling program focussed on delineating and upgrading an optimal open pit Mineral
Resource on the Waihi and Homeward Bound lines of lode. Additional drilling targeted open pit extensions to the north and south of
the existing open pit, and also the potential for underground resource extensions at depth.
Figure 7 Waihi Area Location Plan
Callion
Located approximately 13 kilometres from the Davyhurst processing plant, the existing Callion open pit is approximately 650 metres
long and 40 metres deep, with the underground workings extending off the southern end of the pit to a vertical depth of 220 metres
below surface.
The total upgraded Callion Mineral Resource (Indicated and Inferred) increased to 680,000 t @ 4.9 g/t Au for 107,000 ounces Au.
A Maiden Underground Mineral Resource (Indicated and Inferred) was declared at Callion totalling 411,000 t @ 5.8 g/t Au for 77,000 oz
Au. This complemented the recently announced open pit resource 269,000 t @ 3.5 g/t Au for 30,000 oz Au. Mineralisation remains open
down plunge of the known resource areas. Strong potential remains for further resource growth with additional drilling.
Development plans for the Callion deposit include an open pit cut back and re-establishing access to existing underground mine
workings to extract a number of high-grade zones that remain within the historical mine and the development of new high-grade
areas below the existing mine workings.
19
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 Figure 8 Callion Diagrammatic Long Section looking west, highlighting existing open pit outline, underground workings and significant drill intersections
REGIONAL EXPLORATION
Regional exploration continued throughout the year, with all minimum expenditure commitments met.
The exploration focus has been on the development of a coherent exploration program for the coming 12 months and continuation of
the ranking and target definition for all prospects within the Company’s extensive project area. Exploration RC (6,513 metres), Aircore
(3,448 metres), Auger (1,091 holes) and diamond (313.9 metres) drilling was undertaken on several prospects throughout the Davyhurst
Gold Project. Field mapping, surface sampling and pXRF analyses were also routinely undertaken.
Lady Ida Project
The Flame prospect was first defined by surface (auger) geochemical anomaly which was tested by RAB drilling in 2005. This drilling
returned an anomalous intersection of 3m @ 1.27g/t from SRB3049. The prospect is interpreted to lie on the same mineralised trend as
the Golden Lode deposit. To date, this trend has been under explored.
The Flame prospect has only limited shallow drilling in the area. The initial RC program consisted of two holes on the same section line
as SRB3049. Drilling intersected a sequence of fine grained foliated ultramafics with a wide zone of quartz veining and alteration. A
number of significant intercepts were returned from this zone including 2.0m @ 19.22 g/t Au, 9.0m @ 5.53g/t Au and 3.0m @ 8.19 g/t Au
(at a 0.5g/t lower cut). This entire mineralised zone bulks out to 25m @ 4.64g/t Au if a lower cut off of 0.2g/t is applied.
Please refer to ASX announcement dated 20 May 2020 for more information. Further follow-up work is planned.
20
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 D I R E C T O R S ’ R E P O R T
Figure 9 Flame Prospect Location Plan
OR A BA NDA MINI NG LI M I TED AN D I TS C ONT R OLL ED ENT I T I ES
ACN 100 038 266 A NNUAL REPORT 2020
21
21
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 Figure 10 Flame Prospect Cross Section 6,650,160mN
Mulline Project (Young Australian)
The Young Australian prospect is situated in the central part of the Mulline gold corridor, in the northern part of Ora Banda’s Davyhurst
Gold Project. The Mulline corridor is a north trending approximately 16 km long x 2.5 km wide zone with a high concentration of the
historic shafts, old workings and more recent shallow laterite pits.
Drilling at Young Australian on two fences of holes 400 metres apart intersected multiple zones of quartz-sulphide veining
accompanied by biotite-chlorite-sulphide alteration. in a moderate east dipping structure within an altered basalt. Best results
returned include 4m @ 6.18 g/t Au from 36m, 4m @ 10.78 g/t Au from 48m, 8m @ 1.09 g/t Au from 44m, and 4m @ 3.82 g/t Au from 137m.
The mineralised zone continues over 350 metres south of the current drilling as identified by historic RAB drill holes MERB232 7m
@ 2.3 g/t Au from 38m and RC hole FTRC003, 5m @ 7.52 g/t Au from 38m.
Please refer to ASX announcement dated 20 May 2020 for more information.
22
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 D I R E C T O R S ’ R E P O R T
Figure 11 Young Australian prospect within the Mulline corridor
OR A BA NDA MINI NG LI M I TED AN D I TS C ONT R OLL ED ENT I T I ES
ACN 100 038 266 A NNUAL REPORT 2020
23
23
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 Corporate
Capital Raising
On 16 August 2019 the Company announced it had received firm commitments for a placement to raise $18.5 million (before costs) via
the issue of 100,000,000 new fully paid ordinary shares. The placement was undertaken at an issue price of 18.5 cents per fully paid
ordinary share and was strongly supported both by existing Ora Banda shareholders and new sophisticated investors introducing a
number of new institutional shareholders to the Company’s register.
Settlement of Tranche 1 of the placement (the issue of approximately 57.6 million new shares) was announced on 26 August 2019.
On 15 November 2019 shareholders approved the issue of approximately 42.4 million new shares to Ora Banda’s major shareholder,
Hawke’s Point Holdings 1 Limited (Tranche 2 of the placement).
Small Shareholding Sale Facility
On 7 August 2019 the Company announced it had established a small shareholding sale facility to provide shareholders with holdings
valued at less than $500 (“Unmarketable Parcels”) with an opportunity to sell their shareholdings without incurring brokerage or
handling costs.
On 24 October 2019 the Company announced completion of the small shareholding sale facility. Of the 812,878 fully paid ordinary
shares comprising the Unmarketable Parcels at Record Date (6 August 2019), 643,882 fully paid ordinary shares (79%) were sold under
the small shareholder sale facility.
Financial Review
The Group recorded a net loss of $6.68 million for the year ended 30 June 2020 (30 June 2019: net profit of $8.07 million). There were
asset impairment reversals of $7.31 million recognised for the year ended 30 June 2020 (30 June 2019: impairment expense $0.69
million).
During the year ended 30 June 2020 the Group incurred $10.53 million (30 June 2019: $1.56 million) of capitalised mine development
and exploration expenditure and acquired property, plant and equipment of $1.27 million (30 June 2019: Nil).
During the year ended 30 June 2020 the Group recorded net cash outflows of $21.01 million in operating and investing activities, which
was funded by existing cash of $14.14 million at 1 July 2019 and cash inflows of $17.67 million from share issues. The Group’s closing
cash balance at 30 June 2020 was $10.58 million.
Liquidity and Capital Resources
The table below sets out summary information about the Group’s earnings and movements in shareholder wealth for the five years to
30 June 2020:
Performance Measures
FY 2020
$
FY 2019
$
FY 2018
$
FY 2017
$
FY 2016
$
Net assets/(liabilities)
48,031,000
35,368,000
(35,977,000)
11,115,000
4,164,000
Current assets
12,040,000
14,710,000
3,544,000
8,030,000
16,669,000
Cash
10,577,000
14,142,000
5,000
44,000
15,401,000
Contributed equity
368,194,000
350,519,000
287,168,000
251,282,000
228,343,000
Accumulated losses
(322,266,000)
(328,181,000)
(336,255,000)
(250,333,000)
(232,231,000)
Net profit/(loss) before tax
(6,675,000)
8,233,000
(86,390,000)
(18,103,000)
(18,011,000)
Share price at start of year
Share price at end of year
0.16
0.27
Earnings/(loss) per share
(0.012)
0.11
0.16
0.105
0.37
0.11
(1.69)
0.43
0.37
(0.03)
0.15
0.43
(0.08)
24
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 D I R E C T O R S ’ R E P O R T
Capital Structure
As discussed above, during the year ended 30 June 2020 the Company issued 100 million ordinary shares through two tranches at a
price of $0.185 per share, raising $18.5 million before capital raising costs of $0.83 million.
Additionally, 4,565,000 ordinary shares were issued on the exercise of unlisted vested options at a nil exercise price.
A total of 5,581,071 unlisted options were issued during the year ended 30 June 2020, as follows:
• 4,220,714 options are subject to a vesting condition based on Relative Total Shareholder Return, whereby the Company’s total
shareholder return is measured relative to the returns of a peer group over the performance period 1 July 2019 to 30 June 2022. A
total of 50% of the options will vest if the Company’s performance relative to the peer group is at the 50th percentile, while 100%
of the options will vest if the Company’s performance relative to the peer group is at the 75th percentile. The vesting of the options
between the 50th and the 75th percentile will be 50% to 100% vesting based on a straight-line pro rata basis;
• 1,360,357 options are subject to a vesting condition based on the achievement of the Company’s performance metrics over
the performance period 1 July 2019 to 30 June 2020. The vesting criteria are 50% vesting based on the Company’s management
response criteria, 40% vesting based on the Company’s physical and cost performance criteria and 10% based on the Company’s
relative shareholder return performance criteria.
BUSINESS RISK
Following completion of a DFS, and the subsequent raising of funding required to implement the DFS, the Company’s primary business
risk resides in execution of the DFS. Key challenges include risks associated with the re-start of mining and ore processing operations.
To mitigate the risk, the Company has assembled teams of highly skilled and experienced management and operational personnel.
Further, it has access to suitability qualified and experienced contractors and consultants. With these measures in place, the
Company is confident its execution risk is sufficiently mitigated.
Since January 2020 the Group’s operations have been largely unaffected by COVID-19. The Company will continue to adapt and mitigate,
as far as practicable, the risks the disease presents. Given the industry framework in which Ora Banda operates and the strong, debt-
free balance sheet, Ora Banda will continue to actively pursue its business objectives, subject to the evolving and unforeseen impacts
of COVID-19.
SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS
There were no significant changes in the state of affairs of Ora Banda Mining Limited during the year.
EVENTS AFTER BALANCE DATE
On 3 July 2020 the Company announced a $55 million equity capital raising comprising an institutional placement to raise
approximately $40 million and a 1 for 9 Accelerated Non-Renounceable Entitlement Offer to raise approximately $15 million over
two tranches. The first tranche was completed on 29 July 2020, and the second tranche was completed on 9 September 2020.
Apart from the above, no other matters have arisen since the end of the financial year that impact or are likely to impact the results of
the Group in subsequent financial periods.
DIVIDENDS
No dividend has been paid or declared by the Company up to the date of this report.
25
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 SHARES UNDER OPTION
Unissued ordinary shares of the Company under option as at 25 September 2020 are as follows:
Date options granted
Number of unissued ordinary
shares under option
Exercise price
of options
31 January 2018
31 January 2018
2 February 2018
2 February 2018
Various (i)
Various (i)
11 June 2019
11 June 2019 (ii)
Various (iii)
2,178,331
2,178,331
66,667
509,500
3,854,862
3,854,862
2,916,667
600,000
15,616,177
$3.3375
$2.9625
$6.1875
$3.1125
$3.3375
$2.9625
$1.1250
Nil
Nil
Expiry date of
the options
31 January 2023
31 January 2023
2 February 2021
2 February 2021
2 February 2023
2 February 2023
11 June 2023
Various
Various
(i) Consists of options issued to Hawke’s Point, as participants under the rights issue (including pursuant to underwriting arrangements). The issue
dates of these options were 9 February 2018, 27 February 2018 and 14 March 2018.
(ii) Performance options eligible to vest in four tranches commencing 30 June 2019, subject to the satisfaction of the vesting conditions outlined in the
Remuneration Report.
(iii) Incentive options (including “RTSR” and “Other”) issued under the Group’s Employee Share Scheme to various Key Management Personnel are subject
to the satisfaction of the vesting conditions outlined in the Remuneration Report.
The following ordinary shares of the Company were issued during or since the end of the financial year as a result of the exercise
of an option:
Date issued
Various
31 July 2020
Various
MEETINGS OF DIRECTORS
Number of ordinary shares issued
Amount paid per share
4,565,000
956,667
7,666,667
Nil
Nil
$0.2578
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:
Board of Directors
Remuneration &
Nomination Committee
Audit & Risk
Management Committee
Director
Eligible to attend
Attended
Eligible to attend
Attended
Eligible to attend
Attended
Peter Mansell
David Quinlivan
Keith Jones
Mark Wheatley
15
15
15
15
15
15
15
15
1
-
1
1
1
-
1
1
4
-
4
4
4
-
4
4
26
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 D I R E C T O R S ’ R E P O R T
REMUNERATION REPORT (AUDITED)
This Remuneration Report outlines the remuneration arrangements in place for Key Management Personnel of the Group which
includes the Executive Director, Non-executive Directors and Senior Executives.
Contents:
1. Basis of preparation
2. Key Management Personnel
3. Remuneration governance
4. FY20 KMP remuneration
5. Link between Company performance, shareholder wealth generation and remuneration
6. KMP shareholdings
1. BASIS OF PREPARATION
This Remuneration Report has been prepared and audited in accordance with the requirements of the Corporations Act 2001 and
applicable accounting standards.
2. KEY MANAGEMENT PERSONNEL
Key Management Personnel (“KMP”) comprise 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). Unless otherwise
indicated, all KMP held their position throughout the financial year and up to the date of this Report.
The Report details the remuneration arrangements for the Group’s KMP including Non-executive Directors, Executive Directors and
Senior Executives:
Name
Position
Non-executive Directors
Peter Mansell
Keith Jones
Non-executive Chairman
Non-executive Director
Mark Wheatley
Non-executive Director
Executive Director
David Quinlivan
Managing Director
Senior Executives
Tony Brazier
Andrew Czerw
Brendan Fyfe
Chief Financial Officer & Company Secretary
General Manager – Resource Development
General Counsel
Appointed 6 January 2020
3. REMUNERATION GOVERNANCE
Board and Remuneration & Nomination Committee responsibility
The Remuneration & Nomination Committee is a subcommittee of the board. It assists the board to ensure that the Company
develops and implements remuneration policies and practices that are appropriate for a company of the nature, size and standing of
the Company.
The Remuneration & Nomination Committee is responsible for making recommendations to the board on:
• Remuneration arrangements (including base pay, performance targets, bonuses, equity awards, superannuation, retirement
rights, termination payments) for the Executive Director and Senior Executives;
• Remuneration of Non-executive Directors; and
• Establishment of employee incentive and equity-based plans and the number and terms of any incentives proposed to be issued to
Executives pursuant to those plans, including any vesting criteria.
27
Term as KMP
Full year
Full year
Full year
Full year
Full year
Full year
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 Remuneration principles
The Company’s remuneration strategy and structure is reviewed by the board and the Remuneration & Nomination Committee for
business appropriateness and market suitability on an ongoing basis. KMP are remunerated and rewarded in accordance with the
Company’s remuneration policies (outlined in further detail below).
Engagement of remuneration consultants
During the year, the Company did not engage remuneration consultants to provide a “remuneration recommendation” (as defined in
the Corporations Act 2001), however independent advice was received when the current remuneration framework was established.
This advice was in respect of remuneration reporting and general advice in respect of market practice for long term incentive plans.
In addition, the Remuneration & Nomination Committee benchmark KMP remuneration annually using external independent industry
reports and data to ensure that remuneration levels are competitive and meet the objectives of the Company.
2019 AGM voting outcome and comments
The Company received more than 99% of votes in favour of adopting its Remuneration Report for the 2019 financial year.
4. FY20 KMP REMUNERATION
In determining KMP remuneration, the board aims to ensure that remuneration practices are:
• Competitive and reasonable, enabling the Company to attract and retain high calibre talent;
• Aligned to the Company’s strategic and business objectives and the creation of shareholder value;
• Transparent and easily understood; and
• Acceptable to shareholders.
The Company’s approach to remuneration ensures that remuneration is competitive, performance-focussed, clearly links appropriate
reward with desired business performance, and is simple to administer and understand by Executives and shareholders. In line with
the remuneration policy, remuneration levels are reviewed annually to ensure alignment to the market and the Company’s stated
objectives.
The Company’s reward structure for Executives provides for a combination of fixed and variable pay with the following components:
• Fixed remuneration in the form of base salary, superannuation and benefits;
• Variable remuneration in the form of short-term incentives (“STI”) and long-term incentives (“LTI”).
In accordance with the Company’s objective to ensure that executive remuneration is aligned to Company performance, a portion
of Executives’ remuneration is placed “at risk”. The relative proportion of target FY20 total remuneration packages split between the
fixed and variable remuneration is shown below:
Executive
Managing Director
Senior Executives
a. Fixed remuneration
Fixed Remuneration
(% of total remuneration)
Target STI
(% of total remuneration)
Target LTI
(% of total remuneration)
40%
40%
20%
20%
40%
40%
Fixed remuneration is set at a level that is aligned to market benchmarks and reflective of Executives’ skills, experience,
responsibilities and performance.
When positioning base pay, the Company presently aims to position aggregate fixed remuneration at approximately the 50th
percentile of the industry benchmark AON McDonald Report (an independent, industry recognised report on the gold and mining
industry). This is to ensure that the Company’s remuneration arrangements remain competitive against peer companies to assist
with the retention and attraction of key talent.
Executive remuneration is benchmarked annually to ASX-listed companies of similar size (by market capitalisation), revenue base,
employee numbers and complexity. Specific reference is also made to peer companies within the mining and exploration sectors.
28
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 D I R E C T O R S ’ R E P O R T
b. Short-term incentive (“STI”) arrangements
The purpose of the STI plan is to link the achievement of key Company targets with the remuneration received by those Executives
charged with meeting the targets. The STI Plan is structured so that Executives have the opportunity to earn a cash and/or equity
bonus if certain key performance indicators (“KPIs”) are achieved. The Company must report a surplus of net cash flow from
operating activities for the applicable performance period for any cash STI to be paid.
Each year the Remuneration & Nomination Committee (“Committee”), in conjunction with the board, set KPI targets for Executives.
Ordinarily, the KPIs would include measures relating to the Group and the individual, and include environmental, health & safety,
financial, production, exploration, business development and company performance measures.
The maximum target STI opportunity for Executives is as follows:
Executive
Managing Director
Senior Executives
Maximum STI Opportunity – Cash
Maximum STI Opportunity – Equity
50% of fixed remuneration
75% of fixed remuneration
50% of fixed remuneration
75% of fixed remuneration
FY20 Performance against STI measures
A summary of the KPI targets set for FY20 and their respective weightings is as follows:
KPI
Weighting Measure
Safety & Environment
Exploration & Resource Development
Cost Management & Control
Cash Flow Management & Control
Feasibility Study Completion
Company Performance
Management Response
Table 1.1 STI Performance Targets
6%
10%
10%
6%
8%
10%
50%
Safety and environmental management effectiveness
Execution and success of FY20 exploration strategy
Costs for each cost centre against FY20 targets
Cash flow against FY20 targets
Completion of Feasibility Study within required timeframes
RTSR performance against comparator group
Management’s effectiveness in responding to issues arising during FY20
In assessing KMP performance against the KPI targets during the year, the Committee considered the following achievements against
objectives set at the start of the year:
• Completion of the Definitive Feasibility Study;
• Achieving OH&S objectives;
• Achieving environmental objectives;
• Exceeding the targeted end-of-year cash balance;
• Delivery of positive exploration results; and
• Company’s relative total shareholder return (“RTSR”) performance against the comparator group.
Based on the above assessment, STI payments for FY20 to Executives were as follows:
Executive
Tony Brazier
Andrew Czerw
Brendan Fyfe
Maximum STI
opportunity
% STI
Awarded
STI Awarded
– Cash
STI Awarded
– Options
Value of Options
Granted
STIP Option Class
100%
100%
100%
86.1%
86.1%
86.1%
-
-
-
518,537
490,253
740,767
$82,442
2019 Incentive Options
$77,945
2019 Incentive Options
$125,930
2020 “Other” Options
29
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 c. Long-term incentive (“LTI”) arrangements
Participation in the LTI plan will take the form of a grant of incentives (being either performance rights and/or options) under the
Company’s 2019 Long Term Incentive Plan (or such other similar plan in existence from time to time). The grant of incentives,
including the terms attaching to the grant, will be determined annually by the board and shall be consistent with the rules of
the 2019 Long Term Incentive Plan (or such other similar plan in existence from time to time). Typically, the vesting period for
incentives granted under the LTI plan will be three years.
2020 Share-based payments
During the 30 June 2020 financial year, the following options were issued to KMP under the Company’s Employee Option Plan:
Option Class
KMP
RTSR
Other
RTSR
David Quinlivan
Brendan Fyfe
Brendan Fyfe
Number of options issued
2,000,000
860,357
1,720,714
Underlying security share price at grant date
Exercise price
Grant date
Vesting date
Expiry date
Risk-free rate
Volatility
Dividend yield
Valuation per option
$0.175
Nil
$0.17
Nil
$0.17
Nil
15/11/2019
24/01/2020
24/01/2020
30/06/2022
30/06/2020
30/06/2022
30/06/2024
31/07/2020
30/06/2024
0.75%
80%
Nil
$0.128
0.75%
80%
Nil
$0.17
0.75%
80%
Nil
$0.114
Of the issued KMP options above, 3,720,714 are subject to a vesting condition based on Relative Total Shareholder Return (“RTSR”),
whereby the Company’s total shareholder return is measured relative to the returns of a peer group over the performance period
1 July 2019 to 30 June 2022. This performance condition was selected as the Committee seeks to benchmark performance against its
peers and reward its KMP for outperforming comparable companies. The fair value of the RTSR options was estimated as at the date
of grant using a Monte-Carlo simulation model taking into account the terms and conditions upon which the options were granted.
These options will vest according to the following schedule:
Company’s Performance
Relative to Peer Group
Percentage of Options
Eligible to Vest
ASX Comparator Group
Below 50th percentile
Nil
50th to 75th percentile
50% to 100% on a straight-line pro rata
75th percentile
100%
BC8; BDC; BGL; GOR; MML; PNR; PRU;
RMS; RSG; SBM; SLR; TRY; WGX; WMX
The remaining 860,357 issued KMP options are subject to a vesting condition based on the achievement of Company performance
metrics (“Other”) over the period 1 July 2019 to 30 June 2020. The fair value of these options was estimated as at the date of grant using
the Black-Scholes option pricing methodology taking into account the terms and conditions upon which the options were granted.
The options vested upon completion of the performance milestones as described in “Table 1.1: STI Performance Targets” above,
resulting in 86.1% (740,767) of the options vesting and 13.9% (119,590) being forfeited.
30
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 D I R E C T O R S ’ R E P O R T
d. Contracts with Key Management Personnel
David Quinlivan – Managing Director
Mr Quinlivan is employed under a Contract for Services with Borden Mining Services Pty Limited which commenced on 1 December
2018. Mr Quinlivan receives the following remuneration:
• Monthly retainer fee of $25,000 plus superannuation, together with reasonable out of pocket expenses incurred on a direct
basis;
• Non-cash incentive: Participation in the Company’s Option Scheme. Invitation to participate in the Company’s Option Scheme is
at the full discretion of the board and may be amended from time to time.
The term of the agreement was initially six months from the commencement date being 1 December 2018. Mr Quinlivan has
agreed to an ongoing role as Managing Director following completion of the Capital Raising, with the primary role being to guide the
Company through its re-establishment phase.
Either party may terminate the contract and term upon the provision of 60 days’ written notice, or such shorter period remaining
on the contract period being not less than 30 days.
Tony Brazier – Chief Financial Officer & Company Secretary
Mr Brazier is employed under an Executive Employment Agreement which commenced on 7 January 2019. Mr Brazier receives the
following remuneration:
• Fixed remuneration of $301,125 per annum comprising a base salary of $275,000 and 9.5% superannuation;
• Variable remuneration comprising a cash bonus equal to a percentage of his cash salary (to a maximum of 50%) which will
be paid pro-rated on the successful completion of agreed performance targets at the completion of one year of continuous
employment; and
• Non-cash incentive: Participation in the Company’s Option Scheme. Invitation to participate in the Company’s Option Scheme is
at the full discretion of the board and may be amended from time to time.
The termination provisions of the agreement are:
• For no cause or incapacity: three months’ notice period (or any greater period required by the Fair Work Act 2009);
• Redundancy: 30% of the fixed remuneration (or greater as required by the Fair Work Act 2009);
• Serious misconduct or fraud: no notice period would be provided.
Effective from 1 July 2020, Mr Brazier’s fixed remuneration will increase to $355,875 per annum comprising a base salary of $325,000
per annum and 9.5% superannuation.
Andrew Czerw – General Manager – Resource Development
Mr Czerw was employed under an Employment Agreement which commenced on 10 April 2014. Mr Czerw receives the following
remuneration:
• Fixed remuneration of $284,700 per annum comprising a base salary of $260,000 and 9.5% superannuation, increased to a base
salary of $275,000 on 1 January 2020; and
• Non-cash incentive: Participation in the Company’s Option Scheme. Invitation to participate in the Company’s
Option Scheme is at the full discretion of the board and may be amended from time to time.
The termination provisions of the agreement are:
• For no cause or incapacity: three months’ notice period (or any greater period required by the Fair Work Act 2009);
• Redundancy: 30% of the fixed remuneration (or greater as required by the Fair Work Act 2009);
• Serious misconduct or fraud: no notice period would be provided.
Effective from 1 July 2020, Mr Czerw’s fixed remuneration will increase to $383,250 per annum comprising a base salary
of $350,000 per annum and 9.5% superannuation.
31
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020
Brendan Fyfe – General Counsel
Mr Fyfe was employed under an Executive Employment Agreement which commenced on 6 January 2020. Mr Fyfe receives
the following remuneration:
• Fixed remuneration of $301,125 per annum comprising a base salary of $275,000 and 9.5% superannuation;
• Non-cash incentive: Participation in the Company’s Option Scheme. Invitation to participate in the Company’s
Option Scheme is at the full discretion of the board and may be amended from time to time.
The termination provisions of the agreement are:
• For no cause or incapacity: three months’ notice period (or any greater period required by the Fair Work Act 2009);
• Redundancy: 30% of the fixed remuneration (or greater as required by the Fair Work Act 2009);
• Serious misconduct or fraud: no notice period would be provided.
Effective from 1 July 2020, Mr Fyfe’s fixed remuneration will increase to $328,500 per annum comprising a base salary
of $300,000 per annum and 9.5% superannuation.
e. Non-executive Directors’ Remuneration
The Company’s policy is to remunerate Non-executive Directors (“NEDs”) at market rates (for comparable companies) for time
commitment and responsibilities. To align their interests with those of shareholders, NEDs 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 NEDs of comparable companies.
Payments reflect the demands that are made on and the responsibilities of NEDs. NEDs’ fees and payments are reviewed annually
by the board. The Company’s constitution and ASX Listing Rules specify that the NEDs’ remuneration fee pool shall be determined
from time to time at a general meeting of shareholders.
In accordance with current corporate governance practices, the structure for the remuneration of NEDs and Senior Executives
is separate and distinct. Shareholders approve the maximum aggregate remuneration for NEDs. On 7 June 2019 shareholders
approved the current limit of $850,000. The board determines the actual payments to directors. The remuneration of NEDs
(inclusive of all committee fees and exclusive of superannuation) for the year ended 30 June 2020 have been set at $165,000 for
the Chair and $110,000 for other NEDs. In accordance with the remuneration options structure outlined above, NEDs’ cash salaries
were reduced to $107,250 for the Chair and $71,500 for other NEDs for a period of 12 months from 2 April 2019 to 1 April 2020.
32
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020
D I R E C T O R S ’ R E P O R T
f. Key Management Personnel Remuneration Table
The following table discloses details of the nature and amount of each element of the emoluments of each director of Ora Banda
Mining and each of the officers receiving the highest emoluments for the years ended 30 June 2020 and 30 June 2019.
Short Term
Post
employ-
ment
Other
long
term
Share-
based
payments
Salary
& Fees
STI
(Cash)
STI
(Equity)4
Superann-
uation
Leave
Accrued
Options4
Total
Performance
Related
Remuneration
KMP
Year
$
$
$
$
$
$
$
%
Non-executive
Directors
Peter Mansell
Keith Jones1
Mark Wheatley1
Executive
Director
David Quinlivan1
Senior
Executives
Tony Brazier2
Andrew Czerw
Brendan Fyfe3
Total
2020
121,756
2019
213,086
2020
81,018
2019
17,875
2020
81,018
2019
17,875
2020
300,000
2019
157,669
2020
275,000
2019
128,334
2020
267,500
2019
260,000
2020
135,738
2019
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
11,567
-
-
-
-
-
2,547
7,697
1,698
7,697
1,698
-
28,500
-
-
-
-
-
-
-
-
-
-
173,995
307,318
21,592
237,225
115,997
204,712
14,394
33,967
115,997
204,712
14,394
33,967
377,586
706,086
131,922
289,591
82,442
22,002
15,057
199,734
594,235
-
12,192
7,884
1,615
150,025
77,945
21,927
53,881
188,800
610,053
-
24,700
34,226
1,527
320,453
125,930
10,501
12,001
65,506
349,676
-
-
-
-
-
2020
1,262,030
-
286,317
109,891
80,939
1,237,615
2,976,792
2019 794,839
-
-
42,835
42,110
185,444
1,065,228
1. David Quinlivan, Keith Jones and Mark Wheatley were appointed on 2 April 2019.
2. Tony Brazier was appointed on 7 January 2019.
3. Brendan Fyfe was appointed on 6 January 2020.
4. The fair value of options is calculated at the date of grant using the Black-Scholes and Monte-Carlo simulation option pricing models
and allocated to each reporting period evenly over the period from grant date to vesting date. The value disclosed is the portion of the
fair value of the options recognised as an expense in each reporting period. Share-based awards are recognised as an expense
straight-line over the expected time to vesting.
57%
9%
57%
42%
57%
42%
53%
46%
47%
1%
44%
0%
55%
0%
51%
17%
33
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020
5. LINK BETWEEN COMPANY PERFORMANCE, SHAREHOLDER WEALTH GENERATION AND REMUNERATION
The Remuneration & Nomination Committee applies a series of criteria to assess the performance of the Company. Criteria used in
this assessment execution of development projects and exploration success as well as the following metrics in respect of the current
and previous financial years.
Criteria
Closing cash balances at 30 June ($m)
Closing share price at 30 June ($)
2020
10.58
0.27
2019
14.14
0.16
2018
0.01
0.11
2017
0.04
0.37
2016
15.40
0.43
The Company’s remuneration practices reflect the achievement of certain of the Company and KMP performance objectives.
The Company’s overall objective has been to continue to define resources and reserves, complete its Definitive Feasibility Study
and return the Company back to production.
6. KEY MANAGEMENT PERSONNEL SHAREHOLDINGS
Option holdings of Key Management Personnel
Balance
at 1 July
2019
Granted as
compen-
sation1
Options
exercised2
Options
forfeited4
Options
expired
Balance
at 30 June
2020
Options
vested
during
the year2
Vested and
exercisable
at 30 June
2020
2,162,778
1,441,852
1,441,852
-
-
-
(977,593)
(651,729)
(651,729)
David Quinlivan
3,441,852
2,000,000
(1,095,062)
30 June 2020
Non-executive
Directors
Peter Mansell
Keith Jones
Mark Wheatley
Executive
Director
Senior
Executives
Tony Brazier
Andrew Czerw
Brendan Fyfe3
-
-
-
-
1,185,185
790,123
790,123
977,593
651,729
651,729
-
-
-
4,346,790
1,351,729
956,667
-
-
-
-
-
3,942,208
3,792,899
-
-
(611,111)
(83,713)
3,247,384
1,129,648
(577,778)
(79,147)
(50,000)
3,085,974
1,068,031
N/A
2,581,071
-
(119,590)
-
2,461,481
740,767
518,537
490,253
740,767
Total
16,223,441
4,581,071
(4,565,002)
(282,450)
(50,000)
15,907,060
6,571,226
2,706,224
1. Options granted as compensation represents “RTSR” and “Other” options issued under the terms outlined above.
2. Remuneration options, incentive options and performance options, all of which were granted in the prior year, vested and were exercised
during the year.
3. Brendan Fyfe was appointed on 6 January 2020.
4. On 30 June 2020, 86.1% of FY20 STIP options vested and the remaining 13.9% FY20 STIP options were forfeited.
5. All options were exercised at nil price and each KMP received a quantity of ordinary shares equivalent to the number of options exercised.
34
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 D I R E C T O R S ’ R E P O R T
Value of Options Exercised and Forfeited
The following table discloses the fair value of options when exercised or forfeited, calculated as the number of options multiplied by
the share price on the dates of which those options were exercised or forfeited:
30 June 2020
Non-Executive Directors
Peter Mansell
Keith Jones
Mark Wheatley
Executive Director
David Quinlivan
Senior Executives
Tony Brazier
Andrew Czerw
Brendan Fyfe
Total
30 June 2020
Non-Executive Directors
Peter Mansell
Keith Jones
Mark Wheatley
Executive Director
David Quinlivan
Senior Executives
Tony Brazier
Andrew Czerw
Brendan Fyfe1
Total
Options
exercised
Value on date
of exercise
Options
forfeited
Value on date
of forfeiture
977,593
651,729
651,729
$223,139
$148,760
$148,760
1,095,062
$189,640
611,111
577,778
-
$163,411
$154,498
-
4,565,002
$1,028,208
-
-
-
-
83,713
79,147
119,590
282,450
-
-
-
-
$22,385
$21,164
$31,978
$75,527
Balance at
1 July 2019
Purchases
On the exercise
of options
Balance at
30 June 2020
1,666,667
666,667
300,000
1,170,555
500,000
485,768
977,593
651,729
651,729
3,814,815
1,818,396
1,437,497
666,667
-
1,095,062
1,761,729
-
97,778
N/A
60,000
200,000
-
611,111
577,778
-
671,111
875,556
-
3,397,779
2,416,323
4,565,002
10,379,104
1. Brendan Fyfe was appointed on 6 January 2020.
There were no alterations to the terms and conditions of options granted as remuneration since their grant date.
Loans to Key Management Personnel
There were no loans to Key Management Personnel during the financial year (30 June 2019: Nil).
Other transactions with Directors
Other than as described in this Remuneration Report, there were no other transactions between the Group and directors or their
related entities.
End of REMUNERATION REPORT (AUDITED)
35
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 ENVIRONMENTAL REGULATIONS
The Group is subject to significant environmental regulation in respect to its mineral exploration activities. These obligations are
regulated under relevant government authorities within Australia. The Group 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 Group 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 directors. No environmental breaches have been notified to the
Group by any government agency during the year ended 30 June 2020.
WARDENS COURT PROCEEDINGS
The Company (and its wholly owned subsidiaries) is a party to various proceedings in the Wardens Court pursuant to which third parties
are seeking to challenge its title to various mining tenements by way of forfeiture and other proceedings. The directors are confident
that the Company (and its wholly owned subsidiaries) will be successful in defending these proceedings. There were no proceedings
against any subsidiary that could bring into doubt whether the Company controlled any of its subsidiaries within the Group.
PROCEEDINGS ON BEHALF OF THE COMPANY
Other than as referred to above, no person has applied for leave of a court or to bring proceedings on behalf of the Company or
intervene in any proceedings to which the Company is a party for the purpose of taking responsibility on behalf of the Company, for all
or any part of those proceedings.
NON AUDIT SERVICES
The Group may decide to employ the auditor on assignments additional to their statutory audit duties where the auditor’s expertise
and experience with the Group are important. The directors consider the general standard of independence for auditors imposed by
the Corporations Act 2001 before any engagements are agreed.
No non audit services were provided by KPMG, the Group’s auditors, during the year (30 June 2019: $Nil). Further details of
remuneration of the auditors are set out at Note 17.
AUDITOR’S 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 OF AUDITORS
To the extent permitted by law, the Company has agreed to indemnify its auditors, KPMG, as part of the terms of its audit engagement
agreement against claims by third parties arising from the audit (for an unspecified sum). No payment has been made to indemnify
KPMG during or since the financial year end.
36
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 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 parties against certain claims or for any expenses or costs which may arise as a result of work
performed in their respective capacities as directors and 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 brought 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 OF AMOUNTS
In accordance with ASIC Corporations (Rounding in Financial/Directors’ Reports) Instrument 2016/191, the amounts in the Directors’
Report and in the financial report have been rounded to the nearest one thousand dollars, or in certain cases, to the nearest dollar
(where indicated).
This report is made in accordance with a resolution of directors, pursuant to section 298(2)(a) of the Corporations Act 2001.
On behalf of the directors
David Quinlivan
Managing Director
Perth, Western Australia
25 September 2020
37
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 Annual Mineral Resource
and Ore Reserve Statement
38
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 A N N U A L M I N E R A L R E S O U R C E
A N D O R E R E S E R V E S TAT E M E N T
In accordance with ASX Listing Rule 5.21, the Company reviews and reports its Mineral Resources and Ore Reserves at least annually.
The date of reporting is 30 June each year, to coincide with the Company’s end of financial year balance date. If there are any material
changes to its Mineral Resources or Ore Reserves over the course of the year, the Company is required to promptly report these changes.
Mineral Resource at 30 June 2020
Total Mineral Resources at 30 June 2020 are estimated of 23.7 Mt @ 2.8 g/t Au for 2.13 million ounces of contained gold.
MEASURED
INDICATED
INFERRED
TOTAL MATERIAL
(‘000t)
247
(g/t Au)
4.1
(‘000t)
146
(g/t Au)
3.4
(‘000t)
393
(g/t Au)
3.9
(‘000oz.)
49
PROJECT
GOLDEN EAGLE
LIGHTS OF ISRAEL
MAKAI SHOOT
WAIHI
Underground
Open Pit
TOTAL
Central Davyhurst Subtotal
LADY GLADYS
RIVERINA AREA
Underground
Open Pit
TOTAL
FOREHAND
SILVER TONGUE
SUNRAYSIA
Riverina-Mulline Subtotal
SAND KING
Underground
Open Pit
TOTAL
Open Pit
MISSOURI
Underground
TOTAL
PALMERSTON / CAMPERDOWN
BEWICK MOREING
BLACK RABBIT
THIEL WELL
Siberia Subtotal
Callion
Underground
Open Pit
TOTAL
Callion Subtotal
FEDERAL FLAG
SALMON GUMS
WALHALLA
WALHALLA NORTH
MT BANJO
MACEDON
Walhalla Subtotal
IGUANA
LIZARD
Lady Ida Subtotal
Davyhurst Total
BALDOCK
METEOR
WHINNEN
Mount Ida Total
Combined Total
Cut-Off
2.0
(‘000t)
-
3.0
1.0
0.5
2.0
1.0
0.5
2.0
1.0
1.0
1.0
0.5
2.0
0.5
2.0
1.0
1.0
1.0
0.5
2.0
1.0
1.0
1.0
1.0
1.0
1.0
1.0
1.0
-
-
-
-
-
-
-
-
-
-
116
-
116
-
-
-
116
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
32
-
-
-
-
-
32
-
106
106
300
-
-
-
-
(g/t Au)
-
-
-
-
-
-
-
-
1.8
-
1.8
-
-
-
1.8
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
2
-
-
-
-
-
2.0
-
4
4.0
-
-
-
-
74
1,985
1,948
188
2,136
4,442
1,858
2,694
226
2,843
386
155
175
5,494
1,252
438
1,690
1,460
364
1,824
118
-
-
-
3,632
241
255
496
496
112
199
448
94
109
-
962
690
75
765
136
-
-
2.7
15,800
140
18.6
4.3
2.0
2.4
3.7
2.5
2.4
1.9
1.8
5.7
1.8
1.7
2.7
2.1
1.9
3.4
3.7
3.5
3.4
3.4
3.4
2.3
-
-
-
3.4
3.7
6.0
4.9
4.9
1.8
2.8
1.8
2.4
2.3
-
2.1
2.1
3.7
2.3
2.5
18.6
-
-
180
153
131
195
326
805
190
183
502
685
436
19
318
1,648
128
698
826
17
258
275
174
50
434
18
1,777
28
156
184
184
238
108
216
13
126
186
887
2,032
13
2,045
7,300
0
143
39
180
4.2
1.7
2.9
4.0
3.5
3.3
2.4
3.0
6.1
5.3
1.9
1.3
2.0
3.4
3.3
3.8
3.7
3.5
3.4
3.4
2.4
2.3
3.5
6.0
3.5
1.6
5.5
4.9
4.9
2.5
2.9
1.4
3.0
1.4
1.8
2.0
2.0
2.8
2.0
2.9
0.0
9.3
13.3
10.2
254
2,138
2,079
383
2,462
5,247
2,048
2,993
728
3,721
822
174
493
7,258
1,380
1,136
2,516
1,477
622
2,099
292
50
434
18
5,409
269
411
680
680
382
307
664
107
235
186
1,881
2,722
194
2,916
23,400
136
143
39
320
4.2
2.0
2.4
3.8
2.6
2.5
1.9
1.9
5.9
2.7
1.8
2.5
2.0
2.3
3.4
3.7
3.5
3.4
3.4
3.4
2.4
2.3
3.5
6.0
3.4
3.5
5.8
4.9
4.9
2.3
2.8
1.7
2.5
1.8
1.8
2.1
2.0
3.8
2.1
34
137
159
47
206
427
125
183
139
322
48
14
32
540
150
136
286
160
68
227
23
4
49
3
592
30
77
107
107
28
28
36
9
14
11
125
175
24
199
2.6
18.6
9.3
13.3
13.8
1,990
81
43
17
140
300
2.7
15,900
2.6
7,500
3.0
23,700
2.8
2,130
39
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020
1. The Missouri, Sand King, Riverina, Waihi, Callion & Golden Eagle Mineral Resources have been updated in accordance with all relevant aspects of
the JORC code 2012, and initially released to the market on 15 December 2016 & 26 May 2020 (Missouri), 3 January 2017 & 26 May 2020 (Sand King),
2 December 2019 & 26 May 2020 (Riverina), 4 February 2020 (Waihi), 15 May 2020 & 29 June 2020 (Callion) & 8 April 2020 (Golden Eagle).
2. All Mineral Resources listed above, with the exception of the Missouri, Sand King, Riverina, Waihi, Callion & Golden Eagle Mineral Resources, were
prepared previously and first disclosed under the JORC Code 2004 (refer Swan Gold Mining Limited Prospectus announced on 13 February 2013).
These Mineral Resources have not been updated in accordance with JORC Code 2012 on the basis that the information has not materially changed
since it was first reported.
3. The Riverina, Waihi, Sand King, Missouri and Callion Open Pit Mineral Resource Estimates are reported within a A$2,400/oz pit shell above 0.5g/t.
The Riverina, Waihi, Sand King, Missouri, Callion and Golden Eagle Underground Mineral Resource Estimates are reported from material outside
a A$2,400 pit shell and above 2.0 g/t.
4. The values in the above table have been rounded.
Ore Reserve at 30 June 2020
Total Ore Reserves at 30 June 2020 are estimated of 6.1 Mt @ 2.4 g/t Au for 460,000 ounces of contained gold. No active ore mining has
occurred in this project area hence no resource depletion has occurred for the year.
PROJECT
Sand King
Missouri
Riverina Open Pit
Golden Eagle
Waihi
Callion
TOTAL
PROVED
PROBABLE
TOTAL MATERIAL
(‘000t)
(g/t Au)
(‘000t)
(g/t Au)
(‘000t)
(g/t Au)
(‘000oz)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,300
1,500
1,400
130
1,500
240
6,100
2.6
2.6
1.8
3.8
2.3
2.6
2.4
1,300
1,500
1,400
130
1,500
240
6,100
2.6
2.6
1.8
3.8
2.3
2.6
2.4
110
130
81
16
110
21
460
1. The table contains rounding adjustments to two significant figures and does not total exactly.
2. This Ore Reserve was estimated from practical mining envelopes and the application of modifying factors for mining dilution and ore loss.
3. For the open pit Ore Reserve dilution skins were applied to the undiluted LUC Mineral Resource estimate at zero grade. The in-pit global dilution is
estimated to be 29% at Sand King, 43% at Missouri, 22% at Riverina, 13% at Waihi and 23% at Callion all of which were applied at zero grade. The lower
dilution at Riverina, Waihi and Callion reflecting the softer lode boundary and allows for inherent dilution within the lode wireframe. All Inferred
Mineral Resources were considered as waste at zero grade.
4. The Open Pit Ore Reserve was estimated using incremental cut-off grades specific to location and weathering classification. They range from 0.54
g/t to 0.69 g/t Au and are based on a price of A$2,100 per ounce and include ore transport, processing, site overheads and selling costs and allow for
process recovery specific to the location and domain and which range from 85% (Sand King fresh ore) to 95%.
5. Approximately 100,000 t at 1.8 g/t at Riverina was downgraded from Proved to Probable due to uncertainty at the time surrounding metallurgical
recovery. Subsequent test work estimated the Riverina recoveries to be 90.1%, 97.6% and 94.3% for oxide, transition and fresh, respectively.
6. The underground Ore Reserve was estimated from practical mining envelopes derived from expanded wireframes to allow for unplanned dilution.
A miscellaneous unplanned dilution factor of 5% at zero grade was also included. The global dilution factor was estimated to be 32% with an average
grade of 0.77 g/t Au.
7. The underground Ore Reserve was estimated using stoping cut-off of 2.7 g/t Au which allows for ore drive development, stoping and downstream costs
such as ore haulage, processing, site overheads and selling costs. An incremental cut-off grade of 0.7 g/t Au was applied to ore drive development and
considers downstream costs only. Cut-off grades were derived from a base price of A$2,100 per ounce and allow for an assumed process recovery of
92%. Subsequent test work estimated the Golden Eagle fresh recovery to be 90.6%.
40
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 A N N U A L M I N E R A L R E S O U R C E
A N D O R E R E S E R V E S TAT E M E N T
Governance Arrangements and Internal Controls
Ora Banda Mining has ensured that the Mineral Resources and Ore Reserves quoted are subject to good governance arrangements
and internal controls. The Mineral Resources and Ore Reserves reported have been generated by internal Company geologists, who are
experienced in best practice in modelling and estimation methods. The competent person has also undertaken reviews of the quality
and suitability of the underlying information used to generate the resource estimation. In addition, Ora Banda Mining’s management
carry out regular reviews and audits of internal processes and external contractors that have been engaged by the Company.
Competent Person Statement
The information in this report that relates to exploration results, and the Riverina, Waihi, Golden Eagle, Sand King, Missouri and Callion
Mineral Resources is based on information compiled under the supervision of Mr Andrew Czerw, an employee of Ora Banda Mining
Limited, who is a Member of the Australian Institute of Mining and Metallurgy. Mr Czerw has sufficient experience which is relevant
to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a
Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources
and Ore Reserves’. Mr Czerw consents to the inclusion in the report of the matters based on his information in the form and context in
which it appears.
Sand King, Missouri, Riverina, Waihi, Golden Eagle, and Callion Mineral Resources are reported in accordance with the JORC Code (2012).
The Company confirms that it is not aware of any new information or data that materially affects the information included in the original
market announcements dated 15 December 2016 (Missouri) and 3 January 2017 (Sand King), 2 December 2019 (Riverina), 4 February 2020
(Waihi), 8 April 2020 (Golden Eagle), 15 May 2020 (Callion) and restated in market announcement ‘Davyhurst Gold Project - Ore Reserve
Update’ dated 26 May 2020. The Company further confirms that all material assumptions and technical parameters underpinning the
Mineral Resource estimates in the relevant market announcements continue to apply and have not materially changed.
Mineral Resources other than Sand King, Missouri, Riverina, Waihi, Golden Eagle and Callion, were first reported in accordance with
the JORC 2004 code in Swan Gold Mining Limited Prospectus announced on 13 February 2013. Mineral Resources other than Sand
King, Missouri Riverina, Waihi, Golden Eagle and Callion have not been updated to comply with JORC Code (2012) on the basis that the
information has not materially changed since it was first reported.
The information in this report that relates to Ore Reserves is based on information compiled by Mr Geoff Davidson, who is an
independent mining engineering consultant, and has sufficient relevant experience to advise Ora Banda Mining Limited on matters
relating to mine design, mine scheduling, mining methodology and mining costs. Mr Davidson has sufficient experience which is
relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as
a Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources
and Ore Reserves’. Mr Davidson is a Fellow member of the Australasian Institute of Mining and Metallurgy. Mr Davidson is satisfied that
the information provided in this statement has been determined to a feasibility level of accuracy, based on the data provided by Ora
Banda Mining Limited. Mr Davidson consents to the inclusion in the report of the matters based on his information in the form and
context in which it appears.
This Annual Resources and Reserves Statement has been compiled under the supervision of Mr Andrew Czerw, a full-time employee
of Ora Banda Mining Limited, who is Member of the Australian Institute of Mining and Metallurgy. Mr Czerw has sufficient experience
which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to
qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral
Resources and Ore Reserves’. Mr Czerw consents to the inclusion in the report of the matters based on his information in the form and
context in which it appears. Mr Czerw also consents to the Annual Resources and Reserves Statement as a whole.
41
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 Auditor’s Independence
Declaration
42
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 Auditor’s Independence
Declaration
A U D I T O R ’ S I N D E P E N D E N C E D E C L A R AT I O N
43
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020KPMG, an Australian partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity.Liability limited by a scheme approved under ProfessionalStandards Legislation.Lead Auditor’s Independence Declaration under Section 307C of the Corporations Act 2001 To the Directors of Ora Banda Mining Limited I declare that, to the best of my knowledge and belief, in relation to the audit of Ora Banda Mining Limited for the financial year ended 30 June 2020 there have been: i.no contraventions of the auditor independence requirements as set out in the Corporations Act 2001 in relation to the audit; and ii.no contraventions of any applicable code of professional conduct in relation to the audit.KPMG R Gambitta Partner Perth 25 September 2020 PAR_SIG_01 PAR_NAM_01 PAR_POS_01 PAR_DAT_01 PAR_CIT_01 KPMG, an Australian partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity.Liability limited by a scheme approved under ProfessionalStandards Legislation.Lead Auditor’s Independence Declaration under Section 307C of the Corporations Act 2001 To the Directors of Ora Banda Mining Limited I declare that, to the best of my knowledge and belief, in relation to the audit of Ora Banda Mining Limited for the financial year ended 30 June 2020 there have been: i.no contraventions of the auditor independence requirements as set out in the Corporations Act 2001 in relation to the audit; and ii.no contraventions of any applicable code of professional conduct in relation to the audit.KPMG R Gambitta Partner Perth 25 September 2020 PAR_SIG_01 PAR_NAM_01 PAR_POS_01 PAR_DAT_01 PAR_CIT_01 Consolidated Statement
of Profit or Loss
and other comprehensive income for the year ended 30 June 2020
30 June 2020
$’000
30 June 2019
$’000
Revenue – gold sales
Cost of sales
Gross loss
Other income/(expenses)
General and administration expenses
Exploration and evaluation expenses
Impairment reversal/(expense)
Other operating expenses
Debt forgiveness on DOCA effectuation
Operating (loss)/profit
Finance income
Finance expense
(Loss)/profit before income tax expense
Income tax expense
(Loss)/profit for the year
Other comprehensive income
Items that will not be reclassified subsequently to profit or loss
Loss on revaluation of financial assets at fair value through
other comprehensive income, net of tax
Total comprehensive (loss)/income for the year
Total comprehensive (loss)/income attributable to:
Equity holders of the Parent
Basic (loss)/earnings per share
Diluted (loss)/earnings per share
Notes
1(e)
3
4(a)
9
9
4(b)
29
4(c)
4(c)
5
25
25
-
-
-
254
(6,826)
(4,810)
7,311
(2,567)
-
(6,638)
195
(232)
(6,675)
-
(6,675)
-
(6,675)
(6,675)
(0.012)
(0.012)
The above statement should be read in conjunction with the accompanying notes.
6,429
(8,767)
(2,338)
(119)
(8,901)
(1,333)
(692)
(6,061)
32,288
12,844
-
(4,611)
8,233
(159)
8,074
(467)
7,607
7,607
0.105
0.105
44
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 Consolidated Statement
of Financial Position
as at 30 June 2020
Notes
30 June 2020
$’000
30 June 2019
$’000
Assets
Current assets
Cash and cash equivalents
Receivables and other assets
Inventories
Total current assets
Non-current assets
Receivables and other assets
Exploration, evaluation and development expenditure
Property, plant and equipment
Right-of-use assets
Total non-current assets
Total assets
Liabilities
Current liabilities
Trade and other payables
Lease liabilities
Provisions
Total current liabilities
Non-current liabilities
Trade and other payables
Lease liabilities
Provisions
Total non-current liabilities
Total liabilities
Net assets
Equity
Share capital
Accumulated losses
Reserves
Total equity
6
7
8
7
9
10
11
13
12
14
13
12
14
15
16
10,577
1,408
55
12,040
30
44,841
14,558
381
59,810
71,850
3,880
210
370
4,460
100
182
19,077
19,359
23,819
48,031
14,142
568
-
14,710
20
25,035
13,279
-
38,334
53,044
853
-
179
1,032
-
-
16,644
16,644
17,676
35,368
368,194
(322,266)
2,103
48,031
350,519
(328,181)
13,030
35,368
The above statement should be read in conjunction with the accompanying notes.
45
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 Consolidated Statement
of Changes In Equity
for the year ended 30 June 2020
Consolidated
Notes
Contributed
equity
$’000
Accumulated
losses
$’000
Share-based
payments
reserve
$’000
Fair value of
investments in
listed equities
reserve
$’000
Total
$’000
At 1 July 2018
287,168
(336,255)
11,892
1,218
(35,977)
Profit for the year
Other comprehensive income,
net of income tax
Total comprehensive income
Issue of ordinary shares (net of costs)
Share-based payments
Transactions with owners
in capacity of owners
At 30 June 2019
Loss for the year
Total comprehensive loss
Issue of ordinary shares (net of costs)
Share-based payments
Transfer from fair value reserve
Transfer of exercised and expired
options
Transactions with owners
in capacity of owners
15
26
15
26
-
-
-
63,351
-
63,351
8,074
-
8,074
-
-
-
-
-
-
-
387
387
-
8,074
(467)
(467)
(467)
7,607
-
-
-
63,351
387
63,738
350,519
(328,181)
12,279
751
35,368
-
-
(6,675)
(6,675)
-
-
751
17,675
-
-
-
-
-
-
1,663
-
11,839
(11,839)
-
-
-
-
(751)
-
(6,675)
(6,675)
17,675
1,663
-
-
17,675
12,590
(10,176)
(751)
19,338
At 30 June 2020
368,194
(322,266)
2,103
-
48,031
The above statement should be read in conjunction with the accompanying notes.
46
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 Consolidated Statement
of Cash Flows
for the year ended 30 June 2020
Notes
30 June 2020
$’000
30 June 2019
$’000
Cash flows from Operating Activities
Receipts from customers
Other receipts
Payments to suppliers and employees
Interest received
Interest paid
Net cash flows used in operating activities
24
Cash flows from Investing Activities
Payments for capitalised exploration and development expenditure
Payments for property, plant and equipment
Proceeds on sale of investments in listed equities
Proceeds from sale of property, plant and equipment
Net cash flows (used in)/provided by investing activities
Cash flows from Financing Activities
Proceeds from the issue of shares
Payments for costs of raising capital
Proceeds from loan advances
Repayment of loans
Repayment of lease liabilities
Net cash flows from financing activities
Net (decrease)/increase in cash and cash equivalents held
Cash and cash equivalents at the beginning of the year
Cash and cash equivalents at the end of the year
6
-
205
(10,954)
195
-
(10,554)
(9,412)
(1,092)
-
49
(10,455)
18,500
(825)
-
-
(231)
17,444
(3,565)
14,142
10,577
The above statement should be read in conjunction with the accompanying notes.
6,429
-
(31,493)
-
(190)
(25,254)
(1,565)
-
3,215
-
1,650
7,946
(1,349)
31,794
(650)
-
37,741
14,137
5
14,142
47
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 Notes to the Consolidated
Financial Statements
for the year ended 30 June 2020
48
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 Notes to the Consolidated
Financial Statements
for the year ended 30 June 2020
N O T E S T O T H E C O N S O L I D AT E D
F I N A N C I A L S TAT E M E N T S
1. BASIS OF PREPARATION
Ora Banda Mining Limited (“Company”) and its subsidiaries (“Group”) are a for-profit group of companies incorporated and domiciled
in Australia whose shares are publicly traded on the Australian Securities Exchange (“ASX”). The nature of the operations and principal
activities of the Group are described in the Directors’ Report.
The consolidated financial statements were approved by the board of directors on 25 September 2020. The consolidated 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 issued by the Australian Accounting Standards Board (“AASB”). The financial
report has been prepared on a historical cost basis, except for certain financial assets and liabilities which are measured on a fair
value basis. The consolidated financial report is presented in Australian dollars, which is the functional and presentation currency
of the Company and its subsidiaries.
Compliance with Australian Accounting Standards ensures that the consolidated financial statements and notes comply with
International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”).
The Company is of a kind referred to in ASIC Corporations (Rounding in Financial/Directors’ Reports) Instrument 2016/191 and
in accordance with that Instrument, all financial information has been rounded off to the nearest thousand dollars, unless
otherwise stated.
(a) Changes in accounting policies and disclosures
New and amended standards and interpretations
The Group has not yet early adopted any other standard, interpretation or amendment that has been issued but is not yet
effective.
AASB 16 Leases
The Group applied AASB 16 Leases for the first time from 1 July 2019. A number of other new standards are also effective from 1 July
2019 but they do not have a material effect on the Group’s financial statements.
AASB 16 introduced a single, on-balance sheet accounting model for lessees. As a result, the Group, as a lessee, has recognised
right-of-use assets representing its right to use the underlying assets and lease liabilities representing its obligation to make
lease payments.
The Group adopted the new standard using the modified retrospective approach, where the lease liability is measured at the
present value of future lease payments on the initial date of application, being 1 July 2019. The lease asset is measured as an
amount equal to the lease liability. Under the transition method, prior period comparative financial statements are not required
to be restated.
Leases
Previously, the Group determined at contract inception whether an arrangement was or contained a lease under AASB
Interpretation 4 Determining whether an Arrangement contains a Lease. The Group now assesses whether a contract is or
contains a lease based on the new definition of a lease. Under AASB 16, a contract is, or contains, a lease if the contract conveys a
right to control the use of an identified asset for a period of time in exchange for consideration.
On transition to AASB 16, the Group elected to apply the practical expedient to grandfather the assessment of which transactions
are leases. It applied AASB 16 only to contracts that were previously identified as leases. Contracts that were not identified as
leases under AASB 117 and AASB Interpretation 4 were not reassessed. Therefore, the definition of a lease under AASB 16 has been
applied only to contracts entered into or changed on or after 1 July 2019.
At inception or on reassessment of a contract that contains a lease component, the Group allocates the consideration in
the contract to each lease and non-lease component on the basis of their relative stand-alone prices. However, for leases of
properties in which it is a lessee, the Group has elected not to separate non-lease components and will instead account for the
lease and non-lease components as a single lease component.
49
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 The Group as Lessee
The Group assesses whether a contract is or contains a lease, at inception of that contract. The Group recognises a right-of-use
asset and a corresponding lease liability with respect to all lease arrangements in which it is the lessee, except for short-term leases
(defined as leases with a lease term of 12 months or less) and leases of low value assets (as example certain office equipment). For
these leases, the Group recognises the lease payments as an expense on a straight-line basis over the term of the lease unless another
systematic basis is more representative of the time pattern in which economic benefits from the leased assets are consumed.
The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date,
discounted by using the rate implicit in the lease. If this rate cannot be readily determined, the Group uses its incremental
borrowing rate.
Lease payments included in the measurement of the lease liability comprise:
•
•
Fixed lease payments (including in-substance fixed payments), less any lease incentives receivable;
Variable lease payments that depend on an index or rate, initially measured using the index or rate at the commencement date.
The Group presents lease liabilities as a separate line item in the consolidated statement of financial position. The lease liability
is subsequently measured by increasing the carrying amount to reflect interest on the lease liability (using the effective interest
method) and by reducing the carrying amount to reflect the lease payments made. The interest expense is charged to profit or loss
over the lease period to produce a constant periodic rate of interest on the remaining balance of the liability.
The Group remeasures the lease liability (and makes a corresponding adjustment to the related right-of-use asset) whenever:
•
The lease term has changed or there is a significant event or change in circumstances resulting in a change in the assessment
of exercise of a purchase option, in which case the lease liability is remeasured by discounting the revised lease payments
using a revised discount rate;
•
The lease payments change due to changes in an index or rate or a change in expected payment under a guaranteed residual
value, in which cases the lease liability is remeasured by discounting the revised lease payments using an unchanged
discount rate (unless the lease payments change is due to a change in a floating interest rate, in which case a revised
discount rate is used);
•
A lease contract is modified and the lease modification is not accounted for as a separate lease, in which case the lease
liability is remeasured based on the lease term of the modified lease by discounting the revised lease payments using a
revised discount rate at the effective date of the modification.
Right-of-use assets comprise the initial measurement of the corresponding lease liability, lease payments made at or before the
commencement day, less any lease incentives received and any initial direct costs. They are subsequently measured at cost less
accumulated depreciation and any impairment losses.
Right-of-use assets are depreciated over the shorter period of lease term and useful life of the underlying asset. If a lease
transfers ownership of the underlying asset or the cost of the right-of-use asset reflects that the Group expects to exercise a
purchase option, the related right-of-use asset is depreciated over the useful life of the underlying asset. The depreciation starts
at the commencement date of the lease.
Right-of-use assets are presented as a separate line in the consolidated statement of financial position. The Group applies AASB 136
Impairment of Assets to determine whether a right-of-use asset is impaired and, if so, recognises the impairment loss in profit or loss.
The Group has applied judgement to determine the lease term for some lease contracts in which it is a lessee that include renewal
options. The assessment of whether the Group is reasonably certain to exercise such options impacts the lease term, which
significantly affects the amount of lease liabilities and right-of-use assets recognised.
Transition (Group as Lessee)
At transition, for leases classified as operating leases under AASB 117, lease liabilities were measured at the present value of
the remaining lease payments, discounted at the Group’s incremental borrowing rate as at 1 July 2019. Right-of-use assets are
measured at an amount equal to the lease liability, adjusted by the amount of any prepaid or accrued lease payments.
The Group used the following practical expedients when applying AASB 16 to leases previously classified as operating leases under
AASB 117:
•
Applied the exemption not to recognise right-of-use assets and liabilities for leases with less than 12 months of lease term and
leases of low value assets;
•
Excluded initial direct costs from measuring the right-of-use asset at the date of initial application; and
• Used hindsight when determining the lease term if the contract contains options to extend or terminate the lease.
50
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 N O T E S T O T H E C O N S O L I D AT E D
F I N A N C I A L S TAT E M E N T S
For leases classified as finance leases under AASB 117, the carrying amount of the right-of-use asset and the lease liability at 1 July
2019 were determined at the carrying amount of the lease asset and lease liability under AASB 117 immediately before that date.
The impact of initial application of AASB 16 at the 1 July 2019 transition date was the recognition of a right-of-use asset of $132,000
and a corresponding lease liability in the statement of financial position. For those lease arrangements where an interest rate
has not been determined by the financier, an incremental borrowing rate is estimated to calculate the interest component and
discount of the lease liabilities as at 1 July 2019. The Group’s incremental borrowing rate has been determined based on market-
equivalent borrowing rates to finance assets of a similar nature. The Group’s incremental borrowing rate applied, on average, was
6% for those lease liabilities recorded on transition. This average rate has not changed as a result of new leases arranged during
the period. Further disclosures are included in Notes 11 and 12.
IFRIC 23 Uncertainty over Income Tax Treatments
IFRIC 23 became effective for the Group from 1 July 2019 and clarifies how the recognition and measurement requirements of
IAS 12 Income Taxes are applied where there is uncertainty over income tax treatments. The Group has reviewed the accounting
standard and has determined that there is no material impact.
(b) Basis of consolidation
The consolidated financial statements comprise the financial statements of the Group. A list of controlled companies
(subsidiaries) at year end is disclosed in Note 22.
The financial statements of subsidiaries are prepared for the same reporting period as the parent company, using consistent
accounting policies.
Intra-group balances and transactions, and any unrealised income and expenses arising from intra-group transactions, are
eliminated in preparing the consolidated financial statements.
(c) Fair value measurement
A number of the Group’s accounting policies and disclosures require the determination of fair value for both financial and non-
financial assets and liabilities. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date in the principal or, in its absence, the most advantageous
market to which the Group has access at that date. The fair value of a liability reflects its non-performance risk. Fair values
have been determined for measurement and/or disclosure purposes based on the following methods. When applicable, further
information about the assumptions made in determining fair values is disclosed in the notes specific to that asset or liability.
When measuring the fair value of an asset or liability, the Group uses observable market data as far as possible. Fair values are
categorised into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows:
•
•
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities;
Level 2: Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (ie: as
prices) or indirectly (ie: derived from prices);
•
Level 3: Inputs for the asset or liability that are not based on observable market data.
If the inputs used to measure the fair value of an asset or a liability fall into different levels of the fair value hierarchy, then the
fair value measurement is categorised in its entirety in the same level of the fair value hierarchy as the lowest level input that is
significant to the entire measurement. The Group recognises transfers between levels of the fair value hierarchy at the end of the
reporting period during which the change has occurred.
(d) New Standards and Standards not yet Effective
The Company has adopted all new standards and pronouncements applicable to the reporting period. Other than the impact of
the adoption of AASB 16 Leases, there was no other impact to the Company. There are no standards or pronouncements not yet
effective, but to be adopted in future periods, which have been assessed to have an impact on the Company once adopted.
(e) Revenue recognition
Gold bullion sales
Under AASB 15, revenue is recognised when a customer obtains control of the goods or services. Determining the timing of the
transfer of control requires judgement. With the sale of gold bullion, this occurs when physical bullion, from a contracted sale,
is transferred from the Company’s to the buyer’s account. The Company’s sole customer is the Perth Mint. No sales were made
during the reporting period.
51
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 2. SIGNIFICANT ACCOUNTING JUDGEMENTS, ESTIMATES AND ASSUMPTIONS
The preparation of financial statements requires management to make judgements, estimates and assumptions that affect the
application of accounting policies and reported amounts of assets and liabilities, income and expenses.
Judgements and estimates which are material to the financial report are found in the following notes:
• Note 5: Income Tax – consideration to recognition of deferred tax assets;
• Note 7: Trade Receivables – provision for expected credit losses on trade and other receivables;
• Note 9: Exploration, Evaluation and Development Expenditure – consideration of impairment reversal indicators and recognition
of impairment losses or reversals;
• Note 9: Reserves and Resources – estimating reserves and resources;
• Note 10: Property, Plant and Equipment – consideration of impairment triggers;
• Note 14: Provision for Rehabilitation – measurement of provision based on key assumptions; and
• Note 26: Share-based Payments – estimations involving valuation of options issued to directors and employees.
3. OTHER INCOME/(EXPENSES)
Profit on sale of property, plant & equipment
Debts recovered
Other income
Loss on sale of investments
4. (a) GENERAL AND ADMINISTRATION EXPENSES
Employee benefits expenses
Share-based payments (Note 26)
Administration and corporate costs
Movements in expected credit loss
Depreciation expense
4. (b) OTHER OPERATING EXPENSES
Site contractors and consultants
Travel costs
Repairs and maintenance
Power generation and utilities
Other operating expenses
30 June 2020
$’000
30 June 2019
$’000
49
144
61
-
254
-
-
-
(119)
(119)
30 June 2020
$’000
30 June 2019
$’000
1,986
1,663
2,852
(125)
450
6,826
5,074
145
4,630
(948)
-
8,901
30 June 2020
$’000
30 June 2019
$’000
1,291
254
186
223
613
2,567
1,476
979
229
-
3,377
6,061
52
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 N O T E S T O T H E C O N S O L I D AT E D
F I N A N C I A L S TAT E M E N T S
30 June 2020
$’000
30 June 2019
$’000
195
195
(211)
-
(21)
(232)
(37)
-
-
(1,049)
(3,534)
(28)
(4,611)
(4,611)
4. (c) FINANCE INCOME/(EXPENSE)
Interest income
Finance income
Accretion of rehabilitation provision
Interest bearing loans & borrowings measured at amortised cost
Other parties
Finance expense
Net finance expense
Accounting policies
Interest income comprises bank interest on funds invested and is recognised as it accrues, using the effective interest method.
Finance expenses comprise interest expense on borrowings, unwinding of the discount on provisions and change in the value of
investments measured at fair value through the profit and loss. All borrowing costs are recognised in the consolidated statement of
profit or loss and other comprehensive income using the effective interest method in the period in which they are incurred except
borrowing costs that are directly attributable to the acquisition, construction and production of a qualifying asset that necessarily
takes a substantial period to get ready for its intended use or sale. In this case, borrowing costs are capitalised as part of the
qualifying asset.
5. INCOME TAX
(a) Components of tax expense:
Current tax benefit
Deferred tax
(b) Deferred income tax related to items recognised directly to equity
Gain on financial asset at fair value through other comprehensive income
(c) Prima facie income tax expense
The prima facie tax payable on loss before income tax
is reconciled to the income tax expense as follows:
Prima facie income tax benefit/(expense) on loss
before income tax at 30% (2019: 30%).
Tax effect of:
- Expenses not deductible in determining taxable profit/loss
- Items which are non-assessable in determining taxable profit/loss
- Losses and other deferred tax balances not recognised during the period
Income tax expense/(benefit) attributable to loss
30 June 2020
$’000
30 June 2019
$’000
-
-
-
-
(43)
202
159
202
(2,003)
2,470
527
-
1,476
-
918
(10,619)
7,390
159
Based on the 30 June 2019 lodged Group income tax return and estimates for 30 June 2020, the Group has an unrecognised deferred
tax asset of $84.20 million on carried forward tax losses of $280.67 million. Losses carried forward of $170.24 million as at 30 June 2019
are subject to the satisfaction of the same business test or the business continuity test, due to several continuity of ownership failures
during the loss year periods. Losses incurred post 30 June 2016 are subject to the satisfaction of the continuity of ownership test.
53
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020
Accounting policies
Income tax
Income tax expense comprises current and deferred tax. Income tax expense is recognised in profit or loss except to the extent that it
relates to items recognised directly in equity, in which case it is recognised in equity.
Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at
balance date, and any adjustment to tax payable in respect of previous years.
Deferred tax is recognised using the balance sheet method, providing for temporary differences between the carrying amounts of
assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is measured at the tax
rates that are expected to be applied to the temporary differences when they reverse, based on the laws that have been enacted or
substantively enacted at balance date.
Tax losses
Deferred tax assets are recognised for the carry-forward of unused tax losses to the extent that it is probable that taxable profits
will be available in the future against which unused tax losses can be utilised. The deductible carry-forward tax losses do not expire
under current tax legislation. Deferred tax assets have not been recognised in respect of these items because it is not probable
that future taxable profit will be available against which the Group can utilise the benefits therefrom, detailed further in significant
judgements below.
Tax consolidation
Ora Banda Mining Limited and its wholly owned Australian resident subsidiaries have formed a tax consolidated group with effect from
1 July 2002. Ora Banda Mining Limited is the head entity of the tax consolidated group.
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.
Significant judgements
Deferred tax assets
Deferred tax assets, including those arising from unutilised tax losses, require the Group to assess the likelihood that it will generate
sufficient taxable earnings in future periods, in order to utilise recognised deferred tax assets. Assumptions about the generation of
future taxable profits depend on management’s estimates of future cash flows. These estimates of future taxable income are based
on forecast cash flows from operations (which are impacted by production and sales volumes, commodity prices, reserves, operating
costs, closure and rehabilitation costs, capital expenditure and other capital management transactions). To the extent that future
cash flows and taxable income differ significantly from estimates, the ability of the Group to realise the net deferred tax assets could
be impacted.
On 30 June 2020, the Group released a Definitive Feasibility Study (“DFS”) that outlined the path to re-starting production at its
Davyhurst Gold Project. Plant commissioning is expected to commence in Q4, CY20 with first gold production targeted for Q1, CY21.
Despite the DFS, the Group has assessed that a deferred tax asset for carried forward losses of $280.67 million as at 30 June 2020
should not be recognised given: (i) the care and maintenance status of the Davyhurst plant assets at balance date; (ii) further losses
expected to be incurred in the lead up to the restart of production; and (iii) the Group’s history of losses, of which create uncertainty
as to the extent to which the carried forward losses can and will be utilised.
54
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 6. CASH AND CASH EQUIVALENTS
Cash at bank and on hand
Accounting policies
N O T E S T O T H E C O N S O L I D AT E D
F I N A N C I A L S TAT E M E N T S
30 June 2020
$’000
30 June 2019
$’000
10,577
10,577
14,142
14,142
Cash and cash equivalents comprise cash balances and call deposits with maturities of three months or less. The Group ensures that
as far as possible it maintains excess cash and cash equivalents in short-term high interest-bearing deposits. The Group’s exposure to
interest rate risk and a sensitivity analysis of financial assets and liabilities are disclosed in Note 21.
7. RECEIVABLES AND OTHER ASSETS
Current
GST receivables
Prepayments
Other receivables
Less provision for expected credit loss
Non-current
Security deposits
30 June 2020
$’000
30 June 2019
$’000
239
1,164
1,981
3,384
(1,976)
1,408
71
497
2,442
2,513
(2,442)
568
30
20
The Group’s exposure to credit risk is disclosed in Note 21.
Accounting policies
Trade receivables are recognised initially at the value of the invoice sent to the counterparty and subsequently at the amounts
considered recoverable (amortised cost). Where there is evidence that the receivable is not recoverable, it is impaired with a
corresponding change to the Consolidated Statement of Profit or Loss and Other Comprehensive Income. GST receivable balances are
recorded initially as the consideration to be received from the federal government, and then subsequently at amortised cost.
Impairment of receivables
Reconciliation of provision for expected credit loss
Carrying amount at beginning of year
Reversal due to debt recovery
Amounts written off during the year
Carrying amount at the end of year
30 June 2020
$’000
30 June 2019
$’000
2,442
(171)
(295)
1,976
3,268
-
(826)
2,442
55
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020
Significant judgements
Provision for expected credit losses of trade and other receivables
The provision relates to outstanding amounts for shares issued to prior related parties and advances provided to prior related parties
for the recharges of costs incurred by the Group on behalf of the prior related party arising from prior periods. These amounts are
disclosed as ‘other receivables’. All related party receivables have been fully provided for based on an expected credit loss rate of
100%. The assessment of expected credit losses is a significant estimate. The amount of expected credit losses is sensitive to changes
in circumstances. The Group’s historical credit loss experience may also not be representative of customer’s actual default in the
future.
8. INVENTORIES
CURRENT
Materials and supplies
Finished goods
Total inventories
Accounting policies
30 June 2020
$’000
30 June 2019
$’000
44
11
55
-
-
-
Inventories include consumable stores, ore stockpiles, gold in circuit and finished goods (dore). Gold bullion, gold in circuit and ore
stockpiles are physically measured or estimated and valued at the lower of cost and net realisable value. Cost represents the weighted
average cost and includes direct purchase costs and an appropriate portion of fixed and variable production overhead expenditure,
including depreciation and amortisation, incurred in converting materials into finished goods.
Net realisable value represents estimated selling price in the ordinary course of business less any further costs expected to be
incurred to completion and disposal.
Consumable stores are valued at the lower of cost and net realisable value. Any provision for obsolescence is determined by reference
to specific items of stock. A regular review is undertaken to determine the extent of any provision for obsolescence.
9. EXPLORATION EVALUATION AND DEVELOPMENT EXPENDITURE
30 June 2020
$’000
30 June 2019
$’000
Exploration and evaluation phase
Acquisitions during the year
Balance at 30 June
Development phase
Cost brought forward
Expenditure during the year
Depreciation expense
Impairment reversal/(expense)
Rehabilitation provision adjustment
Transferred to property, plant & equipment
Balance at 30 June
Total
1,972
1,972
25,035
8,553
-
7,311
2,222
(252)
42,869
44,841
-
-
24,730
1,565
(568)
(692)
-
-
25,035
25,035
56
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020
N O T E S T O T H E C O N S O L I D AT E D
F I N A N C I A L S TAT E M E N T S
Accounting policies and significant judgements
Exploration and evaluation phase
Expenditure on areas of interest in the exploration and evaluation phase are those expenditures incurred in connection with the
exploration for and evaluation of minerals resources before the technical feasibility and commercial viability of extracting a mineral
resource are demonstrable. Exploration and evaluation phase assets include the costs of acquiring exploration licenses or exploration
rights and the fair value (at acquisition date) of exploration and evaluation assets acquired. All other expenditure on areas of interest
in the exploration and evaluation phase, including all expenditure incurred prior to securing legal rights to explore an area, is
expensed as incurred.
Capitalised exploration and evaluation expenditure is accumulated in respect of each identifiable area of interest. An “area of
interest” is an individual geological area which is considered to constitute a favourable environment for the presence of a mineral
deposit or has been proved to contain such a deposit. These costs are carried forward only if they relate to an area of interest for
which rights of tenure are current and where:
• such costs are expected to be recouped through successful development and exploitation or from sale of the area; and
• exploration and evaluation activities in the area have not, at balance date, reached a stage which permits a reasonable
assessment of the existence or otherwise of economically recoverable resources, and active and significant operations in, or
relating to, this area are continuing.
A regular review is undertaken of each area of interest to determine the appropriateness of continuing to carry forward capitalised
costs in relation to the area of interest. If capitalised costs do not meet the criteria noted above, they are written off in full against the
Consolidated Statement of Profit or Loss and Other Comprehensive Income.
During the year, $4.81 million of costs incurred on areas of interest in the exploration and evaluation phase were expensed to the
Consolidated Statement of Profit or Loss and Other Comprehensive Income (2019: $1.33 million) as they did not meet the recognition
criteria noted above. $1.97 million was paid to acquire access to land which the Group capitalised.
Exploration and evaluation assets are transferred to development phase assets once technical feasibility and commercial viability of
an area of interest is demonstrable. At this stage, exploration and evaluation assets are tested for impairment, and any impairment
loss is recognised, prior to being reclassified.
Impairment testing of exploration and evaluation assets
Exploration and evaluation assets are assessed for impairment if sufficient data exists to determine technical feasibility and
commercial viability or facts and circumstances suggest that the carrying amount exceeds the recoverable amount.
Exploration and evaluation assets are tested for impairment when any of the following facts and circumstances exist:
•
the term of exploration licence in the specific area of interest has expired during the reporting period or will expire in the near
future, and is not expected to be renewed;
• substantive expenditure on further exploration and evaluation of mineral resources in the specific area are not budgeted or
planned;
• exploration for and evaluation of mineral resources in the specific area have not led to the discovery of commercially viable
quantities of mineral resource and the decision was made to discontinue such activities in the specific area; or
• sufficient data exists to indicate that, although development in the specific area of interest is likely to proceed, the carrying
amount of the exploration and evaluation asset is unlikely to be recovered in full from successful development or by sale.
When a potential impairment is indicated, an assessment is performed for each cash generating unit which is no larger than the area
of interest.
57
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 Development phase assets
The Group capitalises expenditure on areas of interest in the development phase only where the following criteria are met:
• The Group has right of tenure in the area of interest;
• The expenditure is for the purpose of furthering an already proven mineral resource area; and
• The expenditure provides future economic benefit by developing the underlying resources to further progress the asset towards
commercial production.
Development phase assets are transferred to mine properties and mining assets when commercial production is achieved at the area
of interest.
Impairment testing of assets in the development or production phase
The carrying amounts of assets in the development or production phase are reviewed at each balance date to determine whether
there is any indication of impairment. If any such indication exists, then the asset’s recoverable amount is estimated.
The recoverable amount of an asset or cash-generating unit is the greater of its value-in-use (“VIU”) and its fair value less costs of
disposal (“FVLCD”). For the purpose of impairment testing, assets that cannot be tested individually are grouped together into the
smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other
assets or groups of assets (“cash-generating unit”).
An impairment loss is recognised if the carrying amount of an asset or its cash-generating unit exceeds its recoverable amount.
Impairment losses are recognised in the Statement of Profit or Loss and Other Comprehensive Income.
Impairment losses recognised in prior periods are assessed at each balance date for any indications that the loss has decreased or
no longer exists and therefore should be reversed. An impairment loss is reversed if there has been a change in the estimates used
to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not
exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had initially
been recognised. Impairment reversals are also recognised in the Statement of Profit or Loss and Other Comprehensive Income.
Expenditure in the development phase are assessed in light of current economic conditions. The carrying values of these assets have
been assessed for impairment or impairment reversal where respective indicators exist using a fair value less cost to sell technique.
In previous periods, $7.31 million in impairment expense was recorded based on implied market values applied to the Group’s existing
resource and reserve base at the date of impairment. The implied market values were calculated based on comparable transactions
within Australia converted to a value per ounce and normalised for changes in gold prices since the date of the transactions observed.
This technique is considered to use Level 3 inputs. During the current period, the Group observed the following changes to the key
inputs as previously used in the fair value less cost to sell technique:
•
Increase in Group resources of 348,000 ounces, representing an increase of 20%;
• Conversion of Group resources to reserves of 310,000 ounces, representing an increase of 207%; and
•
Increases in the gold price.
Based on these reversal indicators, the Group determined it was appropriate to reverse all prior period impairment charges recorded
against capitalised balances in the development phase.
Recoverable amount
The Group has determined the recoverable amount of its mine development phase assets using a fair value less cost of disposal
approach. The fair value estimates used to determine the recoverable amount are Level 3 fair value measurements, insofar as the
estimates are derived from valuation techniques that include inputs that are not based on observable market data. In summary,
an independent expert derived a dollar value per ounce from market transactions involving comparable companies for transactions
up to August 2019. When the dollar value per ounce was applied to the Group’s updated resource estimates as at 30 June 2020,
the recoverable amount totalled $47.9 million. This valuation approach is considered consistent with the approach taken by
market participants. The Group carries its mine development phase assets at the lower of its recoverable amount and its cost less
accumulated depreciation. As at 30 June 2020, the recoverable amount is in excess of cost less accumulated depreciation.
58
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 N O T E S T O T H E C O N S O L I D AT E D
F I N A N C I A L S TAT E M E N T S
Exploration expenditure commitments
Exploration expenditure commitments represent tenement rentals and minimum spend requirements that are required to be met
under the relevant legislation should the Group wish to retain tenure on all its current tenements (refer Note 18).
Mine properties and mining assets
Mine properties represent the acquisition cost and/or accumulated exploration, evaluation and development expenditure in respect
of areas of interest in which mining has commenced. When commercial production is achieved, capitalised costs in the development
phase are transferred to mine properties, at which time it is amortised on a unit of production basis based on ounces mined over the
total estimated reserves and resources related to this area of interest.
Significant factors considered in determining the technical feasibility and commercial viability of the project are the completion of a
feasibility study, the existence of sufficient resources to proceed with development and approval by the board of directors to proceed
with development of the project.
Underground development expenditure incurred in respect of mine development after the commencement of production is carried
forward as part of mine development only when substantial future economic benefits are expected, otherwise this expenditure is
expensed as incurred.
Reserves and resources
Resources are estimates of the amount of gold product that can be economically extracted from the Group’s mine properties. In
order to calculate resources, estimates and assumptions are required about a range of geological, technical and economic factors,
including quantities, grades, production techniques, recovery rates, production costs, future capital requirements, short and long
term commodity prices and exchange rates.
Estimating the quantity and/or grade of resources requires the size, shape and depth of ore bodies to be determined by analysing
geological data. This process may require complex and difficult geological judgments and calculations to interpret the data.
The Group determines and reports ore resources under the Australian Code of Reporting for Mineral Resource and Ore Reserves (2004
and 2012), known as the JORC Code. The JORC Code requires the use of reasonable assumptions to calculate resources. Due to the fact
that economic assumptions used to estimate resources change from period to period, and geological data is generated during the
course of operations, estimates of resources may change from period to period. Changes in reported resources may affect the Group’s
financial results and financial position in a number of ways, including:
• asset carrying values may be impacted due to changes in estimates of future cash flows;
• amortisation charged in the Statement of Profit or Loss and Other Comprehensive Income may change where such charges are
calculated using the units of production basis;
• decommissioning, site restoration and environmental provisions may change due to changes in estimated resources after
expectations about the timing or costs of these activities change; and
•
recognition of deferred tax assets, including tax losses.
59
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 10. PROPERTY, PLANT AND EQUIPMENT
Cost brought forward
Additions
Transfer from mine development
Write-offs
Depreciation expense
Balance at 30 June
(a) Reconciliation
Balance 1 July 2018
Depreciation expense
Balance 30 June 2019
Balance 1 July 2019
Additions
Transfers
Write-offs
Depreciation expense
Balance 30 June 2020
Accounting policies
30 June 2020
$’000
30 June 2019
$’000
13,279
1,270
252
(15)
(228)
14,558
Motor
Vehicles
$’000
Furniture
& Fittings
$’000
Plant &
Equipment
$’000
199
-
199
199
-
-
-
(35)
164
707
-
707
707
-
(377)
-
(79)
251
12,824
(451)
12,373
12,373
1,270
629
(15)
(114)
14,143
13,730
-
-
-
(451)
13,279
Total
$’000
13,730
(451)
13,279
13,279
1,270
252
(15)
(228)
14,558
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 assets located on a mine site are carried at cost less accumulated depreciation and any accumulated
impairment losses. All such assets are depreciated over the estimated remaining economic life of the mine, using a units-of-
production basis. The cost of certain items of property, plant and equipment has been determined with reference to its fair value,
detailed in significant judgements below.
All other property, plant and equipment assets are carried at cost less accumulated depreciation and impairment losses. These items
are depreciated on a straight-line basis over the assets estimated useful life which is three to eight years. Depreciation commences
from the time the asset is held ready for use.
Cost includes expenditures that are directly attributable to the acquisition of the asset. The cost of self-constructed assets includes
the cost of materials and direct labour, any other costs directly attributable to bringing the asset to a working condition for its
intended use, and the costs of dismantling and removing the items and restoring the site on which they are located.
When parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major
components) of property, plant and equipment. The cost of replacing part of an item of property, plant and equipment is recognised in
the carrying amount of the item if it is probable that the future economic benefits embodied within the part will flow to the Group and
its cost can be measured reliably. The costs of the day-to-day servicing of property, plant and equipment are recognised in profit or
loss as incurred.
60
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020
N O T E S T O T H E C O N S O L I D AT E D
F I N A N C I A L S TAT E M E N T S
Impairment testing
Property, plant and equipment is evaluated annually, at 30 June, to determine whether there are any indications of impairment or
any circumstances justifying the reversal of previously recognised impairment losses. Factors such as changes in assumptions in
future commodity prices, exchange rates, production rates and input costs, are monitored to assess for indications of impairment or
reversal of previously recognised impairments. If any such indications of impairment or impairment reversals exist, a formal estimate
of the recoverable amount is performed. In assessing whether an impairment is required, the carrying value of the asset is compared
with its recoverable amount, which is the higher of FVLCD and VIU.
As at 30 June 2020, it was assessed that there were no indicators of impairment nor indicators of impairment reversal pertaining to
property, plant and equipment.
11. RIGHT-OF-USE ASSETS
Non-current
Cost
Opening balance at 1 July 2019
Recognised on initial application of AASB 16
Adjusted balance on 1 July 2019
Additions
Closing balance at 30 June 2020
Accumulated depreciation
Opening balance at 1 July 2019
Depreciation charge for the period
Closing balance at 30 June 2020
Carrying amount – Opening balance at 1 July 2019 following initial application
Carrying amount – Closing balance at 30 June 2020
Property, plant and
equipment
$’000
-
132
132
471
603
-
222
222
132
381
There were no right-of-use assets recognised as at 30 June 2019. The impact of initial application of AASB 16 at the 1 July 2019 transition
date was the recognition of a right-of-use asset of $132,000 and a corresponding lease liability. The assets consist of an office lease
and equipment rentals. The weighted average discount rate used in discounting the lease liabilities as at 1 July 2019 and for additions
during the year ended 30 June 2020 was 6%.
61
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 12. LEASE LIABILITIES
Maturity analysis
Year 1
Year 2
Less unearned interest
Analysed as:
Current
Non-current
30 June 2020
$’000
30 June 2019
$’000
226
187
413
(21)
392
210
182
392
-
-
-
-
-
-
-
-
The right-of-use assets to which the lease liabilities relate is disclosed in Note 11.
Accounting policies
From 1 July 2019 the Group has applied the new AASB 16 Leases accounting standard. Refer to Note 1 for details on accounting policies
and the impacts of the new standard which has increased the value of right-of-use assets and lease liabilities of the Group.
13. TRADE AND OTHER PAYABLES
Current
Trade payables
Accruals
Other payables
Non-current
Other payables
30 June 2020
$’000
30 June 2019
$’000
2,482
1,068
330
3,880
100
100
183
582
88
853
-
-
The Group’s exposure to liquidity risk and a sensitivity analysis of financial assets and liabilities are disclosed in Note 21.
Accounting policies
Trade payables are recognised at the value of the invoice received from a supplier. They represent liabilities for goods and services
provided to the Group prior to the end of the financial year that are unpaid and arise when the Group becomes obliged to make future
payments in respect of the purchase of these goods and services. The amounts are unsecured and generally paid between 30-45 days
of recognition.
62
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020
14. PROVISIONS
Current
Provision for annual leave
Provision for long service leave
Non-current
Provision for rehabilitation
(a) Provision for rehabilitation
Carrying amount at beginning of year
Re-assessment of provision
Accretion
Carrying amount at the end of year
N O T E S T O T H E C O N S O L I D AT E D
F I N A N C I A L S TAT E M E N T S
30 June 2020
$’000
30 June 2019
$’000
301
69
370
19,077
19,077
16,644
2,222
211
19,077
179
-
179
16,644
16,644
15,595
-
1,049
16,644
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
based on estimates provided by an external consultant. Key inclusions and pertinent matters underpinning the provision are:
• Provision covers the four project areas, being Carnegie, Siberia, Mt Ida and Heron;
• Project areas (apart from the Davyhurst gold project site) have undergone limited scale exploration activities and have been on
care and maintenance;
• Cost estimates for the four project areas, included actual mining contractor and equipment rates and average industry contracting
rates;
• Provision incorporates costs for the demolition and cartage of fixed infrastructure to the nearest nominated waste disposal area;
• No allowance has been made for decommissioning of assets not owned by the Group but are located on Group owned leases;
• Rehabilitation costs being incurred over a 5.5 year period;
• 10% (2019: 15%) contingency has been included in the provision calculation;
• Allowance has been made within the contingency, for post-closure maintenance and reworking of environmental rehabilitation;
• Discount rate applied of 0.48%, estimated based on yields of government risk-free bonds; and
•
Inflation rate of 2%, estimated based on federal government target rates for inflation.
Assumptions, which are based on the current economic environment, have been made which the Company 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.
63
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020
Accounting policies
Provisions are recognised when the Group has a present (legal or constructive) obligation as a result of a past event, it is probable that
the Group will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. The amount
recognised as a provision is the best estimate of the consideration required to settle the present obligation at balance date, taking
into account the risks and uncertainties surrounding the obligation. If the time value of money is material, provisions are discounted
using a current pre-tax rate specific to the liability. The increase in the provision resulting from the passage of time is recognised as a
finance cost.
Short-term employee benefits
Liabilities for employee benefits for wages, salaries and annual leave represent present obligations resulting from employees’
services provided to balance date and are calculated at undiscounted amounts based on remuneration wage and salary rates that the
Group expects to pay as at balance date including related on-costs.
Long-term employee benefits
The Group’s net obligation in respect of long-term employee benefits is the amount of future benefit that employees have earned
in return for their service in the current and prior periods plus related on costs. The benefit is discounted to determine its present
value using a discount rate that equals the yield at balance date on Australian high-quality corporate bonds that have maturity dates
approximating the terms of the Group’s obligations.
Rehabilitation costs
Mine rehabilitation costs will be incurred by the Group either while operating, or at the end of the operating life of, the Group’s
facilities and mine properties. The Group assesses its mine rehabilitation provision at each balance date. The Group recognises a
rehabilitation provision where it has a legal and constructive obligation as a result of past events, and it is probable that an outflow
of resources will be required to settle the obligation, and a reliable estimate of the amount of the obligation can be made. The nature
of these restoration activities includes dismantling and removing structures; rehabilitating mines and tailings dams; dismantling
operating facilities; closing plant and waste sites; and restoring, reclaiming and revegetating affected areas.
The obligation generally arises when the asset is installed, or the ground/environment is disturbed at the mining operation’s location.
When the liability is initially recognised, the present value of the estimated costs is capitalised by increasing the carrying amount of
the related mining assets to the extent that it was incurred as a result of the development/construction of the mine.
Additional disturbances that arise due to further development/construction at the mine are recognised as additions or charges to the
corresponding assets and rehabilitation liability when they occur.
Changes in the estimated timing of rehabilitation or changes to the estimated future costs are dealt with prospectively by recognising
an adjustment to the rehabilitation liability and a corresponding adjustment to the asset to which it relates, if the initial estimate was
originally recognised as part of an asset measured in accordance with AASB 116.
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.
64
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 N O T E S T O T H E C O N S O L I D AT E D
F I N A N C I A L S TAT E M E N T S
Significant judgements
Provision for rehabilitation
Decommissioning and restoration costs are a normal consequence of mining and much of this expenditure is incurred at the end
of a mine’s life. In determining an appropriate level of provision, consideration is given to the expected future costs to be incurred,
the timing of these expected future costs (largely dependent on the life of the mine) and the estimated future level of inflation. The
ultimate cost of 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, currently proposed to be 2026 (2019: 2025), 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. At 30 June 2020, the provision of $19.1 million (30 June 2019: $16.6 million) represents the
Company’s best estimate of the rehabilitation costs required.
15. SHARE CAPITAL
Issued and paid up capital
590,284,962
368,194
485,719,962
350,519
30 June 2020
Number
30 June 2020
$’000
30 June 2019
Number
30 June 2019
$’000
(a) Movements in share capital
Balance as at 1 July 2018
761,784,738
287,168
Shares issued in accordance with the DOCA
Shares issued under Entitlement & Shortfall Offer
Shares issued under Placement
Shares issued on exercise of options
Consolidation of shares
Cost of capital raising
Balance as at 30 June 2019
Shares issued under Placement1
Shares issued on exercise of options2
Cost of capital raising1
Balance as at 30 June 2020
5,729,391,596
761,780,013
32,845,000
12
(6,800,081,397)
-
485,719,962
100,000,000
4,565,000
-
57,295
7,618
328
-
-
(1,890)
350,519
18,500
-
(825)
590,284,962
368,194
1. On 16 August 2019 the Company announced it had received firm commitments for a placement to raise $18.5 million (before costs) via the issue
of 100,000,000 new fully paid ordinary shares. The placement was undertaken at an issue price of 18.5 cents per fully paid ordinary share and was
strongly supported both by existing Ora Banda shareholders and new sophisticated investors introducing a number of new institutional shareholders
to the Company’s register.
Settlement of Tranche 1 of the placement (the issue of approximately 57.6 million new shares) was announced on 26 August 2019. On 15 November
2019 shareholders approved the issue of approximately 42.4 million new shares to Ora Banda’s major shareholder, Hawke’s Point Holdings 1 Limited
(Tranche 2 of the placement).
2. 4,565,000 ordinary shares were issued as a result of the exercise of unlisted vested remuneration, incentive and performance options at a nil
exercise price.
(b) Rights of each type of share
Ordinary shares participate in dividends and the proceeds on winding up of the parent entity in proportion to the number of
shares held. At shareholder meetings each ordinary share gives entitlement to one vote when a poll is called.
65
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020
(c) Share Options
Options over ordinary shares:
Employee share scheme
The Group continued to offer employee participation in short term and long term incentive schemes as part of the remuneration
packages for the employees of the Group. Refer to Note 26 for further information.
(d) Dividends paid or proposed
No dividends were paid or proposed during the current or previous financial year. No dividends have been proposed subsequent
to the end of the current financial year.
Accounting policies
Issued and paid up capital is recognised at the fair value of the consideration received by the Company. Any transaction costs arising
on the issue of ordinary shares are recognised directly in equity as a reduction of the share proceeds received.
16. RESERVES
Fair value of investments in listed equities reserve
Share-based payment reserve
Notes
(a)
(b)
30 June 2020
$’000
30 June 2019
$’000
-
2,103
2,103
751
12,279
13,030
(a) Fair value of investments in listed equities reserve
(i) Nature and purpose of reserve
This reserve is used to record unrealised movements in investments in listed equities at fair value through other
comprehensive income and not distributable.
(ii) Movements in reserve
Balance at beginning of year
Transferred to retained earnings
Change in fair value of listed equities through
other comprehensive income, net of tax
Balance at end of year
(b) Share-based payments reserve
(i) Nature and purpose of reserve
751
(751)
-
-
1,218
-
(467)
751
The reserve is used to record the fair value of shares or options issued to employees and directors as part of their
remuneration. The balance is transferred to share capital when options are granted, and balance is transferred to retained
earnings when options lapse.
(ii) Movements in reserve
Balance at beginning of year
Share-based payments expense (Note 26)
Options issued in lieu of payment for share raising costs
Exercised and expired options transferred to retained earnings
Balance at end of year
12,279
1,663
-
(11,839)
2,103
11,892
145
242
-
12,279
66
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020
17. REMUNERATION OF AUDITORS
Amounts paid or due and payable to:
KPMG
- Auditing and reviewing the financial reports
Other auditors
- Auditing and reviewing the financial reports1
N O T E S T O T H E C O N S O L I D AT E D
F I N A N C I A L S TAT E M E N T S
30 June 2020
$
30 June 2019
$
45,000
45,000
66,443
66,443
-
-
302,384
302,384
1. Consists of amounts invoiced by the previous auditor for prior period work, received during the 30 June 2020 financial year.
No non-assurance services (30 June 2019: Nil) were provided during the financial year.
18. EXPENDITURE COMMITMENTS
Under the terms of mineral tenement licences held by the Group, minimum annual expenditure obligations of $4,603,000 (30 June
2019: $4,515,000) may be required to be expended in the forthcoming financial year in order for the tenements to maintain a status of
good standing. This expenditure may be incurred by the Group and may be subject to variation from time to time in accordance with
Department of Industry and Resources regulations.
19. SEGMENT INFORMATION
For the year ended 30 June 2020, the Group’s focus has been on the exploration and evaluation of its interests in mineral tenement
licences associated with the Davyhurst gold project.
The Group operates in Australia.
Group performance is evaluated based on the financial position and operating profit or loss and is measured on a consistent basis
with the information contained in the consolidated financial statements. As such, no additional information is provided to that
already contained in the consolidated financial statements.
Major Customer
During the year ended 30 June 2020, no revenue was derived. In the prior year, $6,429,000 was derived from sales to one customer,
being Perth Mint.
20. RELATED PARTY TRANSACTIONS
(a) Key Management Personnel compensation
- Short-term employee benefits
- Post-employment payments
- Share-based payments
30 June 2020
$
30 June 2019
$
1,262,030
190,830
1,523,932
2,976,792
989,242
42,835
185,444
1,217,521
(b) Individual directors and executives’ compensation disclosures
Information regarding individual directors and executives’ compensation and some equity instruments disclosures as permitted by
Corporations Regulations 2M.3.03 is provided in the Remuneration Report section of the Directors’ Report.
During the year 4,581,071 incentive options were awarded to KMP. See Note 26 and the Remuneration Report for further details of
these related party transactions.
67
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020
21. FINANCIAL RISK MANAGEMENT
The Group’s principal financial assets comprise trade and other receivables and cash that arises directly from its operations.
The Group’s principal financial liabilities comprise trade payables. The main purpose of these financial instruments is to manage
cash flow and assist the Group in its daily operational requirements.
The Group is exposed to the following financial risks in respect to the financial instruments that it held at the end of the year:
•
Interest rate risk;
• Liquidity risk; and
• Credit risk.
The directors have overall responsibility for identifying and managing operational and financial risks.
(a) Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate as a result of changes
in market interest rates.
At balance date, the interest rate profile of the Group’s interest-bearing financial instruments was:
Fixed rate instruments
Lease liabilities
Variable rate instruments
Cash and cash equivalents
30 June 2020
$’000
30 June 2019
$’000
392
-
10,577
14,142
An increase/decrease of 1% in the interest rate applicable to the interest-bearing financial instruments at balance date would
result in an increase/decrease in net loss of $102,000 for the year ended 30 June 2020 (2019: an increase/decrease in net profit
of $141,000). This analysis assumes that all other variables remain constant.
(b) Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Group’s approach
to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due,
under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Group’s reputation.
The Group manages liquidity risk by maintaining adequate cash reserves from funds generated from operations and by
continuously monitoring forecast and actual cash flows.
Maturity analysis
The tables below represent the undiscounted contractual settlement terms for financial instruments and management’s
expectation for settlement of maturities.
68
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 N O T E S T O T H E C O N S O L I D AT E D
F I N A N C I A L S TAT E M E N T S
Total contractual
cash flows
$’000
Carrying
amount
$’000
3,980
413
4,393
3,980
392
4,372
Carrying
amount
$’000
853
853
30 June 2020
Trade and other payables
Lease liabilities
Net maturities
< 12 month
$’000 s
2-5 years
$’000
> 5 years
$’000
3,880
226
4,106
100
187
287
-
-
-
< 12 month
$’000 s
2-5 years
$’000
> 5 years
$’000
853
853
-
-
-
-
Total contractual
cash flows
$’000
853
853
30 June 2019
Trade and other payables
Net maturities
(c) Credit risk
Credit risk is the risk that a counterparty will not meet its obligations under a financial instrument or customer contract, leading
to a financial loss. The Group is exposed to credit risk from its operating activities (primarily trade and other receivables).
Exposure to credit risk associated with its financing activities arising from deposits with banks and financial institutions, foreign
exchange transactions and other financial instruments is not considered to be significant.
Trade and other receivables
Customer credit risk is managed subject to the Group’s established policy, procedures and control relating to customer credit risk
management. The Group trades only with recognised creditworthy third parties. The Group’s only customer is Perth Mint and at 30
June 2020, the exposure to credit risk associated with this customer and trade receivables is not significant. The Group has other
receivables that have been specifically identified as being of significant risk with respect to collection and therefore are included,
in full, in the expected credit loss.
An impairment analysis is performed at each balance date using a provision matrix to measure expected credit losses. The
provision rates are based on days past due for groupings of various customer segments with similar loss pattern. The calculation
reflects the probability weighted outcome, the time value of money and reasonable and supportable information that is available
at balance date about past events, current conditions and forecasts of future economic conditions.
The maximum exposure to credit risk for trade and other receivables at the balance date is the carrying value of each class of
financial assets disclosed in Note 7. The Group does not hold collateral as security.
Cash and cash equivalents
The Group limits its exposure to credit risk by only investing in liquid securities and only with major Australian financial
institutions.
(d) Fair values versus carrying values
The carrying value of cash and cash equivalents, trade and other receivables and trade and other payables is considered to be a
fair approximation of their fair values.
69
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 22. INVESTMENTS IN CONTROLLED ENTITIES
The Company controlled the following subsidiaries:
Name of controlled entities
Monarch Nickel Pty Limited
Monarch Gold Pty Limited
Carnegie Gold Pty Limited
Siberia Mining Corporation Pty Limited
Eastern Goldfields Mining Services Pty Limited
Controlled entities of Siberia Mining Corporation Pty Limited
Mt Ida Gold Operations Pty Limited
Ida Gold Operations Pty Limited
Pilbara Metals Pty Limited
Siberia Gold Operations Pty Limited
Mt Ida Gold Pty Limited
Holding Company
Country of
incorporation
Class
of shares
Equity holding
2020
2019
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
100
80
100
100
100
100
100
100
100
100
100
80
100
100
100
100
100
100
100
100
The ultimate holding company of the Group is Ora Banda Mining Limited, which is based in Western Australia and listed on the
Australian Securities Exchange.
Accounting policies
Subsidiaries are entities controlled by the Group. The Group controls an entity when it is exposed to, or has rights to, variable returns
from its involvement with the entity and has the ability to affect those returns through its power over the entity. The financial
statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the
date that control ceases.
23. CONTINGENT LIABILITIES
The Company and its wholly owned subsidiaries are parties to various proceedings in the Wardens Court pursuant to which third
parties are seeking to challenge its title to various mining tenements by way of forfeiture and other proceedings. The Group has legal
representation in respect of these plaints. The directors do not believe the plaints have a reasonable prospect of success and the
plaints will be vigorously defended by the Group.
70
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020
N O T E S T O T H E C O N S O L I D AT E D
F I N A N C I A L S TAT E M E N T S
30 June 2020
$’000
30 June 2019
$’000
10,577
14,142
24. CASH FLOW STATEMENT
(a) Reconciliation of cash and cash equivalents
Cash balances comprise:
Cash and cash equivalents
For the purposes of the cash flow statement, cash and
cash equivalents consist of cash and cash equivalents
as defined above.
(b) Reconciliation of net cash outflow from operating activities
to loss after income tax
(Loss)/profit after income tax
(6,675)
8,074
Adjusted for non-cash items:
Depreciation of property, plant and equipment
Impairment (reversal)/expense
Interest expense – capitalised
Accretion of rehabilitation provision
Share-based payments
Profit on sale of property, plant and equipment
Property, plant and equipment write-offs
Payments to suppliers made via equity settlement
Loss on disposal of investments
Loss on fair value hedge
Income tax expense
Debt forgiveness
Changes in operating assets and liabilities:
(Increase)/decrease in receivables
(Increase)/decrease in inventories
Increase/(decrease) in payables (excluding capital items)
Increase/(decrease) in provisions
Net cash outflow from operating activities
450
(7,311)
21
211
1,663
(49)
15
-
-
-
-
-
(850)
(55)
1,835
191
(10,554)
1,019
692
3,372
1,049
145
-
-
14,131
119
(293)
159
(32,169)
913
2,058
(23,353)
(170)
(25,254)
7 1
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020
25. EARNINGS/(LOSS) PER SHARE
(Loss)/profit used in the calculation of basic (loss)/earnings per share
(6,675)
8,233
30 June 2020
$’000
30 June 2019
$’000
Weighted average number of ordinary shares on issue used
in the calculation of basic earnings per share
Effect of dilution:
Weighted average number of ordinary shares on issue adjusted
for the effect of dilution
Basic (loss)/earnings per share
Diluted (loss)/earnings per share
Number
Number
560,434,327
-
75,373,996
503,510
560,434,327
75,877,506
(0.012)
(0.012)
0.105
0.105
A total of 40,046,782 options were on issue at 30 June 2020 and have not been accounted for in the above diluted earnings per share
calculations as the Group is in a loss position. A total of 44,433,913 options were on issue at 30 June 2019 and have not been accounted
for in the above diluted earnings per share calculations as they had exercise prices greater than the average market price of ordinary
shares during the year and were therefore considered anti-dilutive.
Accounting policies
Basic EPS is calculated as profit attributable to ordinary shareholders of the Company divided by the weighted average number of
ordinary shares.
Diluted EPS is determined by adjusting the profit attributable to ordinary shareholders and the weighted average number of ordinary
shares outstanding for the effects of all dilutive potential ordinary shares, including options granted to employees.
26. SHARE-BASED PAYMENTS
Equity-settled share-based payments are provided to directors, employees, consultants and other advisors. The issue to each
individual director, employees, consultant or advisor is controlled by the board and ASX Listing Rules. Terms and conditions of the
payments are determined by the board, subject to approval where required.
During the year ended 30 June 2020, a share-based payment expense of $1,663,000 (30 June 2019: $145,000) was recognised in the
Consolidated Statement of Profit or Loss and Other Comprehensive Income and $Nil (30 June 2019: $242,000) was recognised as a
share-based payment expense that was offset against share capital.
Option movements during the year
At 1 July
Granted during the year
Consolidated during the year
Exercised/expired during year
Forfeited during the year
At 30 June
2020
Number
44,433,913
5,581,071
-
(9,616,253)
(351,949)
40,046,782
2020
WAEP ($)
1.11
Nil
-
0.43
Nil
1.12
2019
Number
226,688,555
30,323,026
(197,552,501)
(15,025,167)
-
44,433,913
2019
WAEP ($)
0.26
0.17
3.13
0.46
-
1.11
The weighted-average share price at the date of exercise for options exercised during the year ended 30 June 2020 was $0.23
(2019: $0.06).
72
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020
N O T E S T O T H E C O N S O L I D AT E D
F I N A N C I A L S TAT E M E N T S
30 June 2020
A total of 5,581,071 unlisted options were issued during the year ended 30 June 2020. Of the issued options, 4,220,714 are subject to a
vesting condition based on Relative Total Shareholder Return (“RTSR”), whereby the Company’s total shareholder return is measured
relative to the returns of a peer group over the performance period 1 July 2019 to 30 June 2022. The fair value of the RTSR options was
estimated as at the date of grant using a Monte-Carlo simulation model taking into account the terms and conditions upon which the
options were granted. These options will vest according to the following schedule:
Company’s Performance Relative
to Peer Group
Percentage of Options
Eligible to Vest
ASX Comparator Group
Below 50th percentile
Nil
50th to 75th percentile
50% to 100% on a straight-line pro rata
BC8; BDC; BGL; GOR; MML; PNR; PRU;
RMS; RSG; SBM; SLR; TRY; WGX; WMX
75th percentile
100%
The remaining 1,360,357 issued options are subject to a vesting condition based on the achievement of the Company’s performance
metrics (“Other”) over the performance period 1 July 2019 to 30 June 2020. The fair value of these options was estimated as at the date
of grant using the Black-Scholes option pricing methodology taking into account the terms and conditions upon which the options
were granted. These options will vest according to the following schedule:
Option Vesting Conditions
Percentage of Options Eligible to Vest
Ora Banda Physical & Cost Performance
Ora Banda Management Response
Ora Banda Company RSR Performance
40%
50%
10%
On 30 June 2020, 86.1% (1,171,267) of FY20 STIP “Other” options vested and the remaining 13.9% (189,090) of FY20 STIP “Other” options
were forfeited.
The terms and conditions upon which the options were granted are summarised in the following table:
Option Class
Underlying security share price at grant date
Exercise price
Grant date
Vesting date
Expiry date
Risk-free rate
Volatility
Dividend yield
Number of options issued
Valuation per option
Fair value per option class
Other
$0.17
Nil
RTSR
$0.17
Nil
RTSR
$0.175
Nil
Other
$0.17
Nil
RTSR
$0.17
Nil
9/10/2019
9/10/2019
15/11/2019
24/01/2020
24/01/2020
30/06/2020
30/06/2022
30/06/2022
30/06/2020
30/06/2022
31/07/2020
30/06/2024
30/06/2024
31/07/2020
30/06/2024
0.62%
80%
Nil
500,000
$0.17
$85,000
0.60%
80%
Nil
0.75%
80%
Nil
0.75%
80%
Nil
0.75%
80%
Nil
500,000
2,000,000
860,357
1,720,714
$0.12
$0.128
$0.17
$0.114
$60,000
$256,000
$146,261
$196,161
The measure of volatility used in the option pricing model is the annualised standard deviation of the continuously compounded rates
of return on the historical TSR of Ora Banda and each constituent of the peer group for the length of time equal to the measurement
period. The recent volatilities of the constituents of the peer group and Ora Banda (using comparable companies) was calculated over
a one, two and three-year period.
73
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 30 June 2019
The fair value of options granted during the 2019 year was calculated at the date of grant using the Black-Scholes and Monte-Carlo
simulation option pricing models. The inputs to the valuation models used to determine the fair value at the grant dates were
as follows:
Option Class
Weighted average
fair value per option
Consultant
Options
Employee
Incentive
Options
Remuneration
Options
Director
Incentive
Options
Director
Incentive
Options
Director
Incentive
Options
Performance
Options
$0.03
$0.13
$0.16
$0.14
$0.12
$0.12
$0.16
Grant date
11/06/2019
28/06/2019
11/06/2019
11/06/2019
11/06/2019
11/06/2019
11/06/2019
Number of options
7,666,667
11,251,358
1,155,001
2,477,778
1,777,778
1,777,778
700,000
Expiry date
Exercise price
Price of shares on grant date
Estimated volatility
Risk-free interest rate
Dividend yield
11/06/2021
30/06/2024
11/12/2020 30/06/2020 30/06/2021
30/06/2023
30/06/2019
$0.263
$0.16
62%
1.01%
0%
Nil
$0.16
62%
1.07%
0%
Nil
$0.16
62%
1.01%
0%
Nil
$0.16
62%
1.01%
0%
Nil
$0.16
62%
1.01%
0%
Nil
$0.16
62%
1.07%
0%
Nil
$0.16
62%
1.01%
0%
Fair value per option class
$230,000
$1,475,188
$184,800
$234,667
$216,889
$215,111
$335,000
Vesting conditions
Nil
Service,
KPI &
share price
related
Service
related
Service &
share price
related
Service &
share price
related
Service &
share price
related
Service & KPI
related
Accounting policies
The grant date fair value of equity-settled share-based payment awards granted to employees is generally recognised as an expense,
with a corresponding increase in equity, over the vesting period of the awards. The amount recognised as an expense is adjusted to
reflect the number of awards for which the related service and non-market performance conditions are expected to be met, such
that the amount ultimately recognised is based on the number of awards that meet the related service and non-market performance
conditions at the vesting date. For share-based payment awards with non-vesting conditions, the grant date fair value of the share-
based payment is measured to reflect such conditions and there is no true-up for differences between expected and actual outcomes.
27. EVENTS AFTER BALANCE DATE
On 3 July 2020 the Company announced a $55 million equity capital raising comprising an institutional placement to raise
approximately $40 million and a 1 for 9 Accelerated Non-Renounceable Entitlement Offer to raise approximately $15 million over two
tranches. The first tranche was completed on 29 July 2020, and the second tranche was completed on 9 September 2020.
Apart from the above, no other matters have arisen since the end of the financial year that impact or are likely to impact the results of
the Group in subsequent financial periods.
74
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 28. PARENT ENTITY INFORMATION
(a) Financial Position
Assets
Current assets
Non-current assets
Total assets
Liabilities
Current liabilities
Non-current liabilities
Total liabilities
Equity
Contributed equity
Accumulated losses
Reserves
Total equity
(b) Financial performance
(Loss)/profit for the year
Other comprehensive income
Total comprehensive (loss)/profit for the year
(c) Contingent liabilities and commitments
N O T E S T O T H E C O N S O L I D AT E D
F I N A N C I A L S TAT E M E N T S
30 June 2020
$’000
30 June 2019
$’000
11,527
36,485
48,012
3,367
156
3,523
368,194
(325,808)
2,103
44,489
(9,384)
-
(9,384)
14,679
20,756
35,435
900
-
900
350,519
(327,111)
11,127
34,535
8,836
-
8,836
Contingent liabilities and commitments identified are as per those detailed within Notes 18 and 23 of this report.
(d) Deed of cross guarantee
Ora Banda Mining Limited and the following entities are parties to a deed of cross guarantee (which was executed on 26 June
2018 and lodged with the Australian Securities and Investments Commission) under which each Company guarantees the debts
of the others:
• Monarch Nickel Pty Limited;
• Carnegie Gold Pty Limited;
• Siberia Mining Corporation Pty Limited;
• Mt Ida Gold Operations Pty Limited;
•
Ida Gold Operations Pty Limited;
• Pilbara Metals Pty Limited;
• Siberia Gold Operations Pty Limited; and
• Mt Ida Gold Pty Limited.
By entering into the deed, the wholly owned entities have been relieved from the requirement to prepare financial statements
and a directors’ report under Corporations Instrument 2016/785 issued by the Australian Securities and Investments Commission.
The above companies represent a “Closed Group” for the purposes of the Corporations Instrument, and as there are no other parties
to the deed of cross guarantee that are controlled by Ora Banda Mining Limited, they also represent the “Extended Closed Group”.
As the Extended Closed Group includes all material subsidiaries of Ora Banda Mining Limited, there is no difference between the
Consolidated Statement of Profit or Loss and Other Comprehensive Income and Consolidated Statement of Financial Position of the
Ora Banda Mining Limited consolidated entity and the Extended Closed Group.
75
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020
29. DEBT FORGIVENESS ON DOCA EFFECTUATION
The Company completed a Deed of Company Arrangement (“DOCA”) during the 2019 financial year. At DOCA effectuation the Group’s
creditors forgave liabilities of $32.29 million.
The impact of the forgiveness is reported on the Consolidated Statement of Profit or Loss and Other Comprehensive Income in the
year in which it occurred.
76
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 Directors’ Declaration
1.
In the opinion of the directors of Ora Banda Mining Limited and its controlled entities:
(a) the Group’s consolidated financial statements and notes set out on pages 44 to 76 are in accordance with the
Corporations Act 2001, including:
(i)
giving a true and fair view of the Group’s financial position as at 30 June 2020 and of its performance, for the financial
year ended on that date; and
(ii) complying with Australian Accounting Standards and the Corporations Regulations 2001;
(b) the financial report also complies with International Financial Reporting Standards as set out in Note 1;
(c) there are reasonable grounds to believe that the Group will be able to pay its debts as and when they become due and payable;
and
(d) at the date of this declaration, there are reasonable grounds to believe that the Company and the subsidiaries identified in
Note 28, will be able to meet any obligations or liabilities to which they are or may become subject to by virtue of the Deed of
Cross Guarantee between the Company and those subsidiaries.
2.
the Director has been given the declarations required by Section 295A of the Corporations Act 2001 from the Managing Director
and Chief Financial Officer for the financial year ended 30 June 2020.
Signed in accordance with a resolution of directors made pursuant to section 295(5)(a) of the Corporations Act 2001.
On behalf of the directors
David Quinlivan
Managing Director
Perth, Western Australia
25 September 2020
77
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020
Independent Auditor’s
Report
78
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 Independent Auditor’s
Report
I N D E P E N D E N T A U D I T O R ’ S R E P O R T
79
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 KPMG, an Australian partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity.Liability limited by a scheme approved under Professional Standards Legislation. Independent Auditor’s Report To the shareholders of Ora Banda Mining Limited Report on the audit of the Financial Report Opinion We have audited the Financial Report of Ora Banda Mining Limited (the Company). In our opinion, the accompanying Financial Report of the Company is in accordance with the Corporations Act 2001, including: •giving a true and fair view of the Group’s financial position as at 30 June 2020 and of its financial performance for the year ended on that date; and •complying with Australian Accounting Standards and the Corporations Regulations 2001. The Financial Report comprises: •Consolidated Statement of financial position as at 30 June 2020; •Consolidated Statement of profit or loss and other comprehensive income, Consolidated Statement of changes in equity, and Consolidated Statement of cash flows for the year then ended; •Notes including a summary of significant accounting policies; and •Directors’ Declaration. The Group consists of the Company and the entities it controlled at the year-end or from time to time during the financial year. Basis for opinion We conducted our audit in accordance with Australian Auditing Standards. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the Financial Report section of our report. We are independent of the Group in accordance with the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code) that are relevant to our audit of the Financial Report in Australia. We have fulfilled our other ethical responsibilities in accordance with the Code. Key Audit Matters The Key Audit Matter we identified is development phase assets. Key Audit Matters are those matters that, in our professional judgement, were of most significance in our audit of the Financial Report of the current period. This matter was addressed in the context of our audit of the Financial Report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on this matter. KPMG, an Australian partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity.Liability limited by a scheme approved under Professional Standards Legislation. Independent Auditor’s Report To the shareholders of Ora Banda Mining Limited Report on the audit of the Financial Report Opinion We have audited the Financial Report of Ora Banda Mining Limited (the Company). In our opinion, the accompanying Financial Report of the Company is in accordance with the Corporations Act 2001, including: •giving a true and fair view of the Group’s financial position as at 30 June 2020 and of its financial performance for the year ended on that date; and •complying with Australian Accounting Standards and the Corporations Regulations 2001. The Financial Report comprises: •Consolidated Statement of financial position as at 30 June 2020; •Consolidated Statement of profit or loss and other comprehensive income, Consolidated Statement of changes in equity, and Consolidated Statement of cash flows for the year then ended; •Notes including a summary of significant accounting policies; and •Directors’ Declaration. The Group consists of the Company and the entities it controlled at the year-end or from time to time during the financial year. Basis for opinion We conducted our audit in accordance with Australian Auditing Standards. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the Financial Report section of our report. We are independent of the Group in accordance with the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code) that are relevant to our audit of the Financial Report in Australia. We have fulfilled our other ethical responsibilities in accordance with the Code. Key Audit Matters The Key Audit Matter we identified is development phase assets. Key Audit Matters are those matters that, in our professional judgement, were of most significance in our audit of the Financial Report of the current period. This matter was addressed in the context of our audit of the Financial Report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on this matter. 80
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020Development phase assets ($42.869 million) Refer to Note 9 to the Financial Report The key audit matter How the matter was addressed in our audit Existence, accuracy and valuation of expenditure capitalised as development phase assets was considered to be a key audit matter. Assets in the development phase of $42.869 million represent 60% of total assets as at 30 June 2020. During the period, the Group capitalised $8.554 million of development phase expenditure. In response to increases in the Group’s mineral resource estimates and the market price of gold, the Group reversed impairment charges recorded in previous periods of $7.311 million. Development phase assets are to be recorded using AASB 116 Property, Plant and Equipment. The standard prescribes that an expenditure shall be recognised as an asset if, and only if: a)it is probable that future economic benefits associated with the item will flow to the entity; and b)the cost of the item can be measured reliably. The Group uses judgements and estimates in: •the design and application of its accounting policies to identify and allocate expenditure between operating loss and assets, using AASB 116; and •identifying impairment reversal indicators and determining the quantum of any reversal. The existence of management judgments and estimates and the significance of the balance in the Group’s Statement of Financial Position has resulted in our conclusion that this is a key audit matter. Our procedures included: •We assessed the Group’s accounting policy by comparing it to AASB 116; •On a sample basis, we tested the allocation of expenditure to development phase assets by inspecting source documents and examining evidence underlying the allocation for consistency with the features contained in AASB 116; •We evaluated the Group’s assertion as to the presence of impairment reversal indicators. We compared the indicators to those in the accounting standards. We challenged the identification of the key indicators, being increased mineral resource estimates and increases to the gold price, against published consensus market prices and the Group’s mineral resource estimation from its publically available Definitive Feasibility Study; •We challenged the quantum of the impairment reversal by analysing the key indicators mentioned previously, as to their impact on the calculation of the recoverable amount. In addition, we evaluated the market comparable transactions used by the Group in the calculation of the recoverable amount against our industry knowledge; •We assessed the competence, objectivity and scope of the Group’s internal expert involved in the estimation process of mineral resources; •We checked features of the Definitive Feasibility Study prepared by the expert underpinning the calculation of the recoverable amount for consistency with our knowledge of the areas of interest, and the authority of the report; and •We evaluated the adequacy of disclosures in the financial report against the requirements of the accounting standards. I N D E P E N D E N T A U D I T O R ’ S R E P O R T
I N D E P E N D E N T A U D I T O R ’ S R E P O R T
81
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020Other Information Other Information is financial and non-financial information in Ora Banda Mining Limited’s annual reporting which is provided in addition to the Financial Report and the Auditor’s Report. The Directors are responsible for the Other Information. Our opinion on the Financial Report does not cover the Other Information and, accordingly, we do not and will not express an audit opinion or any form of assurance conclusion thereon, with the exception of the Remuneration Report and our related assurance opinion. In connection with our audit of the Financial Report, our responsibility is to read the Other Information. In doing so, we consider whether the Other Information is materially inconsistent with the Financial Report or our knowledge obtained in the audit, or otherwise appears to be materially misstated. We are required to report if we conclude that there is a material misstatement of this Other Information, and based on the work we have performed on the Other Information that we obtained prior to the date of this Auditor’s Report we have nothing to report. Responsibilities of the Directors for the Financial Report The Directors are responsible for: •preparing the Financial Report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 •implementing necessary internal control to enable the preparation of a Financial Report that gives a true and fair view and is free from material misstatement, whether due to fraud or error •assessing the Group and Company’s ability to continue as a going concern and whether the use of the going concern basis of accounting is appropriate. This includes disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless they either intend to liquidate the Group and Company or to cease operations, or have no realistic alternative but to do so. Auditor’s responsibilities for the audit of the Financial Report Our objective is: •to obtain reasonable assurance about whether the Financial Report as a whole is free from material misstatement, whether due to fraud or error; and •to issue an Auditor’s Report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error. They are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the Financial Report. A further description of our responsibilities for the audit of the Financial Report is located at the Auditing and Assurance Standards Board website at: https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf. This description forms part of our Auditor’s Report. Development phase assets ($42.869 million) Refer to Note 9 to the Financial Report The key audit matter How the matter was addressed in our audit Existence, accuracy and valuation of expenditure capitalised as development phase assets was considered to be a key audit matter. Assets in the development phase of $42.869 million represent 60% of total assets as at 30 June 2020. During the period, the Group capitalised $8.554 million of development phase expenditure. In response to increases in the Group’s mineral resource estimates and the market price of gold, the Group reversed impairment charges recorded in previous periods of $7.311 million. Development phase assets are to be recorded using AASB 116 Property, Plant and Equipment. The standard prescribes that an expenditure shall be recognised as an asset if, and only if: a)it is probable that future economic benefits associated with the item will flow to the entity; and b)the cost of the item can be measured reliably. The Group uses judgements and estimates in: •the design and application of its accounting policies to identify and allocate expenditure between operating loss and assets, using AASB 116; and •identifying impairment reversal indicators and determining the quantum of any reversal. The existence of management judgments and estimates and the significance of the balance in the Group’s Statement of Financial Position has resulted in our conclusion that this is a key audit matter. Our procedures included: •We assessed the Group’s accounting policy by comparing it to AASB 116; •On a sample basis, we tested the allocation of expenditure to development phase assets by inspecting source documents and examining evidence underlying the allocation for consistency with the features contained in AASB 116; •We evaluated the Group’s assertion as to the presence of impairment reversal indicators. We compared the indicators to those in the accounting standards. We challenged the identification of the key indicators, being increased mineral resource estimates and increases to the gold price, against published consensus market prices and the Group’s mineral resource estimation from its publically available Definitive Feasibility Study; •We challenged the quantum of the impairment reversal by analysing the key indicators mentioned previously, as to their impact on the calculation of the recoverable amount. In addition, we evaluated the market comparable transactions used by the Group in the calculation of the recoverable amount against our industry knowledge; •We assessed the competence, objectivity and scope of the Group’s internal expert involved in the estimation process of mineral resources; •We checked features of the Definitive Feasibility Study prepared by the expert underpinning the calculation of the recoverable amount for consistency with our knowledge of the areas of interest, and the authority of the report; and •We evaluated the adequacy of disclosures in the financial report against the requirements of the accounting standards. 82
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020Report on the Remuneration Report Opinion In our opinion, the Remuneration Report of Ora Banda Mining Limited for the year ended 30 June 2020, complies with Section 300A of the Corporations Act 2001. Directors’ responsibilities The Directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance with Section 300A of the Corporations Act 2001. Our responsibilities We have audited the Remuneration Report included in pages 27 to 35 of the Directors’ report for the year ended 30 June 2020. Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards. KPMG R Gambitta Partner Perth 25 September 2020 ASX Additional
Information
Tenement No.
Status
Registered Holder
Ownership
Location
E16/0344
E16/0456
E16/0473
E16/0474
E16/0475
E16/0480
E16/0482
E16/0483
E16/0484
E16/0486
E16/0487
E24/0203
E29/0640
E29/0889
E29/0895
E29/0955
E29/0964
E30/0333
E30/0335
E30/0338
E30/0454
E30/0468
E30/0490
E30/0491
E30/0504
G30/0006
G30/0007
L15/0224
L16/0058
L16/0062
L16/0072
L16/0073
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
SIBERIA MINING CORPORATION PTY LTD
SIBERIA MINING CORPORATION PTY LTD
CARNEGIE GOLD PTY LTD
CARNEGIE GOLD PTY LTD
CARNEGIE GOLD PTY LTD
GOLDSTAR RESOURCES (WA) PTY LTD
GOLDSTAR RESOURCES (WA) PTY LTD
GOLDSTAR RESOURCES (WA) PTY LTD
GOLDSTAR RESOURCES (WA) PTY LTD
GOLDSTAR RESOURCES (WA) PTY LTD
GOLDSTAR RESOURCES (WA) PTY LTD
ATRIPLEX PTY LIMITED
MT IDA GOLD PTY LTD
HERON RESOURCES LIMITED
MT IDA GOLD PTY LTD
SIBERIA MINING CORPORATION PTY LTD
GOLDSTAR RESOURCES (WA) PTY LTD
CARNEGIE GOLD PTY LTD
CARNEGIE GOLD PTY LTD
CARNEGIE GOLD PTY LTD
CARNEGIE GOLD PTY LTD
CARNEGIE GOLD PTY LTD
CARNEGIE GOLD PTY LTD
CARNEGIE GOLD PTY LTD
Application
CARNEGIE GOLD PTY LTD
Application
CARNEGIE GOLD PTY LTD
Application
CARNEGIE GOLD PTY LTD
Granted
Granted
Granted
Granted
Granted
SIBERIA MINING CORPORATION PTY LTD
SIBERIA MINING CORPORATION PTY LTD
SIBERIA MINING CORPORATION PTY LTD
CARNEGIE GOLD PTY LTD
CARNEGIE GOLD PTY LTD
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
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
Coolgardie
Coolgardie
Coolgardie
Coolgardie
Coolgardie
Coolgardie
Coolgardie
Coolgardie
Coolgardie
Coolgardie
Coolgardie
Kalgoorlie
Menzies
Menzies
Menzies
Kalgoorlie
Menzies
Menzies
Coolgardie
Menzies
Menzies
Menzies
Menzies
Menzies
Menzies
Menzies
Menzies
Coolgardie
Coolgardie
Coolgardie
Coolgardie
Coolgardie
83
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020Report on the Remuneration Report Opinion In our opinion, the Remuneration Report of Ora Banda Mining Limited for the year ended 30 June 2020, complies with Section 300A of the Corporations Act 2001. Directors’ responsibilities The Directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance with Section 300A of the Corporations Act 2001. Our responsibilities We have audited the Remuneration Report included in pages 27 to 35 of the Directors’ report for the year ended 30 June 2020. Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards. KPMG R Gambitta Partner Perth 25 September 2020 Tenement No.
Status
Registered Holder
Ownership
Location
L16/0103
L24/0085
L24/0115
L24/0170
L24/0174
L24/0188
L24/0224
L24/0233
L24/0240
L24/0242
L29/0074
L30/0035
L30/0037
L30/0066
L30/0069
L30/0074
L30/0076
L30/0077
L30/0078
M16/0262
M16/0263
M16/0264
M16/0268
M16/0470
M24/0039
M24/0115
M24/0159
M24/0208
M24/0376
M24/0634
M24/0660
M24/0663
M24/0664
M24/0665
M24/0683-I
M24/0686
M24/0757
M24/0772-I
M24/0797
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
SIBERIA MINING CORPORATION PTY LTD
SIBERIA MINING CORPORATION PTY LTD
SIBERIA MINING CORPORATION PTY LTD
CARNEGIE GOLD PTY LTD
CARNEGIE GOLD PTY LTD
SIBERIA MINING CORPORATION PTY LTD
SIBERIA MINING CORPORATION PTY LTD
CARNEGIE GOLD PTY LTD
CARNEGIE GOLD PTY LTD
Application
CARNEGIE GOLD PTY LTD
Granted
Granted
Granted
Granted
Granted
Granted
MT IDA GOLD PTY LTD
CARNEGIE GOLD PTY LTD
CARNEGIE GOLD PTY LTD
CARNEGIE GOLD PTY LTD
CARNEGIE GOLD PTY LTD
CARNEGIE GOLD PTY LTD
Application
CARNEGIE GOLD PTY LTD
Application
CARNEGIE GOLD PTY LTD
Application
CARNEGIE GOLD PTY LTD
SIBERIA MINING CORPORATION PTY LTD
SIBERIA MINING CORPORATION PTY LTD
SIBERIA MINING CORPORATION PTY LTD
CARNEGIE GOLD PTY LTD
CARNEGIE GOLD PTY LTD
CHARLES ROBERT GARDNER
SIBERIA MINING CORPORATION PTY LTD
SIBERIA MINING CORPORATION PTY LTD
SIBERIA MINING CORPORATION PTY LTD
SIBERIA MINING CORPORATION PTY LTD
HERON RESOURCES LIMITED
HERON RESOURCES LIMITED
HERON RESOURCES LIMITED
HERON RESOURCES LIMITED
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
100/100
100/100
96/96
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
96/96
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
96/96
96/96
100/100
96/96
100/100
100/100
100/100
100/100
100/100
Coolgardie
Coolgardie
Kalgoorlie
Kalgoorlie
Kalgoorlie
Kalgoorlie
Kalgoorlie
Kalgoorlie
Kalgoorlie
Kalgoorlie
Menzies
Menzies
Menzies
Menzies
Menzies
Menzies
Menzies
Menzies
Menzies
Coolgardie
Coolgardie
Coolgardie
Coolgardie
Coolgardie
Kalgoorlie
Kalgoorlie
Kalgoorlie
Kalgoorlie
Kalgoorlie
Kalgoorlie
Kalgoorlie
Kalgoorlie
Kalgoorlie
HERON RESOURCES LIMITED / IMPRESS ENERGY
90/100 & 10/100
Kalgoorlie
HERON RESOURCES LIMITED
HERON RESOURCES LIMITED
HERON RESOURCES LIMITED
HERON RESOURCES LIMITED
HERON RESOURCES LIMITED
100/100
100/100
100/100
100/100
100/100
Kalgoorlie
Kalgoorlie
Kalgoorlie
Kalgoorlie
Kalgoorlie
84
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 A S X A D D I T I O N A L I N F O R M AT I O N
Tenement No.
Status
Registered Holder
Ownership
Location
Granted
Granted
Granted
Granted
Granted
Granted
Granted
SIBERIA MINING CORPORATION PTY LTD
SIBERIA MINING CORPORATION PTY LTD
SIBERIA MINING CORPORATION PTY LTD
SIBERIA MINING CORPORATION PTY LTD
HERON RESOURCES LIMITED
HERON RESOURCES LIMITED
SIBERIA MINING CORPORATION PTY LTD
Application
HERON RESOURCES LIMITED
MT IDA GOLD PTY LTD
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
Kalgoorlie
Kalgoorlie
Kalgoorlie
Kalgoorlie
Kalgoorlie
Kalgoorlie
Kalgoorlie
Kalgoorlie
Menzies
MT IDA GOLD PTY LTD & STUART LESLIE HOOPER
95/100 & 5/100
Menzies
MT IDA GOLD PTY LTD
CARNEGIE GOLD PTY LTD
CARNEGIE GOLD PTY LTD
CARNEGIE GOLD PTY LTD
CARNEGIE GOLD PTY LTD
CARNEGIE GOLD PTY LTD
CARNEGIE GOLD PTY LTD
CARNEGIE GOLD PTY LTD
CARNEGIE GOLD PTY LTD
CARNEGIE GOLD PTY LTD
CARNEGIE GOLD PTY LTD
GOLDSTAR RESOURCES (WA) PTY LTD
GOLDSTAR RESOURCES (WA) PTY LTD
HERON RESOURCES LIMITED
HERON RESOURCES LIMITED
HERON RESOURCES LIMITED
HERON RESOURCES LIMITED
HERON RESOURCES LIMITED
HERON RESOURCES LIMITED
SIBERIA MINING CORPORATION PTY LTD
SIBERIA MINING CORPORATION PTY LTD
SIBERIA MINING CORPORATION PTY LTD
SIBERIA MINING CORPORATION PTY LTD
SIBERIA MINING CORPORATION PTY LTD
SIBERIA MINING CORPORATION PTY LTD
MT IDA GOLD PTY LTD
MINERAL AND GOLD RESOURCES
MT IDA GOLD PTY LTD
MT IDA GOLD PTY LTD
100/100
100/100
100/100
100/100
100/100
100/100
96/96
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
Menzies
Menzies
Menzies
Menzies
Menzies
Menzies
Menzies
Coolgardie
Menzies
Coolgardie
Menzies
Coolgardie
Coolgardie
Kalgoorlie
Kalgoorlie
Kalgoorlie
Kalgoorlie
Kalgoorlie
Kalgoorlie
Kalgoorlie
Kalgoorlie
Kalgoorlie
Kalgoorlie
Kalgoorlie
Kalgoorlie
Menzies
Menzies
Menzies
Menzies
85
M24/0845
M24/0846
M24/0847
M24/0848
M24/0915-I
M24/0916
M24/0960
M24/0973
M29/0002
M29/0165
M29/0422
M30/0102
M30/0103
M30/0111
M30/0123
M30/0126
M30/0157
M30/0187
M30/0253
M30/0255
M30/0256
P16/2921
P16/2922
P24/4395
P24/4396
P24/4400
P24/4401
P24/4402
P24/4403
P24/4750
P24/4751
P24/4754
P24/5073
P24/5074
P24/5075
P29/2328
P29/2397
P29/2398
P29/2399
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 Tenement No.
Status
Registered Holder
Ownership
Location
P29/2400
P29/2401
P29/2402
P29/2403
P29/2404
P29/2405
P29/2406
P29/2407
P30/1122
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
MT IDA GOLD PTY LTD
MT IDA GOLD PTY LTD
MT IDA GOLD PTY LTD
MT IDA GOLD PTY LTD
MT IDA GOLD PTY LTD
MT IDA GOLD PTY LTD
MT IDA GOLD PTY LTD
MT IDA GOLD PTY LTD
CARNEGIE GOLD PTY LTD
Tenement Acquisitions & Disposals
Mining Tenements Disposed: 3
Mining Tenements Acquired:
L24/240 granted on 27 November 2019
L30/69 granted on 11 March 2020
L30/74 granted on 21 April 2020
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
Menzies
Menzies
Menzies
Menzies
Menzies
Menzies
Menzies
Menzies
Menzies
86
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020
A S X A D D I T I O N A L I N F O R M AT I O N
The following information is provided, in accordance with Listing Rule 4.10:
CORPORATE GOVERNANCE
The Company’s corporate governance plan is available on the Company’s website at www.orabandamining.com.au.
SECURITY HOLDERS
SUBSTANTIAL SHAREHOLDERS
The Company has the following substantial shareholders as at 7 September 2020:
Hawke’s Point Holdings I Limited
NPS Mining Alliance Pty Limited
Shares Held
295,085,758
38,619,516
NUMBER OF HOLDERS IN EACH CLASS OF EQUITY SECURITIES
AND THE VOTING RIGHTS ATTACHED (AS AT 7 SEPTEMBER 2020)
ORDINARY SHARES
There are 2,357 holders of ordinary shares as at 7 September 2020. Each shareholder is entitled to one vote per share. In accordance
with the Company’s constitution, on a show of hands every member present in person or by proxy or attorney or duly authorised
representative has one vote for every fully paid ordinary share held.
OPTIONS
There are 415 holders of unlisted options. There are no voting rights attaching to the options. A total of 31,775,397 options are on issue.
If exercised, the 31,775,397 options will convert into 31,775,397 ordinary shares.
The options have the following exercise prices and expiry dates:
No. of holders
No. of Options
Exercise Price
Expiry Date
1
1
60
59
347
346
4
10
1
509,500
66,667
2,178,331
2,178,331
3,854,862
3,854,862
2,916,667
15,616,177
600,000
$3.1078
$6.1828
$2.9578
$3.3328
$2.9578
$3.3328
$1.1203
Nil
Nil
02/02/2021
02/02/2021
31/01/2023
31/01/2023
02/02/2023
02/02/2023
11/06/2023
Various
Various
87
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 DISTRIBUTION SCHEDULE OF THE NUMBER OF HOLDERS IN EACH CLASS
OF EQUITY SECURITY AS AT 7 SEPTEMBER 2020
Range
ORDINARY SHARES
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 Over
Total
Class
RESTRICTED SECURITIES
Ordinary Shares
Total
Range
Total holders
Units
% Units
286
520
309
906
336
2,357
8
8
62,570
1,606,576
2,346,916
33,988,990
704,260,851
742,265,903
Number
55,464,867
55,464,867
0.01
0.22
0.32
4.58
94.87
100.00
Latest date that voluntary
escrow period ends
11/12/2020
Total holders
Units
% Units
UNLISTED OPTIONS EXPIRING 02/02/2021 AT $3.1078
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 Over
Total
UNLISTED OPTIONS EXPIRING 02/02/2021 AT $6.1828
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 Over
Total
UNLISTED OPTIONS EXPIRING 31/01/2023 AT $2.9578
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 Over
Total
-
-
-
-
1
1
-
-
-
1
-
1
3
23
13
16
5
60
-
-
-
-
509,500
509,500
-
-
-
66,667
-
66,667
2,666
74,996
97,166
466,836
1,536,667
2,178,331
0.00
0.00
0.00
0.00
100.00
100.00
0.00
0.00
0.00
100.00
0.00
100.00
0.12
3.44
4.46
21.43
70.54
100.00
88
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 A S X A D D I T I O N A L I N F O R M AT I O N
DISTRIBUTION SCHEDULE OF THE NUMBER OF HOLDERS IN EACH CLASS
OF EQUITY SECURITY AS AT 7 SEPTEMBER 2020 (Cont)
Range
Total holders
Units
% Units
UNLISTED OPTIONS EXPIRING 31/01/2023 AT $3.3328
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 Over
Total
UNLISTED OPTIONS EXPIRING 2/02/2023 AT $2.9578
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 Over
Total
UNLISTED OPTIONS EXPIRING 2/02/2023 AT $3.3328
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 Over
Total
UNLISTED OPTIONS EXPIRING 11/06/2023 AT $1.1203
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 Over
Total
2
23
13
16
5
59
286
46
8
5
5
347
286
44
9
5
2
346
-
-
-
-
4
4
1,666
74,996
98,166
466,836
1,536,667
2,178,331
48,419
108,211
58,269
210,796
3,429,167
3,854,862
48,419
99,886
66,594
210,796
3,429,167
3,854,862
-
-
-
-
2,916,667
2,916,667
UNLISTED INCENTIVE OPTIONS EXPIRING BETWEEN 30/09/2020 AND30/6/2024 AT NIL EXERCISE PRICE
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 Over
Total
-
-
-
-
10
10
-
-
-
-
15,616,177
15,616,177
0.08
3.44
4.51
21.43
70.54
100.00
1.26
2.81
1.51
5.47
88.95
100.00
1.26
2.59
1.73
5.47
88.95
100.00
-
-
-
-
100.00
100.00
-
-
-
-
100.00
100.00
89
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020
DISTRIBUTION SCHEDULE OF THE NUMBER OF HOLDERS IN EACH CLASS
OF EQUITY SECURITY AS AT 7 SEPTEMBER 2020 (Cont)
Range
Total holders
Units
% Units
UNLISTED PERFORMANCE OPTIONS EXPIRING ON EVENT RELATED DATES AT NIL EXERCISE PRICE
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 Over
Total
MARKETABLE PARCEL
-
-
-
-
1
1
-
-
-
-
600,000
600,000
-
-
-
-
100.00
100.00
On 7 September 2020 there were 312 shareholders with less than a marketable parcel (being 1,429 shares), based on the closing price
of $0.35 per share.
TWENTY LARGEST HOLDERS OF EACH CLASS OF QUOTED SECURITY
The names of the 20 largest holders of each class of quoted security, the number of equity securities each holds and the percentage of
issued capital each holds (as at 7 September 2020) are set out below:
Rank
Name
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
CITICORP NOMINEES PTY LIMITED
NPS MINING ALLIANCE PTY LIMITED
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
MR HENDRICUS INDRISIE
NATIONAL NOMINEES LIMITED
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
WYLLIE GROUP PTY LIMITED
GR ENGINEERING SERVICES LIMITED
UBS NOMINEES LIMITED
BNP PARIBAS NOMS PTY LTD
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED-GSCO ECA
RALMANA PTY LIMITED
DONALD SMITH VALUE FUND LP
INVESTMET LIMITED
BNP PARIBAS NOMINEES PTY LTD
NATIONAL NOMINEES LIMITED
UNIVERSAL OIL (AUSTRALIA) PTY LTD
SOUTHERN CROSS CAPITAL PTY LTD
CS THIRD NOMINEES PTY LIMITED
MR MICHAEL FOTIOS
TOP TWENTY SHAREHOLDERS
TOTAL REMAINING SHAREHOLDERS
TOTAL SHAREHOLDERS
Units
% of Units
302,455,179
40.75
38,619,516
33,352,892
26,085,556
23,158,175
18,959,002
17,720,426
15,406,214
11,750,358
10,108,944
9,964,673
9,463,675
8,333,333
8,016,667
6,907,190
5,000,000
5,000,000
4,902,389
4,715,435
4,233,333
564,152,957
178,112,946
742,265,903
5.20
4.49
3.51
3.12
2.55
2.39
2.08
1.58
1.36
1.34
1.27
1.12
1.08
0.93
0.67
0.67
0.66
0.64
0.57
76.00
24.00
100.00
90
ORA BANDA MINING LIMITED AND ITS CONTROLLED ENTITIESACN 100 038 266 ANNUAL REPORT 2020 orabandamining.com.au