Peabody Energy
Annual Report 2012

ANNUAL 
REPORT 
2012

XXXXXXX

1

For personal use onlyANNUAL GENERAL MEETING OF SHAREHOLDERS 

To be held at 10am on Tuesday 20 November 2012: 

Exchange Centre, 20 Bridge Street, Sydney

All $ amounts referred to in this report are expressed in $AUD unless otherwise noted

www.bathurstresources.co.nz

For personal use only“OVER THE NEXT DECADES, WE’LL BE 
SHARING THE BENEFITS OF OUR BUSINESS WITH 
HUNDREDS OF NEW ZEALAND FAMILIES AND 
BUSINESSES AND CONTRIBUTING TO THE LONG-
TERM PROTECTION OF THE CONSERVATION 
ESTATE IN THE SOUTH ISLAND”.

SECTION
ONE

Year In Review

SECTION
TWO

SECTION
THREE

Financial Statements

Other Information

Chairman and Managing Director’s Report   4
Review of Operations  
6
16
Sustainability  
24
Our People  
26
Coal  

Directors’ Report  

Auditor’s Independence Declaration  

Corporate Governance Statement 

28

44

45

ASX Principles Compliance Statement   51

Financial Statements 

Directors’ Declaration  

Independent Auditor’s Report 

54

100

101

ASX additional information 
Tenement Schedule 
Coal Resources and Reserves 
Corporate Directory 

104
106
107
109

1

For personal use onlyABOUT BATHURST RESOURCES

Bathurst Resources Limited was fl oated on the Australian 
Securities Exchange in December 2007 and listed on 
the New Zealand Exchange in November 2010.

The company is now well positioned as a modern 
New Zealand mining company with producing assets 
in the South Island and an operations offi  ce in Wellington. 
The company is already a producer of coal for the domestic 
thermal markets and is fi rmly focussed on becoming 
a leading exporter of high quality coking coal from its 
Buller Coal Project, near Westport, on the West Coast.

HIGHLIGHTS 2011/2012

 ‧ Settlement of Coalbrookdale acquisition

 ‧ Opening of new operations offi ce in Wellington

 ‧ First shipment of Cascade coal leaves Westport

 ‧ Successful mediation of Residents’ appeal against resource consents

 ‧ Execution of a Deed of Ground Lease for Port Taranaki

 ‧ Heads of Agreement signed with Westport Harbour Limited

 ‧

Increase in Reserves and Resources for the Buller Coal Project

            ORGANISATIONAL STRUCTURE

BATHURST GROUP 

BULLER COAL 
LIMITED

EASTERN COAL 
LIMITED

EASTERN COAL SUPPLIES 
TAKITIMU (AND COALDALE)
OHAI
ALBURY

SOUTH BULLER

CASCADE
COALBROOKDALE 
ESCARPMENT
WHAREATEA WEST
DEEP CREEK

NORTH BULLER 

BLACKBURN
MILLERTON
NORTH BULLER

Below: The Cascade mine, on the edge 
of the Denniston Plateau

2

For personal use onlySECTION 
ONE

Year In Review

Chairman and Managing Director’s Report   4
6
Review of Operations  
16
Sustainability  
24
Our People  
26
Coal  

For personal use onlyCHAIRMAN AND MANAGING DIRECTOR’S REPORT

WE ARE PLEASED TO PRESENT OUR 
ANNUAL REPORT AND FINANCIAL STATEMENTS 
FOR THE 2011/12 YEAR - A PERIOD OF 
SIGNIFICANT PLANNING, GROWTH AND 
PRODUCTION FOR BATHURST RESOURCES AS 
WE MOVE TOWARDS OUR GOAL OF BECOMING 
A LEADING NEW ZEALAND COAL PRODUCER.

L: Craig Munro, Non-Executive Chair, R: Hamish Bohannan, 
Managing Director. Below L to R: Craig Munro, 
Rt Hon John Key, Hon Phil Heatley, Hamish Bohannan

In March 2012, the New Zealand Prime Minister, the Rt Hon 
John Key, opened our new operations offi  ce in Wellington. 
Joined by a number of his parliamentary colleagues, and 
our business partners and supporters, the Prime Minister 
reinforced his support for organisations such as Bathurst 
that are providing jobs and economic benefi ts to the 
country while carefully managing environmental impacts.

Our new offi ce reinforces our  commitment to being a long-term 

member of the New Zealand community. We are a New Zealand-

focussed company, listed on both the NZX and the ASX. All our 

operating assets are in New Zealand, with our primary asset, the 

Buller Coal Project, based at the epicentre of the country’s proud 

mining heritage on the West Coast of the South Island.

During the year the company continued to focus on gaining full 

approvals for the development of its fl agship Escarpment project, 

on the Denniston Plateau near Westport. 

At the beginning of the reporting period, Escarpment was granted its 

resource consents. However, shortly after, the consents were subject 

to three appeals: one on the location of the proposed mine’s infrastructure, 

one on the basis that climate change effects should be considered and 

one on environmental grounds. The fi rst appeal was resolved through 

mediation and withdrawn. The Environment Court ruled that climate 

change effects were irrelevant in relation to the second appeal and the 

High Court has subsequently upheld that ruling. At the time of writing, 

leave for a further appeal to the Court of Appeal has just been granted 

and we are working with the other parties to have that appeal heard 

as quickly as possible.

4

For personal use onlyCHAIRMAN AND MANAGING DIRECTOR’S REPORT

The remaining appeal on environmental grounds is due to be heard 

in New Zealand’s Environment Court during November with a ruling 

expected early next year. 

Although we are confi dent of a positive ruling our preference is to reach 

a settlement with the remaining appellants prior to a court hearing and 

we are working hard to achieve that outcome.

We remain committed to the Buller Coal Project, which is expected 

to provide 225 new direct jobs on the West Coast and inject about 

NZ$1 billion into the New Zealand economy over six years. We are 

optimistic we will be in production by mid-2013.

Key to this development is Escarpment which has the potential to 

produce 1 million tonnes per annum of high-quality coking coal for 

export to overseas customers. In the coming year we will be focussing 

on developing adjoining projects in South Buller and, later, bringing 

our North Buller tenements into operation. As the full Buller Coal 

Project comes on line we are targeting an increase in production 

to approximately 4 million tonnes per annum by 2018.

Meanwhile the Buller Coal Project continues to produce modest 

amounts of export coal and coal for domestic cement production 

from the Cascade mine, which is now ramping up to an annualised 

rate of 150,000 tonnes.

In anticipation of increased production from Buller when Escarpment 

FINANCIAL RESULTS

comes into production, the company established coal facilities at 

the deep-water Port of Taranaki on the North Island and is close to 

completing its Stage 1 port upgrade of the Westport coal handling 

facilities.

During the reporting period, we also commenced production at our 

With A$53.8 million of cash in the bank and some earnings from small, 

existing coal operations, Bathurst is well-funded for the near term.

Total coal sales revenue reported for the year was $16.5 million, derived 

from both the Buller Coal and Eastern Coal operations.

new Coaldale block at  the Takitimu mine near Nightcaps. Production 

Our earnings showed a net loss for the group of $21.5 million for 

from the Cascade mine at Buller and the Takitimu mine at Nightcaps 

the year to 30 June 2012 (2011: $13.5 million). This was due to the 

continues to provide positive operational cash fl ow for the business. 

impairment of the Eastern assets, unrealised foreign exchange losses 

As a company, our focus is not just on growth, but also on responsible 

development. During the year we established the independent Kaitiaki 

on the deferred consideration for the L&M aquisition, and expensing 

of normal project development costs.

Environmental Reference Group to monitor our environmental 

With our fi rst full year of operations behind us we look forward to 

performance and ensure that our programmes and systems comply 

continued growth with a strong balance sheet to support our 

with best practice. 

development and expansion activities.

More recently we were pleased to be invited to join New Zealand’s 

In closing, we would like to acknowledge the efforts of our fellow 

Sustainable Business Council, an organisation established to 

directors, management and staff. 

promote business leadership in sustainability and focused, through

its membership, on the balanced pursuit of economic growth, 

ecological integrity and social progress.

We would also like to extend our thanks to our shareholders. 

We appreciate your continued support in a year that has seen some 

setbacks, but has also seen the company fi rmly cement its position 

In March 2012, Bathurst was pleased to welcome on board our new 

in New Zealand. We remain committed to returning value to all 

Chief Operating Offi cer, Richard Tacon. Richard has over 30 years’ 

our stakeholders as we move towards becoming a pre-eminent 

experience in both the New Zealand and  Australian coal industries. 

coal producer.

Richard joined Bathurst from Centennial Coal where he was General 

Manager Western Operations. Originally from New Zealand, Richard 

has now returned to be based in our Wellington offi ce. 

With our focus clearly on New Zealand, we are currently in the process 

CRAIG MUNRO | Non-Executive Chair         HAMISH BOHANNAN | Managing Director

of building up a strong Wellington based management team.

5

For personal use onlyREVIEW OF OPERATIONS

THE 2012 FINANCIAL YEAR WAS A SIGNIFICANT 
ONE FOR BATHURST WITH THE COMPANY 
CEMENTING ITS PRESENCE IN NEW ZEALAND, 
BEING WELL PLACED TO ACHIEVE ITS GOAL 
OF BECOMING A MAJOR COAL PRODUCER. 

The company’s operations are focussed on New Zealand’s 
South Island with the Buller Coal Project near Westport on 
the West Coast, the Takitimu mine at Nightcaps in Southland 
and a coal handling and distribution centre in Timaru.

In March 2012, Bathurst underpinned its commitment to New Zealand 

when the Prime Minister, the Right Hon. John Key, offi ciated at the 

opening of the company’s offi ce in Wellington. 

OPERATIONAL

Bathurst’s fl agship development is the Buller Coal Project, a high 

quality export coking coal operation, targeting a 4 million tonne per 

annum production profi le by 2018. 

The fi rst substantive stage of the Buller Coal Project is Escarpment, 

located on the historic Denniston Plateau adjacent to the Cascade 

mine. The plateau has long been recognised as one of New Zealand’s 

most signifi cant coal areas with a proud history of mining dating back 

to the 1800’s. It produces valuable hard coking coal, sought by steel 

makers all over the world. 

Below: The Buller Coal Project
1, Seddonville, 2, North Buller, 
3, Millerton, 4, Blackburn, 5, Deep Creek, 
6, Coalbrookdale, 7 Whareatea West, 
8, Cascade, 9, Escarpment

1

2

3

4

5

6

8

7

9

WESTPORT

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For personal use onlyREVIEW OF OPERATIONS

Resource consents were granted for the Escarpment permit in August 

2011. Whilst the consents were appealed, the company was successful 

in resolving the fi rst of these through mediation and is now in the 

process of working through the remaining two appeals. 

The Buller Coal Project currently produces modest amounts of coal 

from the Cascade mine on the edge of the Denniston Plateau, part of 

the Eastern Resources Group acquisition which was fi nalised in March 

2011. The Cascade mine was previously a small volume mine producing 

coal for the local cement market. Production is now ramping up to 

150,000 tonnes per annum of semi soft coking coal targeting the export 

market. The coal from the Cascade mine is also in demand by the ferro 

silicon metals market and trial shipments have already commenced 

to an end user in Australia. 

Drilling in the areas surrounding the Cascade mine has identifi ed further 

coal adjacent to the current Mining Permit (MP), which will extend the 

life of mine by up to eight years.

During 2012 the company completed the acquisition of the 

Coalbrookdale assets, a strategic tenement package at South Buller 

also adjacent to the company’s Escarpment permit and operating 

Cascade mine. An access arrangement and wildlife permit authority have 

been issued by the Department of Conservation for ongoing exploration 

at Coalbrookdale. During the year, and subsequent to year end, a total 

of 79 holes were drilled across the Coalbrookdale permits. Coalbrookdale 

is currently fully consented for underground mining. The company 

however the company is reviewing its development plans with a view 

to making an application for open cast mining.

Drilling produced encouraging results at Bathurst’s Whareatea West 

Exploration Permit (“EP”), concentrating on the western area, and the 

adjacent West Plateau EP. An appraisal extension for a further two 

years was granted for the Whareatea West EP.

Bathurst has continued exploration on the North Buller Project during 

the year, with two rigs committed to an extensive programme to 

delineate the extent of the resource across several permits in the area. 

This programme is ongoing to prove up reserves with an aim of bringing 

the fi rst permits into production in late 2016. The results of an 

independent scoping study on North Buller are currently being reviewed.

Bathurst has now commenced infrastructure upgrades at the Ports of 

Taranaki and Westport, securing a route to the export markets of South 

East Asia and India. Coal facilities were installed at the deep water port 

of Taranaki during the year. Similar facilities are currently being 

constructed at Westport for completion in December 2012. 

In Southland, mining operations at the Takitimu mine extended into 

the adjoining Coaldale block to access a further six years of resource. 

A new mining permit was granted as part of that extension.

At Albury, near Timaru, Bathurst holds Prospecting Permit 52484 over 

an area of 838 square kilometres which is prospective for thermal coal. 

During the year, desktop studies and trenching were undertaken to 

defi ne areas of interest prior to making application for an EP.

7

L to R: Craig Pilcher, Eastern GM, , Pat McManus, Buller District Mayor, 
Richard Tacon, Bathurst COO, 

For personal use onlyREVIEW OF OPERATIONS

Eastern Coal
Takitimu Coal Limited (ML 37079)

The Takitimu mine is located at Nightcaps, north of Invercargill. Mining 

operations originally commenced at Nightcaps in 1881. Sub-bituminous 

coal from the open cut operations is railed to a number of major industrial 

customers in the Southland, Otago and South Canterbury areas.

The resource in the main Takitimu pit will deplete by the end of the 2012 

calendar year and operations have now expanded into the adjacent 

Coaldale block. The original pit is progressively being backfi lled and 

rehabilitated as fi nal coal winning takes place. 

A tender for mining services for the Coaldale block was awarded 

to NZ mining contractor, Stevenson Mining Limited. 

The resource consent for the Coaldale extension was granted in July 

2011, with approvals for a 24 hour/7 day a week operation if required. 

MP 53614 was issued in June 2012 to cover a small tonnage of Crown 

coal within the area. Stripping commenced in the block in April 2012 

in conjunction with the construction of haul roads, and water treatment 

and sediment control ponds. Coal winning from the Coaldale block 

commenced in May 2012.

Access to the area was initially by way of a royalty agreement with 

the landowner. In February 2012 an offer was made to acquire the 

property on which Coaldale is located. For Bathurst, this was a strategic 

acquisition that would substantially improve the project economics 

at Takitimu. 

Having access to the complete area of the property will also enable 

the company to realise the full potential of the coal resource that exists 

there. Further, it will result in a signifi cant reduction in the operating costs 

of handling overburden and eventual rehabilitation. Under the landowner 

agreement, overburden had to be transported to segregated stockpiles 

at an area some distance away, incurring onerous haul costs. The ability 

to locate overburden stockpiles in the immediate vicinity of the pit will 

greatly reduce those costs. Additionally Bathurst will no longer be 

required to make ongoing royalty payments to the land owner.

Full ownership of the land will also allow for access into other adjacent 

areas prospective for quality sub bituminous coal. It also gives the 

company an asset that can be sold when operations are completed.

In July 2012, subsequent to year end, Overseas Investment Offi ce 

(“OIO”) approval was received to acquire the property and the 

transaction will complete in December 2012. 

8

L to R: John Low, Takitimu Coal operator, Mike Borthwick, consultant, 
Sam Aarons, Bathurst GM Corporate Relations

PRODUCTION

Bathurst operates two coal mines in New Zealand, the 
Takitimu Mine (Eastern Coal) and the Cascade Mine (Buller 
Coal). Production fi gures of Takitimu and Cascade for the 
year ended 30 June 2012 are set out below.

OPERATION

Eastern Coal 

Buller Coal

TOTAL

PRODUCTION

OVERBURDEN

 (Tonnes)

148,071

59,285

207,356

 (BCM)

1,322,033

1,583,963

2,905,996

For personal use onlyREVIEW OF OPERATIONS

9

For personal use onlyREVIEW OF OPERATIONS

In April 2012, Deputy Prime Minister and Southland MP, the Hon 

BULLER COAL PROJECT

Bill English, visited the Takitimu mine site to gain an insight into the 

expansion plans which will see the production of over two million 

tonnes of sub bituminous coal, creating jobs in the local community

 and meeting the energy needs of the region. 

Buller Coal
Cascade Coal Limited (MP 41455)

The Cascade mine is the fi rst production block in the South Buller 

operation and is adjacent to the Escarpment and Coalbrookdale blocks. 

The Cascade mine has historically produced approximately 45,000 

tonnes per annum of high value, low contaminant coal for the local 

industrial market.

During the year drilling identifi ed a signifi cant tonnage of coal in 

the EP adjacent to the Cascade mine. Subsequent to period end, 

an application was granted for an Extension of Land (“EOL”) to include 

the area of additional resource under the existing MP. Production is now 

planned to be ramped up to 150,000tpa by increasing the workforce, 

introducing a 24 hour/ 7 day a week roster, and commissioning new 

plant and equipment. This will open up the opportunity for export 

sales in addition to fulfi lling contracted commitments in New Zealand.

Escarpment Resource Consents

Buller Coal Limited, Bathurst’s wholly owned subsidiary, was granted 

resource consents for Escarpment by an independent panel of 

commissioners representing the West Coast Regional Council and the 

Buller District Council in August 2011.

The resource consents were appealed by three parties; the West Coast 

Environmental Network Incorporated (“WCENT”), the Fairdown-

Whareatea Residents’ Association Incorporated (“Residents”) and the 

Royal Forest & Bird Protection Society of New Zealand Incorporated 

(“Forest & Bird”). 

In December 2011, Bathurst entered into mediation with the Residents. 

Concurrently with the mediation, Bathurst undertook a comprehensive 

review of the Escarpment project which resulted in a revised plan, 

resolving the Residents’ issues and incorporating improvements to the 

infrastructure layout, further reducing the environmental impact of the 

project on the plateau. The resultant changes have the support of the 

Residents who withdrew their appeal on 27 April 2012 and published 

a letter confi rming their full support of the project. The other parties 

who “co-joined” in the Residents’ appeal agreed with the Residents’ 

Initial shipments of coal from the Cascade mine took place out of 

application being withdrawn.

Westport in November through to Port Taranaki, New Plymouth. 

Coal was also sent via the Port of Lyttelton to a ferro silicon producer 

in Australia. Shipments through Westport have since halted whilst the 

company constructs covered storage and improved coal handling 

facilities there as the fi rst stage of its planned port upgrades. 

Bathurst regards engagement on a local basis as fundamental to its 

on-going operations, and was pleased to see a successful mediation 

which turned community opposition into community support. 

10

For personal use onlyREVIEW OF OPERATIONS

L: Denniston Plateau

On 27 March 2012, Bathurst attended a hearing in relation to the 

Revised plan for Buller Coal Project

appeals before the New Zealand Environment Court. The purpose 

During the mediation process with the Residents, Bathurst was able 

of the hearing was to determine the validity of considering climate 

to review the existing infrastructure plan for Escarpment, the fi rst stage 

change as a factor in granting resource consents. On 30 April 2012, 

of the Buller Coal Project. The company has now put in place an 

Bathurst received a positive decision from Judge L J Newhook, the 

improved plan which both addresses the Residents’ concerns and 

Acting Principal Environment Judge. 

The Court granted the declaration sought by the company that, 

in considering applications for consent for the Escarpment project, 

the Court cannot have any regard to the effects on climate change 

provides greater long term benefi ts for the company. These include 

an optimised mining schedule, more effi cient use of resources and 

infrastructure, lower operating costs and a signifi cant reduction in 

environmental effects. 

of discharges into the air of greenhouse gases. The climate change 

In creating the revised plan for the project, Bathurst tested the 

declaration was appealed by Forest & Bird and WCENT. The appeal 

assumptions on which Bathurst’s predecessor, L&M Coal Holdings 

was heard by the High Court subsequent to the year end on 30 July 

Limited’s (“L&M”) planning and permitting applications were made 

2012, and on 24 August 2012 a decision was handed down upholding 

whilst acknowledging the previous constraints upon L&M.

the original decision made by Judge Newhook. 

The original proposal was based on mining the Escarpment block, 

A further appeal was lodged by WCENT on 11 September 2012. At the 

constructing a coal washing plant on the plateau and transporting 

time of writing this report, an application for Leave to Appeal has been 

the coal via a pipeline to a stockpile facility on the lowland at Fairdown. 

made to the High Court. A decision is yet to be handed down on this. 

Since the original proposal, Bathurst has acquired the Cascade, 

Should the appeal be accepted, the parties should also receive an 

Coalbrookdale and Whareatea West blocks, adjacent to Escarpment , 

indication of a hearing date at the same time.

The Environment Court has delivered a timetable for the hearing of the 

remaining appeal. In accordance with the timetable, Buller Coal Limited 

lodged its evidence with the Court on 18 June 2012. The hearing will 

commence in Christchurch on Monday, 29 October 2012. The Court has 

set aside four weeks for the hearing, as well as a two week break. The 

fi nal week of the hearing will commence on Monday, 3 December 2012.

and is looking to acquire additional land on the coastal plain, which 

has given the company more options for the location of infrastructure.

11

For personal use onlyREVIEW OF OPERATIONS

The revised plan eliminates the technical risk associated with the 

Coal will be trucked from the North Buller sites to the stockpile area for 

pipeline, commits to an aerial system of coal transportation, delivers a 

benefi ciation and loading onto rail for export through the ports of 

better capital profi le and signifi cantly reduces the environmental effects 

Westport or Lyttelton. 

of the Buller Coal Project. 

In conjunction with the review of a scoping study of the area, two 

It also incorporates an improved mine schedule for the Escarpment 

drill rigs have been dedicated to drilling in North Buller during the year. 

block based on the data from the recent drilling programme. The 

These have been concentrated in the Seddonville area, mainly on land 

schedule now provides for mining low ash virgin coal from the western 

held by the Ngai Tahu Forest Estates Limited. Bathurst is also making 

side of the mining area in the fi rst stages rather than the original plan 

application for an Access Arrangement to drill the areas of Crown land 

which was to fi rst recover coal from the old underground workings 

held by the Department of Conservation within its North Buller permits.

where contamination with rocks and overburden is likely to have 

occurred. Mining in this sequence will defer the immediate need for 

a washplant as the virgin coal is saleable in its raw state. 

Bathurst has employed a leading environmental consulting group to 

commence a study of the environmental values of the Buller region. 

The study will assess the known ecological, historical, recreational, 

Initial production rates from Escarpment are expected to be 

cultural and social values of the area. This information will be mapped 

approximately 500,000 tpa as the coal will be trucked from the plateau 

and the outcomes will feed into a planning process to assist Bathurst 

until the new aerial transport infrastructure has been constructed and 

to develop a long term strategic plan for the region. 

permitted. Additionally some 150,000 tpa will continue to be trucked 

from Cascade.

North Buller

The Buller Coal Project is expected to be fully funded, after allowing 

for existing cash reserves and an anticipated US$90 million in borrowing 

facilities available under agreements that Bathurst aims to conclude 

North Buller is the next development target at the Buller Coal Project. 

with its offtake partners in the coming months.

The North Buller prospects comprise Seddonville, Ngakawau, Millerton, 

Fly Creek and Blackburn. Part of Seddonville is held under the Coal 

Creek EP and the remaining deposits fall under the Buller EP. 

Preliminary analysis indicates that the low ash, higher sulphur coal from 

this area can be blended with South Buller coal to produce a premium 

product. The revised location of the washplant for South Buller at the 

new stockpile site on the coastal plain negates the requirement for 

duplicated infrastructure for coal handling from the North Buller region. 

Below L: Tammy Livermore, Cascade Coal truck driver
Below R: Jasmine Hoetjes, Buller Coal exploration geologist

12

For personal use onlyREVIEW OF OPERATIONS

Development of Buller Coal Project

The group comprises independent representatives with experience 

In the last year Bathurst has signifi cantly developed the logistics plan 

in the particular environmental needs and challenges posed by 

for the Buller Coal Project. In January 2012, the company announced 

operations in New Zealand. It also includes Mr Rob Lord, 

the execution of a Deed of Ground Lease with Port Taranaki. This 

an independent and non-executive director of Bathurst.

agreement marks a signifi cant milestone for the Buller Coal Project, 

forming a key step in the logistics chain and further securing the route 

to market. The lease allowed Bathurst to construct storage sheds 

adjacent to a deep water berth to accept the incoming coal from the 

The US operations of the company have now been wound up with the 

State of Delaware cancelling the incorporation of Bathurst Resources 

USA LLC on 1 June 2012.

port of Westport. The overall facility is large enough to allow for future 

expansion as the company continues to develop and enter new projects. 

FINANCIAL

Another key step in the logistics chain was secured in the previous 

The group made a net loss before tax for the year of $25.9 million 

fi nancial year by signing a Heads of Agreement with Westport Harbour 

(2011: $15.1 million). The net loss before tax comprised of the following 

Limited to give Bathurst exclusive use of a coal handling facility to ship 

key items:

the coal from the Buller project. Bathurst will also enter into a joint 

venture arrangement with Westport Harbour Limited to facilitate a 

NZ$30 million (A$23.5 million) redevelopment of the existing port into 

Operating mines

an effi cient bulk coal handling facility. Bathurst is currently fi nalising 

Impairment loss

the documentation for this transaction. 

Construction has recently commenced on stage one of this 

redevelopment, with the building of a NZ$5 million (A$3.9 million) 

9,000 tonne capacity storage facility which is expected to be completed 

by December 2012. This facility will have the capability to receive coal 

Deferred consideration fair value, foreign exchange, 
and unwinding adjustments (see table below)

Project development costs expensed, 
administration & support costs

Share based payments

by truck and later, by rail via an overhead conveyor. The new upgraded 

Net interest revenue

facility will eventually have the ability to load vessels at either the river 

wharf or the inner wharf. Nelson based fi rm, Brightwater Engineering, 

has been engaged to design and construct the facility.

Net loss before tax

Income tax benefi t

Loss for the year after income tax

$’000

(895)

(6,365)

(8,893)

(13,193)

95

3,378

(25,873)

4,353

(21,520)

CORPORATE

Bathurst’s Wellington offi ce was offi cially opened by New Zealand Prime 

Minister, Rt Hon John Key on 21 March 2012. The Wellington offi ce 

underpins the company’s long term commitment to New Zealand and 

will be the main offi ce for the New Zealand operations. The Prime 

Minister acknowledged Bathurst’s activities as important in economic 

terms for New Zealand. Bathurst also has project offi ces at Westport 

and Nightcaps in the South Island and a coal handling and distribution 

centre in Timaru.

In March 2012, Richard Tacon commenced as the company’s Chief 

Operating Offi cer. Mr Tacon is based in the Wellington offi ce and is 

Included in the $8.9 million loss relating to deferred consideration 

adjustments (shown in the table below) is $7.0 million of unrealised 

foreign exchange losses due to a weakening NZ dollar relative to the 

US dollar (the deferred consideration is payable in US dollars). The 

deferred consideration only becomes payable upon sales targets as 

set out in note 17 to the fi nancial statements and as such is considered 

to be naturally hedged against US dollar sales receipts expected at 

the time the deferred consideration falls due.

ADJUSTMENT TO DEFERRED CONSIDERATION

Fair value gain (through income statement)

responsible for Bathurst’s existing coal mines and the development of 

Foreign Exchange loss on deferred consideration

the high quality coking coal projects on the Denniston Plateau. Mr Tacon 

Unwinding of discount rate

was born in New Zealand and has signifi cant experience in the local and 

international coal industry in both underground and open cast operations.

Total income statement impact 
of deferred consideration

$’000

1,905

(6,987)

(3,811)

(8,893)

During the year Bathurst announced the formation of an Environmental 

Reference Group, chaired by eminent New Zealand conservationist, 

Mr Guy Salmon. The group is called the “Kaitiaki Group”. Kaitiaki is 

a Maori name which embodies the concept of guardianship of the 

natural environment. It has been established to actively monitor and 

guide Bathurst’s environmental performance and reports to the 

Bathurst board. 

In addition, the deferred consideration adjustment includes 

a $1.9 million fair value gain and $3.8 million of fi nance charges. 

The accounting standards require deferred consideration to be 

defl ated to refl ect the time value of money, as the repayment 

date for the deferred consideration draws nearer the effect of this 

defl ation is unwound to the income statement.

13

For personal use onlyREVIEW OF OPERATIONS

During the year a review and analysis of the Eastern Coal business 

was undertaken which noted a coal supply contract with negative 

margins. As a result of this review an impairment loss of $6.4 million 

was recorded against the assets of the Eastern Coal business. 

The review of the Eastern Coal business continues and business 

improvement initiatives are to be implemented.

The cash outfl ow for the group for the year was $33.9 million (2011: 

$79.0m infl ow) which included operating cash outfl ows of $7.1 million 

(2011: $6.0 million). The operational cash out fl ow comprised:

Operating mines

Net interest received

Project development, administration & support 
costs paid

Income taxes paid

Cash out fl ow from operations

$’000

504

3,711

(10,224)

(1,081)

(7,090)

Operating mine cash fl ows were adversely impacted during the year 

as the operations extinguished current mining blocks and moved into 

new areas at both the Cascade and Takitimu operations. When steady 

state export sales from Buller are established, the cash fl ows from 

mining operations are expected to improve. Income taxes paid related 

to profi ts generated in the 2011 fi nancial year.

Other signifi cant cash fl ows for the year include the settlement of 

the Coalbrookdale asset acquisition for $7.4 million, payments for 

property, plant and equipment of $8.5 million and exploration, 

evaluation, and consenting costs of $8.2 million.

During the year, $3.0 million was raised on the issue of shares on the 

exercise of options, including $0.1 million received for shares issued 

in July 2012.

The consolidated entity had $53.8 million cash on hand at 30 June 

2012 (30 June 2011: $87.4 million).

Top: Ainsley Ferrier, Buller Coal mine planning manager
Bottom: Tony Fox, Cascade Coal mine manager

14

For personal use onlyREVIEW OF OPERATIONS

BATHURST RESOURCES PLACES A STRONG 
EMPHASIS ON ENGAGEMENT – WITH OUR 
STAFF, CONTRACTORS AND STAKEHOLDERS,
WITH OUR SHAREHOLDERS, AND WITH THE 
COMMUNITIES IN WHICH WE WORK.

The company is committed to regular communications through newsletters, website updates, and presentations 
to investors, and business and community interest groups. Click on www.youtube.com/bathurstresources to view 
our YouTube site for video clips on the Escarpment project, our people, and local community stakeholders. 
Visit our website on www.bathurstresources.co.nz

Email the company direct on info@bathurstresources.co.nz

15

For personal use onlySUSTAINABILITY

THE COMPANY’S APPROACH TO 
SUSTAINABILITY IS BASED ON A MODERN 
DEFINITION OF SUSTAINABLE DEVELOPMENT, 
WHICH IS “ENSURING A BETTER QUALITY 
OF LIFE FOR EVERYONE, NOW AND FOR 
GENERATIONS TO COME.

The South Island iwi of Ngai Tahu eloquently capture 
this principle in their vision:
-
-

-
Mo tatou, a, mo ka uri a muri ake nei: 
For us and our children after us.

-

-

-

Bathurst supports this vision and is committed to 
delivering positive outcomes for present and future 
generations through careful stewardship of its assets, 
resources and activities.

PEOPLE, COMMUNITIES, ENVIRONMENT

At the heart of the Bathurst family of businesses is the safety and 

wellbeing of its people as well as the health and welfare of those 

in the communities in which it works. Sound environmental 

management is also paramount to Bathurst’s values.

As a miner, Bathurst is immersed in understanding environmental 

impacts through geological surveys, environmental planning, 

management of infrastructure, and extraction of natural resources,

regeneration of natural landforms and habitats, and reinvestment 

in the conservation estate. 

ENVIRONMENT

OUR PEOPLE 

COMMUNITIES

OUR PEOPLE

The wellbeing of Bathurst’s people, both employees and contractors, 

and those who live near its operations, is the company’s fi rst priority. 

Every person who joins the company is provided with comprehensive 

training in health and safety practices, resulting in a workforce that 

emphasises trust, respect and safety awareness.

Bathurst constantly monitors its health and safety performance 

to ensure safe working practices are understood and followed, 

and looks for ways to achieve continuous improvement.

“Bathurst is committed to the responsible care 

of its employees, contractors and local 

communities” 

16

For personal use onlySUSTAINABILITY

COMMUNITIES

Bathurst is focused on being a good neighbour and sharing 
the benefi ts of its projects with the communities in which 
it operates through business partnerships and community-
based initiatives.

Supporting local businesses

Community sponsorship

Throughout 2011-12, Bathurst continued to develop its community 

involvement in a number of areas, including:

 ‧

 Inaugural Buller Coal scholarship for Buller High School graduate

Renee Straker to study science at the University of Canterbury

 ‧

 Sponsorship of the Denniston Chaingrinder mountain bike event 

Through its Buller Coal subsidiary in Westport, Bathurst has formed 

in Westport

alliances with West Coast businesses that provide services to the 

 ‧

 Support for the Denniston Hill Climb motorcar rally in Westport 

company’s mine sites. 

“Bathurst works with neighbours, employees, 

community groups and other stakeholders to 

add value to the communities in the company’s 

operational areas”

Community liaison

At its Takitimu mine at Nightcaps in Southland, Bathurst Resources 

subsidiary, Eastern Coal has established a successful relationship

with the local Community Development Association and has regular 

interaction with neighbours, local residents and businesses of the region 

to anticipate and assist in resolving issues relating to the company’s 

mining activities. Buller Coal is in the process of establishing a similar 

group in Westport as an integral component of the Buller Coal Project.

 ‧

 Sponsorship of Buller Rugby Union

 ‧

 Eastern Coal’s sponsorship of NZ Safety’s 1,300km Tour 

of New Zealand cycle race

 ‧

 Support for Timaru’s Caroline Bay Aquatic Centre

 ‧

 Support for Nightcap’s primary schools

 ‧

 Sponsorship of the Gowan Mountain Bike race

Below: Buller Coal mountain bike team L to R: Jasmine Hoetjes, 
Michael Kingsbury, Marianne Rogers, GM Buller Coal, Howie Wilson
Below R: Renee Straker, scholarship winner

17

For personal use only 
SUSTAINABILITY

“ WE ARE WORKING TO ACHIEVE BEST 

PRACTICE IN MANAGING THE ENVIRONMENTAL 
AND SOCIAL IMPACTS OF OUR MINING AND 
PROCESSING OPERATIONS.”

ENVIRONMENT

Bathurst understands the importance New Zealanders place 
on the natural environment. 

The group reports to the Bathurst board of directors and is tasked 

with delivering commentary and advice on the company’s performance 

to achieve the following outcomes:

The company shares this view, and has laid the foundations 
for best practice in environmental management of its mining 
activities. 

 ‧

 environmental best practice by management and staff

 ‧

 best practice environmental decision-making processes and policies

 ‧

 responsiveness to the changing needs and expectations 

This includes the establishment of the Kaitiaki Environmental 
Reference Group to monitor the company’s environmental 
performance, ensuring that rehabilitation is a central part of 
operations. Bathurst is also proposing a range of biodiversity 
off sets and compensation to protect plants and animals in 
and around the Denniston Plateau to ensure an overall and 
ongoing net benefi t to the conservation estate.

Kaitiaki Environmental Reference Group

In September 2011, Bathurst established the Kaitiaki Environmental 

Reference Group - an independent body charged with actively 

monitoring and guiding Bathurst’s environmental performance. 

Kaitiaki is a Maori term which embodies the concept of guardianship 

of the natural environment. 

The Kaitiaki Group is an initiative by Bathurst to ensure that the 

company applies best practice in its environmental management 

by providing a forum for discussion between the company and its 

relevant stakeholders on environmental issues. 

of stakeholders 

 ‧

 assurance of Bathurst’s record of responsible, environmental 

stewardship

The Kaitiaki Group is chaired by Guy Salmon – a renowned 

New Zealand conservationist and Executive Director of the Ecologic 

Foundation, an independent sustainability think tank, based in Nelson, 

New Zealand. 

Other members include Dr Colin Meurk, an ecologist and restoration 

specialist at Lincoln University’s Landcare Research; Peter Hansen, 

a Brisbane-based specialist in the environmental management of coal 

mines; Toko Kapea, a lawyer and iwi liaison specialist; and Rob Lord, 

a graduate in chemistry and zoology from the University of Waikato, 

and a non-executive director of Bathurst. 

At Buller, the Kaitiaki Group aims to work with other interested parties 

to defi ne areas of the Denniston Plateau that should be protected for 

their biodiversity value, as a large conservation reserve. 

This underpins Bathurst’s belief that mining activity and a conservation 

reserve can successfully co-exist.

18

For personal use onlySUSTAINABILITY

19

For personal use onlySUSTAINABILITY

Environmental rehabilitation

As part of its commitment to best practice environmental management, 

Bathurst has devised a carefully-phased rehabilitation programme that 

enables ecosystems to thrive during operations, and after mining 

activities have ended.

The overall goal is to create environmental conditions that are 

compatible with the natural landscape, and from which an indigenous 

ecosystem can thrive post mining. 

Bathurst’s approach involves the staged application of rehabilitation 

activities during exploration and development phases as well as during 

the actual mining activities, as opposed to undertaking large-scale 

rehabilitation works at the conclusion of mining. The aim is to disturb 

as little area as possible for the shortest period of time.

One of the rehabilitation techniques employed on the Denniston 

Plateau will be Vegetation Direct Transfer (VDT), where vegetation 

and soil is moved directly from one site to another. This process 

has already been used by Bathurst to rehabilitate parts of its 

Coalbrookdale stockpile site. 

A digger lifts the vegetation and immediate subsoil in one intact 

layer and transfers it to another site, resulting in immediate cover. 

Supplementary seeding and planting is undertaken to boost the 

overall recovery of the transferred shrubs and plants. This technique, 

as practised by Bathurst and other companies, has been used exten-

sively with excellent results in the rehabilitation of indigenous bush in high 

At Escarpment, the company has proposed a programme of predator 

altitude plateau environments similar to that of the Denniston Plateau. 

Bathurst is also committed to undertaking appropriate biodiversity offset 

and compensation programmes to ensure a net enviromental gain. 

management over 5,620 hectares of the Heaphy region with the 

Department of Conservation for at least 35 years to help protect 

and monitor populations of the Great Spotted Kiwi.

“Bathurst is dedicated to the responsible extraction 

and use of the mineral resource in a manner that 

respects the historical, cultural and environmental 

associations in the local area of operation and that 

has a positive impact on both the regional and 

national economies.”

Image, below: ‘Cut and Cover’ mining 
operations and mine rehabilitation.

At Takitimu, whilst mining and associated land disturbance is all on 

agricultural land, rehabilitation is still of high importance and an integral 

part of the mining process. Overburden material is stored in segregated 

stockpiles which are revegetated whilst in storage for erosion and 

dust mitigation. 

The soil is reinstated in its original layers and reformed to follow 

the pre-mining contours as close as practicable. 

After site stabilisation, topsoils are reinstated and sown in pasture, 

at which point the land use can revert back to farming.

VV
Vegetation Direct

Transfer

VV
Vegetation Removal

Removing
Overburden

Mining Coal
Seam

Replacing
Overburden

Overburden Covered
With Capping Material

VV
Vegetation Direct 

Transfer

VV
Vegetation Placement

COAL SEAM

20

For personal use onlySUSTAINABILITY

THE FUTURE

In mid-2012, Bathurst was invited to join the Sustainable Business 

Council – a partnership between Business New Zealand’s Sustainable 

Business Forum and the Business Council for Sustainable Development. 

The SBC is New Zealand’s peak business sustainability body.

In future, Bathurst Resources will report on its sustainable development 

progress, using the SBC’s framework for Sustainable Development 

Reporting (SDR), which takes into account economic, environmental 

and social impacts.

“Bathurst looks forward to continuing to make 

signifi cant positive contributions to the economy 

and community, while mitigating its environmental 

impacts and ensuring the company delivers a net 

environmental gain to New Zealand’s conservation 

estate for generations to come.”

Above: Plant nursery at Westport - As part of Buller 
Coal’s rehabilitation programme, local plants are 
propagated from seed, cuttings and wildings. 
Once the plants reach a certain size, they are 
then planted in areas for restoration.

ENVIRONMENT

ECONOMIC

SOCIAL

21

For personal use onlySUSTAINABILITY

BULLER COAL WORKS CLOSELY 
WITH THE DEPARTMENT OF CONSERVATION 
TO ENSURE THE PROTECTION OF 
NEW ZEALAND’S UNIQUE SPECIES. 

PROTECTING THE KIWI

The Great Spotted Kiwi is endemic to the South Island of New Zealand. 

Once numerous, there are now less than 16,000 in total, almost all of 

which are found in the higher altitude areas of northwest Nelson, the 

Paparoa Range, and near Arthur’s Pass. Their population is estimated 

to be declining at about 2% per annum and their main threat is 

predation from stoats.

The Great Spotted Kiwi is the tallest kiwi, at about 45 centimetres tall. 

The birds have only one mate at a time and generally mate for life. One 

pair’s territory can be 25 hectares in size. The breeding season begins 

in June and ends in March, so any mining related activities that are 

undertaken during this period in areas known to be kiwi habitats are 

preceded by a search to identify any evidence of breeding. If any eggs 

or chicks are discovered in areas that may be impacted by activity, they 

are removed to a safe rearing facility. Once the chicks attain a predator 

proof size of around 1kg they are released back into the wild. 

In September, a search for Great Spotted Kiwi nests was conducted 

in the area marked for the expansion of the Cascade mine. Buller Coal 

staff worked alongside contractors, James Fraser and Natasha Coad 

from consultancy ‘With a Nose for Conservation’. This company 

specialises in locating threatened bird species using a specially trained 

and certifi ed dog team.

They found no evidence of nests or dependent chicks. A male kiwi call 

was heard and an adult female bird was located. She showed no signs 

of breeding and was released. The proposed area for disturbance was 

only a small part of the pair’s overall territory and the birds identifi ed will 

easily relocate to the undisturbed areas without any impact on their 

breeding cycle. 

Top L: James Fraser, consultant, Top R: ‘Percy’
Middle from L: Nathasha Coad and James Fraser, 
consultants, with dogs, ‘Percy’ and ‘Breeze’
Bottom R: Cascade mine site
Opp Page: Trish Costelloe, Buller Coal
environmental planner

22

For personal use onlySUSTAINABILITY

23

For personal use onlyOUR PEOPLE

EXECUTIVE MANAGEMENT TEAM

RICHARD TACON
Chief Operating Offi cer

Since starting his career in the 1970s, Richard has worked in almost 

The business was bought by Eastern Corporation in 2006, and Craig 

joined the company as Marketing Manager and then Operations 

Manager, playing a key role in the establishment and growth of the 

Takitimu and Cascade coal mines. 

every role in the coal mining industry.

Craig joined Bathurst as General Manager of Eastern Coal when the 

His fi rst job in the industry was at Greymouth’s Liverpool State Mine, 

owned by the New Zealand Government. He moved to Australia to 

further his mining career. Following his work at the coalface, he went on 

to hold several management roles in mines around Australia, working his 

way from undermanager to general manager. Richard has held senior 

leadership roles for the past decade.

Eastern assets were aquired in March 2011. He is based in Timaru 

at Bathurst’s coal handling and distribution centre.

MARIANNE ROGERS
General Manager, Buller Operations

Marianne was a recipient of the State Coal Mines scholarship in 

New Zealand and since then has spent over 20 years in the mining 

Richard holds fi rst, second and third class coal mining qualifi cations 

sector. She was the fi rst female to graduate with a Bachelor of 

and studied at the Otago School of Mining. He has also spent 15 years 

Engineering in Mining from the University of Auckland.

on a rescue crew, making him familiar with the principles and practice 

of mine safety.

After graduating in 1991, Marianne began her career as an underground 

miner for Mount Isa Mines in Queensland. Since then she has worked as 

After living and working in Australia for 32 years, Richard returned 

a Senior Leaching Engineer for Adelaide Brighton Cement Limited, 

to New Zealand to take up his current post with Bathurst. 

a registered Underground Mine Manager for Australian Resources 

CRAIG PILCHER
General Manager, Eastern Coal Limited

Craig has extensive engineering experience with both coal and oil-fi red 

steam boiler installations and maintenance, as well as refrigeration, 

marine, plant maintenance and general engineering.

Born in South Canterbury, Craig’s fi rst career was as an A-grade fi tter 

and welder, undertaking regular coal and oil steam boiler installations. 

After a period as plant engineer and construction diver at the Port of 

Timaru, Craig became owner and director of a South Island coal 

supply business in 1997. 

Limited and as a Senior Mining Engineer for International Mining 

Consultants Pty Limited. 

In 2005, Marianne completed a Bachelor of Law with First Class 

Honours at Queensland University of Technology and after working 

at Minter Ellison, returned to mining with Peabody Energy before 

joining Bathurst.

Marianne returned to New Zealand to take up her position with Bathurst, 

based in Westport.

Top L: Sam Aarons, Middle: Craig Pilcher, Top R: Marianne Rogers, 
Bottom R: Tim Manners, Bottom L: Richard Tacon.

24

For personal use onlyOUR PEOPLE

GERALD COOPER
Executive General Manager Engineering & Construction

Gerry has 35 years’ experience in the marine, mining and electricity 

generation industries and is a member of the Australian Institute 

of Company Directors.

After graduating as a Marine Engineer in London in 1976, he travelled 

the world, working as a seagoing engineer before moving onto the 

power generation fi eld. 

Gerry has held engineering and maintenance roles for Monadelphous 

Engineering, Cyprus Gold, Arimco, Copper Mines of Tasmania, 

Pegasus Gold, Acacia Resources and WMCF Phosphate Hill. 

He has been Engineering Manager for AshantiGold in Guinea and 

Iluka Resources in the United States, Group Engineering Manager 

for IAMGold, and Vice President, Engineering and Maintenance 

with Braemore Resources in Australia.

Gerry is based in Bathurst’s Wellington offi ce.

TIM MANNERS
Chief Financial Offi cer/Company Secretary

Tim has 20 years’ experience in fi nance and accounting in the mining 

industry and is a Fellow of the Institute of Chartered Accountants in 

Australia.

After graduating with a Bachelor of Business, he began his career 

at Ernst & Young, where he gained his professional qualifi cations. 

He then spent seven years with Sons of Gwalia in Western Australia, 

moving from junior accountant to accounting general manager. 

He has been Chief Financial Offi cer for Western Areas NL, where 

he played a leading role in establishing a dual listing for the company 

on the Toronto Stock Exchange, and CFO of Perilya the base metals 

miner in NSW, before joining Bathurst.

Tim is also a member of the Institute of Company Directors and the 

Chartered Institute of Company Secretaries in Australia. He is based 

in the company’s Perth offi ce. 

SAM AARONS
General Manager Corporate Relations

Sam’s background is advertising, marketing and commercial 

management. She worked with several major advertising agencies in 

Melbourne, before spending 14 years as a Divisional General Manager 

Top L: Craig Munro, Top R; Hamish Bohannan, Middle: Gerry 
Cooper, Bottom R: Malcolm McPherson, Bottom L: Rob Lord.

for Henry Walker Eltin, a large civil and mining contracting company 

(now Leighton’s Contracting). During this period she also served with 

the Royal Australian Navy Reserves as Public Relations Offi cer for the 

Darwin Port Division. 

She joined Eastern Resources Group as Manager, Corporate Relations & 

Business Development, a position she held for 8 years. Her role 

with Eastern focussed on growing the company’s mining operations in 

New Zealand, developing existing tenements and sourcing new projects. 

BOARD OF DIRECTORS

Craig Munro – Non-Executive Chair

Hamish Bohannan – Gerald Cooper – Executive Director

Rob Lord – Non-Executive Director

Malcolm McPherson – Non-Executive Director

Profi les of the board members can be found on pages 30-32 

Sam joined the Bathurst team following its acquisition of the Eastern 

of the Directors’ Report – Information on Directors.

assets and relocated to Wellington in 2011.

25

For personal use onlyCOAL

COAL FORMS THE FOUNDATION FOR MANY 
OF THE MODERN PRODUCTS AND SERVICES 
IN THE WORLD TODAY AND TOUCHES ALL 
ASPECTS OF MODERN LIVING.

COAL 

A foundation stone for modern living. 

ENERGY 

Hard coking (metallurgical) coal is used in iron smelters to create hard, 

fl exible steel, which in turn forms the basis of buildings and bridges, 

automobiles and aeroplanes, and even wind turbines.

In short, coal is pervasive. It can be found associated with almost 

everything that can be seen, heard, touched, and consumed. And it’s 

a natural resource – the result of plant matter that’s been buried and 

compacted for millions of years. 

The resource is mined, washed, refi ned and blended with other materials 

to generate products that contribute to increased quality of life and living 

standards around the world.

The following list outlines the main uses of coal through 
modern products and services.

SHELTER 

Steel and cement for construction of buildings and structures

WARMTH 

Direct heat and through electricity generation

Heating in food processing, swimming pools, hospitals

PROCESSING 

Coal is integral to wool processing and leather tanning 

FOOD PRODUCTION 

Fertilisers and nitric acid

TRANSPORT 

Aeroplanes, bridges, buses, cars, ships, and trains 

PERSONAL HYGIENE 

Silicones for soap, toothpaste, shampoo and cosmetics

MEDICAL EQUIPMENT 

Surgical instruments and carbon fi lters, e.g. For dialysis machines 

COMPUTERS 

Silicon chips for computers

RENEWABLE ENERGY 

Steel for wind turbines and plastics for solar panels

SPORTING EQUIPMENT 

Carbon fi bre for bicycles, fi shing rods, golf clubs, and tennis racquets

26

For personal use onlySECTION 
TWO

Financial Statements

Directors’ Report  

Auditor’s Independence Declaration  

Corporate Governance Statement 

28

44

45

ASX Principles Compliance Statement   51

Financial Statements 

Directors’ Declaration  

Independent Auditor’s Report 

54

100

101

2727

For personal use onlyDIRECTORS’ REPORT

DIRECTORS’ REPORT
30 JUNE 2012

DIRECTORS’ REPORT

Your directors present their report on the consolidated entity (“the group”) consisting of Bathurst Resources Limited (“Bathurst” or “the company”) 

and the entities it controlled at the end of, or during, the year ended 30 June 2012.

DIRECTORS

The following persons were directors of Bathurst Resources Limited at any time during the whole of the fi nancial year and up to the date of this report:

Craig Munro 

Non-Executive Chair

Hamish Bohannan 

Managing Director

Gerald Cooper 

Executive Director

Rob Lord  

Non-Executive Director 

Malcolm Macpherson  

Non-Executive Director 

PRINCIPAL ACTIVITIES 

During the year the principal continuing activities of the group consisted of:

 ‧

 the production of coal in New Zealand; and

 ‧

 the exploration and development of coal mining assets in New Zealand.

DIVIDENDS

No dividend was paid or declared during the current or prior fi nancial year and the directors do not recommend the payment of a dividend.

REVIEW OF OPERATIONS & SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS

As per Class Order 98/2395 issued by Australian Securities and Investments Commission, information on the review of operations and fi nancial 

position of the group is set out in the ‘Review of Operations’ on pages 6 to 14 of this annual report. 

MATTERS SUBSEQUENT TO THE END OF THE FINANCIAL YEAR

Bathurst’s wholly owned subsidiary, Takitimu Coal Limited, completed the strategic acquisition of the adjoining property at its Takitimu operations 

at Nightcaps for NZ$14.2 million (A$11.1 million), following successful negotiations with the landowner. The purchase of the land received the 

required approval from the Overseas Investment Offi ce of New Zealand on 25 July 2012.

Overall Bathurst considers the purchase of the land to be a key strategic acquisition which will substantially improve the economics of the 

Takitimu operations that continue to generate positive operational cash fl ows. It also gives the company an asset that can be sold when 

operations are completed.

28

For personal use onlyDIRECTORS’ REPORT

LIKELY DEVELOPMENTS AND EXPECTED RESULTS OF OPERATIONS

The operations of the group are expected to expand over the next year with the construction of infrastructure to support the Buller Coal Project 

and the resolution of the appeals against the resource consents for the Escarpment project. 

ENVIRONMENTAL REGULATION

The Bathurst group’s exploration and mining activities are subject to a range of environmental regulations which govern how the group carries 

out its business. These regulations are set out below.

Mine development approvals

Bathurst is required to obtain resource consents under the Resource Management Act 1991 (“RMA”). A resource consent is required for mining 

activities and the construction / development of infrastructure within the permit area. In addition to this, under the Crown Minerals Act 1991 

and the Conservation Act 1987, Bathurst must enter into concession agreements and access arrangements with New Zealand’s Department 

of Conservation to enter and operate on Crown land. The relevant authorities are consulted throughout the approvals process, and to the best 

of the directors’ knowledge, all approval activities have been undertaken in compliance with the requirements of the RMA, Crown Minerals Act 

and Conservation Act.

Exploration activities

In order to enter Crown land and engage in exploration activities, Bathurst must enter into an Access Arrangement Concession Agreement with 

New Zealand’s Department of Conservation, as required under the Crown Minerals Act 1991 and the Conservation Act 1987. Bathurst has, to the 

best of the directors’ knowledge, entered into all of the appropriate agreements and acted in accordance with those agreements in regards to 

engaging in exploration activities on Crown land. 

Mining activities

The mining activities of the group are regulated by the resource consents that grant Bathurst the right to engage in the mining activity. The resource 

consents involve both the District and Regional Councils. In addition to this, a mining permit or licence is required to engage in mining activities on 

Crown land. These permits/licences are issued by the Ministry of Economic Development under the Crown Minerals Act 1991. Conditions around 

water and air discharges that result from the mining operations are governed by the resource consent that the operation is operating under. 

The mining operations of Bathurst are inspected on a regular basis and no instances of non-compliance have been noted. 

Hazardous substances

Mining activities involve the storage and use of hazardous substances, including fuel. Bathurst must comply with the Hazardous Substances 

and New Organisms Act 1996 when handling hazardous materials. To the best of the directors’ knowledge, no instances of non-compliance 

have been noted.

Emissions Trading Scheme

The New Zealand Emissions Trading Scheme (“NZ ETS”) came into effect from 1 July 2010 which essentially makes Bathurst liable for greenhouse 

gas emissions associated with coal sold in New Zealand and for the fugitive emissions from coal seams exposed in New Zealand. Bathurst’s liability 

is based on the type and quantity of coal tonnes sold, with the cost of such being passed onto Bathurst’s customers.

29

For personal use onlyDIRECTORS’ REPORT

DIRECTORS’ REPORT
30 JUNE 2012

INFORMATION ON DIRECTORS

Mr Craig Munro 

FCPA, FAusIMM, FAICD 

Non-Executive Chair

Experience and expertise

Craig Munro is a Certifi ed Practicing Accountant with over 40 years’ experience in the mining industry. He was previously Senior Vice President 

Corporate & Finance and Chief Financial Offi cer of Anvil Mining Limited. He has been both an executive director and non-executive director of 

a number of listed companies since 1990. He is currently a director of Energy and Minerals Australia Limited and was previously a director of 

Humanis Group Limited and Pegasus Metals Limited.

Other current directorships of listed companies

Energy and Minerals Australia Limited – Non-Executive Director

Former directorships in last 3 years of listed companies

Humanis Group Limited – Non-Executive Director

Pegasus Metals Limited

Special responsibilities

Chair of the board

Member of remuneration & nomination committee

Member of audit committee

Interests in shares and options

462,526 fully paid ordinary shares in Bathurst Resources Limited

4,500,000 unlisted options over ordinary shares in Bathurst Resources Limited

Mr Hamish Bohannan 

BEngSc Hons Mining, MEngSc Rock Mechanics, MBA, FAusIMM, CEng, MIMM, MAICD

Managing Director

Experience and expertise

Hamish Bohannan is a Mining Engineer with over 35 years’ experience in the resources industry, starting as a miner with Gold Fields Limited in 

South Africa before completing a degree at the Royal School of Mines. Whilst much of his experience has been in underground mining, he has 

been actively involved in many areas of the industry including dredging and open cut mining, processing and smelting having worked around the 

globe in various metals from copper and gold to nickel and mineral sands. Previously Chief Executive Offi cer of Braemore Resources, Mr Bohannan 

has also held executive positions with Cyprus Minerals, WMC Limited, Iluka Resources and IAMGold. Mr Bohannan is a director of Straterra, 

the New Zealand resource sector industry association and of the Coal Association of New Zealand.

Other current directorships of listed companies

Nil

Former directorships in last 3 years of listed companies

Phillips River Mining Limited (previously Tectonic Resources NL) – Non-Executive Chair

Special responsibilities

Managing Director

Interests in shares and options

10,605,000 fully paid ordinary shares in Bathurst Resources Limited

10,000,000 unlisted options over ordinary shares in Bathurst Resources Limited

30

For personal use onlyDIRECTORS’ REPORT

Mr Gerald Cooper 

MAICD 

Executive Director

Experience and expertise

Gerald Cooper is a qualifi ed Marine Engineer who served for a number of years as a seagoing engineer before moving onto the power generation 

fi eld. Following emigration to Australia, he worked within the mining industry in engineering & maintenance related roles for Monadelphous 

Engineering, Cyprus Gold, Arimco, Copper Mines of Tasmania, Pegasus Gold, Acacia Resources and WMCF Phosphate Hill. 

Mr Cooper subsequently moved overseas to work for AshantiGold in Guinea and Iluka Resources in the United States. Mr Cooper was group engineering 

manager for IAMGold before returning to Australia in 2007 and taking up a position as VP Engineering & Maintenance with Braemore Resources.

Other current directorships of listed companies

None

Former directorships in last 3 years of listed companies

None

Special responsibilities

General Manager – Engineering & Construction

Interests in shares and options

560,000 fully paid ordinary shares in Bathurst Resources Limited

7,500,000 unlisted options over ordinary shares in Bathurst Resources Limited

Mr Rob Lord 

BSc, MBA 

Non-Executive Director

Experience and expertise

Rob Lord is currently Regional Director Oceania for Wallenius Wilhelmsen Logistics AS, a global shipping and logistics company specialising 

in the movement of vehicles and heavy and specialised cargo such as – mining and construction equipment, rail cars and power generators.

Prior to this he was the Managing Director and Chief Executive Offi cer of Gloucester Coal Ltd a successful ASX 200 publically listed company 

specialising in coal mining and marketing.

Before his appointment at Gloucester Coal, Mr Lord worked in the pulp and paper industry for many years, most recently as executive vice president 

responsible for the Australasian operations of Norwegian-based Norske Skog. Mr Lord has also worked in a variety of senior international marketing 

and sales roles including head of marketing and sales roles at Norske Skog Australasia, Fletcher Challenge Paper Australasia and Tasman Pulp and 

Paper in New Zealand. Mr Lord is a director of Norske Skog Industries Australia Limited which is an unlisted public company.

Other current directorships of listed companies

None

Former directorships in last 3 years of listed companies

Gloucester Coal Limited – Managing Director

Special responsibilities

Member of remuneration & nomination committee

Chair of audit committee

Interests in shares and options

530,938 fully paid ordinary shares in Bathurst Resources Limited

3,500,000 unlisted options over ordinary shares in Bathurst Resources Limited

31

For personal use onlyDIRECTORS’ REPORT

DIRECTORS’ REPORT
30 JUNE 2012

INFORMATION ON DIRECTORS (CONTINUED)

Mr Malcolm Macpherson 

BSc, Cert.Acctg, FAICD, FAusIMM, FTSE 

Non-Executive Director

Experience and expertise

Malcolm Macpherson is an experienced business leader in the resources sector in Australia and overseas. Mr Macpherson held a successful 

seven year tenure as Managing Director and Chief Executive Offi cer of Iluka Resources Limited. 

Mr Macpherson has held board positions with other notable companies and organisations such as Portman Limited, Eltin Limited, and Western 

Power Corporation (as chair). Mr Macpherson has also had active roles in research and innovation, including an advisory role to the CSIRO.

Other current directorships of listed companies

Pluton Resources Limited – Non-Executive Chair

Titanium Corporation Limited – Non-Executive Director

Former directorships in last 3 years of listed companies

Minara Resources Limited – Non-Executive Chair

Range River Gold Limited – Non-Executive Director

Special responsibilities

Chair of remuneration & nomination committee

Member of audit committee

Interests in shares and options

100,000 fully paid ordinary shares in Bathurst Resources Limited

2,000,000 unlisted options over ordinary shares in Bathurst Resources Limited

COMPANY SECRETARY

Mr Tim Manners BBus, FCA, ACIS, MAICD is a Joint Company Secretary and the Chief Financial Offi cer. Mr Manners became the Joint Company 

Secretary upon the appointment of Laura McMahon Blechynden on 27 March 2012. Mr Manners has over 18 years’ experience in senior fi nancial 

positions within the resources sector. 

Miss Laura McMahon Blechynden, BA, LLB was appointed as a Joint Company Secretary and Legal Counsel on 27 March 2012. Laura has 

extensive experience in a wide range of corporate and commercial matters within the resources sector including public and private equity fund 

raisings, due diligence, mergers, acquisitions and divestments. 

32

For personal use onlyDIRECTORS’ REPORT

MEETINGS OF DIRECTORS

The number of meetings of the company’s board of directors and of each board committee held during the year ended 30 June 2012, 

and the numbers of meetings attended by each director were: 

Full meetings of directors

Meetings of committees

Audit

Remuneration / Nomination

A

14

14

13

14

14

B

14

14

14

14

14

A

6

**

**

6

6

B

6

**

**

6

6

A

3

**

**

3

3

B

3

**

**

3

3

Craig Munro

Hamish Bohannan

Gerald Cooper

Rob Lord

Malcolm Macpherson

A = number of meetings attended

B = number of meetings held during the time the director held offi ce or was a member of the committee during the year

** = not a member of the relevant committee 

REMUNERATION REPORT 

This remuneration report sets out the remuneration information for Bathurst Resources Limited’s non-executive directors, executive directors, 

and other key management personnel.

Directors and executives disclosed in this report

Other key management personnel

Name

R Tacon

T Manners

Position

Chief Operating Offi cer

Chief Financial Offi cer / Joint Company Secretary

L McMahon Blechynden

Joint Company Secretary / Legal Counsel

M Rogers

A Thom

C Pilcher

M Brunsdon

General Manager – Buller operations

General Manager – Corporate development*

General Manager – Eastern operations

General Manager – Marketing*

* A Thom and M Brunsdon ceased employment with Bathurst on 30 April 2012 and 7 June 2012 respectively.

For information on non-executive and executive directors – refer to pages 30 to 32.

33

For personal use onlyDIRECTORS’ REPORT

DIRECTORS’ REPORT
30 JUNE 2012

REMUNERATION REPORT (CONTINUED)

Role of the remuneration & nomination committee 

The remuneration & nomination committee (“R&N committee”) is a sub-committee of the Bathurst board. The R&N committee is responsible for 

making recommendations to the board on remuneration matters such as non-executive director fees, executive remuneration for directors and 

other executives, and the over-arching executive remuneration policy and incentive schemes.

The objective of the R&N committee is to ensure that the company’s remuneration policies and structures are fair and competitive and aligned 

with the long-term interests of the company. The R&N committee draws on its own experience in remuneration matters and seeks advice from 

independent remuneration consultants.

The Corporate Governance Statement provides further information on the role of the R&N committee.

Principles used to determine the nature and amount of remuneration

Non-executive directors

The fees and payments the company makes to its non-executive directors refl ect the level of responsibility attributed to board members and the 

demands which are made on the directors’ time. Non-executive directors’ fees and payments are reviewed annually by the board. The board has 

also considered the advice of independent remuneration consultants to ensure non-executive directors’ fees and payments are appropriate and in 

line with industry standards. The fees paid to the chair are determined independently to the fees of non-executive directors. The chair is not present 

at any discussions relating to determination of his own remuneration.

In previous years the company has granted non-executive directors unlisted options over ordinary shares in the company as a part of their 

remuneration packages. The issue of options was to align the interests of directors and shareholders and compensate for reduced fees during 

the company’s start-up phase. However, in the 2011 fi nancial year the company ceased the practice of issuing options to non-executive directors 

with the company’s continued growth and its inclusion in the relevant ASX indices.

Directors’ fees

The current base fees were last reviewed with effect from 1 January 2011 and are inclusive of committee fees.

Non-executive directors’ fees are determined within an aggregate directors’ fee pool limit, which is periodically recommended for approval by 

shareholders. The maximum currently stands at $800,000 per annum and was approved by shareholders at the general meeting on 18 April 2011.

The following fees have applied:

Base fees

Chair

Other non-executive directors

From 1 January 2011

1 July 2010 to 31 December 2010

$160,000

$80,000

$60,000

$36,000

Superannuation contributions required under the Australian superannuation guarantee legislation are made to directors and are deducted from 

their overall fee entitlements.

Executive remuneration

The objective of the group’s executive reward framework is to ensure reward for performance is competitive and appropriate for the results delivered. 

The framework aligns executive reward with achievement of strategic objectives and the creation of value for shareholders, and conforms with 

industry practice. 

The R&N committee ensures that executive pay is competitive and reasonable, as well as, acceptable to shareholders. The company ensures that 

an executive’s remuneration is linked to that executive’s performance to ensure that the interests of the company and its executives are aligned. 

The R&N committee determines executive remuneration to ensure transparency and to effectively manage capital.

In consultation with external remuneration consultants, the company has structured an executive remuneration framework that is market competitive 

and complementary to the reward strategy of the organisation.

34

For personal use onlyDIRECTORS’ REPORT

The company believes that the policy for determining executive’s remuneration is aligned to shareholders’ interests because it focuses on sustained 

growth in shareholder wealth by pushing growth in share price and delivering constant return on assets, as well as, focusing the executive on key 

non-fi nancial drivers of value. Most importantly, the company ensures that its remuneration policy attracts and retains high calibre executives, who 

in turn add value to the company and to the shareholders.

The company also believes that its remuneration policy for executives is aligned to the interests of its executives. The executive remuneration policy 

rewards capability and experience and refl ects competitive reward for contribution to growth in shareholder wealth. The policy is transparent so it 

provides a clear structure for earning rewards and provides recognition for contribution.

The framework provides a mix of fi xed and variable pay, and a blend of short and long-term incentives. As executives gain seniority with the group, 

the balance of this mix shifts to a higher proportion of ‘at risk’ rewards.

The executive remuneration and reward framework has three components:

 ‧ base pay and benefi ts, including superannuation

 ‧ short-term performance incentives, and

 ‧

long-term incentives.

The combination of these comprises an executive’s total remuneration.

Base pay and benefi ts

Executives are offered a competitive base pay that comprises the fi xed component and rewards. External remuneration consultants provide analysis 

and advice to ensure base pay is set to refl ect the market for a comparable role. Base pay for executives is reviewed annually to ensure the 

executive’s remuneration is competitive with the market. An executive’s remuneration is also reviewed on promotion.

There are no guaranteed base pay increases included in any executives’ contracts.

Superannuation

Superannuation contributions required under the Australian superannuation guarantee legislation are made to executives and are in addition to the 

base pay and benefi ts.

Short-term incentives

Bathurst’s short-term incentive plan is to provide cash bonuses to executives who exceed performance expectations. All payments under the short 

term incentive scheme are made at the discretion of the R&N committee or the board. The short term incentives are determined according to the 

executive’s performance during the preceding year. At the end of every fi nancial year the executives meet with their immediate manager to discuss 

performance and set individual goals and targets for the coming year. Following meetings, the Managing Director will make recommendations for 

cash bonuses for any executives who have performed exceptionally. The list of suggested short term incentives is then presented to the R&N 

committee and must be approved before they are paid. The Managing Director’s performance is reviewed by the board. Depending on the results 

of the review the board may award a short term incentive. 

Long-term incentives

Long-term incentives have been previously provided to certain employees via the Bathurst Resources Limited Employee Share Option Plan which 

was approved by shareholders at the 2010 Annual General Meeting (“AGM”). This plan is under review by the R&N committee. The participants and 

the quantum of the long term incentive schemes are currently determined in the same manner as the short–term incentives. However, for the 2013 

fi nancial year onwards the R&N committee has established a matrix of performance criteria that will be used to assess and award long term incentive 

payments to senior staff.

35

For personal use onlyDIRECTORS’ REPORT

DIRECTORS’ REPORT
30 JUNE 2012

REMUNERATION REPORT (CONTINUED)

Use of remuneration consultants

In February 2011, the Chair employed the services of PwC to review its existing Employee Share Option Plan (“ESOP”) and to provide 

recommendations in respect the ESOP. Under the terms of the engagement, PwC provided remuneration recommendations as defi ned 

in section 9B of the Corporations Act 2001 and were paid $9,500 for these services in the 2012 fi nancial year.

PwC has confi rmed that the above recommendations have been made free from undue infl uence by members of Bathurst’s key 

management personnel. 

The following arrangements were made to ensure that the remuneration recommendation was made free from undue infl uence:

 ‧

 PwC was engaged by, and reported directly to Craig Munro, the chair of the company;

 ‧

 the remuneration recommendation was provided by PwC directly to Craig Munro; and

 ‧

 PwC did not provide any member of management with a copy of the remuneration recommendation. 

As a consequence, the board is satisfi ed that the recommendations were made free from undue infl uence from any members of the key 

management personnel. 

Voting and comments made at the Company’s 2011 Annual General Meeting

Bathurst’s remuneration report for the 2011 fi nancial year was passed by a show of hands. Over 80% of the proxy votes received by Bathurst were 

in favour of the remuneration report. Bathurst did not receive any specifi c feedback at the AGM or throughout the year on its remuneration practices.

36

For personal use onlyDIRECTORS’ REPORT

Details of remuneration

Amounts of remuneration

Details of the remuneration of the directors and the key management personnel of the group for the current and previous fi nancial year are set out 

Short-term employee benefi ts

Post-employment 
benefi ts

Share based 
payments

Cash salary and 
fees

Cash 
bonus

Non-monetary 
benefi ts

Superannuation

$

$

$

-

-

-

36,209

-

-

-

-

-

-

-

-

160,000

73,395

73,395

545,004

350,000

100,470

350,000

43,077

556,364

250,981

300,000

193,456

-

-

-

-

-

-

-

-

-

-

-

-

-

Options / 
Shares

Total

$

$

32,843

192,843

32,843

112,843

-

80,000

65,686

646,899

52,549

434,049

-

109,512

48,025

429,525

-

46,954

$

-

6,605

6,605

-

31,500

9,042

31,500

3,877

-

(294,152)

262,212

18,975

31,432

3,451

-

269,956

48,025

379,457

-

196,907

36,209

142,987

(14,181)

3,161,157

in the following tables.

2012

Name

NON-EXECUTIVE DIRECTORS

Craig Munro - Chair

Rob Lord 

Malcolm Macpherson

EXECUTIVE DIRECTORS

Hamish Bohannan

Gerald Cooper

OTHER KEY MANAGEMENT 
PERSONNEL

Richard Tacon 

Timothy Manners

Laura McMahon Blechynden

Max Brunsdon

Alan Thom 

Marianne Rogers 

Craig Pilcher

Total key management 
personnel compensation

2,996,142

Notes:
Directors and other key management personnel had the following appointment & resignation dates:

Richard Tacon 
Laura McMahon Blechynden 
Max Brunsdon  
Alan Thom 

Appointed 
Appointed 
Resigned 
Resigned 

26 March 2012
27 March 2012
7 June 2012 
30 April 2012

All other directors and key management personnel were in offi ce for the full fi nancial year.

37

For personal use onlyDIRECTORS’ REPORT

DIRECTORS’ REPORT
30 JUNE 2012

REMUNERATION REPORT (CONTINUED)

Details of remuneration (continued)

2011

Name

Short-term employee benefi ts

Post-employment 
benefi ts

Share based 
payments

Cash salary and 
fees

Cash 
bonus

Non-monetary 
benefi ts

Superannuation

Options

Total

NON-EXECUTIVE DIRECTORS

Craig Munro - Chair

Rob Lord

Malcolm Macpherson

EXECUTIVE DIRECTORS

Hamish Bohannan

Gerald Cooper

OTHER KEY MANAGEMENT 
PERSONNEL

Timothy Manners

Graham Anderson

Max Brunsdon

Alan Thom

Marianne Rogers

Craig Pilcher

$

110,000

50,149

37,568

628,678

$

-

-

-

-

317,979

100,000

347,750

29,750

395,455

61,647

192,116

53,739

-

-

-

-

-

-

$

-

-

-

$

-

4,513

3,381

$

$

785,566

895,566

996,166

1,050,828

1,122,000

1,162,949

21,809

-

1,681,833

2,332,320

-

-

-

-

-

-

-

39,321

1,179,416

1,636,716

25,575

1,054,752

1,428,077

-

-

5,548

17,291

947

344,700

374,450

939,852

1,335,307

970,000

1,037,195

923,252

1,132,659

-

54,686

Total key management 
personnel compensation

2,224,831

100,000

21,809

96,576

9,997,537

12,440,753

Notes:
Directors and other key management personnel had the following appointment dates:

Timothy Manners 
Alan Thom 
Marianne Rogers 
Craig Pilcher 
Rob Lord 
Malcolm Macpherson 
Graham Anderson 

Appointed 
Appointed 
Appointed 
Appointed 
Appointed 
Appointed 
Resigned 

23 August 2010
17 March 2011
18 October 2010
18 March 2011
17 August 2010
5 January 2011
3 February 2011

All other directors and key management personnel were in offi ce for the full fi nancial year.

38

For personal use onlyDIRECTORS’ REPORT

The relative proportions of remuneration that are linked to performance and those that are fi xed are as follows:

Fixed remuneration

At risk – STI

At risk – LTI*

2012

2011

2012

2011

2012

2011

EXECUTIVE DIRECTORS OF 
BATHURST RESOURCES LIMITED

Hamish Bohannan

Gerald Cooper

OTHER KEY MANAGEMENT 
PERSONNEL OF THE GROUP

Richard Tacon

Timothy Manners

Laura McMahon Blechynden

Graham Anderson

Max Brunsdon

Alan Thom

Marianne Rogers

Craig Pilcher

90%

88%

100%

89%

100%

-

100%

100%

87%

100%

28%

22%

-

26%

-

8%

30%

6%

18%

100%

-

-

-

-

-

-

-

-

-

-

-

6%

-

-

-

-

-

-

-

-

10%

12%

-

11%

-

-

-

-

13%

-

72%

72%

-

74%

-

92%

70%

94%

82%

-

* Since long term incentives are provided exclusively by way of options, the percentages disclosed refl ect the value of remuneration consisting of options, based on the value of options expensed 
during the year.

Service Agreements

On appointment to the board, all non-executive directors enter into a service agreement with the company in the form of a letter of appointment. 

The letter summarises the board policies and terms, including compensation, relevant to the offi ce of director.

Remuneration and other terms of employment for the Managing Director, Chief Financial Offi cer and the other key management personnel are also 

formalised in service agreements. 

All contracts with executives may be terminated early by either party with one to three months’ notice, subject to termination payments due when 

terminated by the company as detailed below.

Name

Hamish Bohannan

Gerald Cooper

Richard Tacon

Timothy Manners

Laura McMahon Blechynden

Marianne Rogers

Craig Pilcher

Termination benefi t

3 months base salary

2 months base salary

3 months base salary

2 months base salary

1  months base salary

2 months base salary

1 months base salary

Term of agreement

Base salary including 
superannuation

$545,000

$381,500

$407,173

$381,500

$174,400

$327,000

$240,316

Ongoing

Ongoing

Ongoing

Ongoing

Ongoing

Ongoing

Ongoing

39

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DIRECTORS’ REPORT
30 JUNE 2012

REMUNERATION REPORT (CONTINUED)

Share based compensation

The terms and conditions of each grant of options affecting remuneration in the current or a future reporting period are as follows:

Grant date

Vesting date

Expiry date

Exercise price

Value per option 
at grant date

29 Nov 2010

Upon fi rst 25kt from Buller Coal Project

31 Dec 2013

6 Dec  2010

Upon fi rst 25kt from Buller Coal Project

31 Dec 2013

$0.40

$0.40

$0.276

$0.252

%
Vested

0%

0%

During the year no options over ordinary shares in the company were provided as remuneration to directors or other key management personnel 

of Bathurst Resources Limited.

Further information on the options is set out in note 31 to the fi nancial statements. 

The assessed fair value at grant date of options granted to the individuals is allocated equally over the period from grant date to vesting date, 

and the amount is included in the remuneration tables above.

Fair values at grant date are independently determined using a Black-Scholes option pricing model that takes into account the exercise price, 

the term of the option, the impact of dilution, the share price at grant date and expected price volatility of the underlying share, the expected 

dividend yield and the risk-free interest rate for the term of the option.

Shares provided on exercise of remuneration options

Details of ordinary shares in the company provided as a result of the exercise of remuneration options to each director of Bathurst Resources Limited 

and other key management personnel of the group are set out below.

Date of exercise
of options

Number of ordinary shares 
issued on exercise of 
options during the year

Value at 
exercise date

EXECUTIVE DIRECTORS OF 
BATHURST RESOURCES LIMITED

H Bohannan

G Cooper

OTHER KEY MANAGEMENT 
PERSONNEL OF THE GROUP

Timothy Manners

Timothy Manners

Max Brunsdon

Max Brunsdon

31 Aug 2011

14 Oct 2011

10 Jan 2012

7 Feb 2012

28 Mar 2012

11 Apr 2012

2,400,000

500,000

300,000

1,700,000

1,000,000

2,000,000

$1,372,800

$196,000

$162,600

$1,091,400

$642,000

$540,000

Notes:
The value at the exercise date of options that were granted as part of the remuneration and were exercised during the year has been determined as the intrinsic value of the options at that date.

40

For personal use onlyDIRECTORS’ REPORT

The amount paid per ordinary share by each key management personnel on the exercise of options at the date of exercise was as follows:

Exercise date

31 August 2011

14 October 2011

10 January 2012

7 February 2012

28 March 2012

11 April 2012

Amount paid per share

37.8c

37.8c

10.8c

10.8c

10.8c

40.0c

No amounts are unpaid on any shares issued on the exercise of options.

Details of remuneration: Bonuses and share-based compensation benefi ts

For each cash bonus and grant of options included in the tables on pages 37-40, the percentage of the available bonus or grant that was paid, 

or that vested, in the fi nancial year, and the percentage that was forfeited because the person did not meet the service and performance criteria 

is set out below. No part of the bonus is payable in future years. The options issued in the 2011 fi nancial year which have not vested immediately, 

vest upon the shipment of the fi rst 25,000 tonnes from the Buller Coal Project. None of these options will vest if the conditions are not satisfi ed, 

hence the minimum value of the option yet to vest is nil. The maximum value of the options yet to vest has been determined as the amount of 

the grant date fair value of the options that is yet to be expensed.

Bonus

Share-based compensation benefi ts (options)

Name

Paid Year granted

Vested

Forfeited

Financial year in 
which options are 
expected to vest

Maximum total 
value of grant 
yet to vest

%

%

%

NON-EXECUTIVE DIRECTORS

Craig Munro - Chair

Rob Lord

Malcolm Macpherson

EXECUTIVE DIRECTORS

Hamish Bohannan

Gerald Cooper

OTHER KEY MANAGEMENT PERSONNEL

Timothy Manners

Marianne Rogers

-

-

-

-

-

-

-

2011

2011

2011

2011

2011

2011

2011

-

-

-

-

-

-

-

-

-

-

-

-

-

-

30 June 2014

30 June 2014

-

30 June 2014

30 June 2014

30 June 2014

30 June 2014

$

110,845

110,845

-

221,691

177,753

162,084

162,084

41

For personal use onlyDIRECTORS’ REPORT

DIRECTORS’ REPORT
30 JUNE 2012

Loans to directors and executives

Information on loans to directors and executives, including amounts, interest rates and repayment terms are set out in Note 24 to the 

fi nancial statements.

Shares under option

Unissued ordinary shares of Bathurst Resources Limited under options at the date of this report are as follows:

Date granted

Expiry date

Issue price of shares

Number under option

22 Oct 2008

22 Oct 2008

16 Jun 2010

18 Aug 2010

20 Aug 2010

20 Aug 2010

5 Nov 2010

29 Nov 2010

29 Nov 2010

6 Dec 2010

18 April 2011

18 April 2011

3 Sept 2012

31 Oct 2012

31 Oct 2013

16 Jun 2013

30 Sept 2013

30 Sept 2013

30 Sept 2013

15 Nov 2013

30 Sept 2013

31 Dec 2013

31 Dec 2013

31 Dec 2013

31 Dec 2013

20 Aug 2014

$0.378

$0.378

$0.155

$0.108

$0.168

$0.108

$0.36

$0.21

$0.40

$0.40

$1.13

$0.85

$0.38

500,000

500,000

666,667

9,500,000

1,000,000

5,500,000

14,344,109

1,000,000

14,000,000

8,200,000

2,000,000

2,000,000

2,000,000

61,210,776

No option holder has any right under the options to participate in any other share issue of the company or any other entity.

Shares issued on the exercise of options

During the year ended 30 June 2012 a total of 12,840,000 shares of Bathurst Resources Limited were issued on the exercise of options raising 

a total of $2,895,600. Subsequent to 30 June 2012 and up to the date of this report, a further 1,000,000 shares of Bathurst Resources Limited 

were issued on the exercise of options raising a total of $108,000.

Insurance of offi cers

During the fi nancial year, Bathurst Resources Limited paid a premium of $39,387 to insure the directors and secretaries of the company.

The liabilities insured are legal costs that may be incurred in defending civil or criminal proceedings that may be brought against the offi cers in 

their capacity as offi cers of entities in the group, and any other payments arising from liabilities incurred by the offi cers in connection with such 

proceedings. This does not include such liabilities that arise from conduct involving a wilful breach of duty by the offi cers or the improper use by 

the offi cers of their position or of information to gain advantage for themselves or someone else or to cause detriment to the company. It is not 

possible to apportion the premium between amounts relating to the insurance against legal costs and those relating to other liabilities. 

Non-audit services

The company engaged the auditor on assignments additional to their statutory audit duties where the auditor’s expertise and experience with the 

company and/or the group are important.

Details of the amounts paid or payable to the auditor (PricewaterhouseCoopers “PwC”) for audit and non-audit services provided during the year 

are set out on the next page.

42

For personal use onlyDIRECTORS’ REPORT

The board of directors has considered the position and is satisfi ed that the provision of the non-audit services is compatible with the general 

standard of independence for auditors imposed by the Corporations Act 2001. The directors are satisfi ed that the provision of non-audit services 

by the auditor, as set out below, did not compromise the auditor independence requirements of the Corporations Act 2001 for the following reasons:

 ‧

 all non-audit services have been reviewed by the audit committee to ensure they do not impact the impartiality and objectivity of the auditor

 ‧

 none of the services undermine the general principles relating to auditor independence as set out in APES 110 Code of Ethics for Professional 

Accountants.

During the year the following fees were paid or payable for non-audit services provided by the auditor of the parent entity and its related practices:

OTHER ASSURANCE SERVICES

PwC Australian fi rm:

Due diligence services

PwC New Zealand fi rm:

Due diligence services
Total remuneration for other assurance services

TAXATION SERVICES

PwC Australian fi rm:

Tax compliance services

Consulting advice on mergers and other structuring

PwC New Zealand fi rm:

Tax compliance services

Consulting advice on mergers and structuring
Total remuneration for taxation services

OTHER SERVICES

PwC Australian fi rm:

ESOP & Remuneration structuring advice
Total remuneration for other services

Total remuneration for non-audit services

Auditor’s independence declaration

2012
$

2011
$

-

-

-

26,000

182,341

57,682

118,849

384,872

52,648

29,621

82,269

23,700

9,000

28,418

49,091

110,209

9,500

9,500

10,000

10,000

394,372

202,478

A copy of the auditor’s independence declaration as required under section 307C of the Corporations Act 2001 is set out on page 44.

Rounding of amounts

The company is of a kind referred to in Class Order 98/100, issued by the Australian Securities and Investments Commission, relating to the 

“rounding off” of amounts in the directors’ report. Amounts in the directors’ report have been rounded off to the nearest thousand dollar, or in 

certain cases, to the nearest dollar. 

This report is made in accordance with a resolution of directors.

CRAIG MUNRO | Chair 

Perth

27 September 2012

43

For personal use onlyAUDITOR’S INDEPENDENCE DECLARATION

AUDITOR’S INDEPENDENCE DECLARATION
30 JUNE 2012

44

For personal use onlyCORPORATE GOVERNANCE STATEMENT

CORPORATE GOVERNANCE STATEMENT
30 JUNE 2012

CORPORATE GOVERNANCE

Bathurst Resources Limited has a strong focus on corporate governance and has worked hard during the year to administer and improve its 

corporate governance procedures and policies. This statement reports on Bathurst’s key governance framework, principles and practices as at the 

date of this report. The board are committed to achieving and demonstrating the highest standards of corporate governance. The board continues 

to review its corporate governance framework and practices to ensure they meet the interests of shareholders. Bathurst and its controlled entities 

together are referred to as the group in this statement.

Further information about the company’s corporate governance practices may be found on the company’s website at www.bathurstresources.co.nz, 

under the section marked “Corporate Governance”. 

ASX PRINCIPLES OF GOOD CORPORATE GOVERNANCE

ASX Listing Rule 4.10.3 requires that ASX listed companies report on the extent to which they have followed the ASX Corporate Governance 

Council’s Corporate Governance Principles and Recommendations 2nd edition (“ASX Principles”) during the reporting period. Where companies 

have not followed all of the recommendations contained in the ASX Principles, they must identify the recommendations they have not followed 

and give reasons for the departure. 

Bathurst has followed each recommendation where the board has considered the recommendation to be appropriate for its corporate governance 

practices. Where Bathurst has adopted a recommendation this report sets out the appropriate statements regarding the adoption. In the case that, 

after due consideration, the company’s corporate governance practices depart from a recommendation, the board has offered full disclosure and an 

explanation for the adoption of its own practice in order to comply with the “if not, why not” reporting regime. A checklist cross referencing the ASX 

Principles to the relevant section of this statement and to other sections of the directors’ report is provided on pages 51 to 53 of this report.

As detailed in this Corporate Governance Statement, Bathurst considers that its governance practices comply with the ASX Principles, subject to 

the qualifi cations noted in the Compliance Statement.

1. BOARD OF DIRECTORS

Principle 1: Lay solid foundations for management and oversight 

Principle 2: Structure the board to add value

(a) Board composition and expertise

The board has an extensive range of relevant industry experience, fi nancial and other skills and expertise to meet its objectives. The current board 

composition comprises three independent, non-executive directors (including the chair) and two executive directors. The board considers that the 

non-executive directors collectively bring the range of skills, knowledge and experience necessary to direct the company.

A profi le of each director setting out their skills, experience, expertise and period of offi ce is set out in the directors’ report. 

Bathurst’s constitution states that at each AGM one third of its directors (excluding the managing director) and any director who has held offi ce 

for three of more years since their last election, must retire. Directors who retire under this rotation mechanism are eligible to offer themselves for 

re-election by shareholders at the AGM subject only to the point below.

A director should, subject to circumstances prevailing at the time and the company’s ability to fi nd a suitable replacement, aim to retire from the 

board at the conclusion of the AGM occurring after the tenth anniversary of the director’s fi rst appointment or election to the board.

(b) Board role and responsibilities

The central role of the board is to oversee and approve the company’s strategic direction, to select and appoint a managing director, to oversee 

the company’s management and business activities and report to shareholders.

The relationship between the board and senior management is critical to the group’s long-term success. The directors are responsible to the 

shareholders for the performance of the group in both the short and the longer term and seek to balance sometimes competing objectives in 

the best interests of the group as a whole. 

45

For personal use onlyCORPORATE GOVERNANCE STATEMENT

CORPORATE GOVERNANCE STATEMENT
30 JUNE 2012

1. BOARD OF DIRECTORS (CONTINUED)

The roles and responsibilities of the board are formalised in the Board Charter, which defi nes in detail the matters that are reserved for the board 

and its committees, and those that the board has delegated to management. 

The chair is responsible for leadership of the board, for the effi cient organisation and conduct of the board’s function and for the promotion 

of relations between board members and between board and management that are open, cordial and conducive to productive cooperation. 

The managing director is responsible for implementing group strategies and policies. The board charter specifi es that these are separate roles 

to be undertaken by separate people.

The Bathurst Board Charter states:

 ‧

 the board is to be comprised of both executive and non-executive directors with a majority of non-executive directors. Non-executive directors 

bring a fresh perspective to the board’s consideration of strategic, risk and performance matters;

 ‧

 in recognition of the importance of independent views and the board’s role in supervising the activities of management, the chair must be an 

independent non-executive director;

 ‧

 the majority of the board must be independent of management and all directors are required to exercise independent judgement and review 

and constructively challenge the performance of management;

 ‧

 the chair is elected by the full board and is required to meet regularly with the managing director; and

 ‧

 the chair of the board is responsible for determining the process for evaluating board performance. Such evaluations are to be conducted at least 

annually and will focus on the effectiveness of the board function and whether there continues to exist an appropriate mix of skills required by the 

board to maximise its effectiveness and its contribution to the group.

The Board Charter is available in the corporate governance section of Bathurst’s website.

In addition to matters required by law to be approved by the board, the following powers are reserved to the board for decision:

 ‧

 Strategy – providing strategic oversight and approving strategic plans and initiatives;

 ‧

 Board performance and composition – evaluating the performance of non-executive directors, and determining the size and composition 

of the board as well as recommending to shareholders the appointment and removal of directors;

 ‧

 Leadership selection – evaluating the performance of, and selection of, the CEO and those key executives reporting directly to the CEO. 

Review on a regular basis appropriate succession planning for the CEO;

 ‧

 Corporate responsibility – considering the social, safety, ethical and environmental impacts of the group’s activities, and setting policy and 

monitoring compliance with safety, corporate and social policies and practices;

 ‧

 Financial performance – approving Bathurst’s annual operating plans and budget, monitoring management, fi nancial and operational 

performance;

 ‧

 Continuous Disclosure - ensuring processes are established to capture issues for the purposes of continuous disclosure to both the ASX 

and the NZX;

 ‧

 Financial reports to shareholders – approving annual and half year reports and disclosures to the market that contain, or relate to, fi nancial 

projections, statements as to future fi nancial performance or changes to the policy or strategy of the company; and

 ‧

 Establishing procedures – ensuring that the board is in a position to exercise its power and to discharge its responsibilities as set out in the 

Board Charter.

(c) Director Independence

The independent directors of the company during the reporting period were Craig Munro (chair), Rob Lord and Malcolm Macpherson. These directors 

are independent as they are non-executive directors who are not members of management and who are free of any business or other relationship that 

could materially interfere with, or could reasonably be perceived to materially interfere with, the independent exercise of their judgment. 

The roles of Managing Director / CEO and Chair are fi lled by Hamish Bohannan and Craig Munro respectively. They are not exercised by the 

same individual. 

46

For personal use onlyCORPORATE GOVERNANCE STATEMENT

The board has approved a policy on independence of directors, a copy of which is available in the corporate governance section of Bathurst’s website. 

On appointment, each director is required to provide information to the chair to assess and confi rm their independence as part of their consent to 

act as a director. At the date of this report the chair considers that the three non-executive directors on the board are independent. The chair 

considers the independence of directors having regard to the relationships listed in Box 2.1 of the ASX Principles.

(d) Board and senior executive performance evaluation 

The board, in conjunction with the R&N committee, reviews the size and composition of the board and the mix of existing and desired competencies 

across members from time to time. Criteria considered by the directors when evaluating prospective candidates are contained in the Board’s Charter.

The chair of the board is responsible for ensuring a regular review of the performance of the board, committees and individual directors occurs at 

least annually. The chair is responsible for determining the process under which this evaluation takes place.

The board reviews annually the size and composition of the board and the mix of existing and desired competencies across members. The board may 

engage an independent recruitment fi rm to undertake a search for suitable candidates if and when an additional member is considered appropriate.

The board is responsible for evaluating the performance of senior executives. In 2012, the company implemented a performance review procedure. 

Pursuant to the procedure the board will evaluate the performance of senior executives via an ongoing process of assessment and a formal annual 

review in December. During the formal review the senior executive’s performance is measured against their role’s assessment criteria. The fi rst formal 

reviews will take place in December 2012.

(e) Nominations and appointment of new directors and succession planning

Recommendations for nomination of new directors are considered by the R&N committee and approved by the board as a whole. The R&N 

committee review director appointments having regard to the candidate’s commercial experience, skills and other qualities. External consultants 

may be used from time to time to access a wide base of potential directors.

The board recognises the impact of board tenure on succession planning and that board renewal is critical to performance. Each director other 

than the managing director, must not hold offi ce (without re-election) past the third annual general meeting of the company following the director’s 

appointment or three years following that director’s last election or appointment (whichever is the longer). However, a director appointed to fi ll a 

casual vacancy or as an addition to the board must not hold offi ce (without re-election) past the next annual general meeting of the company. 

At each annual general meeting a minimum of one director or a third of the total number of directors must resign. A director who retires at an 

annual general meeting is eligible for re-election at that meeting and the re-appointment of directors is not automatic. 

(f) Professional advice

Directors may, in carrying out their company related duties, seek external professional advice. If external professional advice is sought a director 

is entitled to reimbursement of all reasonable costs where such a request for advice is approved in writing by the chair. In the case of a request 

by the chair, approval is required by at least two other directors.

(g) Confl icts of interest

The board has approved directors’ Confl ict of Interest Guidelines (contained in the Board code of conduct) which applies if there is, or may be, 

a confl ict between the personal or other interests of a director. 

A director with an actual or potential confl ict of interest in relation to a matter before the board does not receive the board papers relating to that 

matter and when the matter comes before the board for discussion, the director withdraws from the meeting for the period the matter is considered 

and takes no part in the discussion or decision-making process.

(h) Board Meetings

The chair sets the agenda for each meeting in conjunction with the chief executive offi cer and the company secretary. Any director may request 

additional matters be added to the agenda. Board and committee papers are provided to directors, where possible, fi ve (5) business days prior 

to the relevant meeting. Copies of board papers are circulated in either electronic or hard copy form. Directors are entitled to request additional 

information where they consider the information is necessary to support informed decision-making.

Details of the number of meetings of the board of directors of Bathurst, and each board committee, held and attended by each director during 

the 12 months ended 30 June 2012 are shown on page 33 of the directors’ report.

47

For personal use onlyCORPORATE GOVERNANCE STATEMENT

CORPORATE GOVERNANCE STATEMENT
30 JUNE 2012

2. BOARD COMMITTEES

Principle 2: Structure the board to add value

Principle 4: Safeguard integrity in fi nancial reporting

(a) Board committees and membership

The board has established two committees to assist in the discharge of its responsibilities. These are:

 ‧

remuneration & nomination committee (“R&N committee”); and

 ‧ audit committee.

The charters of all board committees detailing the roles and duties of each are available in the corporate governance section of Bathurst’s website. 

All board committee charters are reviewed at least annually.

At the date of this report the membership of each board committee is shown in the relevant section below. The executive directors can attend the 

audit committee meetings by invitation. All papers considered by the committees are available on request to directors who are not on that committee.

Following each committee meeting, generally at the next Board meeting, the board is given a verbal update by the chair of each committee. 

In addition, minutes of all committee meetings are available to all directors.

(b) Remuneration and nomination committee

The R&N committee consists of the following non-executive independent directors:

 ‧ M Macpherson (Chair);

 ‧ R Lord; and

 ‧ C Munro.

Details of these directors’ qualifi cations and attendance at R&N committee meetings are set out in the directors’ report on pages 30-33.

The board has adopted an R&N committee Charter which describes the role, composition, functions and responsibilities of the R&N committee. 

A copy of the R&N committee Charter is available on the company’s website. 

(c) Audit committee

The audit committee consists of the following non-executive directors:

 ‧ R Lord (Chair);

 ‧ M Macpherson; and

 ‧ C Munro.

The audit committee comprises three non-executive and independent directors of the company. The chair of the board is not the chair of the 

committee. The chair and members of the committee are appointed by the board and may be appointed for specifi ed terms. Membership of 

the committee is reviewed annually by the board. 

Details of these directors’ qualifi cations and attendance at audit committee meetings are set out in the directors’ report on pages 30-33.

The external auditors, the chief fi nancial offi cer and the fi nancial controller attend committee meetings by invitation.

The role of the audit committee is to assist the board to meet its oversight responsibilities in relation to the company’s fi nancial reporting, internal 

control structure, corporate governance policies and practices, fi nancial risk management procedures and the external audit function. In doing so, 

it is the committee’s responsibility to maintain free and open communication between the audit committee and the external auditors and the 

management of Bathurst.

The audit committee operates in accordance with a charter which is available on the company’s website. 

48

For personal use onlyCORPORATE GOVERNANCE STATEMENT

The audit committee may consult independent experts and institute special investigations if it considers it necessary in order to fulfi l its 

responsibilities. Furthermore, the audit committee shall have the authority to seek any information it requires from any offi cer or employee of 

the company or its controlled entities and such offi cers or employees shall be instructed by the board of the company employing them to respond 

to such enquiries.

The company has established procedures for the selection, appointment and rotation of its external auditor. The board is responsible for the 

initial appointment of the external auditor and the appointment of a new external auditor when any vacancy arises, as recommended by the audit 

committee. Candidates for the position of external auditor must demonstrate complete independence from the company through the engagement 

period. The board may otherwise select an external auditor based on criteria relevant to the company’s business and circumstances. The 

performance of the external auditor is reviewed on an annual basis by the audit committee and any recommendations are made to the board. 

The company and audit committee policy is to appoint external auditors who demonstrate experience and independence. The performance of 

the external auditor is reviewed annually and applications for tender of external audit services are requested as deemed appropriate, taking into 

consideration assessment of performance, existing value and tender costs. 

PwC was appointed as the external auditor in 2010. It is PwC’s policy to rotate audit engagement partners on listed companies at least every 

fi ve years.

An analysis of fees paid to the external auditors, including a break-down of fees for non-audit services, is provided in the directors’ report and in note 

25 to the fi nancial statements. It is the policy of the external auditors to provide an annual declaration of their independence to the audit committee.

The external auditor will attend the annual general meeting and be available to answer shareholder questions about the conduct of the audit and 

the preparation and content of the audit report.

3. RISK MANAGEMENT

Principle 7: Recognise and Manage Risk

The board, through the audit committee and senior management, are responsible for overseeing and implementing the company’s Risk 

Management Policy.

The company is committed to effective risk management to achieve its business objectives. The company aims to continually improve the management 

of risk, to make better decisions to achieve its objectives and to reduce the likelihood and consequences of adverse effects to tolerable levels.

At all levels of the business senior management is responsible for the development, implementation and maintenance of risk management systems 

that will effectively allow the group to:

 ‧

 identify, assess and manage risks in an effective and effi cient manner;

 ‧

 use risk management to help make better decisions;

 ‧

 reduce the risk of not meeting business objectives;

 ‧

 meet relevant corporate governance requirements; and

 ‧

 identify and evaluate opportunities based on their risk/reward balance.

The goals of risk management are achieved by:

 ‧

 implementing a comprehensive and systematic risk assessment and reporting system across the organisation;

 ‧

 training employees in the use of the system, and in suitable risk assessment methodologies for their business and work applications;

 ‧

 developing a risk profi le for each business unit, and then providing risk funding to reduce risk and maintain a suitable risk/reward balance;

 ‧

 embedding risk management into the way we work; and

 ‧

 auditing the system.

49

For personal use onlyCORPORATE GOVERNANCE STATEMENT

CORPORATE GOVERNANCE STATEMENT
30 JUNE 2012

3. RISK MANAGEMENT (CONTINUED)

The board receives monthly reports about the fi nancial condition and operational results of Bathurst and its controlled entities. The CEO and CFO 

provide, at the end of each six monthly period, a formal statement (in accordance with section 295A of the Corporations Act) to the board confi rming 

that the company’s fi nancial reports present a true and fair view, in all material respects, and that the group’s fi nancial condition and operational 

results have been prepared in accordance with the relevant accounting standards.

The statement also confi rms the integrity of the company’s fi nancial statements and notes to the fi nancial statements, is founded on a sound system of 

risk management and internal compliance and control which implements the policies approved by the board, and that Bathurst’s risk management and 

internal compliance and control systems, to the extent they relate to fi nancial reporting, are operating effi ciently and effectively in all material respects. 

4. CODE OF CONDUCT, SHARE TRADING POLICY AND DIVERSITY POLICY

Principle 3: Promote Ethical and Responsible Decision Making

(a) Codes of Conduct

The board has approved a code of conduct for directors and for employees, which describes the standards of ethical behaviour that directors 

and employees are required to maintain. The company promotes the open communication of unethical behaviour within the organisation.

Compliance with the code of conduct assists Bathurst in effectively managing its operating risks and meeting its legal and compliance obligations. 

As well as enhancing the company’s corporate reputation.

The code of conduct describes the company’s requirements on matters such as confi dentiality, confl icts of interest, use of company information, 

sound employment practices, compliance with laws and regulations and the protection and safeguarding of company assets.

A copy of the company’s code of conduct is available on Bathurst’s website.

(b) Share trading policy

The company’s share trading policy is binding on all directors and employees. The policy provides a brief summary of the law on insider trading 

and other relevant laws, sets out the restrictions on dealing in securities by people who work for, or are associated with, Bathurst and is intended 

to assist in maintaining market confi dence in the integrity of dealings in the company’s securities.

The policy stipulates that the only appropriate time for a director or employee to deal in the company’s securities is when he or she is not in 

possession of ‘price sensitive information’ that is not generally available to the share market. A director wishing to deal in the company’s securities 

may only do so after fi rst having advised the chair of his or her intention. A senior executive wishing to deal must fi rst notify the company secretary. 

Confi rmation of any dealing must also be given by the director or senior executive within two business days after the dealing. 

Directors and senior executives’ dealings in the company’s securities are also subject to specifi ed closed periods which are set out in the company’s 

share trading policy or as otherwise determined by the board from time to time.

A copy of the company’s share trading policy is available on the corporate governance section of Bathurst’s website.

(c) Diversity policy

The company values diversity and recognises the benefi ts it can bring to the organisation’s ability to achieve its goals. Accordingly the company 

has developed a diversity policy. This policy outlines the company’s diversity objectives in relation to gender, age, cultural background and ethnicity. 

The policy includes requirements for the board to establish measurable objectives and appropriate strategies for achieving diversity. The policy 

provides for the board to assess annually both the objectives, and the company’s progress in achieving them. The proportion of female employees 

in the whole organisation is currently 28% with 38% at senior management and nil % at board level. 

50

For personal use onlyASX PRINCIPLES COMPLIANCE STATEMENT

ASX PRINCIPLES COMPLIANCE STATEMENT
30 JUNE 2012

ASX Corporate Governance Council’s Best Practice Recommendations

Reference (1)

Compliance

PRINCIPLE 1:

Lay solid foundations for management and oversight

1.1

1.2

1.3

Companies should establish the functions reserved to the board and 

those delegated to senior executives and disclose those functions.

Companies should disclose the process for evaluating the performance 

of senior executives.

Companies should provide the information indicated in the Guide 

to reporting on Principle 1.

1(b)

Comply

1(d),
 Remuneration report

Comply

1(a), 1(b), 1(d)

Comply

PRINCIPLE 2:

Structure the board to add value

2.1

2.2

2.3

2.4

2.5

2.6

A majority of the board should be independent directors.

The chair should be an independent director.

The roles of chair and chief executive offi cer should not be exercised 

by the same individual.

The board should establish a nomination committee.

Companies should disclose the process for evaluating the performance 

of the board, its committees and individual directors.

1(c)

1(c)

1(c)

1(e), 2(b)

1(b), 1(d)

Companies should provide the information indicated in the Guide 

to reporting Principle 2.

1(a), 1(d), 1(f), 2(b) & 

Directors’ report

Comply

Comply

Comply

Comply

Comply

Comply

PRINCIPLE 3:

Promote ethical and responsible decision-making

3.1

3.2

3.3

3.4

3.5

Companies should establish a code of conduct and disclose the code or a 

summary of the code as to:

 ‧

 The practices necessary to maintain confi dence in the company’s integrity;

 ‧

 The practices necessary to take into account their legal obligations and the 

4 (a)

Comply

reasonable expectations of their stakeholders; and

 ‧

 Responsibility and accountability of individuals for reporting and investigating 

reports of unethical practices.

Companies should establish a policy concerning diversity and disclose the policy. 

The policy should include requirements for the board to establish measurable 

objectives for achieving gender diversity and for the board to assess annually 

both the objectives and the progress in achieving them.

Companies should disclose in each annual report the measurable objectives 

4(c)

Comply

for achieving gender diversity set by the board in accordance with the diversity 

4(c)

Comply 

policy and progress towards achieving them.

Companies should disclose in each annual report the proportion of women 

employees in the whole organisation, women in senior executive positions 

4(c)

Comply

and women on the board.

Companies should provide the information indicated in the Guide to reporting 

on Principle 3.

4(a), 4(b), 4(c)

Comply

51

For personal use onlyASX PRINCIPLES COMPLIANCE STATEMENT

ASX PRINCIPLES COMPLIANCE STATEMENT
30 JUNE 2012

ASX Corporate Governance Council’s Best Practice Recommendations

Reference (1)

Compliance

PRINCIPLE 4:

Safeguard integrity in fi nancial reporting

4.1

4.2

4.3

4.4

The board should establish an audit committee.

2(c)

Comply

The audit committee should be structured so that it:

 ‧

 consists only non-executive directors;

 ‧

 consists of a majority of independent directors;

 ‧

 is chaired by an independent chairperson who is not chairperson 

of the board; and

 ‧

 has at least three members.

2(c)

Comply

The audit committee should have a formal charter.

2(c)

Comply

Companies should provide the information indicated in Guide to reporting 

on principle 4.

2(c), Directors’ report

Comply

PRINCIPLE 5:

Make timely and balanced disclosure

5.1

5.2

Companies should establish written policies designed to ensure compliance 

with ASX Listing Rules disclosure requirements and to ensure accountability 

at a senior executive level for that compliance and disclose those policies or 

a summary of those policies.

Companies should provide the information indicated in Guide to reporting 

on Principle 5.

PRINCIPLE 6:

Respect the rights of shareholders

6.1

6.2

Companies should design and disclose a communications policy for promoting 

effective communication with shareholders and encourage their participation at 

general meetings and disclose their policy or a summary of that policy.

Companies should provide the information indicated in the Guide to reporting 

on Principle 6.

PRINCIPLE 7:

Recognise and manage risk

6

6

6

6

Comply

Comply

Comply

Comply

7.1

7.2

7.3

7.4

Companies should establish policies for the oversight and management 

of material business risks and disclose a summary of those policies.

The board should require management to design and implement the risk 

management and internal control system to manage the company’s material 

2(b), 3

Comply

business risks and report to it on whether those risks are being management 

3

Comply

effectively. The board should disclose that management has reported to it as 

to the effectiveness of the company’s management of its material business risk.

The board should disclose whether it has received assurance from the chief 

executive offi cer (or equivalent) and the chief fi nancial offi cer (or equivalent) 

that the declaration provided in accordance with section 295A of the Corporations 

Act is founded on a sound system of risk management and internal control and 

that the system is operating effectively in all material respects in relation to fi nancial 

reporting risks.

Companies should provide the information indicated in Guide to Reporting 

on Principle 7.

3

3

Comply

Comply

52

For personal use onlyASX PRINCIPLES COMPLIANCE STATEMENT

ASX Corporate Governance Council’s Best Practice Recommendations

Reference (1)

Compliance

PRINCIPLE 8:

Remunerate fairly and responsibly

8.1

8.2

8.3

8.4

The board should establish a remuneration committee.

The remuneration committee should be structured so that it:

 ‧ consists of a majority of independent directors

 ‧

is chaired by an independent chair

 ‧ has at least three members

2(b)

2(b)

Companies should clearly distinguish the structure of non-executive directors’ 

1(b), 2(b), 2(d), 

remuneration from that of executive directors and senior executives.

Remuneration report

Companies should provide the information indicated in Guide to Reporting 

2(b), Remuneration 

on Principle 8.

report

Comply

Comply

Comply

Comply

(1)  The default reference refers to the relevant sections of this Corporate Governance Statement. Reference to the Directors’ report and the Remuneration Report is shown where applicable. 

53

For personal use onlyFINANCIAL STATEMENTS

CONTENTS 

CONSOLIDATED INCOME STATEMENT 

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME 

CONSOLIDATED BALANCE SHEET 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY 

CONSOLIDATED STATEMENT OF CASH FLOWS 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 

DIRECTORS’ DECLARATION 

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS 

55

55

56

57

58

59

100

101

These fi nancial statements are the consolidated fi nancial statements of the consolidated entity consisting of Bathurst Resources Limited and 

its subsidiaries. The fi nancial statements are presented in Australian dollars.

Bathurst Resources Limited is a company limited by shares, incorporated and domiciled in Australia. Its registered offi ce and principal place 

of business is:

Bathurst Resources Limited

Ground Floor, 1306 Hay Street

West Perth WA 6005

A description of the nature of the consolidated entity’s operations and its principal activities is included on page 28 of the directors’ report 

and on pages 6 to 14 of this Annual Report, both of which do not form part of these fi nancial statements.

The fi nancial statements were authorised for issue by the directors on 27 September 2012. The directors have the power to amend 

and reissue the fi nancial statements.

Through the use of the internet, we have ensured that our corporate reporting is timely and complete. All press releases, fi nancial reports 

and other information is available at our Investors’ Information section of our website: www.bathurstresources.co.nz

54

For personal use onlyFINANCIAL STATEMENTS

CONSOLIDATED INCOME STATEMENT
FOR THE YEAR ENDED 30 JUNE 2012

REVENUE FROM OPERATIONS

EXPENSES

Changes in inventories of fi nished goods

Raw materials, mining costs, and consumables used

Freight expense

Employee benefi ts expense

Depreciation and amortisation expense

Acquisition related costs

Consultants

Other expenses

Finance costs

Foreign exchange (loss) / gain

Share based payments

Impairment loss

Fair value adjustment – deferred consideration

Loss before income tax

Income tax benefi t
Loss for the year after income tax

Earnings per share for loss attributable to the ordinary equity holders of the company:

Basic earnings per share

Diluted earnings per share

Notes

4

5

5

5

5

31

5

17

6

30

30

2012
$’000

29,697

916

(14,402)

(7,476)

(8,580)

(2,432)

(1,148)

(1,864)

(5,084)

(4,052)

(7,083)

95

(6,365)

1,905

(25,873)

4,353

(21,520)

2011
$’000

8,758

78

(2,643)

(1,655)

(3,789)

(688)

(2,318)

(891)

(3,174)

(3,185)

8,216

(11,641)

-

(2,176)

(15,108)

1,633

(13,475)

Cents

Cents

(3.12)

(3.12)

(2.76)

(2.76)

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2012

Loss for the year

Other comprehensive income

Exchange differences on translation of foreign operations

Other comprehensive income for the year, net of tax

Total comprehensive income for the year

Total comprehensive income for the year attributable to the owners 
of Bathurst Resources Limited

Notes

2012
$’000

2011
$’000

(21,520)

(13,475)

21

1,028

1,028

141

141

(20,492)

(13,334)

(20,492)

(13,334)

The above consolidated income statement and consolidated statement of comprehensive income should be read in conjunction with the accompanying notes.

55

For personal use onlyFINANCIAL STATEMENTS

CONSOLIDATED BALANCE SHEET
AS AT 30 JUNE 2012

ASSETS

Current assets

Cash and cash equivalents

Trade and other receivables

Inventories

Financial assets

Other assets

Total current assets

Non-current assets

Property, plant and equipment

Mine licences, properties, exploration and evaluation assets

Financial assets

Other assets

Total non-current assets

Total assets

LIABILITIES

Current liabilities

Trade and other payables

Borrowings

Deferred consideration

Current tax liabilities

Provisions

Total current liabilities

Non-current liabilities

Borrowings

Deferred consideration

Deferred tax liabilities

Provisions

Total non-current liabilities

Total liabilities

NET ASSETS

EQUITY

Contributed equity

Reserves

Accumulated losses
TOTAL EQUITY

Notes

2012
$’000

2011
$’000

7

8

9

10

11

12

13

10

11

15

16

17

6 (e)

18

16

17

19

18

20

21

53,823

2,615

2,014

136

181

87,418

3,987

1,058

-

537

58,769

93,000

12,953

314,416

3,305

1,759

10,046

281,641

282

3,897

332,433

295,866

391,202

388,866

5,561

2,013

-

-

637

8,211

-

138,583

70,597

1,745

210,925

4,682

831

41,052

942

509

48,016

1,988

89,387

75,027

668

167,070

219,136

215,086

172,066

173,780

211,063

15,963

(54,960)

172,066

192,190

15,030

(33,440)

173,780

The above consolidated balance sheet should be read in conjunction with the accompanying notes.

56

For personal use onlyFINANCIAL STATEMENTS

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2012

CONSOLIDATED

Balance at 1 July 2010

Loss for the year

Other comprehensive income

Total comprehensive income for the year

Transactions with owners in their capacity 
as owners:

Contributions of equity, net of transaction costs

Exercise of options

Share-based payments

Balance at 30 June 2011

Balance at 1 July 2011

Loss for the year

Other comprehensive income

Total comprehensive income for the year

Transactions with owners in their capacity 
as owners:
Contributions of equity, net of transaction costs 

Exercise of options

Share-based payments 

Balance at 30 June 2012

Contributed
Equity
$’000

Option 
Reserve
$’000

Notes

32,958

1,148

-

-

-

154,602

4,630

-

159,232

192,190

-

-

-

2,069

-

11,641

13,710

14,858

192,190

14,858

-

-

-

15,978

2,895

-

18,873

211,063

-

-

-

-

-

(95)

(95)

20

20

31

20

20

31

Foreign 
Currency 
Translation 
Reserve
$’000

31

-

141

141

-

-

-

-

172

172

-

1,028

1,028

-

-

-

-

Accumulated 
Losses
$’000

Total Equity 
$’000

(19,965)

(13,475)

-

14,172

(13,475)

141

(13,475)

(13,334)

-

-

-

-

(33,440)

(33,440)

(21,520)

-

(21,520)

-

-

-

-

156,671

4,630

11,641

172,942

173,780

173,780

(21,520)

1,028

(20,492)

15,978

2,895

(95)

18,778

172,066

14,763

1,200

(54,960)

The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.

57

For personal use onlyFINANCIAL STATEMENTS

CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2012

CASH FLOWS FROM OPERATING ACTIVITIES

Receipts from customers (inclusive of GST)

Payments to suppliers and employees (inclusive of GST)

Interest received

Interest and other fi nance costs paid

Income taxes paid

Net cash outfl ow from operating activities

CASH FLOWS FROM INVESTING ACTIVITIES

Payment for acquisition of subsidiary, net of cash acquired

Payments for property, plant and equipment

Payments for exploration assets

Payments for acquisition of mining permits

Proceeds from the sale of property, plant & equipment

Advances to third parties

Other

Net cash outfl ow from investing activities

CASH FLOWS FROM FINANCING ACTIVITIES

Proceeds from the issue of shares

Repayment of borrowings

Repayment of loans to external parties

Payments for share issue costs

Net cash infl ow from fi nancing activities

NET (DECREASE) / INCREASE IN CASH AND CASH EQUIVALENTS

Cash and cash equivalents at the beginning of the year

Effects of exchange rate changes on cash and cash equivalents

Cash and cash equivalents at the end of the year

Non-cash fi nancing and investing activities

Notes

2012
$’000

2011
$’000

31,347

(41,067)

3,897

(186)

(1,081)

(7,090)

10,137

(18,062)

2,108

(121)

(28)

(5,966)

-

(61,888)

(8,527)

(8,221)

(7,382)

93

(3,117)

(1,751)

(28,905)

3,004

(842)

-

(64)

(2,890)

(2,051)

(3,815)

-

-

(380)

(71,024)

170,532

(207)

(5,076)

(9,230)

2,098

156,019

(33,897)

87,418

302

53,823

79,029

8,276

113

87,418

29

10

7

29(a)

The above consolidated statement of cash fl ows should be read in conjunction with the accompanying notes.

58

For personal use onlyFINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2012

NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies adopted in the preparation of these consolidated fi nancial statements are set out below. These policies have 

been consistently applied to all the years presented, unless otherwise stated. The fi nancial statements are for the consolidated entity consisting 

of Bathurst Resources Limited and its subsidiaries.

(a) Basis of preparation

These general purpose fi nancial statements have been prepared in accordance with Australian Accounting Standards, other authoritative 

pronouncements of the Australian Accounting Standards Board, Urgent Issues Group Interpretations and the Corporations Act 2001. 

Bathurst Resources Limited is a for-profi t entity for the purposes of preparing the fi nancial statements.

(i) Compliance with IFRS

The consolidated fi nancial statements of the Bathurst Resources Limited group also comply with International Financial Reporting Standards (IFRS) 

as issued by the International Accounting Standards Board (IASB).

(ii) Historical cost convention

These fi nancial statements have been prepared under the historical cost convention, as modifi ed by the revaluation of available-for-sale fi nancial 

assets, fi nancial assets and liabilities (including derivative instruments) at fair value through profi t or loss.

(iii) Critical accounting estimates

The preparation of fi nancial statements requires the use of certain critical accounting estimates. It also requires management to exercise its 

judgement in the process of applying the group’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas 

where assumptions and estimates are signifi cant to the fi nancial statements are disclosed in note 2.

(b) Principles of consolidation

The consolidated fi nancial statements incorporate the assets and liabilities of all subsidiaries of Bathurst Resources Limited (”company” or ”parent 

entity”) as at 30 June 2012 and the results of all subsidiaries for the year then ended. Bathurst Resources Limited and its subsidiaries together are 

referred to in this fi nancial report as the group or the consolidated entity.

Subsidiaries are all entities over which the group has the power to govern the fi nancial and operating policies, generally accompanying a 

shareholding of more than one-half of the voting rights. The existence and effect of potential voting rights that are currently exercisable or 

convertible are considered when assessing whether the group controls another entity.

Subsidiaries are fully consolidated from the date on which control is transferred to the group. They are de-consolidated from the date that 

control ceases.

The acquisition method of accounting is used to account for business combinations by the group (refer to note 1(h)).

Intercompany transactions, balances and unrealised gains on transactions between group companies are eliminated. Unrealised losses are also 

eliminated unless the transaction provides evidence of the impairment of the asset transferred. Accounting policies of subsidiaries have been 

changed where necessary to ensure consistency with the policies adopted by the group.

(c) Segment reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker. The chief 

operating decision maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identifi ed 

as the board of directors.

(d) Foreign currency translation

(i)  Functional and presentation currency

Items included in the fi nancial statements of each of the group’s entities are measured using the currency of the primary economic environment 

in which the entity operates (“the functional currency”). The consolidated fi nancial statements are presented in Australian dollars, which is Bathurst 

Resources Limited’s functional and presentation currency.

59

For personal use onlyFINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2012

NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(d) Foreign currency translation (continued)

(ii) Transactions and balances

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. 

Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year end exchange rates of 

monetary assets and liabilities denominated in foreign currencies are recognised in profi t or loss, except when they are deferred in equity as 

qualifying cash fl ow hedges and qualifying net investment hedges or are attributable to part of the net investment in a foreign operation.

Foreign exchange gains and losses are presented on the face of the income statement.

Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value 

was determined. Translation differences on assets and liabilities carried at fair value are reported as part of the fair value gain or loss. For example, 

translation differences on non-monetary assets and liabilities such as equities held at fair value through profi t or loss are recognised in profi t or loss 

as part of the fair value gain or loss and translation differences on non-monetary assets such as equities classifi ed as available-for-sale fi nancial 

assets are recognised in other comprehensive income.

(iii) Group Companies

The results and fi nancial position of foreign operations (none of which has the currency of a hyperinfl ationary economy) that have a functional 

currency different from the presentation currency are translated into the presentation currency as follows:

 ‧

 assets and liabilities for each balance sheet presented are translated at the closing rate at the date of that balance sheet;

 ‧

 income and expenses for each income statement and statement of comprehensive income are translated at monthly average exchange rates 

(unless this is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income 

and expenses are translated at the dates of the transactions), and

 ‧

 all resulting exchange differences are recognised in other comprehensive income.

On consolidation, exchange differences arising from the translation of any net investment in foreign entities, and of borrowings and other fi nancial 

instruments designated as hedges of such investments, are recognised in other comprehensive income. When a foreign operation is sold or any 

borrowings forming part of the net investment are repaid, a proportionate share of such exchange difference is reclassifi ed to profi t or loss, as part 

of the gain or loss on sale where applicable. Goodwill and fair value adjustments arising on the acquisition of a foreign operation are treated as 

assets and liabilities of the foreign operation and translated at the closing rate.

(e) Revenue recognition

Revenue is recognised and measured at the fair value of the consideration received or receivable to the extent it is probable that the economic 

benefi ts will fl ow to the group and the revenue can be reliably measured. The following specifi c recognition criteria must also be met before revenue 

is recognised:

(i)  Sale of goods

Revenue from the sale of goods is recognised when there is an executed sales agreement at the time of delivery of the goods to customer, 

indicating that there has been a transfer of risks and rewards to the customer, no further work or processing is required, the quantity and quality 

of the goods has been determined, the price is fi xed and when title has passed.

(ii) Freight income

Revenue from freight services is recognised in the accounting period in which the services are provided. Revenue is not recognised until the service 

has been completed.

(iii) Interest income

Interest income is recognised as interest accrues using the effective interest method. This is a method of calculating the amortised cost of a fi nancial 

asset and allocating the interest income over the relevant period using the effective interest rate, which is the rate that exactly discounts estimated 

future cash receipts through the expected life of the fi nancial asset to the net carrying amount of the fi nancial asset.

60

For personal use onlyFINANCIAL STATEMENTS

(f) Income tax

The income tax expense or revenue for the period is the tax payable on the current period’s taxable income based on the applicable income tax 

rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to temporary differences and to unused tax losses.

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the end of the reporting period in 

the countries where the company’s subsidiaries and associates operate and generate taxable income. Management periodically evaluates positions 

taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It establishes provisions where 

appropriate on the basis of amounts expected to be paid to the tax authorities.

Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities 

and their carrying amounts in the consolidated fi nancial statements. However, deferred tax liabilities are not recognised if they arise from the initial 

recognition of goodwill. Deferred income tax is also not accounted for if it arises from initial recognition of an asset or liability in a transaction other 

than a business combination that at the time of the transaction affects neither accounting nor taxable profi t or loss. Deferred income tax is 

determined using tax rates (and laws) that have been enacted or substantially enacted by the end of the reporting period and are expected to apply 

when the related deferred income tax asset is realised or the deferred income tax liability is settled.

Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that future taxable amounts will 

be available to utilise those temporary differences and losses.

Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount and tax bases of investments in foreign 

operations where the company is able to control the timing of the reversal of the temporary differences and it is probable that the differences will not 

reverse in the foreseeable future.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities and when the deferred 

tax balances relate to the same taxation authority. Current tax assets and tax liabilities are offset where the entity has a legally enforceable right to 

offset and intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.

Current and deferred tax is recognised in profi t or loss, except to the extent that it relates to items recognised in other comprehensive income 

or directly in equity. In this case, the tax is also recognised in other comprehensive income or directly in equity, respectively.

(g) Leases

The determination of whether an arrangement is, or contains, a lease is based on the substance of the arrangement and requires an assessment 

of whether the fulfi lment of the arrangement is dependent on the use of a specifi c asset or assets and the arrangement conveys a right to use 

the asset.

Finance leases are capitalised at the lease’s inception at the fair value of the leased property, or, if lower, the present value of the minimum lease 

payments. The corresponding rental obligations, net of fi nance charges, are included in other short-term and long-term payables. 

Capitalised leased assets are depreciated over the shorter of the estimated useful life of the asset and the lease term if there is no reasonable 

certainty that the group will obtain ownership by the end of the lease term.

Operating lease payments are recognised as an expense in the income statement on a straight-line basis over the lease term. Operating lease 

incentives are recognised as a liability when received and subsequently reduced by allocating lease payments between rental expense and reduction 

of the liability.

61

For personal use onlyFINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2012

NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(h) Business combinations

The acquisition method of accounting is used to account for all business combinations, regardless of whether equity instruments or other assets 

are acquired. The consideration transferred for the acquisition of a subsidiary comprises the fair values of the assets transferred, the liabilities 

incurred and the equity interests issued by the group. The consideration transferred also includes the fair value of any asset or liability resulting from 

a contingent consideration arrangement and the fair value of any pre-existing equity interest in the subsidiary. Acquisition-related costs are expensed 

as incurred. Identifi able assets acquired and liabilities and contingent liabilities assumed in a business combination are, with limited exceptions, 

measured initially at their fair values at the acquisition date. On an acquisition-by-acquisition basis, the group recognises any non-controlling interest 

in the acquiree either at fair value or at the non-controlling interest’s proportionate share of the acquiree’s net identifi able assets.

The excess of the consideration transferred and the amount of any non-controlling interest in the acquiree over the fair value of the group’s share of 

the net identifi able assets acquired is recorded as goodwill. If those amounts are less than the fair value of the net identifi able assets of the subsidiary 

acquired and the measurement of all amounts has been reviewed, the difference is recognised directly in profi t or loss as a bargain purchase.

Where settlement of any part of cash consideration is deferred, the amounts payable in the future are discounted to their present value as at the date 

of exchange. The discount rate used is the risk free rate, being the long term government borrowing rate. This is then adjusted for an estimated risk 

premium to refl ect the rate at which a similar borrowing could be obtained from an independent fi nancier under comparable terms and conditions.

Contingent consideration is classifi ed as a fi nancial liability (deferred consideration). Amounts classifi ed as a fi nancial liability are subsequently 

remeasured to fair value with changes in fair value recognised on the face of the income statement as “revaluation of deferred consideration”.

(i) Impairment of assets

Goodwill and intangible assets that have an indefi nite useful life are not subject to amortisation and are tested annually for impairment, or more 

frequently if events or changes in circumstances indicate that they might be impaired. Other assets are tested for impairment whenever events 

or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by 

which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell 

and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifi able cash 

infl ows which are largely independent of the cash infl ows from other assets or groups of assets (cash-generating units). Non-fi nancial assets other 

than goodwill that suffered an impairment are reviewed for possible reversal of the impairment at the end of each reporting period.

(j) Cash and cash equivalents

Cash and short-term deposits in the balance sheet comprise cash at bank and on hand and short- term deposits with an original maturity of three 

months or less.

For the purposes of the Cash Flow Statement cash and cash equivalents consist of cash and cash equivalents as defi ned above, net of outstanding 

bank overdrafts.

(k) Trade receivables

Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less provision 

for impairment. Trade receivables are generally due for settlement within 30 days. They are presented as current assets unless collection is not 

expected for more than 12 months after the reporting date.

Collectability of trade receivables is reviewed on an ongoing basis. Debts which are known to be uncollectible are written off by reducing the carrying 

amount directly. An allowance account (provision for impairment of trade receivables) is used when there is objective evidence that the group will not 

be able to collect all amounts due according to the original terms of the receivables. 

Signifi cant fi nancial diffi culties of the debtor, probability that the debtor will enter bankruptcy or fi nancial reorganisation, and default or delinquency 

in payments (more than 30 days overdue) are considered indicators that the trade receivable is impaired. The amount of the impairment allowance 

is the difference between the asset’s carrying amount and the present value of estimated future cash fl ows, discounted at the original effective 

interest rate. Cash fl ows relating to short-term receivables are not discounted if the effect of discounting is immaterial.

The amount of the impairment loss is recognised in profi t or loss within other expenses. When a trade receivable for which an impairment allowance 

had been recognised becomes uncollectible in a subsequent period, it is written off against the allowance account. Subsequent recoveries of 

amounts previously written off are credited against other expenses in profi t or loss.

62

For personal use onlyFINANCIAL STATEMENTS

(l) Inventories

Raw materials and stores, work in progress and fi nished goods are stated at the lower of cost and net realisable value. Cost comprises direct 

materials, direct labour and an appropriate proportion of variable and fi xed overhead expenditure, the latter being allocated on the basis of normal 

operating capacity. Cost includes the reclassifi cation from equity of any gains or losses on qualifying cash fl ow hedges relating to purchases of 

raw material but excludes borrowing costs. Costs are assigned to individual items of inventory on the basis of weighted average costs. Costs of 

purchased inventory are determined after deducting rebates and discounts. Net realisable value is the estimated selling price in the ordinary course 

of business less the estimated costs of completion and the estimated costs necessary to make the sale.

(m) Waste in advance

Waste removed in advance (overburden) costs incurred in the development of a mine are capitalised as parts of the costs of constructing the mine 

and subsequently amortised over the life of the mine.

Waste removal normally continues through the life of the mine. The company defers waste removal costs incurred during the production stage of 

its operations and discloses it within “other current assets”.

The amount of waste removal costs deferred is based on the ratio obtained by dividing the volume of waste removed by the tonnage of coal mined. 

Waste removal costs incurred in the period are deferred to the extent that the current period ratio exceeds the life of mine ratio. Such deferred costs 

are then charged against the income statement to the extent that, in subsequent periods, the ratio falls short of the life of mine ratio. The life of mine 

ratio is based on proven and probable reserves of the operation.

Waste moved in advance costs form part of the total investment in the relevant cash generating unit, which is reviewed for impairment if events 

or changes in circumstances indicate that the carrying value may not be recoverable.

Changes to the life of mine stripping ratio are accounted for prospectively.

(n) Investment and other fi nancial assets

Classifi cation

The group classifi es its fi nancial assets in the following categories: loans and receivables, held-to-maturity investments and available-for-sale fi nancial 

assets. The classifi cation depends on the purpose for which the investments were acquired.

Management determines the classifi cation of its investments at initial recognition and, in the case of assets classifi ed as held-to-maturity, 

re-evaluates this designation at the end of each reporting date.

Loans and receivables

Loans and receivables are non-derivative fi nancial assets with fi xed or determinable payments that are not quoted in an active market. They are 

included in current assets, except for those with maturities greater than 12 months after the reporting period which are classifi ed as non-current 

assets. Loans and receivables are included in trade and other receivables (note 8) in the balance sheet.

Recognition and derecognition

Regular way purchases and sales of fi nancial assets are recognised on trade-date – the date on which the group commits to purchase or sell 

the asset. Financial assets are derecognised when the rights to receive cash fl ows from the fi nancial assets have expired or have been transferred 

and the group has transferred substantially all the risks and rewards of ownership.

When securities classifi ed as available-for-sale are sold, the accumulated fair value adjustments recognised in other comprehensive income are 

reclassifi ed to profi t or loss as gains and losses from investment securities. 

Measurement

At initial recognition, the group measures a fi nancial asset at its fair value plus transaction costs that are directly attributable to the acquisition of 

the fi nancial asset.

Loans and receivables and held-to-maturity investments are subsequently carried at amortised cost using the effective interest rate method.

63

For personal use onlyFINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2012

NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(n) Investment and other fi nancial assets (continued)

Impairment

The group assesses at the end of each reporting period whether there is objective evidence that a fi nancial asset or group of fi nancial assets 

is impaired. A fi nancial asset or a group of fi nancial assets is impaired and impairment losses are incurred only if there is objective evidence of 

impairment as a result of one or more events that occurred after the initial recognition of the asset (a ‘loss event’) and that loss event (or events) 

has an impact on the estimated future cash fl ows of the fi nancial asset or group of fi nancial assets that can be reliably estimated. 

(i) Assets carried at amortised cost

For loans and receivables, the amount of the loss is measured as the difference between the asset’s carrying amount and the present value of 

estimated future cash fl ows (excluding future credit losses that have not been incurred) discounted at the fi nancial asset’s original effective interest 

rate. The carrying amount of the asset is reduced and the amount of the loss is recognised in profi t or loss. If a loan or held-to-maturity investment 

has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract. 

As a practical expedient, the group may measure impairment on the basis of an instrument’s fair value using an observable market price.

If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after 

the impairment was recognised (such as an improvement in the debtor’s credit rating), the reversal of the previously recognised impairment loss 

is recognised in profi t or loss.

Impairment testing of trade receivables is described in note 1(k).

(o) Property, plant and equipment

All property, plant and equipment is stated at historical cost less depreciation. Historical cost includes expenditure that is directly attributable to 

the acquisition of the items. Cost may also include transfers from equity of any gains or losses on qualifying cash fl ow hedges of foreign currency 

purchases of property, plant and equipment.

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future 

economic benefi ts associated with the item will fl ow to the group and the cost of the item can be measured reliably. The carrying amount of any 

component accounted for as a separate asset is derecognised when replaced. All other repairs and maintenance are charged to profi t or loss during 

the reporting period in which they are incurred.

Land is not depreciated. Depreciation on other assets is calculated using the straight-line method to allocate their cost, net of their residual values, 

over their estimated useful lives or, in the case of leasehold improvements and certain leased plant and equipment, the shorter lease term as follows:

 ‧

 Buildings 25 years

 ‧

 Mine infrastructure 3 – 8 years 

 ‧

 Plant & machinery 2 - 25 years

 ‧

 Plant & machinery leased – units of use

 ‧

 Furniture, fi ttings and equipment 3-8 years

The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period.

An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated 

recoverable amount (note 1(i)).

Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in profi t or loss. 

64

For personal use onlyFINANCIAL STATEMENTS

(p) Exploration and evaluation expenditure

Exploration and evaluation expenditure incurred is capitalised to the extent that the expenditure is expected to be recovered through the successful 

development and exploitation of the area of interest, or the exploration and evaluation activities in the area of interest have not yet reached a point 

where such an assessment can be made. All other exploration and evaluation expenditure is expensed as incurred.

Capitalised costs are accumulated in respect of each identifi able area of interest. Costs are only carried forward to the extent that tenure is current 

and they are expected to be recouped through the successful development of the area (or, alternatively by its sale) or where activities in the area 

have not yet reached a stage which permits reasonable assessment of the existence of economically recoverable reserves and operations in relation 

to the area are continuing.

Accumulated costs in relation to an abandoned area are written off in full against profi t in the period in which the decision to abandon the area is made.

When production commences, the accumulated costs for the relevant area of interest are amortised over the life of the area according to the rate 

of depletion of the economically recoverable reserves.

A regular review is undertaken of each area of interest to determine the appropriateness of continuing to carry forward costs in relation to that area 

of interest.

(q) Mining and development properties

Mining and development properties include the cost of acquiring and developing mining properties, mineral rights and exploration, evaluation and 

development expenditure carried forward relating to areas where production has commenced. These assets are amortised using the unit of 

production basis over the proven and probable reserves. Amortisation starts from the date when commercial production commences.

An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated 

recoverable amount.

(r) Trade and other payables

These amounts represent liabilities for goods and services provided to the group prior to the end of fi nancial year which are unpaid. The amounts are 

unsecured and are usually paid within 30 days of recognition. Trade and other payables are presented as current liabilities unless payment is not due 

within 12 months from the reporting date. They are recognised initially at their fair value and subsequently measured at amortised cost using the 

effective interest method.

(s) Borrowings

Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortised cost. 

Any difference between the proceeds (net of transaction costs) and the redemption amount is recognised in profi t or loss over the period of the 

borrowings using the effective interest method. Fees paid on the establishment of loan facilities are recognised as transaction costs of the loan to 

the extent that it is probable that some or all of the facility will be drawn down. In this case, the fee is deferred until the draw down occurs. To the 

extent there is no evidence that it is probable that some or all of the facility will be drawn down, the fee is capitalised as a prepayment for liquidity 

services and amortised over the period of the facility to which it relates.

Borrowings are removed from the balance sheet when the obligation specifi ed in the contract is discharged, cancelled or expired. The difference 

between the carrying amount of a fi nancial liability that has been extinguished or transferred to another party and the consideration paid, including 

any non-cash assets transferred or liabilities assumed, is recognised in profi t or loss as other income or fi nance costs.

Where the terms of a fi nancial liability are renegotiated and the entity issues equity instruments to a creditor to extinguish all or part of the liability 

(debt for equity swap), a gain or loss is recognised in profi t or loss, which is measured as the difference between the carrying amount of the fi nancial 

liability and the fair value of the equity instruments issued.

Borrowings are classifi ed as current liabilities unless the group has an unconditional right to defer settlement of the liability for at least 12 months 

after the reporting period.

65

For personal use onlyFINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2012

NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(t) Provisions

Provision for rehabilitation

Provisions are made for site rehabilitation costs relating to areas disturbed during the mine’s operation up to reporting date but not yet rehabilitated. 

The provision is based on management’s best estimate of future costs of rehabilitation. When the provision is recognised, the corresponding 

rehabilitation costs are recognised as part of mining property and development assets. At each reporting date, the rehabilitation liability is 

re-measured in line with changes in the timing or amount of the costs to be incurred. Changes in the liability relating to rehabilitation of mine 

infrastructure and dismantling obligations are added to or deducted from the related asset.

If the change in the liability results in a decrease in the liability that exceeds the carrying amount of the asset, the asset is written down to nil 

and the excess is recognised immediately in the income statement. If the change in the liability results in an addition to the cost of the asset, 

the recoverability of the new carrying value is considered. Where there is an indication that the new carrying amount is not fully recoverable, 

an impairment test is performed with the write down recognised in the income statement in the period in which it occurs.

The net present value of the provision is calculated using an appropriate discount rate, the unwinding of the discount applied in calculating 

the net present value of the provision is charged to the income statement in each reporting period and is classifi ed as a fi nance cost.

(u) Employee benefi ts

(i) Short-term obligations

Liabilities for wages and salaries, including non-monetary benefi ts, and annual leave expected to be settled within 12 months after the end of the 

period in which the employees render the related service are recognised in respect of employees’ services up to the end of the reporting period 

and are measured at the amounts expected to be paid when the liabilities are settled. The liability for annual leave and accumulating sick leave is 

recognised in the provision for employee benefi ts. All other short-term employee benefi t obligations are presented as payables.

(ii) Other long-term employee benefi t obligations

The liability for long service leave and annual leave which is not expected to be settled within 12 months after the end of the period in which the 

employees render the related service is recognised in the provision for employee benefi ts and measured as the present value of expected future 

payments to be made in respect of services provided by employees up to the end of the reporting period using the projected unit credit method. 

Consideration is given to expected future wage and salary levels, experience of employee departures and periods of service. Expected future 

payments are discounted using market yields at the end of the reporting period on national government bonds with terms to maturity and currency 

that match, as closely as possible, the estimated future cash outfl ows.

(iii) Share-based payments

Share-based compensation benefi ts are provided to employees via the Bathurst Resources Limited Employee Share Option Plan. Information 

relating to these schemes is set out in note 31.

The fair value of options granted under the Bathurst Resources Limited Employee Share Option Plan is recognised as an employee benefi ts expense 

with a corresponding increase in equity. The total amount to be expensed is determined by reference to the fair value of the options granted, which 

includes any market performance conditions and the impact of any non-vesting conditions but excludes the impact of any service and non-market 

performance vesting conditions. 

Non-market vesting conditions are included in assumptions about the number of options that are expected to vest. The total expense is recognised 

over the vesting period, which is the period over which all of the specifi ed vesting conditions are to be satisfi ed. At the end of each period, the entity 

revises its estimates of the number of options that are expected to vest based on the non-marketing vesting conditions. It recognises the impact of 

the revision to original estimates, if any, in profi t or loss, with a corresponding adjustment to equity.

(v) Contributed equity

Ordinary shares are classifi ed as equity. 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.

66

For personal use onlyFINANCIAL STATEMENTS

(w) Earnings per share

(i)  Basic earnings per share

Basic earnings per share is calculated by dividing:

 ‧

 the profi t attributable to owners of the company, excluding any costs of servicing equity other than ordinary shares

 ‧

 by the weighted average number of ordinary shares outstanding during the fi nancial year, adjusted for bonus elements in ordinary shares issued 

during the year.

(ii) Diluted earnings per share

Diluted earnings per share adjusts the fi gures used in the determination of basic earnings per share to take into account:

 ‧

 the after income tax effect of interest and other fi nancing costs associated with dilutive potential ordinary shares, and

 ‧

 the weighted average number of additional ordinary shares that would have been outstanding assuming the conversion of all dilutive potential 

ordinary shares.

(x) Deferred Consideration

The fair value of deferred consideration payments are calculated periodically with adjustments through profi t and loss. The portion of the fair value 

adjustment due to the time value of money (unwinding of discount) is recognised as a fi nance cost. For further information on deferred consideration 

refer to note 17.

(y) Goods and Services Tax (GST)

Revenues, expenses and assets are recognised net of the amount of goods and services tax (“GST”), except where the GST incurred on a purchase 

of goods and services is not recoverable from the taxation authorities, in which case the GST is recognised as part of the cost of acquisition of the 

asset or as part of an item of the expense item as applicable. Receivables and payables in the balance sheet are shown inclusive of GST.

The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the balance sheet. 

Cash fl ows are included in the Cash Flow Statement on a gross basis and the GST component of cash fl ows arising from investing and fi nancing 

activities, which is recoverable from, or payable to, the taxation authority are classifi ed as operating cash fl ows.

(z) Rounding of amounts

The company is of a kind referred to in Class Order 98/100, issued by the Australian Securities and Investments Commission, relating to the 

‘rounding off’ of amounts in the fi nancial statements. Amounts in the fi nancial statements have been rounded off in accordance with that Class Order 

to the nearest thousand dollars, or in certain cases, the nearest dollar.

(aa) New accounting standards and interpretations

Certain new accounting standards and interpretations have been published that are not mandatory for 30 June 2012 reporting periods. The group’s 

assessment of the impact of these new standards and interpretations is set out below.

(i) AASB 10 Consolidated Financial Statements, AASB 11 Joint Arrangements, AASB 12 Disclosure of Interests in Other Entities, revised AASB 127 

Separate Financial Statements and AASB 128 Investments in Associates and Joint Ventures and AASB 2011-7 Amendments to Australian 

Accounting Standards arising from the Consolidation and Joint Arrangements Standards (effective 1 January 2013)

In August 2011, the AASB issued a suite of fi ve new and amended standards which address the accounting for joint arrangements, consolidated 

fi nancial statements and associated disclosures. AASB 10 replaces all of the guidance on control and consolidation in AASB 127 Consolidated and 

Separate Financial Statements, and Interpretation 12 Consolidation – Special Purpose Entities. The core principle that a consolidated entity presents 

a parent and its subsidiaries as if they are a single economic entity remains unchanged, as do the mechanics of consolidation. However, the 

standard introduces a single defi nition of control that applies to all entities. It focuses on the need to have both power and rights or exposure to 

variable returns. Power is the current ability to direct the activities that signifi cantly infl uence returns. Returns must vary and can be positive, negative 

or both. Control exists when the investor can use its power to affect the amount of its returns. There is also new guidance on participating and 

protective rights and on agent/principal relationships. 

The group does not expect the new standard to have a signifi cant impact on its composition. 

67

For personal use onlyFINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2012

NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(aa) New accounting standards and interpretations (continued)

AASB 11 introduces a principles based approach to accounting for joint arrangements. The focus is no longer on the legal structure of joint 

arrangements, but rather on how rights and obligations are shared by the parties to the joint arrangement. Based on the assessment of rights 

and obligations, a joint arrangement will be classifi ed as either a joint operation or a joint venture. Joint ventures are accounted for using the equity 

method, and the choice to proportionately consolidate will no longer be permitted. Parties to a joint operation will account their share of revenues, 

expenses, assets and liabilities in much the same way as under the previous standard. AASB 11 also provides guidance for parties that participate 

in joint arrangements but do not share joint control.

As the group is not a party to any joint venture arrangements, AASB 11 will not have any impact on the amounts recognised in its fi nancial 

statements.

AASB 12 sets out the required disclosures for entities reporting under the two new standards, AASB 10 and AASB 11, and replaces the disclosure 

requirements currently found in AASB 127 and AASB 128. Application of this standard by the group will not affect any of the amounts recognised 

in the fi nancial statements, but will impact the type of information disclosed in relation to the group’s investments.

Amendments to AASB 128 provide clarifi cation that an entity continues to apply the equity method and does not remeasure its retained interest 

as part of ownership changes where a joint venture becomes an associate, and vice versa. The amendments also introduce a “partial disposal” 

concept. The group does not expect this will impact its fi nancial reporting.

The group does not expect to adopt the new standards before their operative date. They would therefore be fi rst applied in the fi nancial statements 

for the annual reporting period ending 30 June 2014.

(ii) AASB Interpretation 20 Stripping Costs in the Production Phase of a Surface Mine and AASB 2011-12 Amendments to Australian Accounting 

Standards arising from Interpretation 20 (effective 1 January 2013) 

Interpretation 20 sets out the accounting for overburden waste removal (stripping) costs in the production phase of a mine. It states that these costs 

can only be recognised as an asset if they can be attributed to an identifi able component of the ore body, the costs relating to the improved access 

to that component can be measured reliably and it is probable that future economic benefi ts associated with the stripping activity (improved access 

to the orebody) will fl ow to the entity. The costs will be amortised over the life of the identifi ed component of the ore body. 

This is different to the consolidated entity’s current accounting policy which is to capitalise stripping costs based on a general waste-to-ore stripping 

ratio and amortise the costs over the life of the mine. The interpretation must be applied retrospectively and the group will have to write off existing 

stripping cost asset balances to retained earnings on the date of transition, unless they relate to an identifi able component of the ore body. The total 

carrying amount of deferred waste capitalised as at 30 June 2012 was $nil.

The group expects to adopt the interpretation from 1 July 2013. 

(iii) AASB 13 Fair Value Measurement and AASB 2011-8 Amendments to Australian Accounting Standards arising from AASB 13 (effective 

1 January 2013)

AASB 13 was released in September 2011. It explains how to measure fair value and aims to enhance fair value disclosures. The group has yet 

to determine which, if any, of its current measurement techniques will have to change as a result of the new guidance. It is therefore not possible 

to state the impact, if any, of the new rules on any of the amounts recognised in the fi nancial statements. However, application of the new standard 

will impact the type of information disclosed in the notes to the fi nancial statements. The group does not intend to adopt the new standard before 

its operative date, which means that it would be fi rst applied in the annual reporting period ending 30 June 2014.

(ab) Parent entity fi nancial information

The fi nancial information for the parent entity, Bathurst Resources Limited, disclosed in note 32 has been prepared on the same basis as the 

consolidated fi nancial statements, except as set out below.

(i) Investments in subsidiaries, associates and joint venture entities

Investments in subsidiaries, associates and joint venture entities are accounted for at cost in the fi nancial statements of Bathurst Resources Limited. 

(ii) Financial guarantees

Where the parent entity has provided fi nancial guarantees in relation to loans and payables of subsidiaries for no compensation, the fair values 

of these guarantees are accounted for as contributions and recognised as part of the cost of the investment.

68

For personal use onlyFINANCIAL STATEMENTS

NOTE 2 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events 

that may have a fi nancial impact on the entity and that are believed to be reasonable under the circumstances.

The group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by defi nition, seldom equal the related 

actual results. The estimates and assumptions that have a signifi cant risk of causing a material adjustment to the carrying amounts of assets and 

liabilities within the next fi nancial year are discussed below.

(i) Impairment 

The future recoverability of the assets recorded by the group is dependent upon a number of factors, including whether the group decides to exploit 

its mine property itself or, if not, whether it successfully recovers the related asset through sale.

Factors that could impact future recoverability include the level of reserves and resources, future technological changes, costs of drilling and 

production, production rates, future legal changes, and changes to commodity prices and foreign exchange rates.

(ii) Valuation of deferred consideration

In valuing the deferred consideration payable under business acquisitions management uses estimates and assumptions. This includes future coal 

prices, discount rates, coal production, and the timing of payments. The amounts of deferred consideration are reviewed at each balance date and 

updated based on best available estimates and assumptions at that time.

The carrying amount of deferred consideration is set out in note 17.

(iii) Reserves and Resources

Reserves and resources are based on information compiled by a Competent Person as defi ned in accordance with the Australasian Code of 

Mineral Resources and Ore Reserves of December 2004 (the JORC code). There are numerous uncertainties inherent in estimating reserves and 

assumptions that are valid at the time of estimation but that may change signifi cantly when new information becomes available. Changes in forecast 

prices of commodities, exchange rates, production costs or recovery rates may change the economic status and may, ultimately, result in the 

reserves being restated. Such changes in reserves could impact on depreciation and amortisation rates, asset carrying values and provisions for 

rehabilitation. 

(iv) Provision for rehabilitation

In calculating the estimated future costs of rehabilitating and restoring areas disturbed in the mining process certain estimates and assumptions 

have been made. (Refer to Note 1(t)). The amount the group is expected to incur to settle these future obligations includes estimates in relation 

to the appropriate discount rate to apply to the cash fl ow profi le, expected mine life, application of the relevant requirements for rehabilitation, 

and the future expected costs of rehabilitation. 

Changes in the estimates and assumptions used could have a material impact on the carrying value of the rehabilitation provision and related asset. 

The provision is reviewed at each reporting date and updated based on the best available estimates and assumptions at that time. 

The carrying amount of the rehabilitation provision is set out in Note 18.

(v)  Waste in advance

Waste moved in advance is calculated with reference to the stripping ratio (waste moved over coal extracted) of the area of interest and the excess 

of this ratio over the estimated stripping ratio for the area of interest expected to incur over its life. Management estimates this life of mine ratio based 

on geological and survey models as well as reserve information for the areas of interest.

The carrying amount of the waste moved in advance is set out in Note 11.

(vi) Taxation

The group’s accounting policy for taxation requires management judgement in relation to the application of income tax legislation. There are many 

transactions and calculations undertaken during the ordinary course of business where the ultimate tax determination is uncertain. The group 

recognises liabilities for tax, and if appropriate taxation investigation or audit issues, based on whether taxation will be due and payable. Where the 

taxation outcome of such matters is different from the amount initially recorded, such difference will impact the current and deferred tax position in 

the period in which the assessment is made.

69

For personal use onlyFINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2012

NOTE 2 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (CONTINUED)

In addition, certain deferred tax assets for deductible temporary differences and carried forward taxation losses have been recognised. In recognising 

these deferred tax assets assumptions have been made regarding the group’s ability to generate future taxable profi ts. Utilisation of the tax losses 

also depends on the ability of the tax entities to satisfy certain tests at the time the losses are recouped. If the entities fail to satisfy the tests, the 

carried forward losses that are currently recognised as deferred tax assets would have to be written off to income tax expense. There is an inherent 

uncertainty in applying these judgements and a possibility that changes in legislation will impact upon the carrying amount of deferred tax assets 

and deferred tax liabilities recognised on the balance sheet.

NOTE 3 SEGMENT INFORMATION

(a) Description of segments

Management has determined the operating segments based on the reports reviewed by the board of directors that are used to make strategic 

decisions.

The board reviews the business from both a mine and geographic perspective and has identifi ed two reportable segments. The Buller Coal segment 

relates to the mining, development and ultimate exploitation of permits under the Buller Coal management team in the Buller region of New Zealand. 

The Eastern Coal segment refers to the Takitimu mine and Timaru coal handling and distribution centre under the Eastern management team. 

The fi nancial performance of these segments is monitored and operated separately from each other.

All other operations of the group are classifi ed within “Corporate” section of the segment note which encompasses the administration and treasury 

management of the group. 

During the period the defi nitions of the operating segments have changed to align to changes in the management structure of the group. 

The Cascade mine and Whareatea West permit area now fall under the Buller Coal management team and are reported under the Buller Coal 

segment. This mine and permit area previously fell under Eastern Resources Group. The Eastern Resources Group segment has been renamed 

Eastern Coal to refl ect the rebranding initiatives undertaken by the group.

Comparative information has been restated to refl ect the changes discussed above.

70

For personal use onlyFINANCIAL STATEMENTS

(b) Segment information provided to the board

The segment information provided to the board for the reportable segments for the year ended 30 June 2012 is as follows:

2012

Sales revenue

Interest income

Other income

Total segment revenue

Inter segment revenue

Revenue from operations

Total revenue per the income statement

Loss before tax

Loss before tax includes:

Depreciation and amortisation

Impairment loss

Total segment assets

Total assets per the balance sheet

Total segment liabilities

Total liabilities per the balance sheet

2011

Sales revenue

Interest income

Other income

Total segment revenue

Inter segment revenue

Revenue from operations

Total revenue per the income statement

Profi t / (loss) before tax

Profi t / (loss) before tax includes:

Depreciation and amortisation

Total segment assets

Total assets per the balance sheet

Total segment liabilities

Total liabilities per the balance sheet

Buller Coal Eastern Coal
$’000

$’000

Corporate
$’000

6,666

19,663

-

7

6,673

(780)

5,893

59

510

20,232

-

20,232

-

3,560

12

3,572

-

3,572

Total
$’000

26,329

3,619

529

30,477

(780)

29,697

29,697

(14,893)

(7,789)

(3,191)

(25,873)

1,093

-

332,446

1,238

6,365

4,609

101

-

54,147

215,034

3,279

823

Buller Coal Eastern Coal
$’000

$’000

Corporate
$’000

1,682

-

-

1,682

(470)

1,212

4,744

28

153

4,925

-

4,925

-

2,621

-

2,621

-

2,621

2,432

6,365

391,202

391,202

219,136

219,136

Total
$’000

6,426

2,649

153

9,228

(470)

8,758

8,758

4,833

144

(20,085)

(15,108)

486

181

21

688

291,061

11,924

85,881

209,432

5,084

570

388,866

388,866

215,086

215,086

71

For personal use onlyFINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2012

NOTE 3 SEGMENT INFORMATION (CONTINUED)

(c) Other segment information

(i) Segment revenue

Interest income between the segments is carried out at arm’s length and is eliminated on consolidation. The revenue from external parties reported 

to the board is measured in a manner consistent with that in the income statement.

Revenues from external customers are derived from the sale of coal and freight services. Interest income from external parties is earned on cash 

deposits.

(ii) Segment assets

The amounts reported to the board with respect to total assets are measured in a manner consistent with that of the fi nancial statements. These 

assets are allocated based on the operations of the segment and the physical location of the asset.

The total of non-current assets other than fi nancial instruments and deferred tax assets located in Australia is $340,324 (2011: $343,915), and the 

total of these non-current assets located in New Zealand is $327,028,375 (2011: $295,522,798). Segment assets are allocated to countries based 

on where the assets are located.

(iii) Segment liabilities

The amounts reported to the board with respect to total liabilities are measured in a manner consistent with that of the fi nancial statements. These 

liabilities are allocated based on the operations of the segment.

NOTE 4 REVENUE

Sales revenue

Coal sales

Freight 

Other revenue

Interest income

Other

Total revenue from operations

2012
$’000

16,454

9,095

25,549

3,619

529

4,148

29,697

2011
$’000

4,045

1,911

5,956

2,649

153

2,802

8,758

72

For personal use onlyFINANCIAL STATEMENTS

NOTE 5 EXPENSES 

LOSS BEFORE INCOME TAX INCLUDES THE FOLLOWING SPECIFIC EXPENSES:

2012
$’000

2011
$’000

Employee benefi t expenses

Defi ned contribution post-employment expense 

Other employee benefi ts expense 
Total employee benefi ts expenses

Depreciation

Buildings

Mine infrastructure

Plant & machinery

Furniture, fi ttings, and equipment

Plant & machinery under fi nance leases

Amortisation

Mining licences

Mining properties

Total depreciation and amortisation

Impairment losses (a)

Property, plant, and equipment

Mine licences, properties, and exploration & evaluation assets

Waste in advance
Total impairment loss

Finance costs

Interest expense

Provisions: unwinding of discount rate (note 18)

Deferred consideration: unwinding of discount rate (note 17)
Total fi nance costs

Foreign exchange loss / (gain)

Foreign exchange on intercompany loans

Foreign exchange on deferred consideration (note 17)

Realised foreign exchange
Total foreign exchange loss / (gain)

Net loss on disposal of property, plant and equipment

Minimum lease payments expense relating to operating leases

73

230

8,350

8,580

37

207

425

301

469

1,439

827

166

993

2,432

3,877

2,013

475

6,365

187

54

3,811

4,052

-

6,987

96

7,083

27

516

141

3,648

3,789

8

75

120

46

125

374

143

171

314

688

-

-

-

-

181

-

3,004

3,185

(1,626)

(6,613)

23

(8,216)

6

188

For personal use onlyFINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2012

NOTE 5 EXPENSES (CONTINUED)

(a) Impairment loss

During the year a review and analysis of the Eastern Coal business was undertaken which indicated that the assets of the Eastern Coal business 

were impaired. The main driver of this impairment was a coal supply contract with negative margins. 

The Eastern Coal Cash Generating Unit (“CGU”) is the Takitimu mine and Timaru coal handling and distribution centre. The recoverable amount 

of the CGU was determined using its fair value less costs to sell. The fair value less costs to sell was determined on a discounted cash fl ow basis. 

Forecast cash fl ows were based on existing mining contracts, coal sales contracts and a discount rate the company would expect a market 

participant to apply to future cash fl ows. The resulting cash fl ows were discounted using a post-tax real cost of capital.

The review of the business continues and business improvement initiatives are to be implemented.

NOTE 6 INCOME TAX BENEFIT

(A) INCOME TAX EXPENSE / (BENEFIT)

Current tax

Deferred tax

Adjustments for current tax of prior periods

Deferred income tax (benefi t) / expense included in the income tax benefi t comprises:

Increase in deferred tax assets (note 14)

Increase in deferred tax liabilities (note 19)

(B) NUMERICAL RECONCILIATION OF INCOME TAX BENEFIT TO PRIMA FACIE TAX PAYABLE

Loss from continuing operations before income tax benefi t

Tax at the standard Australian rate of 30%

Tax effect of amounts that are not deductible / (assessable) in calculating taxable income:

Non-deductible expenses

Revaluation of deferred consideration

Non-deductible amortisation of fair value adjustments

Unwinding of discount rates

Unrealised foreign exchange losses / (gains)

Other

Potential tax benefi ts not recognised

Difference in overseas tax rates

Adjustments for current tax of prior periods

Adjustments to previously unrecognised tax losses

Effect of change in tax rate on recognised carried forward tax losses

Income tax benefi t

(C) TAX LOSSES

2012
$’000

-

(4,721)

368

(4,353)

(5,051)

330

(4,721)

2011
$’000

(32)

(1,601)

-

(1,633)

(1,737)

136

(1,601)

(25,873)

(7,762)

(15,108)

(4,532)

438

(572)

-

1,160

2,095

392

105

(4,144)

278

368

(855)

-

(4,353)

775

653

51

902

(2,419)

29

2,777

(1,764)

-

-

-

131

(1,633)

Unused tax losses for which no deferred tax asset has been recognised

Potential tax benefi t at 30%

15,885

4,766

10,641

3,192

74

For personal use onlyFINANCIAL STATEMENTS

The potential tax benefi ts relate to the following tax jurisdictions:

Australia

(D) UNRECOGNISED TEMPORARY DIFFERENCES
Temporary difference relating to investments in subsidiaries for which deferred tax liabilities have 
not been recognised:
Foreign currency translation

Unrecognised deferred tax (assets) / liabilities relating to the above temporary differences 

2012
$’000

2011
$’000

4,766

3,192

1,028

308

141

42

A deferred tax liability has not been recognised in respect of temporary differences of $308,000 (2011: $42,000) arising as a result of the translation 

of the fi nancial statements of the consolidated entity’s subsidiaries in New Zealand. The deferred tax asset will only arise in the event of disposal of 

the subsidiary, and no such disposal is expected in the foreseeable future.

(E) CURRENT TAX PAYABLE

Payable assumed on acquisition of subsidiary 

Current tax expense

Exchange differences
Total current tax payable

NOTE 7 CASH AND CASH EQUIVALENTS

Cash at bank and on hand

Deposits at call

(a) Risk exposure

2012
$’000

2011
$’000

-

-

-

-

2012
$’000

9,450

44,373

53,823

925

(32)

49

942

2011
$’000

9,231

78,187

87,418

The group’s exposure to interest rate risk is discussed in note 23. The maximum exposure to credit risk at the end of the reporting period is the 

carrying amount of each class of cash and cash equivalents mentioned above.

NOTE 8 TRADE AND OTHER RECEIVABLES

Trade receivables

Provision for impairment of receivables

Loans to key management personnel *

GST Receivable

Interest receivable

Other receivables

* Further information relating to loans to key management personnel is set out in note 24.

75

2012
$’000

1,435

(1)

1,434

380

331

274

196

2,615

2011
$’000

1,765

(4)

1,761

380

1,250

550

46

3,987

For personal use onlyFINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2012

NOTE 8 TRADE AND OTHER RECEIVABLES (CONTINUED)

(a) Impaired trade receivables and past due but not impaired

Ageing information on impaired trade receivables and trade receivables that are past due but not impaired has not been provided as the amounts 

are not material to the group. Impaired receivables at 30 June 2012 totalled $542 and trade receivables past due but not impaired at 30 June 2012 

totalled $1,223.

(b) Foreign exchange and interest rate risk

Information about the group’s exposure to foreign currency risk and interest rate risk in relation to trade and other receivables is provided in note 23.

(c) Fair value and credit risk

Due to the short term nature of these receivables, their carrying amount is assumed to approximate their fair value.

The maximum exposure to credit risk at the end of the reporting period is the carrying amount of each class of receivables mentioned above. 

Refer to note 23 for more information on the risk management policy of the group and the credit quality of the entity’s trade receivables.

NOTE 9 INVENTORIES

Raw materials and stores

Finished goods *

2012
$’000

71

1,943

2,014

2011
$’000

53

1,005

1,058

* Finished goods are recorded at the lower of cost and net realisable value as per note 1(l).

(a) Inventory expense

Inventories recognised as expense during the year ended 30 June 2012 amounted to $14,412,680 (2011 – $2,849,910).

Write downs of inventories to net realisable value recognised as an expense during the year ended 30 June 2012 amounted to $1,024,195 (2011 – 

nil). The expense has been included in “Changes in inventories of fi nished goods” in the income statement.

NOTE 10 FINANCIAL ASSETS

CURRENT

Advances to third parties 

NON-CURRENT

Security bonds and deposits

Advances to third parties 

2012
$’000

136

136

309

2,996

3,305

2011
$’000

-

-

282

-

282

Security bonds and deposits have been provided to third parties in relation to rental properties and mine / permit access arrangements.

Advances to third parties have been made under construction contracts to provide working capital assistance to the engaged contractor. 

The advance made attracts an interest rate of 5.75% and is secured by a bank guarantee in favour of Buller Coal Limited.

76

For personal use onlyFINANCIAL STATEMENTS

NOTE 11 OTHER ASSETS

CURRENT

Waste moved in advance

Impairment of Waste in advance (see note 5)

Prepayments

NON-CURRENT

Deposits paid

2012
$’000

2011
$’000

475

(475)

181

181

398

-

139

537

1,759

1,759

3,897

3,897

The deposits paid in the 2011 year relate to the acquisition of the Coalbrookdale assets. This acquisition was completed on 21 July 2011. 

The deposit formed part of the consideration for the asset purchase which is classifi ed as ‘Mine licences & properties’ at 30 June 2012.

The deposits paid in the 2012 year relate to the acquisition of strategic land holdings for the Eastern Coal business. The acquisition was approved 

by the Overseas Investment Offi ce of New Zealand on 25 July 2012 and is planned to be completed by December 2012. See note 28.

NOTE 12 PROPERTY, PLANT AND EQUIPMENT

Freehold 
Land
$’000

Buildings
$’000

Mine 
Infrastructure
$’000

Plant & 
Machinery
$’000

Plant & 
Machinery 
under 
fi nance 
lease
$’000

Furniture, 
fi ttings and 
equipment
$’000

YEAR ENDED 30 JUNE 2011

Opening net book amount

Acquisition of subsidiary

Additions

Disposals

Exchange differences

Depreciation charge
Closing net book amount

AT 30 JUNE 2011

Cost or fair value

Accumulated depreciation
Net book amount

-

550

599

-

42

-

1,191

1,191

-

1,191

-

362

-

-

19

(8)

373

488

(115)

373

-

707

2,834

-

97

(75)

-

2,435

171

(1)

122

(120)

3,563

2,607

4,340

(777)

3,563

4,173

(1,566)

2,607

-

1,649

-

-

83

(125)

1,607

2,371

(764)

1,607

36

115

606

(16)

10

(46)

705

819

(114)

705

Total
$’000

36

5,818

4,210

(17)

373

(374)

10,046

13,382

(3,336)

10,046

77

For personal use onlyFINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2012

NOTE 12 PROPERTY, PLANT AND EQUIPMENT (CONTINUED)

Freehold 
Land
$’000

Buildings
$’000

Mine 
Infrastructure
$’000

Plant & 
Machinery
$’000

Plant & 
Machinery 
under 
fi nance 
lease
$’000

Furniture, 
fi ttings and 
equipment
$’000

YEAR ENDED 30 JUNE 2012

Opening net book amount

Additions

Disposals

Impairment loss (Note 5 )

Exchange differences

Depreciation charge
Closing net book amount

AT 30 JUNE 2012

Cost or fair value

Accumulated depreciation
Net book amount

1,191

411

-

-

19

-

373

741

(2)

(66)

9

(37)

1,621

1,018

1,621

-

1,621

1,145

(127)

1,018

3,563

5,802

(192)

(1,924)

69

(207)

7,111

7,779

(668)

7,111

2,607

579

(35)

(1,847)

30

(425)

909

1,773

(864)

909

1,607

-

-

-

20

(469)

1,158

2,404

(1,246)

1,158

705

848

(83)

(40)

7

(301)

1,136

1,448

(312)

1,136

2012
$’000

Total
$’000

10,046

8,381

(312)

(3,877)

154

(1,439)

12,953

16,170

(3,217)

12,953

2011
$’000

(a) Assets in the course of construction

The carrying amounts of the assets disclosed above include the following expenditure recognised 

in relation to property, plant and equipment which is in the course of construction:

Mine infrastructure 

6,926

2,869

(b) Non-current assets pledged as security

Refer to note 16 for information on non-current assets pledged as security by the group.

78

For personal use onlyFINANCIAL STATEMENTS

NOTE 13 MINING LICENCES, PROPERTIES, EXPLORATION, AND EVALUATION ASSETS

30 JUNE 2011

Opening net book amount

Acquisition of subsidiary

Additions

Amortisation charge

Exchange differences
Closing net book amount

30 JUNE 2012

Opening net book amount

Additions

Effect of prior period adjustments (see note 17 & 19)

Amortisation charge

Impairment loss (see note 5 )

Exchange differences
Closing net book amount

NOTE 14 DEFERRED TAX ASSETS

THE BALANCE COMPRISES TEMPORARY DIFFERENCES ATTRIBUTABLE TO:

Tax losses

Impairment loss

Accruals

Employee benefi ts

Property, plant and equipment

Provisions
Total deferred tax assets

Exploration 
& evaluation 
expenditure
$’000

Mining 
licences & 
properties
$’000

Total
$’000

-

5,336

2,962

-

100

-

-

272,741

278,077

-

(314)

816

2,962

(314)

916

8,398

273,243

281,641

8,398

8,507

-

-

(1,191)

163

273,243

281,641

27,488

(3,713)

(993)

(822)

3,336

35,995

(3,713)

(993)

(2,013)

3,499

15,877

298,539

314,416

2012
$’000

4,092

1,789

29

53

42

849

6,854

2011
$’000

1,747

-

19

56

10

249

2,081

Set-off of deferred tax liabilities pursuant to set-off provisions (see note 19)

(6,854)

(2,081)

Net deferred tax assets

Deferred tax assets expected to be recovered within 12 months

Deferred tax assets expected to be recovered after 12 months

-

475

6,379

6,854

-

2,081

-

2,081

79

For personal use onlyFINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2012

NOTE 14 DEFERRED TAX ASSETS (CONTINUED)

MOVEMENTS

Tax losses
$’000

Accruals
$’000

AT 30 JUNE 2011

Movement to the profi t or loss

Tax losses utilised

Reclassifi ed (see note 19)

Exchange differences
At 30 June 2012

1,747

2,619

(335)

-

61

4,092

19

10

-

-

-

29

Employee 
benefi ts
$’000

Property, 
plant and 
equipment
$’000

Provisions
$’000

Impairment 
Loss
$’000

56

(4)

-

-

1

53

10

67

-

(35)

-

42

249

576

-

18

6

849

-

1,783

-

-

6

1,789

6,854

Total
$’000

2,081

5,051

(335)

(17)

74

The group has recognised a deferred tax asset in relation to the tax losses of the New Zealand entities on the basis that these losses can be utilised 

by future profi t generating New Zealand operations.

NOTE 15 TRADE AND OTHER PAYABLES

2012
$’000

3,631

1,930

5,561

2011
$’000

4,201

481

4,682

2012
$’000

2011
$’000

1,405

608

2,013

-

-

-

273

558

831

1,385

603

1,988

Trade payables

Other payables

(a) Risk exposure

Information on the group’s exposure to foreign exchange risk is provided in note 23.

NOTE 16 BORROWINGS

CURRENT

Secured

Bank loans

Lease liabilities (note 26)

NON-CURRENT

Secured

Bank loans

Lease liabilities (note 26)

80

For personal use onlyFINANCIAL STATEMENTS

(a) Breach of covenant

The group has a fi nance facility (encompassing a bank loan, fi nance lease facility, and bank overdraft facility (unused at 30 June 2012)) with Westpac 

New Zealand Limited. Debt covenants relating to this facility were breached during the year and as such Westpac New Zealand Limited has the 

option to call on these facilities at any time. Accordingly, the fi nance leases and bank loans with Westpac New Zealand Limited have been classifi ed 

as current. Westpac New Zealand waived their rights to take action in respect of the breach on 24 September 2012.

(b) Security

The bank loans are secured by an all obligations General Security Agreement given by Eastern Coal Limited and its subsidiaries (“Eastern”) 

under which each member of Eastern grants to the bank a fi rst ranking security interest over all its present and future acquired property 

(including proceeds) and a fi rst ranking security interest over any of the Eastern assets. In addition to this, the bank has a registered fi rst 

and exclusive mortgage over the property at Timaru owned by a subsidiary company, Eastern Coal Supplies Limited.

Lease liabilities are effectively secured as the rights to the leased assets recognised in the fi nancial statements revert to the lessor in the event 

of default.

The carrying amount of assets pledged as security for current and non-current borrowings are:

CURRENT

General Security Agreement

Cash and cash equivalents

Receivables

Inventories
Total current assets pledged as security

NON-CURRENT

First and exclusive mortgage

Freehold land and buildings

Finance lease

Plant and equipment

General Security Agreement

Plant and equipment
Total non-current assets pledged as security

Total assets pledged as security

(c) Fair value

Bank loans

Lease liabilities

(d) Risk exposures

2012
$’000

2011
$’000

1,166

1,497

2,014

4,677

2,935

1,801

1,058

5,794

874

876

1,158

1,607

886

2,918

7,595

3,250

5,733

11,527

2012

Carrying 
amount
$’000

1,405

608

2,013

Fair value

$’000

1,405

608

2,013

2011

Carrying 
amount
$’000

1,658

1,161

2,819

Fair value

$’000

1,658

1,161

2,819

Details of the group’s exposure to risks arising from current and non-current borrowings are set out in note 23.

81

For personal use onlyFINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2012

NOTE 17 DEFERRED CONSIDERATION 

CURRENT

Acquisition of subsidiary deferred consideration

NON-CURRENT

Acquisition of subsidiary deferred consideration

Total deferred consideration

MOVEMENTS

Balance as at 30 June 2011

Unwinding of discount rate

Foreign exchange loss

Fair value adjustments to deferred consideration

Effect of prior period adjustment 

Exchange differences
At 30 June 2012

(a) Details on deferred consideration

Unwinding of discount rate

2012
$’000

-

-

138,583

138,583

138,583

2011
$’000

41,052

41,052

89,387

89,387

130,439

Deferred 
consideration

$’000

130,439

3,811

6,987

(1,905)

(2,673)

1,924

138,583

The unwinding of discount rate adjustment relates to the fair value impact on the deferred consideration calculation of the time value of money.

Prior period adjustment

During the year an error was noted in the calculation of the fair value of deferred consideration at the time of acquisition. As this adjustment was 

noted within the 12 months after the acquisition date it has been refl ected in the carrying amount of assets acquired rather than through the profi t 

or loss.

Deferred consideration

The acquisition of Buller Coal Limited (formerly L&M Coal Limited) in November 2010 contained two components of deferred consideration, cash 

and royalties.

Deferred cash consideration

The deferred cash consideration is made up of two payments of US$40,000,000 , the fi rst being payable upon 25,000 tonnes of coal being shipped 

from the Buller Coal Project and the second payable upon 1 million tonnes of coal being shipped from the Buller Coal Project.

The potential undiscounted amount of all future cash payments that the group could be required to make under these arrangements is between 

US$nil and US$80,000,000. The deferred cash consideration is valued at each reporting date based on expected timing of the cash payment 

and an appropriate discount rate. In accordance with Australian Accounting Standards the revaluations are taken to the income statement. 

82

For personal use onlyFINANCIAL STATEMENTS

Royalties

As part of the consideration Bathurst was party to a royalty agreement with L&M Coal Holdings Limited. The amounts that are payable in the future 

under this royalty agreement are required, under the Australian Accounting Standards, to be recognised as part of the consideration paid for Buller 

Coal Limited

The fair value of the future royalty payments is estimated using an appropriate discount rate, production profi le, and forecasted US dollar coal prices 

(estimated using forecasts from leading investment banks). In accordance with Australian Accounting Standards the revaluations are taken to the 

income statement. 

Foreign exchange 

Both elements of the deferred consideration are denominated in US dollars and as such are exposed to movements in foreign exchange rates 

(notably New Zealand dollar / US dollar rates) with the effect of changes in the foreign exchange rates being recognised in the income statement 

in the period the change occurs. Refer to note 23 for discussion on the sensitivity of the income statement to fl uctuations in the New Zealand dollar / 

US dollar exchange rate.

The deferred consideration only becomes payable upon sales targets and as such is considered to be naturally hedged against US dollar sales 

receipts expected at the time the deferred consideration falls due.

Payment timing

The production targets that trigger the performance payments and royalties are not expected to be met within the next 12 months, as such deferred 

consideration is classifi ed as non-current at 30 June 2012.

(b) Security

Pursuant to a deed of guarantee and security the two performance payments of US$40 million included in the deferred consideration above are 

secured by way of a fi rst-ranking security interest in all of Buller’s present and future assets (and present and future rights, title and interest in any 

assets). In addition to this, Buller Coal Limited has guaranteed the payment of all amounts under the Sale and Purchase Agreement with L&M Coal 

Holdings Limited.

The performance payments are due on the production targets discussed above; until these production targets are met no amounts are due or 

payable under the Sale and Purchase Agreement with L&M Coal Holdings Limited.

NOTE 18 PROVISIONS

CURRENT

Employee benefi ts

Rehabilitation

NON-CURRENT

Rehabilitation

Total provisions

2012
$’000

442

195

637

1,745

1,745

2,382

2011
$’000

286

223

509

668

668

1,177

83

For personal use onlyFINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2012

NOTE 18 PROVISIONS (CONTINUED)

(a) Rehabilitation

Provision is made for the future rehabilitation of areas disturbed in the mining process. Management estimates the provision based on expected 

levels of rehabilitation, areas disturbed and an appropriate discount rate. Refer to note 1(t) for the group’s accounting policy on rehabilitation.

(b) Movements in provisions

Movements in each class of provision during the fi nancial year, other than employee benefi ts, are set out below:

Rehabilitation 
Provision

$’000

891

54

974

21

1,940

2012
$’000

2011
$’000

76,077

76,261

315

611

448

77,451

(6,854)

70,597

191

77,260

77,451

290

350

207

77,108

(2,081)

75,027

2,068

75,040

77,108

Total
$’000

77,108

330

(1,040)

(17)

1,070

77,451

Carrying amount at start of year

Unwinding of discount rate

Additional provisions recognised

Exchange differences

Carrying amount at the end of the year

NOTE 19 DEFERRED TAX LIABILITIES

THE BALANCE COMPRISES TEMPORARY DIFFERENCES ATTRIBUTABLE TO:

Mining licences

Waste moved in advance

Exploration and evaluation expenditure

Property, plant and equipment
Total deferred tax liabilities

Set-off of deferred tax assets pursuant to set-off provisions (see note 14)

Net deferred tax liabilities

Deferred tax liabilities expected to be settled within 12 months

Deferred tax liabilities expected to be settled after 12 months

MOVEMENTS

AT 30 JUNE 2011

Movement to the profi t or loss

Effect of prior period adjustment

Reclassifi cation (see note 14)

Exchange differences
At 30 June 2012

Mining 
licences
$’000

Waste in 
advance
$’000

Exploration & 
evaluation
$’000

Property, 
plant and 
equipment
$’000

76,261

(233)

(1,040)

18

1,071

76,077

290

36

-

-

(11)

315

350

255

-

-

6

611

207

272

-

(35)

4

448

84

For personal use onlyFINANCIAL STATEMENTS

NOTE 20 CONTRIBUTED EQUITY

(a) Share capital

Ordinary fully paid shares

Cost of capital raising

(b) Movements in ordinary share capital

DETAILS

OPENING BALANCE 1 JULY 2010

Issue of shares

Rights issue (including shortfall)

Conversion of listed and unlisted options

Issue of shares

Less: cumulative costs of capital raising
Balance 30 June 2011

Issue of shares for Coalbrookdale purchase

Conversion of unlisted options

Less: cumulative costs of capital raising
Balance 30 June 2012

(c) Ordinary shares

2012
Shares

2011
Shares

695,747,997

667,907,997

695,747,997

667,907,997

(c)

(e)

(d)

(c)

Number of 
shares

224,924,333

253,333,334

116,269,357

20,980,973

52,400,000

667,907,997

2012
$’000

224,497

(13,434)

211,063

Issue
 price

$0.30

$0.30

various

$1.05

(f)

(d)

15,000,000

12,840,000

$1.07

Various

695,747,997

2011
$’000

205,560

(13,370)

192,190

$’000

32,958

76,000

34,881

4,630

55,020

205,560

(13,370)

192,190

16,042

2,895

224,497

(13,434)

211,063

Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the company in proportion to the number of shares 

held. Every ordinary share is entitled to one vote.

(d) Options

Information relating to the Bathurst Resources Limited Employee Share Option Plan, including details on options issued and exercised during the 

fi nancial year and options outstanding at the end of the reporting period is set out in note 31.

(e) Rights issue

On 7 October 2010 the company invited shareholders to subscribe to a rights issue of 116,269,357 ordinary shares at an issue price of $0.30 per 

share on the basis of 1 share for every 2 fully paid ordinary shares held. The issue was fully subscribed.

(f) Coalbrookdale assets

On 21 July 2011 the group completed the acquisition of the Coalbrookdale assets. As part of the acquisition 15,000,000 shares in Bathurst 

Resources Limited were issued to the vendor.

(g) Capital risk management

The board’s policy is to maintain a strong capital base so as to maintain investor, creditor, and market confi dence and to sustain the future 

development of the business. Given the stage of the company’s development there are no formal targets set for return on capital. There were no 

changes to the company’s approach to capital management during the year. The company is not subject to externally imposed capital requirements.

85

For personal use onlyFINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2012

NOTE 21 RESERVES 

Option issue reserve

Foreign currency translation reserve

2012
$’000

14,763

1,200

15,963

2011
$’000

14,858

172

15,030

The movements in the reserves for the year are shown in the consolidated statement of changes in equity.

Nature and purpose of reserves

Option issue reserve

The option reserve is used to recognise the fair value of options issued.

Foreign currency translation reserve

Exchange differences arising on the translation of foreign controlled entities and from the translation of ‘quasi equity’ inter-company loans in foreign 

operations are recognised in other comprehensive income as described in note 1(d) and accumulated in a separate reserve within equity.

NOTE 22 DIVIDENDS

No dividend was paid or declared during the fi nancial year and the directors do not recommend the payment of a dividend.

NOTE 23 FINANCIAL RISK MANAGEMENT

The group’s activities expose it to a variety of fi nancial risks: market risk (including currency risk, interest rate risk and price risk), credit risk and 

liquidity risk. The group’s overall risk management programme focuses on the unpredictability of fi nancial markets and seeks to minimise potential 

adverse effects on the fi nancial performance of the group.

The group uses different methods to measure different types of risk to which it is exposed. These methods include sensitivity analysis in the case of 

interest rate, foreign exchange and other price risks and aging analysis for credit risk.

Risk management is carried out by the management team under policies approved by the board of directors. Management identifi es and evaluates 

fi nancial risks on a regular basis. 

The group holds the following fi nancial instruments:

FINANCIAL ASSETS

Cash and cash equivalents

Trade and other receivables

Other fi nancial assets 

FINANCIAL LIABILITIES

Trade and other payables

Borrowings

Deferred consideration

86

2012
$’000

2011
$’000

53,823

2,615

3,441

59,879

5,561

2,013

138,583

146,157

87,418

3,987

282

91,687

4,682

2,819

130,439

137,940

For personal use onlyFINANCIAL STATEMENTS

(a) Market risk

(i) Foreign exchange risk

The group operates internationally and is exposed to foreign exchange risk arising from various currency exposures, primarily with respect to the 

US dollar.

Foreign exchange risk arises from future commercial transactions and recognised assets and liabilities denominated in a currency that is not the 

entity’s functional currency. The risk is measured using sensitivity analysis and cash fl ow forecasting.

Due to the stage that the group is in regards to its development, management has not set up formal foreign exchange risk policies.

As certainty around the timing of the cash fl ows required and generated by the project become clearer an appropriate foreign exchange risk 

management policy will be introduced.

The group’s exposure to foreign currency risk at the end of the reporting period, expressed in Australian dollars, was as follows:

Deferred consideration

Sensitivity

30 June 2012
USD
$’000

30 June 2011
USD
$’000

(138,583)

(130,439)

Profi t is sensitive to movements in the NZ dollar / US dollar exchange rates due to the US dollar denominated deferred consideration shown in the 

table above. Had the NZ dollar weakened / strengthened by 10% against the US dollar with all other variables held constant, the group’s post-tax 

profi t for the year would have been $15,544,000 lower / $12,718,000 higher (2011: $14,520,000 lower / $16,090,000 higher) due only to the 

conversion of the US dollar denominated deferred consideration payments.

(ii) Cash fl ow and fair value interest rate risk

The group’s main interest rate risk arises from long term borrowings. Borrowings that are issued at variable interest rates expose the group to cash 

fl ow interest rate risk. Borrowings issued at fi xed rates expose the group to fair value interest rate risk if the borrowings are carried at fair value. The 

group has limited debt and as such there is no formal policy around levels of fi xed and variable borrowings to be maintained. During 2012, the 

group’s borrowings (both fi xed and variable) were denominated in NZ dollars.

As at the end of the reporting period, the group had the following variable rate borrowings:

Bank loans

An analysis by maturities is provided in (c) below.

30 June 2012

30 June 2011

Weighted avg 
interest rate
%

5.5%

Balance
$’000

1,405

Weighted avg 
interest rate
%

4.2%

Balance
$’000

1,658

The group’s fi xed rate borrowings and receivables are carried at amortised cost. They are therefore not subject to interest rate risk as defi ned 

in AASB 7.

Due to the relatively low borrowings of the group the group does not regularly analyse its interest rate exposure and cash fl ow interest rate risk. 

As the group matures and the borrowings increase management will develop appropriate polices and manage the risk accordingly. 

Sensitivity 

At 30 June 2012, if interest rates had been 100 basis points higher or lower during the year with all other variables held constant, post-tax profi t for 

the year would have been $619,000 higher / lower (2011: $300,000 higher / lower), mainly as a result of higher/lower interest income from cash and 

cash equivalents. Profi t is more sensitive to movements in the interest rates in 2012 than 2011 because the average cash balance for 2012 was 

higher than 2011.

87

For personal use onlyFINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2012

NOTE 23 FINANCIAL RISK MANAGEMENT (CONTINUED)

(b) Credit risk

Credit risk is managed on a group basis. Credit risk arises from cash and cash equivalents as well as credit exposures to our customers, including 

outstanding receivables. For banks and fi nancial institutions, only S&P rated parties with a minimum rating of ‘A-1+’ are accepted. If wholesale 

customers are independently rated, these ratings are used. Otherwise, if there is no independent rating, risk control assesses the credit quality of the 

customer, taking into account its fi nancial position, past experience and other factors. 

The compliance with credit limits by corporate customers is regularly monitored by management. Sales to retail customers are required to be settled 

in cash or using major credit cards, mitigating credit risk.

The credit quality of fi nancial assets that are neither past due nor impaired can be assessed by reference to external credit ratings (if available) or to 

historical information about counterparty default rates:

TRADE RECEIVABLES

Counterparties with an external credit rating (S&P)

A-1

A-2

Counterparties without external credit rating

Group 1*
Total trade receivables

Cash at bank and short-term deposits

A-1+

*Group 1 – existing customers (more than 6 months) with no defaults in the past.

(c) Liquidity risk

2012
$’000

2011
$’000

122

590

712

723

1,435

201

640

841

920

1,761

53,823

87,418

Prudent liquidity risk management implies maintaining suffi cient cash and the availability of funding through an adequate amount of committed credit 

facilities to meet obligations when they fall due. At the end of the reporting period the group held deposits at call of $44,372,630 (2011– 

$78,187,202) that are expected to readily generate cash infl ows for managing liquidity risk. Due to the dynamic nature of the project, the group 

maintains fl exibility in liquidity through the use of rolling deposit maturity cycles and by maintaining availability under committed credit lines. 

Given the large cash reserves of the business the focus of management is to maximise returns on this cash rather than adopt a formal liquidity 

management policy. 

Financing arrangements 

The group had access to the following undrawn borrowing facilities at the end of the reporting period:

FLOATING RATE

Bank overdraft (expiring within one year)

The bank overdraft facilities may be drawn at any time and may be terminated by the bank without notice. 

2012
$’000

2011
$’000

422

416

88

For personal use onlyFINANCIAL STATEMENTS

Maturities of fi nancial liabilities

The tables below analyse the group’s fi nancial liabilities into relevant maturity groupings based on their contractual maturities. The amounts disclosed 

in the table are the contractual undiscounted cash fl ows. Balances due within 12 months equal their carrying balances as the impact of discounting 

is not signifi cant. 

CONTRACTUAL MATURITIES 
OF FINANCIAL LIABILITIES

Less than 
6 months

6 – 12 
months

Between 
1 and 2 
years

Between 
2 and 5 
years

Over 
5 years

Total 
contractual 
cash fl ows

Carrying 
amount

At 30 June 2012

$’000

$’000

$’000

$’000

$’000

$’000

$’000

Trade payables

Borrowings (exc. fi nance leases)

Finance leases

Deferred consideration
Total

5,561

1,405

608

-

7,574

-

-

-

-

-

-

-

-

-

-

-

-

-

-

43,506

43,506

60,031

60,031

82,650

82,650

5,561

1,405

608

186,187

193,761

5,561

1,405

608

138,583

146,157

CONTRACTUAL MATURITIES 
OF FINANCIAL LIABILITIES

Less than 
6 months

6 – 12 
months

Between 
1 and 2 
years

Between 
2 and 5 
years

Over 
5 years

Total 
contractual 
cash fl ows

Carrying 
amount

At 30 June 2011

$’000

$’000

$’000

$’000

$’000

$’000

$’000

Trade payables

Borrowings (exc. fi nance leases)

Finance leases

Deferred consideration
Total

(d) Fair value measurements

4,682

170

321

575

5,748

-

167

321

41,176

41,664

-

1,390

383

46,053

47,826

-

-

287

36,190

36,477

-

-

-

17,383

17,383

4,682

1,727

1,312

141,377

149,098

4,682

1,658

1,161

130,439

137,940

The fair value of fi nancial assets and fi nancial liabilities must be estimated for recognition and measurement or for disclosure purposes.

AASB 7 Financial Instruments: Disclosures requires disclosure of fair value measurements by level of the following fair value measurement hierarchy:

(a)  Quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1)

(b)  Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (as prices) or indirectly (derived 

from prices) (level 2), and

(c)  Inputs for the asset or liability that are not based on observable market data (unobservable inputs) (level 3).

The following table presents the groups assets and liabilities measured and recognised at fair value at 30 June 2012 and 30 June 2011:

At 30 June 2012

LIABILITIES

Deferred consideration (see note 17)

At 30 June 2011

LIABILITIES

Deferred consideration (see note 17)

89

Level 3
$’000

Total
$’000

138,583

138,583

Level 3
$’000

Total
$’000

130,439

130,439

For personal use onlyFINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2012

NOTE 23 FINANCIAL RISK MANAGEMENT (CONTINUED)

(d) Fair value measurements (continued)

The fair value of the deferred consideration is calculated as the present value of the expected cash fl ows using a discount rate that refl ects the 

specifi c risk to the expected payment profi le. If the risk adjusted discount rate was 10% higher or lower, the fair value of the deferred consideration 

would decrease by $3,446,122 / increase by $3,669,214. If the expected cash fl ows from the royalty component of the deferred consideration were 

10% higher or lower, the fair value of the deferred consideration would increase by $6,267,096 / decrease by $6,267,096.

NOTE 24 KEY MANAGEMENT PERSONNEL DISCLOSURES

(a) Key management personnel compensation
Short-term employee benefi ts

Post-employment benefi ts

Share based payments

2012
$

2011
$

3,032,349

2,346,640

142,987

96,576

(14,181)

9,997,537

3,161,155

12,440,753

Detailed remuneration disclosures are provided in the remuneration report on pages 33 to 41.

(b) Equity instrument disclosures relating to key management personnel

(i) Options provided as remuneration and shares issued on exercise of such options

Details of options provided as remuneration and shares issued on the exercise of such options, together with the terms and conditions of such 

options, can be found in the remuneration report on pages 33 to 41.

(ii) Option holdings

2012

NAME

DIRECTORS OF BATHURST 
RESOURCES LIMITED

Craig Munro 

Rob Lord

Malcolm Macpherson

Hamish Bohannan

Gerald Cooper

OTHER KEY MANAGEMENT 
PERSONNEL OF THE GROUP

Richard Tacon

Timothy Manners

Marianne Rogers

Craig Pilcher

Laura McMahon Blechynden

Balance at 
start of year

Exercised

Other

Balance at 
end of year

Vested and 
exercisable

Unvested

4,500,000

3,500,000

2,000,000

-

-

-

12,400,000

(2,400,000)

8,000,000

(500,000)

-

-

5,700,000

(2,000,000)

5,000,000

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

4,500,000

3,250,000

1,250,000

3,500,000

2,250,000

1,250,000

2,000,000

2,000,000

-

10,000,000

7,500,000

2,500,000

7,500,000

5,500,000

2,000,000

-

-

-

3,700,000

1,700,000

2,000,000

5,000,000

3,000,000

2,000,000

-

-

-

-

-

-

All vested options are exercisable at the end of the year.

90

For personal use onlyFINANCIAL STATEMENTS

2011

NAME

DIRECTORS OF BATHURST 
RESOURCES LIMITED

Craig Munro 

Rob Lord

Malcolm Macpherson

Hamish Bohannan

Gerald Cooper

OTHER KEY MANAGEMENT 
PERSONNEL OF THE GROUP

Timothy Manners

Max Brunsdon

Alan Thom

Marianne Rogers

Craig Pilcher

Balance at 
start of year

Granted as 
compensation

Exercised

Balance at 
end of year

Vested and 
exercisable

Unvested

-

-

-

2,400,000

1,500,000

4,500,000

3,500,000

2,000,000

10,000,000

6,500,000

-

-

-

-

-

4,500,000

3,500,000

2,000,000

12,400,000

8,000,000

-

-

-

-

-

6,000,000

5,000,000

2,000,000

5,000,000

-

300,000

-

-

-

-

5,700,000

5,000,000

2,000,000

5,000,000

-

3,250,000

2,250,000

2,000,000

9,900,000

6,000,000

3,700,000

3,000,000

2,000,000

3,000,000

-

1,250,000

1,250,000

-

2,500,000

2,000,000

2,000,000

2,000,000

-

2,000,000

-

All vested options are exercisable at the end of the year.

(iii) Share holdings

The number of shares in the company held during the fi nancial year by each director of Bathurst Resources Limited and other key management 

personnel of the group, including their personally related parties, are set out below. There were no shares granted during the reporting period 

as compensation.

2012

NAME

DIRECTORS OF BATHURST RESOURCES LIMITED

Craig Munro 

Rob Lord

Malcolm Macpherson

Hamish Bohannan

Gerald Cooper

OTHER KEY MANAGEMENT PERSONNEL OF THE GROUP

Richard Tacon

Timothy Manners

Marianne Rogers

Craig Pilcher

Laura McMahon Blechynden

Balance at 
start of year

Received during 
the year on 
exercise of options

Other changes 
during the year

Balance at 
end of year

-

-

-

-

70,000

60,000

462,526

530,938

100,000

2,400,000

500,000

(1,465,658)

10,605,000

(240,000)

560,000

-

-

-

2,000,000

(1,862,498)

600,000

-

-

-

-

90,000

9,027

-

102,000

9,027

462,526

460,938

40,000

9,670,658

300,000

-

462,498

-

12,000

-

91

For personal use onlyFINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2012

NOTE 24 KEY MANAGEMENT PERSONNEL DISCLOSURES (CONTINUED)

(iii) Share holdings (continued)

2011

NAME

DIRECTORS OF BATHURST RESOURCES LIMITED

Craig Munro 

Rob Lord

Malcolm Macpherson

Hamish Bohannan

Gerald Cooper

OTHER KEY MANAGEMENT PERSONNEL OF THE GROUP

Timothy Manners

Max Brunsdon

Alan Thom

Marianne Rogers

Craig Pilcher

Balance at 
start of year

Received during 
the year on 
exercise of options

Other changes 
during the year

Balance at 
end of year

200,000

-

-

5,645,000

200,000

351,000

1,002,000

-

-

-

-

-

-

-

-

300,000

-

-

-

-

262,526

460,938

40,000

4,025,658

100,000

(188,502)

(100,000)

-

-

462,526

460,938

40,000

9,670,658

300,000

462,498

902,000

-

-

12,000

12,000

(c) Loans to key management personnel

Details of loans made to directors of Bathurst Resources Limited and other key management personnel of the group, including their personally 

related parties are set out below.

(i) Aggregates for loans to key management personnel

Balance at the 
start of the year

Interest paid and 
payable for the year

Interest not 
charged

Balance at the
 end of the year

Number in the group at 
the end of the year

$

380,000

-

$

47,630

31,363

$

-

-

$

380,000

380,000

1

1

2012

2011

(ii) Individuals with loans above $100,000 during the fi nancial year

Balance at the 
start of the year

Interest paid and 
payable for the year

Interest not 
charged

Balance at the 
end of the year

Highest indebtedness 
during the year

$

380,000

$

47,630

$

-

$

$

380,000

380,000

H Bohannan

The loan outstanding at the end of the year to H Bohannan is an unsecured loan which is repayable on 31 October 2012. Interest is payable on the 

loan at a rate of 12.5%.

92

For personal use onlyFINANCIAL STATEMENTS

NOTE 25 REMUNERATION OF AUDITORS

During the year the following fees were paid or payable for services provided by the auditor of the parent entity, its related practices and non-related 

audit fi rms:

2012
$

2011
$

203,033

-

203,033

26,000

182,341

208,341

9,500

9,500

225,000

52,648

277,648

23,700

9,000

32,700

10,000

10,000

420,874

320,348

41,696

-

41,696

57,682

118,849

176,531

-

29,621

29,621

28,418

49,091

77,509

218,227

107,130

15,675

15,675

41,000

41,000

654,776

468,478

PWC AUSTRALIA

(i) Audit and other assurance services

Audit and review of fi nancial statements

Due diligence services

Total remuneration for audit and other assurance services

(ii) Taxation services

Tax compliance services

Consulting advice on mergers and other structuring

Total remuneration for taxation services

(iii) Other services

ESOP & remuneration structuring advice

Total remuneration for other services

Total remuneration of PwC Australia 

PWC NEW ZEALAND

(i) Audit and other assurance services

Audit and review of fi nancial statements

Due diligence services

Total remuneration for audit and other assurance services

(ii) Taxation services

Tax compliance services

Consulting advice on mergers and other structuring

Total remuneration for taxation services

Total remuneration of PwC New Zealand

NON-PWC AUDIT FIRMS

BDO NEW ZEALAND

(i)  Audit and other assurance services

Audit and review of fi nancial statements

Total remuneration for audit and other assurance services of non-PwC audit fi rms

Total auditors’ remuneration

93

For personal use onlyFINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2012

NOTE 26 COMMITMENTS

(a) Capital commitments

Capital expenditure contracted for at the reporting date but not recognised as liabilities is as follows:

Property, plant & equipment

Within one year

(b) Lease commitments

(i) Non-cancellable operating leases

2012
$’000

2011
$’000

13,183

1,009

The group leases various offi ces, accommodations, and equipment under non-cancellable operating leases expiring within one to six years. 

The leases have varying terms, escalation clauses and renewal rights.

Commitments for minimum lease payments in relation to non-cancellable operating leases are payable as follows:

Within one year

Later than one year but not later than fi ve years

Later than fi ve years

(ii) Finance leases

2012
$’000

444

781

121

1,346

2011
$’000

306

532

104

942

The group leases various plant and equipment with a carrying amount of $1,158,000 (2011: $1,607,000) under fi nance leases expiring within one to 

four years.

Commitments in relation to fi nance leases are payable as follows:

Within one year

Later than one year but not later than fi ve years

Later than fi ve years

Minimum lease payments

Future fi nance charges

Recognised as a liability

The present value of fi nance lease liabilities is as follows:

Within one year

Later than one year but not later than fi ve years

Later than fi ve years

Minimum lease payments

(c) Exploration expenditure commitments

The group holds various exploration permits which have as part of their conditions minimum work programs. 

Commitments in relation to exploration permits are payable as follows:

Within one year

Later than one year but not later than fi ve years

Later than fi ve years

94

2012
$’000

608

-

-

608

-

608

608

-

-

608

2012
$’000

224

1,585

37

1,846

2011
$’000

642

670

-

1,312

(151)

1,161

558

603

-

1,161

2011
$’000

720

1,961

965

3,646

For personal use onlyFINANCIAL STATEMENTS

NOTE 27 RELATED PARTY TRANSACTIONS

(a) Parent entity

The parent entity within the group is Bathurst Resources Limited.

(b) Subsidiaries

The consolidated fi nancial statements incorporate the assets, liabilities and results of the following subsidiaries in accordance with the accounting 

policy described in note 1(b).

Name of entity

Bathurst New Zealand Limited

Bathurst Coal Limited

Buller Coal Limited

Eastern Coal Limited

Cascade Coal Limited

Somervilles Land Holdings Limited

Cascade West Limited

Cascade East Limited

Takitimu Coal Limited

Rochfort Coal Limited

Eastern Coal Supplies Limited

Bathurst Resources USA, LLC

(c) Key management personnel

Country of 
incorporation

Class of 
shares

2012
%

2011
%

Equity holding

New Zealand

New Zealand

New Zealand

New Zealand

New Zealand

New Zealand

New Zealand

New Zealand

New Zealand

New Zealand

New Zealand

USA

Ordinary

Ordinary

Ordinary

Ordinary

Ordinary

Ordinary

Ordinary

Ordinary

Ordinary

Ordinary

Ordinary

Ordinary

100

100

100

100

100

100

100

100

100

100

100

-

100

100

100

100

100

100

100

100

100

100

100

100

Disclosures relating to key management personnel are set out in note 24.

(d) Transactions with other related parties

The following transactions occurred with other parties:

Rental Income

Other related parties

2012
$

2011
$

11.700

-

95

For personal use onlyFINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2012

NOTE 28 EVENTS OCCURRING AFTER THE REPORTING PERIOD

Acquisition of Strategic Land Holding

On 25 July 2012 the company received Overseas Investment Offi ce of New Zealand approval for the acquisition of a strategic land holding adjoining 

the Takitimu operation for NZ$14 million (A$11 million). A deposit of NZ$2 million (A$1.8 million) had been paid before the reporting date with a 

further NZ$5 million (A$4 million) being paid in August 2012. The transaction is expected to complete by December 2012.

NOTE 29 RECONCILIATION OF LOSS AFTER INCOME TAX TO NET CASH OUTFLOW FROM 
OPERATING ACTIVITIES

Loss for the year

Share based payments

Unrealised foreign exchange gain / (loss)

Unwinding of discount rate

Revaluation of deferred consideration

Impairment loss

Depreciation and amortisation

Loss on disposal of property, plant and equipment

Write off of capital works in progress

Changes in operating assets and liabilities:

Decrease in trade debtors

Increase in other operating assets

Increase in inventories

Increase / (decrease) in trade and other payables

Decrease in other liabilities

Increase in other provisions

Decrease in income taxes payable

Decrease in deferred tax liabilities
Net cash outfl ow from operating activities

(a) Non-cash fi nancing and investing activities

Acquisition of Coalbrookdale

2012
$’000

(21,520)

(95)

6,987

3,865

(1,905)

6,365

2,432

27

192

353

(104)

(943)

1,673

-

1,137

(956)

(4,598)

(7,090)

2011
$’000

(13,475)

11,641

(8,239)

3,004

2,176

-

688

6

-

2,586

(1,683)

(67)

(94)

(1,006)

130

(30)

(1,603)

(5,966)

During the 2012 fi nancial year shares were issued to the vendor of the Coalbrookdale assets as part of the settlement for the assets. The value of 

the shares issued was $16,041,500.

Options issued on Capital Raising

During the 2011 fi nancial year options were issued to Helmsec Global Capital Limited in satisfaction of capital raising fees. The value of the options 

issued was $2,069,475 - refer to note 31 for further information.

96

For personal use onlyFINANCIAL STATEMENTS

NOTE 30 EARNINGS PER SHARE

2012
cents

2011
cents

(a) Basic earnings per share

Total basic earnings per share attributable to the ordinary equity holders of the company

(3.12)

(2.76)

(b) Diluted earnings per share

Total diluted earnings per share attributable to the ordinary equity holders of the company

(3.12)

(2.76)

(c) Reconciliation of earnings used in calculating earnings per share

Earnings used in the calculation of basic and dilutive Earnings per share:

Earnings from continued operations
Total earnings

(d) Weighted average number of shares used as the denominator

$’000

$’000

(21,520)

(21,520)

(13,475)

(13,475)

Shares

Shares

Weighted average number of ordinary shares during the period used in the calculation of basic and dilutive 
earnings per share

689,327,339

488,234,924

Adjustments for calculation of diluted earnings per share:

Options (1)

Weighted average number of ordinary shares and potential ordinary shares used as the denominator 
in calculating diluted earnings per share

66,245,132

37,703,440

755,572,471

525,938,364

(1) Options that could potentially dilute earnings per share in the future, but were not included in the calculation per share because they are anti – dilutive for the periods presented.

(e) Rights issue

During the 2011 fi nancial year a two for one rights issue was made to existing shareholders at an offer price below the quoted share price on the day 

the issue was made. Under AASB 113 Earnings Per Share such an issue results in an implied bonus which is applied retrospectively to the earnings 

per share calculations. 

NOTE 31 SHARE-BASED PAYMENTS

(a) Employee share option plan

The Bathurst Resources Limited Employee Share Option Plan (“ESOP”) was approved by shareholders at the 2010 AGM. The ESOP is designed 

to provide directors, senior executives, employees, and consultants with an opportunity to participate in the company’s future growth and gives 

them an incentive to contribute to that growth. The ESOP has been established to enable the company to attract and retain skilled and experienced 

directors, senior executives, employees, and consultants and to provide them with the motivation to make the company more successful and deliver 

long-term shareholder returns.

Under the plan, participants are granted units in the ESOP Trust, some of which only vest upon the shipment of the fi rst 25,000 tonnes from 

the Buller Coal Project. Participation in the ESOP is at the board’s discretion.

Options granted under the plan carry no dividend or voting rights. When exercised each option coverts into one fully paid ordinary share.

97

For personal use onlyFINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2012

NOTE 31 SHARE-BASED PAYMENTS (CONTINUED)

(a) Employee share option plan (continued)

30 June 2012

Issue

Grant date

Expiry date

Exercise 
Price

Balance at 
start of year

Forfeited 
during the 
year

Exercised 
during the 
year

Balance at 
the end of 
the year

Vested and 
exercisable 
at the end 
of the year

A

B

C

D

E

F

G

H
Total

18 Aug 10

30 Sept 13

10.8 cents

20 Aug 10

30 Sept 13

16.8 cents

9,500,000

1,000,000

20 Aug 10

30 Sept 13

10.8 cents

11,000,000

29 Nov 10

30 Sept 13

29 Nov 10

31 Dec 13

6 Dec 10

31 Dec 13

21 cents

40 cents

40 cents

18 Apr 11

31 Dec 13

113 cents

18 Apr 11

31 Dec 13

85 cents

1,000,000

14,000,000

14,700,000

2,000,000

2,000,000

55,200,000

32.7 cents

Weighted average exercise price

30 June 2011

-

-

-

-

-

-

-

-

-

-

-

-

9,500,000

9,500,000

1,000,000

1,000,000

4,500,000

6,500,000

6,500,000

-

-

1,000,000

1,000,000

14,000,000

7,000,000

2,000,000

12,700,000

5,200,000

-

2,000,000

2,000,000

2,000,000

2,000,000

6,500,000

48,700,000

34,200,000

19.8 cents

34.4 cents

32 cents

Issue

Grant date

Expiry date

Exercise 
Price

Balance at 
start of year

Granted 
during the 
year

Exercised 
during the 
year

Balance at 
the end of 
the year

Vested and 
exercisable 
at the end 
of the year

A

B

C

D

E

F

G

H
Total

18 Aug 10

30 Sept 13

15(1) cents

20 Aug 10

30 Sept 13

21(2) cents

20 Aug 10

30 Sept 13

15(1) cents

29 Nov 10

30 Sept 13

29 Nov 10

31 Dec 13

6 Dec 10

31 Dec 13

21 cents

40 cents

40 cents

18 Apr 11

18 Apr 11

31 Dec 13

113 cents

31 Dec 13

85 cents

Weighted average exercise price

-

-

-

-

-

-

-

-

-

-

9,500,000

1,000,000

11,000,000

1,000,000

14,000,000

15,000,000

2,000,000

2,000,000

-

-

-

-

-

9,500,000

9,500,000

1,000,000

1,000,000

11,000,000

11,000,000

1,000,000

1,000,000

14,000,000

7,000,000

300,000

14,700,000

7,200,000

-

-

2,000,000

2,000,000

2,000,000

2,000,000

55,500,000

300,000

55,200,000

40,700,000

32.6 cents

40 cents

32.7 cents

30.1 cents

(1)  As a result of the rights issue in November 2010 the exercise price of these options was adjusted to 10.8 cents

(2)  As a result of the rights issue in November 2010 the exercise price of these options was adjusted to 16.8 cents

The weighted average share price at the date of exercise of options exercised during the year ended 30 June 2012 was $0.74 (2011 – $1.22).

The weighted average remaining contractual life of share options outstanding at the end of the reporting period was 1.41 years (2011 – 2.40 years).

Fair value of options granted

No options were issued during the year ended 30 June 2012.

98

For personal use onlyFINANCIAL STATEMENTS

(b) Other option issues

No options were issued during the year ended 30 June 2012. As at 30 June 2012 there were 16,010,776 options on issue outside the ESOP which 

have an expiry date of between 31 October 2012 and 15 November 2013 along with an exercise price of between 15.5 cents and 37.8 cents.

(c) Expenses arising from the share-based payment transactions

Total expenses arising from share-based payment transactions recognised during the period were as follows:

Options issued under the employee option plan recognised in the income statement

Options issued recognised in the income statement

Vesting and forfeiture adjustments from unvested options

Other options issued recognised directly in equity as costs of equity raising

NOTE 32 PARENT ENTITY INFORMATION

(a) Summary of fi nancial information

The individual fi nancial statements for the parent entity show the following aggregate amounts:

BALANCE SHEET

Current assets

Total assets

Current liabilities

Total liabilities

Shareholders’ equity

Issued capital

Reserves

Option issue reserve

Foreign currency translation reserve

Accumulated losses
Total shareholders’ equity

Profi t / (Loss) for the year

Total comprehensive income

(b) Contractual commitments

No later than one year

Later than one but not later than fi ve years

2012
$’000

-

-

(95)

-

(95)

2012
$’000

37,004

197,240

823

823

2011
$’000

11,191

450

-

2,069

13,710

2011
$’000

85,491

175,850

570

570

211,063

192,190

14,763

32

(29,441)

196,417

2,359

2,359

158

164

322

14,858

32

(31,800)

175,280

(11,835)

(11,835)

146

269

415

(c) Guarantees entered into by the parent entity

The parent entity has provided fi nancial guarantees in respect of bank loans of subsidiaries amounting to $4,665,000 (2011: $4,665,000). 

This loan is secured by registered mortgages over the freehold properties of Eastern Coal Limited (and its subsidiaries) as well as a fi rst 

ranking security interest over Eastern Coal Limited (and its subsidiaries) present and future acquired property (including proceeds).

99

For personal use onlyDIRECTORS’ DECLARATION

In the directors’ opinion:

(a)  the fi nancial statements and notes set out on pages 55 to 99 are in accordance with the Corporations Act 2001, including:

(i)  complying with Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting requirements, and

(ii)  giving a true and fair view of the consolidated entity’s fi nancial position as at 30 June 2012 and of its performance for the fi nancial year 

ended on that date, and

(b)   there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable.

Note 1(a) confi rms that the fi nancial statements also comply with International Financial Reporting

Standards as issued by the International Accounting Standards Board.

The directors have been given the declarations by the chief executive offi cer and chief fi nancial offi cer required by section 295A of the Corporations 

Act 2001.

This declaration is made in accordance with a resolution of the directors.

CRAIG MUNRO | Chair 

Perth

27 September 2012

100

For personal use onlyINDEPENDENT AUDITOR’S REPORT

101

For personal use onlyINDEPENDENT AUDITOR’S REPORT

102

For personal use onlySECTION 
THREE

Other Information

ASX additional information 
Tenement Schedule 
Coal Resources and Reserves 
Corporate Directory 

104
106
107
109

X

For personal use onlyASX ADDITIONAL INFORMATION

The shareholder information set out below was applicable as at 27 September 2012.

A.  Distribution of equity securities

Analysis of numbers of equity security holders by size of holding:

Holding

1 – 1,000

1,001 – 5,000

5,001 – 10,000

10,001 – 100,000

100,001 and over

Ordinary shares

422

972

778

1,761

403

4,336

There were 452 holders of less than a marketable parcel of ordinary shares.

B. Equity security holders

Twenty largest quoted equity security holders

The names of the twenty largest holders of quoted equity securities are listed below:

Name

Number held

Percentage of issued shares

Ordinary shares

National Nominees Limited

J P Morgan Nominees Australia Limited

HSBC Custody Nominees

JP Morgan Nominees Australia Limited

Bell Potter Nominees Limited

Merrill Lynch (Australia) Nominees Pty Limited

Mr RJ Griffi ths & Mrs JD Griffi ths

Citicorp Nominees Pty Limited

RBC Investor Services Australia Nominees Pty Limited

Mr H Bohannan  & Ms J Bohannan

BNP Paribas Noms Pty Limited

Passio Pty Limited

UBS Wealth Management Aust Nominees Pty Limited

CTS Funds Pty Limited

Citicorp Nominees Pty Limited

AMP Life Limited

HSBC Custody Nominees

Mrs Vicky Teoh

Mr Michael Kable

Bond Street Custodians Limited

109,397,168

99,692,232

74,060,996

70,400,419

34,553,255

20,043,704

15,000,000

11,412,462

6,529,394

6,300,000

4,161,199

4,000,000

3,995,187

3,146,000

3,089,475

3,003,108

2,786,799

2,600,000

2,541,000

2,415,017

15.70

14.31

10.63

10.10

4.96

2.88

2.15

1.64

0.94

0.90

0.60

0.57

0.57

0.45

0.44

0.43

0.40

0.37

0.36

0.35

479,127,415

68.77

104

For personal use onlyASX ADDITIONAL INFORMATION

B. Equity security holders (continued)

Unquoted equity securities

Unquoted options on issue

C. Substantial holders

Substantial holders in the company are set out below:

Bank of America Corporation *

L1 Capital Pty Ltd 

Mathews Capital Partners Pty Limited * 

Coupland Cardiff Asset Management

JP Morgan Chase & Co

Number on issue

Number of holders

61,210,776

24

Number held

Percentage of issued shares

83,066,099

78,924,030

52,849,280

43,532,420

34,850,398

11.92

11.33

7.59

6.25

5.00

* The shares held by Mathews Capital Partners Pty Limited (‘Mathews”) are subject to hypothecation with Bank of America Corporation (“Bank of 

America”) and as such Bank of America is required to report these holdings in their notice of substantial holdings. This has resulted in the shares 

of Mathews being double counted in the above table.

D. Voting rights

The voting rights attached to each class of equity securities are set out below:

(a)  Ordinary shares

On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each share shall have one vote.

(b) Options

No voting rights.

105

For personal use onlyTENEMENT SCHEDULE 

TENEMENT SCHEDULE 

Permit Number
Permit Number

MP51279

MP41455

MP41274

MP41456

MP41332

MP53614

EP40591

EP51078

EP40628

EP53047

EP53756

EP54031

EP51260

PP52484

Location
Location

Escarpment

Cascade Creek

Denniston

Denniston

Denniston

Coaldale

Whareatea West 

Coal Creek

Buller

Charleston

Mokihinui

10 Mile Creek

Ohai

Albury

Registered Holder
Registered Holder

Buller Coal Limited

Cascade Coal Limited

Buller Coal Limited

Buller Coal Limited

Buller Coal Limited

Takitimu Coal Limited

Rochfort Coal Limited

Buller Coal Limited

Buller Coal Limited

Buller Coal Limited

Buller Coal Limited

Buller Coal Limited

Rochfort Coal Limited

Rochfort Coal Limited

Bathurst Interest
Bathurst Interest

Bathurst 100%

Bathurst 100%

Bathurst 100%

Bathurst 100%

Bathurst 100%

Bathurst 100%

Bathurst 100%

Bathurst 100%

Bathurst 100%

Bathurst 100%

Bathurst 100%

Bathurst 100%

Bathurst 100%

Bathurst 100%

106

For personal use onlyCOAL RESOURCES AND RESERVES

TABLE 1 - RESOURCES

TABLE 2 - RESERVES (ALL SOUTH BULLER)

AREA

Measured
Resource

Indicated
Resource

Inferred
Resource

Total
Resource

ROM COAL (MT)

(Mt)

(Mt)

(Mt)

(Mt)

Proved

Probable

Total

Escarpment

Deep Creek

Whareatea West

Coalbrookdale

Cascade

Total

PRODUCT COAL (MT)

Escarpment

Deep Creek

Whareatea West

Coalbrookdale

Cascade

Total

2.7

5.8

5.0

-

0.4

13.9

1.9

2.7

10.6

1.8

0.2

17.2

4.6

8.5

15.6

1.8

0.6

31.1

Proved

Probable

Total

2.2

5.1

3.6

-

0.4

11.3

1.6

2.4

6.7

1.6

0.2

12.5

3.8

7.5

10.3

1.6

0.6

23.8

SOUTH BULLER

Escarpment

Deep Creek

Whareatea West

Coalbrookdale

Cascade

Totals

NORTH BULLER

Millerton North

North Buller

Blackburn

Totals

Buller Coal 
Project

TAKITIMU

Coaldale

GRAND TOTAL

2.8

6.2

5

-

0.5

14.5

-

-

-

-

2.1

3.1

12.4

2.3

0.3

20.2

1.9

4.9

5.8

12.6

0.9

1.6

8.1

4.9

0.7

16.2

3.6

10.2

14.1

27.9

5.8

10.9

25.5

7.2

1.5

50.9

5.5

15.1

19.9

40.5

14.5

32.8

44.1

91.4

1.2

15.7

1.2

34.0

0.7

44.8

3.1

94.5

Note       

1  Resources are inclusive of reserves

2  All resources and reserves quoted in this release are reported in terms 

as defi ned in the 2004 Edition of the ‘Australasian Code for Reporting 

of Exploration Results, Mineral Resources and Ore Reserves’ as published 

by the Joint Ore Reserves Committee of the Australasian Institute of 

Mining and Metallurgy, Australian Institute of Geoscientists 

and Minerals Council Of Australia (“JORC”).

107

For personal use onlyCOAL RESOURCES AND RESERVES

RESERVES QUALITY – PRODUCT COAL (AT 15% MOISTURE)

AREA

Ash %

CSN

Volatile Matter

Sulphur

Escarpment

Deep Creek (coking)

Deep Creek (thermal)

Whareatea West

Coalbrookdale

Cascade

Average

  Range

Average

 Range

Average

    Range

Average

   Range

8.2

5.0

11.8

10.5

7.9

2.0

2.1 – 11.4

4.9 – 5.2

6.4 - 16.5

3.2 – 11.8

2.1 – 11.2

0.3 - 2.1

8

>9

N/A

9

5.5

4.5

6 – 9+

5 – 9++

28.4

25.9 – 31.3

37.0

18.0 – 38.0

N/A

N/A

N/A

8 – 9++

29.7

23.9 – 31.7

5 – 8

2 – 5

32.0

29.1 – 32.1

34.9

31.3 – 34.9

0.6

2.5

1.7

0.8

1.0

1.5

0.4 – 0.8

2.0 - 3.1

0.9 - 2.0

0.8 – 0.9

0.3 – 1.4

0.3 – 1.9

RESOURCES QUALITY

The company is not aware of any information to indicate that 

The information on this report that relates to exploration results and 

they quality of the identifi ed resources will fall outside the range 

mineral resources for Millerton North, North Buller, Blackburn and 

of specifi cations for reserves as indicated in the above table.

Coaldale is based on information compiled by Hamish McLauchlan 

Further resource and reserve information can be found on 

the company’s website at www.bathurstresources.co.nz

who is a full time employee of Buller Coal Limited and is a member 

of the Australasian Institute of Mining and Metallurgy. Mr McLauchlan 

has suffi cient experience which is relevant to the style of mineralisation 

and type of deposit under consideration and to the activity which he

COMPETENT PERSON STATEMENTS:

is undertaking to qualify as a Competent Person as defi ned in the 2004 

Edition of the ‘Australasian Code for Reporting of Exploration Results, 

Mineral Resources and Ore Reserves’. Mr McLauchlan consents to the 

inclusion in this report of the matters based on his information in the 

form and context in which it appears above.

The information on this report that relates to mineral resources and 

reserves for Deep Creek is based on information compiled by Neil 

Fraser who is a full time employee of Golder Associates Pty Ltd and 

is a member of the Australasian Institute of Mining and Metallurgy. 

Mr Fraser has suffi cient 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 defi ned in the 2004 Edition of the ‘Australasian Code for Reporting 

of Exploration Results, Mineral Resources and Ore Reserves’. Mr Fraser 

consents to the inclusion in this report of the matters based on his 

information in the form and context in which it appears above.

The information on this report that relates to mineral reserves for 

Escarpment, Cascade, Coalbrookdale and Whareatea West is based 

on information compiled by Ainsley Ferrier who is a full time employee 

of Buller Coal Limited and is a member of the Australasian Institute 

of Mining and Metallurgy. Ms Ferrier has suffi cient experience which 

is relevant to the style of mineralisation and type of deposit under 

consideration and to the activity which she is undertaking to qualify 

as a Competent Person as defi ned in the 2004 Edition of the 

‘Australasian Code for Reporting of Exploration Results, Mineral 

Resources and Ore Reserves’. Ms Ferrier consents to the inclusion 

in this report of the matters based on her information in the form 

and context in which it appears above.

108

For personal use only 
CORPORATE DIRECTORY

Directors  
CRAIG MUNRO | Non – Executive Chair

HAMISH BOHANNAN | Managing Director

GERALD COOPER | (Executive)

ROB LORD | (Non-Executive)

MALCOLM MACPHERSON | (Non-Executive)

Secretaries 
TIMOTHY MANNERS

LAURA MCMAHON BLECHYNDEN

Registered offi ce
Ground Floor, 1306 Hay Street, West Perth, 

WA 6005, + 61 8 9481 2100

New Zealand offi ce 
Level 12, 1 Willeston Street, Wellington 6011

New Zealand, +64 4 499 6830

Share registry 
Computershare Investor Services Pty Limited

Level 2, 45 St Georges Terrace, Perth, WA 6000

1300 557 010 (within Australia)

+ 61 3 9415 4000 (outside Australia)

Auditor 
PricewaterhouseCoopers

QV1, 250 St Georges Terrace, Perth, WA 6000

Solicitors 
Allion Legal

Level 2, 50 Kings Park Road, West Perth, WA 6005

Bell Gully

Level 21, 171 Featherston Street, Wellington 6140, New Zealand

Banker 
Westpac Banking Corporation

Stock exchange listings 
Bathurst Resources Limited shares are listed on the Australian 

Securities Exchange (ASX) and the New Zealand Exchange 

(NZX), under the code BTU.

Website address   
www.bathurstresources.co.nz 

www.bathurstresources.co.nz

For personal use only 
 
 
 
 
 
 
 
 
 
www.bathurstresources.co.nz

For personal use only