ANNUAL REPORT 2019
Peak and NdPr at the Heart of
the Electrification revolution
NdFeB (NdPr)
Permanent Magnets
Nd
Neodymium
Pr
Praseodymium
CONTENTS
2019 Highlights.........................................................................01
Chairman's Letter......................................................................02
CEO's Letter..............................................................................04
Review of Operations...............................................................06
Directors' Report......................................................................15
Auditor's Independence Declaration........................................27
Independent Auditor's Report.................................................28
Consolidated Statement of Comprehensive Income................33
Consolidated Statement of Financial Position..........................34
Consolidated Statement of Cash Flows....................................35
Consolidated Statement of Changes in Equity.........................36
Notes to Financial Statements.................................................37
Directors' Declaration...............................................................72
Tenement Schedule and Reserves & Resources.......................73
Additional Shareholder Information........................................77
Corporate Governance Statement...........................................79
CORPORATE DIRECTORY
DIRECTORS
Non - Executive Chairman:
Peter Meurer
Non - Executive Director:
John Jetter
Jonathan Murray
Tony Pearson
Chief Executive Officer:
Rocky Smith
Chief Financial Officer/Company Secretary
Graeme Scott
REGISTERED OFFICE
Ground Floor, 5 Ord Street
West Perth, WA 6005
CONTACT DETAILS
Phone: +61 8 9200 5360
Fax: +61 8 9226 3831
E-mail: info@peakresources.com.au
Website: www.peakresources.com.au
ACN: 112 546 700
AUSTRALIAN STOCK EXCHANGE
ASX: Australian Securities Exchange, Perth
Code: PEK
SHARE REGISTRY
Link Market Services
Level 12, 680 George Street, Sydney, NSW 2000
AUDITORS
Ernst & Young
11 Mounts Bay Road, Perth, WA 6000
SOLICITORS
Australia:
Steinepreis Paganin
The Read Building
Level 4, 16 Milligan Street, Perth, WA 6000
Tanzania:
Clyde & Co/Ako Law
Jubilee Towers
11th Floor, Ohio Street
Dar Es Salaam, Tanzania
ENABLING LOW CARBON TECHNOLOGIES PAGE 1
2019 Highlights
Peak set to move to 100% ownership of the Ngualla Project
Fully permitted UK refinery site a key differentiator and strategic asset
SML Recommended for grant by the Mining Commission
Offtake discussions well advanced and continuing
Trade tensions bring rare earths into the spotlight
NdPr Enabling Low Carbon Technologies
MAGNETIC REFRIGERATION
CLEAN ENERGY
INDUSTRIAL AUTOMATIZATION
ROBOTICS
ARTIFICIAL INTELLIGENCE
NdFeB MAGNETS
LOW CARBON FUTURE
WIND TURBINES
ELECTRIC MOBILITY SOLUTIONS
ENABLING LOW CARBON TECHNOLOGIES PAGE 1
Chairman's Letter
Chairman's Letter
Secondly the completion of a small capital raising in August 2019 validated the strategic direction that the Company is
taking, including the roll up of Appian's and IFC's interest in PAM into Peak Resources Limited. As a result of this capital
raising we were encouraged to see several institutional shareholders come onto the Company's share register. We look
forward to the ongoing support of these new investor groups as we continue down the development path.
Finally I would like to thank Rocky and the small team we have at Peak for their dedicated efforts and perseverance to
the task. And of course all our shareholders and stakeholders for their continued support and interest in the Company.
I am optimistic that there are bright times ahead for us all.
Yours sincerely,
Peter Meurer
Non-Executive Chairman
Peter Meurer
9 October 2019
Dear Shareholder,
I am pleased to be writing to you at a time when recent global macro developments provide me with much confidence
that Peak has the right business strategy for a resource which is strategically important for global growth. The
importance of rare earths to modern manufacturing businesses could not have been better highlighted than through
the ongoing trade tensions between China and the USA. Additionally China’s indication that it may consider restricting
exports of rare earths should be seen against the background of a quickly emerging supply and demand imbalance. As
is now widely understood rare earths are critical inputs for all number of manufacturing industries and applications,
western governments have woken up to the fact that China controls over 80% of the rare earth supply and downstream
value add processing. These governments are now playing catch-up to secure independence of supply for these critical
metals and products to safeguard their businesses continuity. Peak’s strategy to become a supplier of fully separated
rare earth products with its entire processing capability outside of China fits ideally with these new governmental
strategies for securing rare earth supply independent of China.
More recently there appears to be positive developments in Tanzania. There is no doubt that the 2017 legislation
changes have caused significant delays and uncertainty to all mining companies with projects ready to be developed
in that country. In mid-September, in what I believe has positive implications for the mining industry in Tanzania,
the shareholders of Acacia Mining (Acacia) approved the full takeover of the company by its majority shareholder
Barrick Gold (Barrick). Barrick has been negotiating with the Tanzanian government since 2017 over a new set of fiscal
terms and operating conditions for the three gold mines that Acacia operates in country, the terms under negotiation
see a 50:50 share of the economic benefits and adjustments to terms in the 2017 legislation that have been an
impediment to attracting project finance for the development of new mining projects. This news provides me with
much encouragement that we will see some real progress over coming months and the long awaited receipt of the
Special Mining Licence for the Ngualla Project.
I will leave it to Rocky to comment on this years work programs, the progress made and our vision for your Company
for the future, however I do want to comment on two events post year end that I believe assist to help set us up for
the journey ahead:
Firstly I was extremely pleased that we have been able to agree the restructuring of the ownership of the Project which
will see Peak move to a 100% ownership interest. This fully aligns Appian and IFC with all other shareholders and will
enable us to present an exciting and clear path for the Projects development to prospective development partners and
institutional investors.
ENABLING LOW CARBON TECHNOLOGIES PAGE 2
ENABLING LOW CARBON TECHNOLOGIES PAGE 3
ENABLING LOW CARBON TECHNOLOGIES PAGE 3
PEAK RESOURCES - MORE THAN THE SUM OF ITS
PARTS AND THE FIRST CHOICE FOR INVESTMENT IN
THE RARE EARTH SPACE.
THE ASSET - THE MARKET - THE TEAM
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Chairman's Letter
Chairman's Letter
Secondly the completion of a small capital raising in August 2019 validated the strategic direction that the Company is
taking, including the roll up of Appian's and IFC's interest in PAM into Peak Resources Limited. As a result of this capital
raising we were encouraged to see several institutional shareholders come onto the Company's share register. We look
forward to the ongoing support of these new investor groups as we continue down the development path.
Finally I would like to thank Rocky and the small team we have at Peak for their dedicated efforts and perseverance to
the task. And of course all our shareholders and stakeholders for their continued support and interest in the Company.
I am optimistic that there are bright times ahead for us all.
Yours sincerely,
Peter Meurer
Non-Executive Chairman
Peter Meurer
9 October 2019
Dear Shareholder,
I am pleased to be writing to you at a time when recent global macro developments provide me with much confidence
that Peak has the right business strategy for a resource which is strategically important for global growth. The
importance of rare earths to modern manufacturing businesses could not have been better highlighted than through
the ongoing trade tensions between China and the USA. Additionally China’s indication that it may consider restricting
exports of rare earths should be seen against the background of a quickly emerging supply and demand imbalance. As
is now widely understood rare earths are critical inputs for all number of manufacturing industries and applications,
western governments have woken up to the fact that China controls over 80% of the rare earth supply and downstream
value add processing. These governments are now playing catch-up to secure independence of supply for these critical
metals and products to safeguard their businesses continuity. Peak’s strategy to become a supplier of fully separated
rare earth products with its entire processing capability outside of China fits ideally with these new governmental
strategies for securing rare earth supply independent of China.
More recently there appears to be positive developments in Tanzania. There is no doubt that the 2017 legislation
changes have caused significant delays and uncertainty to all mining companies with projects ready to be developed
in that country. In mid-September, in what I believe has positive implications for the mining industry in Tanzania,
the shareholders of Acacia Mining (Acacia) approved the full takeover of the company by its majority shareholder
Barrick Gold (Barrick). Barrick has been negotiating with the Tanzanian government since 2017 over a new set of fiscal
terms and operating conditions for the three gold mines that Acacia operates in country, the terms under negotiation
see a 50:50 share of the economic benefits and adjustments to terms in the 2017 legislation that have been an
impediment to attracting project finance for the development of new mining projects. This news provides me with
much encouragement that we will see some real progress over coming months and the long awaited receipt of the
Special Mining Licence for the Ngualla Project.
I will leave it to Rocky to comment on this years work programs, the progress made and our vision for your Company
for the future, however I do want to comment on two events post year end that I believe assist to help set us up for
the journey ahead:
institutional investors.
Firstly I was extremely pleased that we have been able to agree the restructuring of the ownership of the Project which
will see Peak move to a 100% ownership interest. This fully aligns Appian and IFC with all other shareholders and will
enable us to present an exciting and clear path for the Projects development to prospective development partners and
ENABLING LOW CARBON TECHNOLOGIES PAGE 2
ENABLING LOW CARBON TECHNOLOGIES PAGE 3
ENABLING LOW CARBON TECHNOLOGIES PAGE 3
PEAK RESOURCES - MORE THAN THE SUM OF ITS
PARTS AND THE FIRST CHOICE FOR INVESTMENT IN
THE RARE EARTH SPACE.
THE ASSET - THE MARKET - THE TEAM
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 CEO's Letter
CEO's Letter
Rocky Smith
9 October 2019
Peak is seeking binding off-take contracts with critical rare earth consumers around the world. We have already worked
with numerous rare earth metal and permanent magnet consumers in Asia, Europe and United States. The contracts
we secure, will likely result in identification of strategic partners for the Ngualla Project and Tees Valley Refinery.
Finance Opportunities
investors.
Our financing efforts are supported by our recent restructuring of the Ngualla project to give Peak 100% ownership and
control. This change in ownership encourages the involvement of both strategic partners and institutional cornerstone
Trade tensions between US and China, rising metal pricing, and tightening supply, will encourage more earnest
negotiation to lock in binding off take from Peak Resources as the alternative “Outside of China” supply.
We are also seeking involvement of multiple governments to support the debt financing through export credit agencies,
with emphasis on United Kingdom and United States. These First World countries are also attempting to supply more
capital support for African countries, to offset Chinese capital domination, we are discussing the possibility for receiving
funding through these programs as well.
I want to personally thank my dedicated staff, the Peak Resources board of directors, our great shareholders and all the
supporters of this Project. Thanks for your continued support and belief in the Ngualla Project, the best undeveloped
NdPr project in the world!
Rocky Smith
Chief Executive Officer
Dear Shareholder,
The past year's focus continued to be directed towards positioning your Company ready for development of the
outstanding Ngualla NdPr deposit and Tees Valley rare earth refinery. The core activities included work on securing
the final permitting, off-take negotiations and investigating financing avenues. We have kept you well updated with
progress on these activities throughout the year.
Tanzania Ngualla
As we are all acutely aware the key is securing our Special Mining License (SML) from Tanzania. At this point we have
received affirmation from both the Minister of Minerals and the Mining Commission that our SML application should
be granted by the Cabinet in the near future. Tanzania has gone very slow on the SML process, we believe some of
this was related to the on-going issues with Acacia Mining (Acacia), which should now be behind us following Barrick
Gold’s purchase of Acacia.
Prior to Barrick Gold’s purchase of Acacia, their negotiations with the Tanzanian Government look to reset the
framework for their mine development and operating agreements, effectively rolling back the most difficult parts of
the 2017 mining law changes. Assuming this framework is ratified, Tanzania will be taking a big step toward being,
once again, one of the best mining regions in Africa.
Tees Valley Refinery
In addition to Tanzania, we have been reviewing other resource opportunities, with a focus on rare earths, specifically
concentrates that can be processed within the Tees Valley refinery. The refinery site in Tees Valley can become one of
the most important rare earth separation complexes “Outside of China”, having superior costs and access to UK, EU
and US markets. We are investigating all opportunities to enhance this refinery, including looking at alternative feeds,
magnet recycle circuit, and increased production capacity.
We will be actively looking to start Front End Engineering and Design (FEED) and Operations Readiness programs at the
beginning of 2020, these activities will require additional support from investors or partners.
Market Conditions
The Electric Vehicle (EV) thematic continues to move forward and all indicators suggest that critical shortages for rare
earths Nd/Pr will occur in the 2022-2025 time frame, exactly when our plant is scheduled to come on line. Additional
rare earth supply capacity is difficult to put in place due to capital cost, technical challenges and acceptance within the
market. Typical timing for a project exceeds five years. I believe rare earth pricing through this period and beyond will
likely exceed $100/Kg for Nd/Pr oxide and we should see signs of this ahead of the actual shortage.
The drive to improve battery technology is happening as we speak, with Tesla recently announcing dramatic battery
cost reductions and performance improvements. This is happening in every market around the world. Every major
automotive manufacture has dedicated significant funding and technical resources towards replacing vehicles with
internal combustion engines with permanent magnet (NdFeB) electric motors.
ENABLING LOW CARBON TECHNOLOGIES PAGE 4
ENABLING LOW CARBON TECHNOLOGIES PAGE 5
ENABLING LOW CARBON TECHNOLOGIES PAGE 5
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 CEO's Letter
CEO's Letter
Rocky Smith
9 October 2019
Peak is seeking binding off-take contracts with critical rare earth consumers around the world. We have already worked
with numerous rare earth metal and permanent magnet consumers in Asia, Europe and United States. The contracts
we secure, will likely result in identification of strategic partners for the Ngualla Project and Tees Valley Refinery.
Finance Opportunities
Our financing efforts are supported by our recent restructuring of the Ngualla project to give Peak 100% ownership and
control. This change in ownership encourages the involvement of both strategic partners and institutional cornerstone
investors.
Trade tensions between US and China, rising metal pricing, and tightening supply, will encourage more earnest
negotiation to lock in binding off take from Peak Resources as the alternative “Outside of China” supply.
We are also seeking involvement of multiple governments to support the debt financing through export credit agencies,
with emphasis on United Kingdom and United States. These First World countries are also attempting to supply more
capital support for African countries, to offset Chinese capital domination, we are discussing the possibility for receiving
funding through these programs as well.
I want to personally thank my dedicated staff, the Peak Resources board of directors, our great shareholders and all the
supporters of this Project. Thanks for your continued support and belief in the Ngualla Project, the best undeveloped
NdPr project in the world!
Rocky Smith
Chief Executive Officer
Dear Shareholder,
Tanzania Ngualla
The past year's focus continued to be directed towards positioning your Company ready for development of the
outstanding Ngualla NdPr deposit and Tees Valley rare earth refinery. The core activities included work on securing
the final permitting, off-take negotiations and investigating financing avenues. We have kept you well updated with
progress on these activities throughout the year.
As we are all acutely aware the key is securing our Special Mining License (SML) from Tanzania. At this point we have
received affirmation from both the Minister of Minerals and the Mining Commission that our SML application should
be granted by the Cabinet in the near future. Tanzania has gone very slow on the SML process, we believe some of
this was related to the on-going issues with Acacia Mining (Acacia), which should now be behind us following Barrick
Gold’s purchase of Acacia.
Prior to Barrick Gold’s purchase of Acacia, their negotiations with the Tanzanian Government look to reset the
framework for their mine development and operating agreements, effectively rolling back the most difficult parts of
the 2017 mining law changes. Assuming this framework is ratified, Tanzania will be taking a big step toward being,
once again, one of the best mining regions in Africa.
Tees Valley Refinery
Market Conditions
In addition to Tanzania, we have been reviewing other resource opportunities, with a focus on rare earths, specifically
concentrates that can be processed within the Tees Valley refinery. The refinery site in Tees Valley can become one of
the most important rare earth separation complexes “Outside of China”, having superior costs and access to UK, EU
and US markets. We are investigating all opportunities to enhance this refinery, including looking at alternative feeds,
magnet recycle circuit, and increased production capacity.
We will be actively looking to start Front End Engineering and Design (FEED) and Operations Readiness programs at the
beginning of 2020, these activities will require additional support from investors or partners.
The Electric Vehicle (EV) thematic continues to move forward and all indicators suggest that critical shortages for rare
earths Nd/Pr will occur in the 2022-2025 time frame, exactly when our plant is scheduled to come on line. Additional
rare earth supply capacity is difficult to put in place due to capital cost, technical challenges and acceptance within the
market. Typical timing for a project exceeds five years. I believe rare earth pricing through this period and beyond will
likely exceed $100/Kg for Nd/Pr oxide and we should see signs of this ahead of the actual shortage.
The drive to improve battery technology is happening as we speak, with Tesla recently announcing dramatic battery
cost reductions and performance improvements. This is happening in every market around the world. Every major
automotive manufacture has dedicated significant funding and technical resources towards replacing vehicles with
internal combustion engines with permanent magnet (NdFeB) electric motors.
ENABLING LOW CARBON TECHNOLOGIES PAGE 4
ENABLING LOW CARBON TECHNOLOGIES PAGE 5
ENABLING LOW CARBON TECHNOLOGIES PAGE 5
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Review of Operations
Review of Operations
Summary
Peak set to move to 100% ownership of the Ngualla Project
• Peak set to move to 100% ownership of the Ngualla Project
• Fully permitted UK refinery site a key differentiator and strategic asset
• SML recommended for grant by the Mining Commission
• Offtake discussions well advanced and continuing
• Trade tensions bring rare earths into the spotlight
The year saw the Company advance the development of its 75% owned Ngualla Rare Earth Project on a number of fronts culminating
in the announcement, post year end, on 29 July 2019 that it had reached conditional agreement with Appian and IFC to move
to 100% ownership in the Ngualla Project (Project). Completion of the restructuring transaction is conditional on the necessary
shareholder and regulatory approvals expected to be received in the December 2019 quarter. The Company believes the simplified
structure will assist in readying the Company to secure project development finance, including attracting additional institutional
investors and development partners to the Project; this has already been demonstrated with a number of new institutional
investors participating in the August 2019 capital raising.
In Tanzania the Company continued to have an active and open dialog with the Government on the granting of the Special Mining
Licence (SML). The Mining Commission recommended the application for approval in October 2018 and the grant of the Licence is
now pending government Cabinet sign-off. All other permitting including ESIA certificate having previously been granted.
In recent months, media coverage over the USA and China trade disputes, and the Lynas Corporation (ASX:LYC) operating licence
renewal process, highlighted the vulnerability of industry to its over-reliance on China as a secure and reliable supply of rare earth
products. These events underline the strategic value of Peak’s UK rare earth refinery site and the potential opportunity for this to
become a rare earth processing hub outside of, and independent of China. Peak has secured a 250 year lease option over the site
with all construction and operating permits for a rare earth refinery also having been secured.
Following the year end close, Peak was pleased to announce that it has entered into conditional agreements to move to 100%
ownership of the Ngualla Rare Earth Project. Peak has executed Binding Heads of Agreement (Appian BHoA and IFC BHoA) with
Appian Pinnacle Hold Co Limited (Appian) and International Finance Corporation (IFC) to roll up their ownership interests in
Mauritian registered company, Peak African Minerals (PAM) into Peak.
The Company believes the proposed simplification of the PAM ownership structure and streamlining of the governance procedures
will ensure that the interests of all shareholders will be aligned towards the development of the Project. The proposed simplified
structure is intended to facilitate the introduction of additional institutional investors in Peak and development partners to
the Project.
interests in PAM.
Under the terms of the Appian BHoA and the IFC BHoA, Appian and IFC will receive the following:
• Appian to receive 327,490,452 new fully paid ordinary shares in Peak (Peak Shares) in exchange for its entire (20% ownership
•
IFC to receive up to 64,268,651 Peak Shares in exchange for its entire (post dilution 3.85%) ownership interests in PAM.
Completion of the Transaction will also be conditional upon (amongst other things):
•
Peak obtaining all necessary shareholder and regulatory approvals required by the Corporations Act, Listing Rules and other
applicable laws in relation to the Transaction;
•
receipt of an independent expert’s report prepared for the purpose of obtaining the approvals concluding that the Transaction
is either fair and reasonable or not fair but reasonable to the non-associated shareholders of Peak.
The Project update reported in October 2017 demonstrates the exceptional fundamentals of the Project and excellent exposure to
the NdPr price, with over 90% of its planned revenue to come from NdPr:
Against this backdrop discussions are well advanced and continue with quality potential offtake partners with a number of
confidential Memorandums of Understanding and Term Sheets under negotiation. On receipt of the SML, Peak looks forward
to progressing these discussions to binding agreements on terms which will underpin the Company’s ability to secure project
development financing. With 90% of Ngualla’s future revenue to be derived from neodymium- praseodymium oxide (NdPr), the
Project is one of a very few capable of helping to meet the predicted surge in demand for this vital raw material for the high
performance permanent magnets used in the preferred motors of electric vehicles (EVs).
•
•
•
prices.
Post Tax NPV8 US$ 612 million and IRR 22% at Project Update rare earth price assumptions.
Total Life of Project Opex intensity US$ 32.24 / kg NdPr is the breakeven point for a positive cash flow, well below current
Total pre-production CAPEX of US$ 365 million for the Ngualla and Tees Valley refinery combined. This has the potential to be
the lowest Capex among its peers for a fully integrated producer.
• Average consolidated annual EBITDA US$ 150 mpa over the 26 year life of the Project.
PRODUCTION ASSUMPTIONS
Life of Mine
Average Life of Mine REO Grade
Life of Mine Strip Ratio (Waste: Ore)
Average Mill Throughput
Average REO Mineral Concentrate Production
Average NdPr Mixed Oxide 2N Production
Average La Oxide Equivalent Production (final product: 7,995 tpa Carbonate)
Average Ce Oxide Equivalent Production (final product: 3,475 tpa Carbonate)
Average SEG and Mixed Heavy Oxide Equivalent Production (final product: 625 tpa Carbonate)
26 Years
4.80%
1.78
711,000 tpa
32,700 tpa
2,810 tpa
4,230 tpa
1,920 tpa
330 tpa
ENABLING LOW CARBON TECHNOLOGIES PAGE 6
ENABLING LOW CARBON TECHNOLOGIES PAGE 7
ENABLING LOW CARBON TECHNOLOGIES PAGE 7
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Review of Operations
Review of Operations
Summary
Peak set to move to 100% ownership of the Ngualla Project
• Peak set to move to 100% ownership of the Ngualla Project
• Fully permitted UK refinery site a key differentiator and strategic asset
• SML recommended for grant by the Mining Commission
• Offtake discussions well advanced and continuing
• Trade tensions bring rare earths into the spotlight
The year saw the Company advance the development of its 75% owned Ngualla Rare Earth Project on a number of fronts culminating
in the announcement, post year end, on 29 July 2019 that it had reached conditional agreement with Appian and IFC to move
to 100% ownership in the Ngualla Project (Project). Completion of the restructuring transaction is conditional on the necessary
shareholder and regulatory approvals expected to be received in the December 2019 quarter. The Company believes the simplified
structure will assist in readying the Company to secure project development finance, including attracting additional institutional
investors and development partners to the Project; this has already been demonstrated with a number of new institutional
investors participating in the August 2019 capital raising.
In Tanzania the Company continued to have an active and open dialog with the Government on the granting of the Special Mining
Licence (SML). The Mining Commission recommended the application for approval in October 2018 and the grant of the Licence is
now pending government Cabinet sign-off. All other permitting including ESIA certificate having previously been granted.
In recent months, media coverage over the USA and China trade disputes, and the Lynas Corporation (ASX:LYC) operating licence
renewal process, highlighted the vulnerability of industry to its over-reliance on China as a secure and reliable supply of rare earth
products. These events underline the strategic value of Peak’s UK rare earth refinery site and the potential opportunity for this to
become a rare earth processing hub outside of, and independent of China. Peak has secured a 250 year lease option over the site
with all construction and operating permits for a rare earth refinery also having been secured.
Against this backdrop discussions are well advanced and continue with quality potential offtake partners with a number of
confidential Memorandums of Understanding and Term Sheets under negotiation. On receipt of the SML, Peak looks forward
to progressing these discussions to binding agreements on terms which will underpin the Company’s ability to secure project
development financing. With 90% of Ngualla’s future revenue to be derived from neodymium- praseodymium oxide (NdPr), the
Project is one of a very few capable of helping to meet the predicted surge in demand for this vital raw material for the high
performance permanent magnets used in the preferred motors of electric vehicles (EVs).
Following the year end close, Peak was pleased to announce that it has entered into conditional agreements to move to 100%
ownership of the Ngualla Rare Earth Project. Peak has executed Binding Heads of Agreement (Appian BHoA and IFC BHoA) with
Appian Pinnacle Hold Co Limited (Appian) and International Finance Corporation (IFC) to roll up their ownership interests in
Mauritian registered company, Peak African Minerals (PAM) into Peak.
The Company believes the proposed simplification of the PAM ownership structure and streamlining of the governance procedures
will ensure that the interests of all shareholders will be aligned towards the development of the Project. The proposed simplified
structure is intended to facilitate the introduction of additional institutional investors in Peak and development partners to
the Project.
Under the terms of the Appian BHoA and the IFC BHoA, Appian and IFC will receive the following:
• Appian to receive 327,490,452 new fully paid ordinary shares in Peak (Peak Shares) in exchange for its entire (20% ownership
interests in PAM.
IFC to receive up to 64,268,651 Peak Shares in exchange for its entire (post dilution 3.85%) ownership interests in PAM.
•
Completion of the Transaction will also be conditional upon (amongst other things):
•
•
Peak obtaining all necessary shareholder and regulatory approvals required by the Corporations Act, Listing Rules and other
applicable laws in relation to the Transaction;
receipt of an independent expert’s report prepared for the purpose of obtaining the approvals concluding that the Transaction
is either fair and reasonable or not fair but reasonable to the non-associated shareholders of Peak.
The Project update reported in October 2017 demonstrates the exceptional fundamentals of the Project and excellent exposure to
the NdPr price, with over 90% of its planned revenue to come from NdPr:
•
•
•
Post Tax NPV8 US$ 612 million and IRR 22% at Project Update rare earth price assumptions.
Total Life of Project Opex intensity US$ 32.24 / kg NdPr is the breakeven point for a positive cash flow, well below current
prices.
Total pre-production CAPEX of US$ 365 million for the Ngualla and Tees Valley refinery combined. This has the potential to be
the lowest Capex among its peers for a fully integrated producer.
• Average consolidated annual EBITDA US$ 150 mpa over the 26 year life of the Project.
PRODUCTION ASSUMPTIONS
Life of Mine
Average Life of Mine REO Grade
Life of Mine Strip Ratio (Waste: Ore)
Average Mill Throughput
Average REO Mineral Concentrate Production
Average NdPr Mixed Oxide 2N Production
Average La Oxide Equivalent Production (final product: 7,995 tpa Carbonate)
Average Ce Oxide Equivalent Production (final product: 3,475 tpa Carbonate)
Average SEG and Mixed Heavy Oxide Equivalent Production (final product: 625 tpa Carbonate)
26 Years
4.80%
1.78
711,000 tpa
32,700 tpa
2,810 tpa
4,230 tpa
1,920 tpa
330 tpa
ENABLING LOW CARBON TECHNOLOGIES PAGE 6
ENABLING LOW CARBON TECHNOLOGIES PAGE 7
ENABLING LOW CARBON TECHNOLOGIES PAGE 7
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Review of Operations
OPERATING COSTS
Average Operating Cost - Ngualla plus concentrate transport
Average Tees Valley Refinery Operating Cost to Final Product
Total Consolidated Operating Cost to Final Product
Total Consolidated Operating Cost/kg (NdPr Mixed Oxide 2N#)
CAPITAL COSTS including growth and contingency
Ngualla (Mine and Process)
Ngualla (Infrastructure)
Tees Valley Refinery
Owners Costs
Total Capital Pre-Production
Average Annual Consolidated Sustaining Capital
FINANCIAL METRICS
Consolidated Total Revenue
Consolidated Average Annual Revenue
Total Consolidated (Post Tax) Cash Generation
Annual Average Consolidated (Post Tax) Cashflow
Average Annual EBITDA
NPV8 - Pre Tax and Royalties
NPV8 - Post Tax and Royalties
NPV10 - Pre Tax and Royalties
NPV10 - Post Tax and Royalties
IRR - Pre Tax and Royalties
IRR - Post Tax and Royalties
Operating Margin
Payback Period (from Start of Operations)
COMMODITY PRICE ASSUMPTIONS average LOM
NdPr Mixed Oxide 2N Min 75% Nd2O3
Lanthanum Rare Earth Oxide Equivalent
Cerium Rare Earth Oxide Equivalent
SEG Mixed Heavy Oxide Equivalent
Ngualla Project production assumptions and projected economics
US$ 51m p.a
US$ 40m p.a
US$ 91m p.a
US$ 32.24/kg
US$ 52 million
US$ 138 million
US$ 157 million
US$ 18 million
US$ 365 million
US$ 5 million
US$ 6.27 billion
US$ 241m p.a
US$ 3.01 billion
US$ 108 m p.a
US$ 150 m p.a
US$ 914 million
US$ 612 million
US$ 686 million
US$ 444 million
26%
22%
62%
5 Years
US$ 77.50/kg
US$ 3.70/kg
US$ 2.20/kg
US$ 8.00/kg
Review of Operations
The information in this report pertaining to the Project financial and economic analysis has not been audited and contains non-IFRS
measures; EBITDA is a non IFRS measure calculated as the earnings before tax, interest, depreciation and amortisation.
SML recommended for grant and pending Tanzanian Cabinet approval
Following notice in October 2018 that the Mining Commission had recommended the Special Mining Licence (SML) application
for approval the Company has continued a very active engagement process with the Tanzanian Government Ministries and Mining
Commission to expedite the issue of the SML.
Given the scale and importance of the SML projects pending approval, the Tanzanian government is taking a cautious approach
to the implementation and application of the 2017 legislation. Whilst the Company has expressed its frustration in the length of
time taken for this process, we appreciate the need for certainty in the SML process and the importance of delivering a secure and
stable legislative environment in which to operate.
The Company continues to do all within its control to expedite the SML; with the Peak executive responsible for the application
travelling regularly to Dodoma, the Tanzanian capital, and the Company’s in-country manager also having relocated from Dar es
Salaam to Dodoma, following the Government Ministry’s move to the capital last year.
The Mining Licence is the final regulatory requirement for the Ngualla Project, with the associated Teesside Refinery already fully
permitted and land secured under option. Once granted the Ngualla Project will be the only rare earth development project that
has a JORC Compliant Ore Reserve, completed definitive feasibility study and fully piloted process from ore to separated oxides
that is fully permitted and ready to construct.
Fully permitted UK Refinery Site a key differentiator and strategic asset
The recent media focus on rare earths highlighted them as potentially being weaponised by China in its trade dispute with the USA.
These developments underline the strategic value and optionality that Peak represents to establish what would be only the second
significant producer of rare earth oxide products independent of the Chinese supply chain.
In time, the UK Refinery will become a rare earth separation hub, with increased NdPr refining capacity. Other projected additions
may include; accepting multiple feed sources to refinery, recycle circuit for used magnets, mid and heavy separation capacity, and
the support of the establishment of a western supply chain for permanent magnets into the EV thematic.
Planning permissions for the refinery and environmental licences for operation of the facility are all in place.
The Company has a further two years on its option, over a 19 hectare parcel of land located in the Wilton International Site. The
option provides for a 250 year lease over the site which has a number of commercial advantages, including:
• Access to the existing industrial park with “plug and play” facilities
Close to ports, bulk low cost reagent supplies and a highly skilled workforce
•
•
•
•
Sustainable options for waste and effluent disposal
• UK Government and Local Authority support for the project
Close to UK and European markets
Size of parcel provides for potential for expansion
#Material assumptions are as per BFS and Ore Reserve ASX Announcements of 12 April 2017 except where indicated in this report.
The information is extracted from the report entitled “Lower price deck delivers similar BFS results for Ngualla” released on the 12
October 2017 and is available to view on the Company’s website www.peakresources.com.au/asx-announcements/. The Company
confirms that it is not aware of any new information or data that materially affects the information included in the original market
announcement and, in the case of estimates of Mineral Resources or Ore Reserves, that all material assumptions and technical
parameters underpinning the estimates in the relevant market announcement continue to apply and have not materially changed.
The Company confirms that the form and context in which the Competent Person’s findings are presented have not been materially
modified from the original market announcement.
Ngualla Hill
Ngualla Hill
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Review of Operations
OPERATING COSTS
Average Operating Cost - Ngualla plus concentrate transport
Average Tees Valley Refinery Operating Cost to Final Product
Total Consolidated Operating Cost to Final Product
Total Consolidated Operating Cost/kg (NdPr Mixed Oxide 2N#)
CAPITAL COSTS including growth and contingency
Ngualla (Mine and Process)
Ngualla (Infrastructure)
Tees Valley Refinery
Owners Costs
Total Capital Pre-Production
Average Annual Consolidated Sustaining Capital
FINANCIAL METRICS
Consolidated Total Revenue
Consolidated Average Annual Revenue
Total Consolidated (Post Tax) Cash Generation
Annual Average Consolidated (Post Tax) Cashflow
Average Annual EBITDA
NPV8 - Pre Tax and Royalties
NPV8 - Post Tax and Royalties
NPV10 - Pre Tax and Royalties
NPV10 - Post Tax and Royalties
IRR - Pre Tax and Royalties
IRR - Post Tax and Royalties
Operating Margin
Payback Period (from Start of Operations)
COMMODITY PRICE ASSUMPTIONS average LOM
NdPr Mixed Oxide 2N Min 75% Nd2O3
Lanthanum Rare Earth Oxide Equivalent
Cerium Rare Earth Oxide Equivalent
SEG Mixed Heavy Oxide Equivalent
Ngualla Project production assumptions and projected economics
US$ 51m p.a
US$ 40m p.a
US$ 91m p.a
US$ 32.24/kg
US$ 52 million
US$ 138 million
US$ 157 million
US$ 18 million
US$ 365 million
US$ 5 million
US$ 6.27 billion
US$ 241m p.a
US$ 3.01 billion
US$ 108 m p.a
US$ 150 m p.a
US$ 914 million
US$ 612 million
US$ 686 million
US$ 444 million
26%
22%
62%
5 Years
US$ 77.50/kg
US$ 3.70/kg
US$ 2.20/kg
US$ 8.00/kg
Review of Operations
The information in this report pertaining to the Project financial and economic analysis has not been audited and contains non-IFRS
measures; EBITDA is a non IFRS measure calculated as the earnings before tax, interest, depreciation and amortisation.
SML recommended for grant and pending Tanzanian Cabinet approval
Following notice in October 2018 that the Mining Commission had recommended the Special Mining Licence (SML) application
for approval the Company has continued a very active engagement process with the Tanzanian Government Ministries and Mining
Commission to expedite the issue of the SML.
Given the scale and importance of the SML projects pending approval, the Tanzanian government is taking a cautious approach
to the implementation and application of the 2017 legislation. Whilst the Company has expressed its frustration in the length of
time taken for this process, we appreciate the need for certainty in the SML process and the importance of delivering a secure and
stable legislative environment in which to operate.
The Company continues to do all within its control to expedite the SML; with the Peak executive responsible for the application
travelling regularly to Dodoma, the Tanzanian capital, and the Company’s in-country manager also having relocated from Dar es
Salaam to Dodoma, following the Government Ministry’s move to the capital last year.
The Mining Licence is the final regulatory requirement for the Ngualla Project, with the associated Teesside Refinery already fully
permitted and land secured under option. Once granted the Ngualla Project will be the only rare earth development project that
has a JORC Compliant Ore Reserve, completed definitive feasibility study and fully piloted process from ore to separated oxides
that is fully permitted and ready to construct.
Fully permitted UK Refinery Site a key differentiator and strategic asset
The recent media focus on rare earths highlighted them as potentially being weaponised by China in its trade dispute with the USA.
These developments underline the strategic value and optionality that Peak represents to establish what would be only the second
significant producer of rare earth oxide products independent of the Chinese supply chain.
In time, the UK Refinery will become a rare earth separation hub, with increased NdPr refining capacity. Other projected additions
may include; accepting multiple feed sources to refinery, recycle circuit for used magnets, mid and heavy separation capacity, and
the support of the establishment of a western supply chain for permanent magnets into the EV thematic.
Planning permissions for the refinery and environmental licences for operation of the facility are all in place.
The Company has a further two years on its option, over a 19 hectare parcel of land located in the Wilton International Site. The
option provides for a 250 year lease over the site which has a number of commercial advantages, including:
Close to ports, bulk low cost reagent supplies and a highly skilled workforce
Sustainable options for waste and effluent disposal
• Access to the existing industrial park with “plug and play” facilities
•
•
• UK Government and Local Authority support for the project
•
•
Close to UK and European markets
Size of parcel provides for potential for expansion
#Material assumptions are as per BFS and Ore Reserve ASX Announcements of 12 April 2017 except where indicated in this report.
The information is extracted from the report entitled “Lower price deck delivers similar BFS results for Ngualla” released on the 12
October 2017 and is available to view on the Company’s website www.peakresources.com.au/asx-announcements/. The Company
confirms that it is not aware of any new information or data that materially affects the information included in the original market
announcement and, in the case of estimates of Mineral Resources or Ore Reserves, that all material assumptions and technical
parameters underpinning the estimates in the relevant market announcement continue to apply and have not materially changed.
The Company confirms that the form and context in which the Competent Person’s findings are presented have not been materially
modified from the original market announcement.
Ngualla Hill
Ngualla Hill
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Review of Operations
Review of Operations
Anticipated supply
demand imbalance
Teesside refinery site and surrounding area and facilities
NdPr Market Developments
A number of developments during the year bode well for strong on-going demand growth for NdPr within the next few years:
temporary softening for NdPr oxide and metal pricing.
Source: Peak Resources and individual company and industry announcements
NdPr Market Pricing
The NdPr price experienced some volatility during the last 2 quarters of the year mainly driven by the ongoing US-China trade
dispute. The supply and demand side currently remains in balance, although the Chinese supply chain reforms did have an
immediate direct impact on the rare earth imports from Myanmar, this triggered steep price increases since May on the heavy rare
earth side of the business, in particular for Terbium and dysprosium-oxide.
Softer than expected EV production results for the past quarter, have delayed expected supply pressures on NdPr, resulting in
Emissions Legislation changes
New European Emission legislation represents indirectly an electric vehicle quota. The new European legislation (commencing 1
January 2020) requires that all but 5% of the EU's car fleet emit no more than 95 grams of carbon dioxide per kilometre driven.
Car Manufacturer fast tracking their electric vehicle plans
In June 2019, Toyota Motor Corporation announced it is to accelerate its Electric vehicle strategy. Toyota aims to get half of its
global sales from electrified vehicles by 2025. This is five years ahead of its previous schedule.
The global automotive industry led by car manufacturers, have jointly committed to a ~ US $400 billion investment in Electric
vehicles. Each internal combustion engine vehicle replaced by an electric vehicle represents an approximate 1kg of additional NdPr
demand. By 2025, the number of different electric vehicle models available is expected to nearly quadruple.
China
The permanent increase of Chinese rare earth material imports underpinned by China’s nearly doubling of its electric vehicle sales
in 2018, compared to the prior year, confirms that the global demand for NdPr is increasing steadily. The Chinese Government
is embracing the shift in the automotive Industry towards electric vehicles and E-mobility in a way no other country can match;
electric vehicles have become one of the 10 core pillars of the “Made in China in 2025” agenda, this assures that Chinese policies
are aligned to fully support the overarching governmental strategy to become a world leader in this technology and industry
segment.
These developments and other supply factors support Peak's view that demand for NdPr is expected to outstrip supply during
2021.
Source: Peak Resources and Asian Metals
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ENABLING LOW CARBON TECHNOLOGIES PAGE 3
Review of Operations
Review of Operations
Anticipated supply
demand imbalance
Source: Peak Resources and individual company and industry announcements
NdPr Market Pricing
The NdPr price experienced some volatility during the last 2 quarters of the year mainly driven by the ongoing US-China trade
dispute. The supply and demand side currently remains in balance, although the Chinese supply chain reforms did have an
immediate direct impact on the rare earth imports from Myanmar, this triggered steep price increases since May on the heavy rare
earth side of the business, in particular for Terbium and dysprosium-oxide.
Softer than expected EV production results for the past quarter, have delayed expected supply pressures on NdPr, resulting in
temporary softening for NdPr oxide and metal pricing.
These developments and other supply factors support Peak's view that demand for NdPr is expected to outstrip supply during
Source: Peak Resources and Asian Metals
ENABLING LOW CARBON TECHNOLOGIES PAGE 10
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ENABLING LOW CARBON TECHNOLOGIES PAGE 11
Teesside refinery site and surrounding area and facilities
NdPr Market Developments
A number of developments during the year bode well for strong on-going demand growth for NdPr within the next few years:
Emissions Legislation changes
New European Emission legislation represents indirectly an electric vehicle quota. The new European legislation (commencing 1
January 2020) requires that all but 5% of the EU's car fleet emit no more than 95 grams of carbon dioxide per kilometre driven.
Car Manufacturer fast tracking their electric vehicle plans
In June 2019, Toyota Motor Corporation announced it is to accelerate its Electric vehicle strategy. Toyota aims to get half of its
global sales from electrified vehicles by 2025. This is five years ahead of its previous schedule.
The global automotive industry led by car manufacturers, have jointly committed to a ~ US $400 billion investment in Electric
vehicles. Each internal combustion engine vehicle replaced by an electric vehicle represents an approximate 1kg of additional NdPr
demand. By 2025, the number of different electric vehicle models available is expected to nearly quadruple.
The permanent increase of Chinese rare earth material imports underpinned by China’s nearly doubling of its electric vehicle sales
in 2018, compared to the prior year, confirms that the global demand for NdPr is increasing steadily. The Chinese Government
is embracing the shift in the automotive Industry towards electric vehicles and E-mobility in a way no other country can match;
electric vehicles have become one of the 10 core pillars of the “Made in China in 2025” agenda, this assures that Chinese policies
are aligned to fully support the overarching governmental strategy to become a world leader in this technology and industry
China
segment.
2021.
ENABLING LOW CARBON TECHNOLOGIES PAGE 3
Review of Operations
Social and Environmental Responsibility
Development Assets
Peak takes its community and social responsibilities very seriously and is proud of its record to date. The projects undertaken in the
past and the manner in which the Company engages with the local community has resulted in widespread support for the Ngualla
Project
Ngualla - a quality NdPr Resource
Outstanding Natural Attributes:
Large Resource – 214.4mt @ 2.15% REO
High grade Reserve – 18.5mt @ 4.80% REO
High grade of NdPr – ~20% of REO
Weathered Bastnaesite – easier to process, tried and tested
Long life operation – 26 years on Reserve only
The newly constructed classrooms donated by the company
The most recent programme; the construction of two classrooms and a teacher’s office at a local school was completed towards
the end of 2018. Due to the protracted application process for the SML the Company is not currently planning to undertake any
major Community Programmes during the 2019/2020 financial year.
Key Metrics:
Comparatively low Capex – US$200m
Employment – 200 direct jobs
Indirect Employment – 1000 jobs
Tanzanian economic activity - US$51m annual Opex
ENABLING LOW CARBON TECHNOLOGIES PAGE 12
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ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Review of Operations
Social and Environmental Responsibility
Development Assets
Peak takes its community and social responsibilities very seriously and is proud of its record to date. The projects undertaken in the
past and the manner in which the Company engages with the local community has resulted in widespread support for the Ngualla
Project
Ngualla - a quality NdPr Resource
Outstanding Natural Attributes:
Large Resource – 214.4mt @ 2.15% REO
High grade Reserve – 18.5mt @ 4.80% REO
High grade of NdPr – ~20% of REO
Weathered Bastnaesite – easier to process, tried and tested
Long life operation – 26 years on Reserve only
The newly constructed classrooms donated by the company
The most recent programme; the construction of two classrooms and a teacher’s office at a local school was completed towards
the end of 2018. Due to the protracted application process for the SML the Company is not currently planning to undertake any
major Community Programmes during the 2019/2020 financial year.
Key Metrics:
Comparatively low Capex – US$200m
Employment – 200 direct jobs
Indirect Employment – 1000 jobs
Tanzanian economic activity - US$51m annual Opex
ENABLING LOW CARBON TECHNOLOGIES PAGE 12
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ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Development Assets
Directors' Report
Teesside - a rare earth processing hub
Outstanding Attributes:
Fully permitted for construction and operation
250 year land option with room for expansion
Excellent infrastructure and location to market
Sustainable options for waste management and disposal
Readily available low cost reagents
Key Metrics:
Comparatively low Capex – US$165m
Employment – 120 direct jobs
Indirect Employment – 500 jobs
UK economic activity - US$40m annual Opex
ENABLING LOW CARBON TECHNOLOGIES PAGE 14
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Directors Report
DIRECTORS
Mr Peter Meurer
Mr Darren Townsend
Mr Jonathan Murray
Mr John Jetter
Mr Tony Pearson
INFORMATION ON DIRECTORS
The directors of Peak Resources Limited submit herewith the financial statements of the Company for the financial year ended 30
June 2019. In order to comply with the provisions of the Corporations Act 2001, the Directors Report as follows:
The names and details of the Company’s directors in office during and since the financial year end until the date of the report are
as follows. Directors were in office for the entire period unless otherwise stated.
Non-Executive Director (Resigned 28 February 2019)
Non-Executive Chairman
Non-Executive Director
Non-Executive Director
Non- Executive Director (Appointed 21 August 2018)
Mr Peter Meurer– Non-Executive Chairman (Appointed 23 April 2018)
MBA & Grad Dip. Biochemistry from RMIT, AICD
Peter has a distinguished career of over 40 years in the Corporate Finance sector and was most recently Non-Executive Chairman
of Nomura Australia. He first joined Nomura Australia in 2009 and prior to this held the roles of Vice Chairman for Citigroup and
Merrill Lynch. Peter has a strong strategic focus and has forged trusted advisor relationships through the many market related
transactions in which he has been involved covering all aspect of corporate finance including equity raisings, debt financing,
corporate advisory and M&A.
Peter is not currently a director of any other listed companies and held no public company directorships in the past three years.
Mr Jonathan Murray – Non-Executive Director (Appointed 22 February 2011, Chairman from 1 April 2015 to 30 November 2015
and 31 December 2017 until 22 April 2018)
Bachelor of Law and Commerce
Jonathan is a partner at an independent corporate law firm Steinepreis Paganin, based in Perth, Western Australia. He specialises
in equity capital raisings, all forms of acquisitions and divestments, governance and corporate compliance. Mr Murray graduated
from Murdoch University in 1996 with a Bachelor of Law and Commerce (majoring in Accounting). He is also a member of FINSIA
(formerly the Securities Institute of Australia). Jonathan serves as a director of the following other listed companies and held no
other public company directorships in the past three years:
• Hannans Limited Ltd – from 22 January 2010
• Vietnam Industrial Investments Limited - from 19 January 2016
Mr John Jetter – Non-Executive Director (Appointed 1 April 2015)
BLaw, BEcon, INSEAD
John has Bachelor of Law and Bachelor of Economics degrees and has extensive international finance and M&A experience having
been the former Managing Director, CEO and head of investment banking of JP Morgan in Germany and Austria, and a member of
the European Advisory Council of JP Morgan in London. He has held various senior positions with JP Morgan during which time he
focused his attention on major corporate clients and advised on some of Europe’s largest transactions. Before joining JPMorgan,
he spent 12 years with CRA Limited (now Rio Tinto) in a variety of senior management roles gaining extensive experience in the
mining and mineral processing industries.
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Development Assets
Teesside - a rare earth processing hub
Outstanding Attributes:
Fully permitted for construction and operation
250 year land option with room for expansion
Excellent infrastructure and location to market
Sustainable options for waste management and disposal
Readily available low cost reagents
Key Metrics:
Comparatively low Capex – US$165m
Employment – 120 direct jobs
Indirect Employment – 500 jobs
UK economic activity - US$40m annual Opex
Directors' Report
Directors Report
The directors of Peak Resources Limited submit herewith the financial statements of the Company for the financial year ended 30
June 2019. In order to comply with the provisions of the Corporations Act 2001, the Directors Report as follows:
DIRECTORS
The names and details of the Company’s directors in office during and since the financial year end until the date of the report are
as follows. Directors were in office for the entire period unless otherwise stated.
Mr Peter Meurer
Mr Darren Townsend
Mr Jonathan Murray
Mr John Jetter
Mr Tony Pearson
INFORMATION ON DIRECTORS
Non-Executive Chairman
Non-Executive Director (Resigned 28 February 2019)
Non-Executive Director
Non-Executive Director
Non- Executive Director (Appointed 21 August 2018)
Mr Peter Meurer– Non-Executive Chairman (Appointed 23 April 2018)
MBA & Grad Dip. Biochemistry from RMIT, AICD
Peter has a distinguished career of over 40 years in the Corporate Finance sector and was most recently Non-Executive Chairman
of Nomura Australia. He first joined Nomura Australia in 2009 and prior to this held the roles of Vice Chairman for Citigroup and
Merrill Lynch. Peter has a strong strategic focus and has forged trusted advisor relationships through the many market related
transactions in which he has been involved covering all aspect of corporate finance including equity raisings, debt financing,
corporate advisory and M&A.
Peter is not currently a director of any other listed companies and held no public company directorships in the past three years.
Mr Jonathan Murray – Non-Executive Director (Appointed 22 February 2011, Chairman from 1 April 2015 to 30 November 2015
and 31 December 2017 until 22 April 2018)
Bachelor of Law and Commerce
Jonathan is a partner at an independent corporate law firm Steinepreis Paganin, based in Perth, Western Australia. He specialises
in equity capital raisings, all forms of acquisitions and divestments, governance and corporate compliance. Mr Murray graduated
from Murdoch University in 1996 with a Bachelor of Law and Commerce (majoring in Accounting). He is also a member of FINSIA
(formerly the Securities Institute of Australia). Jonathan serves as a director of the following other listed companies and held no
other public company directorships in the past three years:
• Hannans Limited Ltd – from 22 January 2010
• Vietnam Industrial Investments Limited - from 19 January 2016
Mr John Jetter – Non-Executive Director (Appointed 1 April 2015)
BLaw, BEcon, INSEAD
John has Bachelor of Law and Bachelor of Economics degrees and has extensive international finance and M&A experience having
been the former Managing Director, CEO and head of investment banking of JP Morgan in Germany and Austria, and a member of
the European Advisory Council of JP Morgan in London. He has held various senior positions with JP Morgan during which time he
focused his attention on major corporate clients and advised on some of Europe’s largest transactions. Before joining JPMorgan,
he spent 12 years with CRA Limited (now Rio Tinto) in a variety of senior management roles gaining extensive experience in the
mining and mineral processing industries.
ENABLING LOW CARBON TECHNOLOGIES PAGE 14
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ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Directors' Report
Directors' Report
In addition, John has an extensive understanding of the rare earths industry and has been actively involved in negotiating and
executing rare earth offtake agreements. John serves as a director of the following other listed companies and held no other public
company directorships in the past three years:
FINANCIAL POSITION
The net assets of the Group have decreased from $31,217,637 at 30 June 2018 to $27,947,140 at 30 June 2019.
• Otto Energy – from 10 December 2007
• Venture Minerals Ltd – from 8 June 2010
Mr Tony Pearson – Non-Executive Director (Appointed 21 August 2018)
B.Comm, AICD
Tony is an experienced international natural resources executive and company director. He is currently a Commissioner at the
Independent Planning Commission, and prior to this he was a group executive at TSX/HKEx listed SouthGobi Resources, based in
Hong Kong, where he was responsible for the company’s corporate and strategic initiatives. Tony also has over 15 year’s commercial
and investment banking experience, covering the Asia Pacific natural resources industry, most recently as a Managing Director at
HSBC. During his career Tony has raised or invested in excess of $15bn across equities, hybrids, bonds, convertibles and project
finance. Tony is currently Chair of White Ribbon and a trustee of the Royal Botanic Garden & Domain Trust. Tony serves as a
director of the following listed company and held no other public company directorships in the past three years:
•
Cellnet Group Ltd - from 5 October 2018
Mr Darren Townsend –Non-Executive Director (Appointed 3 February 2014, Managing Director from 3 February 2014 to 3 November
2017, Resigned 28 February2019)
B.Eng (Mining-Hons) EMBA Managing Director
Darren is a mining engineer with extensive mining and corporate experience. Prior to joining Peak over a period of 6 years Darren
was President & CEO of TSXV listed Pacific Wildcat Resources Corp where he was responsible for building a tantalum mine in
Mozambique and completing the acquisition and resource drill out of a large rare earth and niobium project in Kenya. Previously
Darren has also worked at De Grey Mining Ltd where he held the position of Managing Director from May 2006 to December 2007.
Prior to that he was General Manager of Operations at Sons of Gwalia’s (now Tailson) Wodgina Tantalum operations and over a
period of 7 years, led and managed the development of the mine to become the world’s largest hard rock Tantalum operations.
Darren is not currently a director of any other listed companies and held no public company directorships in the past three years.
COMPANY SECRETARY
On 29 July 2019, Peak announced a proposed transaction which would restructure the ownership of the PAM Group. PAM is the
The following person held the position of company secretary during or at the end of the financial year:
Graeme Scott – Company Secretary (Appointed 3 November 2014)
FCCA
Graeme is a fellow of the Association of Chartered Certified Accountants (UK) with more than 20 years’ experience in professional
and corporate roles in both Australia and the UK. He has spent the last 15 years working in the resources sector in CFO and
Company Secretarial roles for both ASX and TSX listed companies.
PRINCIPAL ACTIVITIES
During the year, the principal activities of the Company consisted of:
(a) Mineral processing technological evaluations;
(b) Mining and associated infrastructure, feasibility evaluations;and
(c) Mineral definition anddevelopment.
OPERATING RESULTS
The loss of the Group after providing for income tax amounted to $4,596,053 (2018: loss $4,903,224).
The basic and diluted loss per share for the Group for the year was 0.58 cents (2018: 0.82 cents)
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The Group’s working capital, being current assets less current liabilities, was $351,045 at 30 June 2019 (2018: $7,594,395).
Post year end the Company completed a share placement on 8 August 2019 which resulted in the Company raising approximately
$4.795m before costs. A total of 119,888,380 new fully paid ordinary shares were issued at $0.04 per share.
As reported with $2.15m cash at bank at the end of the reporting period together with the above mentioned capital raising,
Peak is well funded going into the 2019/2020 financial year to meet its share of the Ngualla Project costs, and its corporate and
administration requirements.
DIVIDENDS PAID OR RECOMMENDED
The Directors do not recommend the payment of a dividend and no amount has been paid or declared by way of a dividend to the
date of this report.
SIGNIFICANT CHANGES IN STATE OF AFFAIRS
Other than detailed below and in the Review of Operations above there were no significant changes in the state of affairs of the
Company, during the financial year:
During the year the Company has made further contributions to Associate Company, Peak African Minerals (PAM) amounting to
$2,100,117 for its share of the Ngualla Project costs. Peak maintains a 75% interest in PAM (Appian 20%, IFC 5%). During the year
the Company repaid $560,031 (US$401,037) to Appian against the loan facility provided by Appian to the Company.
On 2 November 2018 103,858 fully paid ordinary shares were issued following the exercise of PEKOB listed $0.06 options. The
balance of 81,111,930 PEKOB options expired unexercised on 1 November 2018.
AFTER BALANCE DATE EVENTS
parent Company of Tanzanian Registered PR NG Minerals Limited which is the holder of the Ngulla Project Exploration Licences
and Special Mining Licence application. Under the transaction, which is subject to completion of legal documentation, approval
of Peak’s shareholders and other regulatory approvals, PAM’s other shareholders Appian and IFC would swap out their PAM
shareholdings for shares in Peak. Appian to receive 327,490,452 and IFC to receive up to 64,268,651 new fully paid ordinary shares
in Peak in return for their respective 20% and 3.85% (diluted) ownership interests in PAM. Following completion of the transaction,
as contemplated, PAM would then become a 100% owned subsidiary of Peak.
On 8 August 2019 Peak completed a placement of 119,888,380 new fully paid ordinary shares in Peak at $0.04 per share to raise
gross proceeds (before costs) of A$4.795m and has subsequently repaid the Appian loan facility in full.
Other than the matters referred to above there were no other events that have a material impact on the financial statements or
operations of the Group and Company.
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Directors' Report
Directors' Report
In addition, John has an extensive understanding of the rare earths industry and has been actively involved in negotiating and
FINANCIAL POSITION
executing rare earth offtake agreements. John serves as a director of the following other listed companies and held no other public
The net assets of the Group have decreased from $31,217,637 at 30 June 2018 to $27,947,140 at 30 June 2019.
The Group’s working capital, being current assets less current liabilities, was $351,045 at 30 June 2019 (2018: $7,594,395).
Post year end the Company completed a share placement on 8 August 2019 which resulted in the Company raising approximately
$4.795m before costs. A total of 119,888,380 new fully paid ordinary shares were issued at $0.04 per share.
As reported with $2.15m cash at bank at the end of the reporting period together with the above mentioned capital raising,
Peak is well funded going into the 2019/2020 financial year to meet its share of the Ngualla Project costs, and its corporate and
administration requirements.
DIVIDENDS PAID OR RECOMMENDED
The Directors do not recommend the payment of a dividend and no amount has been paid or declared by way of a dividend to the
date of this report.
SIGNIFICANT CHANGES IN STATE OF AFFAIRS
Other than detailed below and in the Review of Operations above there were no significant changes in the state of affairs of the
Company, during the financial year:
During the year the Company has made further contributions to Associate Company, Peak African Minerals (PAM) amounting to
$2,100,117 for its share of the Ngualla Project costs. Peak maintains a 75% interest in PAM (Appian 20%, IFC 5%). During the year
the Company repaid $560,031 (US$401,037) to Appian against the loan facility provided by Appian to the Company.
On 2 November 2018 103,858 fully paid ordinary shares were issued following the exercise of PEKOB listed $0.06 options. The
balance of 81,111,930 PEKOB options expired unexercised on 1 November 2018.
AFTER BALANCE DATE EVENTS
On 29 July 2019, Peak announced a proposed transaction which would restructure the ownership of the PAM Group. PAM is the
parent Company of Tanzanian Registered PR NG Minerals Limited which is the holder of the Ngulla Project Exploration Licences
and Special Mining Licence application. Under the transaction, which is subject to completion of legal documentation, approval
of Peak’s shareholders and other regulatory approvals, PAM’s other shareholders Appian and IFC would swap out their PAM
shareholdings for shares in Peak. Appian to receive 327,490,452 and IFC to receive up to 64,268,651 new fully paid ordinary shares
in Peak in return for their respective 20% and 3.85% (diluted) ownership interests in PAM. Following completion of the transaction,
as contemplated, PAM would then become a 100% owned subsidiary of Peak.
On 8 August 2019 Peak completed a placement of 119,888,380 new fully paid ordinary shares in Peak at $0.04 per share to raise
gross proceeds (before costs) of A$4.795m and has subsequently repaid the Appian loan facility in full.
Other than the matters referred to above there were no other events that have a material impact on the financial statements or
operations of the Group and Company.
company directorships in the past three years:
• Otto Energy – from 10 December 2007
• Venture Minerals Ltd – from 8 June 2010
Mr Tony Pearson – Non-Executive Director (Appointed 21 August 2018)
B.Comm, AICD
Tony is an experienced international natural resources executive and company director. He is currently a Commissioner at the
Independent Planning Commission, and prior to this he was a group executive at TSX/HKEx listed SouthGobi Resources, based in
Hong Kong, where he was responsible for the company’s corporate and strategic initiatives. Tony also has over 15 year’s commercial
and investment banking experience, covering the Asia Pacific natural resources industry, most recently as a Managing Director at
HSBC. During his career Tony has raised or invested in excess of $15bn across equities, hybrids, bonds, convertibles and project
finance. Tony is currently Chair of White Ribbon and a trustee of the Royal Botanic Garden & Domain Trust. Tony serves as a
director of the following listed company and held no other public company directorships in the past three years:
•
Cellnet Group Ltd - from 5 October 2018
2017, Resigned 28 February2019)
B.Eng (Mining-Hons) EMBA Managing Director
Mr Darren Townsend –Non-Executive Director (Appointed 3 February 2014, Managing Director from 3 February 2014 to 3 November
Darren is a mining engineer with extensive mining and corporate experience. Prior to joining Peak over a period of 6 years Darren
was President & CEO of TSXV listed Pacific Wildcat Resources Corp where he was responsible for building a tantalum mine in
Mozambique and completing the acquisition and resource drill out of a large rare earth and niobium project in Kenya. Previously
Darren has also worked at De Grey Mining Ltd where he held the position of Managing Director from May 2006 to December 2007.
Prior to that he was General Manager of Operations at Sons of Gwalia’s (now Tailson) Wodgina Tantalum operations and over a
period of 7 years, led and managed the development of the mine to become the world’s largest hard rock Tantalum operations.
Darren is not currently a director of any other listed companies and held no public company directorships in the past three years.
COMPANY SECRETARY
The following person held the position of company secretary during or at the end of the financial year:
Graeme Scott – Company Secretary (Appointed 3 November 2014)
FCCA
Graeme is a fellow of the Association of Chartered Certified Accountants (UK) with more than 20 years’ experience in professional
and corporate roles in both Australia and the UK. He has spent the last 15 years working in the resources sector in CFO and
Company Secretarial roles for both ASX and TSX listed companies.
PRINCIPAL ACTIVITIES
During the year, the principal activities of the Company consisted of:
(a) Mineral processing technological evaluations;
(b) Mining and associated infrastructure, feasibility evaluations;and
(c) Mineral definition anddevelopment.
OPERATING RESULTS
The loss of the Group after providing for income tax amounted to $4,596,053 (2018: loss $4,903,224).
The basic and diluted loss per share for the Group for the year was 0.58 cents (2018: 0.82 cents)
ENABLING LOW CARBON TECHNOLOGIES PAGE 16
ENABLING LOW CARBON TECHNOLOGIES PAGE 17
ENABLING LOW CARBON TECHNOLOGIES PAGE 17
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Directors' Report
Directors' Report
MEETINGS OF DIRECTORS
The number of meetings attended by each Director of the Company during the financial year was:
Peter Meurer
Darren Townsend
Jonathan Murray
John Jetter
Tony Pearson
Board Meetings
Number held and
entitled toattend
Number attended
7
4
7
7
7
7
4
7
7
7
Note – no Audit Committee Meetings or Remuneration Committee Meetings were held during the year as the function of these
committees was dealt with by the full Board.
EQUITY HOLDINGS OF DIRECTORS
As at the date of this report, the Directors’ interest in the Company were:
Equity shares
Equity options
Performance
Rights
Peter Meurer
Jonathan Murray
John Jetter
Tony Pearson
1,250,000
2,638,753
-
-
30,416,666
10,333,334
10,000,000
-
Details of issues made to directors during the period are provided in the Remuneration Report.
-
-
-
-
FUTURE DEVELOPMENTS
The remuneration of non-executive directors has been set at a maximum of $300,000 as approved by shareholders at the 26
Likely future developments in the operations of the Group are referred to elsewhere in the Annual Report. Other than as referred
to in this report, further information as to likely developments in the operations of the Group and expected results of those
operations would, in the opinion of the Directors, be speculative.
ENVIRONMENTAL ISSUES
The Company is aware of its environmental obligations with regards to its exploration activities and ensures that it complies with all
regulations when carrying out any exploration work. The directors of the Company are not aware of any breach of environmental
regulations for the year under review.
The Directors have considered the National Greenhouse and Energy Reporting Act 2007 (the NGER Act) which introduced a
single national reporting framework for the reporting and dissemination of information about the greenhouse gas emissions,
greenhouse gas projects, and energy use and production of corporations which exceed specified thresholds. At the current stage
of development, the Directors have determined that the NGER Act has no effect on the Company for the current or subsequent
financial year. The Directors will reassess this position as and when the need arises.
REMUNERATION REPORT (AUDITED)
The remuneration report outlines the director and executive remuneration arrangements for the Group in accordance with the
requirements of the Corporations Act 2001 and its Regulations.
Remuneration Policy
The remuneration policy of the Company has been designed to align director and executive objectives with shareholder and
business objectives by providing a fixed remuneration component which is assessed on an annual basis in line with market rates
and offering specific long-term incentives based on key performance areas affecting the Company’s financial results.
•
•
2023.
The Board believes the remuneration policy to be appropriate and effective in its ability to attract and retain the best directors
and executives to run and manage the Company.
The Board’s policy for determining the nature and amount of remuneration for Board members and senior executives of the
Company is as follows:
The remuneration policy, setting the terms and conditions for the executive directors and other senior executives, was developed
by the Board. All executives receive a base salary (which is based on factors such as length of service and experience) and
superannuation. The Board reviews executive packages annually by reference to the Company’s performance, executive
performance and comparable information from industry sectors and other listed companies in similar industries.
The Board may exercise discretion in relation to approving incentives, bonuses and options. The policy is to attract the highest
calibre of executives and reward them for performance that results in long-term growth in shareholder wealth. Executives and
employees are also entitled to participate in the employee share and option arrangements.
The Board policy is to remunerate non-executive directors at market rates for comparable companies for time, commitment and
responsibilities. The Board determines payments to the non-executive directors and reviews their remuneration annually, based
on market practice, duties and accountability. Independent external advice is sought when required. Fees for non-executive
directors are not linked to the performance of the Company. However, to align directors’ interests with shareholder interests, the
directors are encouraged to hold shares in the Company and are able to participate in the employee option plan. Non-executive
directors are not provided with any specified retirement benefits.
All remuneration paid to directors and executives is valued at the cost to the Company and expensed. Shares given to directors
and executives are valued as the difference between the market price of those shares and the amount paid by the director or
executive. Options and performance rights are valued using the Black-Scholes methodology. Details of options and performance
rights provided to directors are detailed in the Remuneration Report.
Non-executive director remuneration
November 2015 annual general meeting.
Performance based remuneration
and executive remuneration packages.
The Company continues to review and consider the inclusion of performance based remuneration component built into director
During the year no performance based option packages were issued to its directors.
The Company received broad approval from Shareholders for an Employee Option Plan (EOP) and Performance Rights Plan (PRP)
at the Annual General Meeting on 29 November 2017. Under the incentive scheme, eligible participants may have been entitled
to three Tranches of future Options, with Tranche 1 vesting 30 June 2018, Tranche 2 vesting 16 January 2019 and Tranche 3
vesting 16 January 2020.
During the year, the Tranche 2 options have been offered and granted to employees, with a total of 5,750,000 Options issued with
an exercise price of $0.035 and which expire on 17 January 2022. Tranche 3 was never offered to any eligible participants and was
terminated when the Company discontinued the above scheme.
During the year the Board approved a new Long Term Incentive Scheme (LTIS) and Short Term Incentive Scheme (STIS) with issues
to be made under the EOP and PRP respectively. On 5 March 2019 the Company issued eligible participants under the scheme,
subject to meeting continuing service conditions, the following series of Options and Performance Rights:
43,000,000 Unlisted Options vesting after 1 years continuous service on 5 March 2020, exercisable at $0.03 expiring 5 March
10,000,000 Performance Rights to vest on achievement of performance criteria, as determined by the Company’s Board, by
5 March 2020 or the Performance Rights will lapse.
ENABLING LOW CARBON TECHNOLOGIES PAGE 18
ENABLING LOW CARBON TECHNOLOGIES PAGE 19
ENABLING LOW CARBON TECHNOLOGIES PAGE 19
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Directors' Report
Directors' Report
MEETINGS OF DIRECTORS
The number of meetings attended by each Director of the Company during the financial year was:
Peter Meurer
Darren Townsend
Jonathan Murray
John Jetter
Tony Pearson
Peter Meurer
Jonathan Murray
John Jetter
Tony Pearson
Board Meetings
Number held and
entitled toattend
Number attended
7
4
7
7
7
7
4
7
7
7
-
-
1,250,000
2,638,753
Note – no Audit Committee Meetings or Remuneration Committee Meetings were held during the year as the function of these
committees was dealt with by the full Board.
EQUITY HOLDINGS OF DIRECTORS
As at the date of this report, the Directors’ interest in the Company were:
Equity shares
Equity options
Performance
Rights
30,416,666
10,333,334
10,000,000
-
-
-
-
-
Details of issues made to directors during the period are provided in the Remuneration Report.
FUTURE DEVELOPMENTS
Likely future developments in the operations of the Group are referred to elsewhere in the Annual Report. Other than as referred
to in this report, further information as to likely developments in the operations of the Group and expected results of those
operations would, in the opinion of the Directors, be speculative.
ENVIRONMENTAL ISSUES
The Company is aware of its environmental obligations with regards to its exploration activities and ensures that it complies with all
regulations when carrying out any exploration work. The directors of the Company are not aware of any breach of environmental
regulations for the year under review.
The Directors have considered the National Greenhouse and Energy Reporting Act 2007 (the NGER Act) which introduced a
single national reporting framework for the reporting and dissemination of information about the greenhouse gas emissions,
greenhouse gas projects, and energy use and production of corporations which exceed specified thresholds. At the current stage
of development, the Directors have determined that the NGER Act has no effect on the Company for the current or subsequent
financial year. The Directors will reassess this position as and when the need arises.
REMUNERATION REPORT (AUDITED)
The remuneration report outlines the director and executive remuneration arrangements for the Group in accordance with the
requirements of the Corporations Act 2001 and its Regulations.
Remuneration Policy
The remuneration policy of the Company has been designed to align director and executive objectives with shareholder and
business objectives by providing a fixed remuneration component which is assessed on an annual basis in line with market rates
and offering specific long-term incentives based on key performance areas affecting the Company’s financial results.
The Board believes the remuneration policy to be appropriate and effective in its ability to attract and retain the best directors
and executives to run and manage the Company.
The Board’s policy for determining the nature and amount of remuneration for Board members and senior executives of the
Company is as follows:
The remuneration policy, setting the terms and conditions for the executive directors and other senior executives, was developed
by the Board. All executives receive a base salary (which is based on factors such as length of service and experience) and
superannuation. The Board reviews executive packages annually by reference to the Company’s performance, executive
performance and comparable information from industry sectors and other listed companies in similar industries.
The Board may exercise discretion in relation to approving incentives, bonuses and options. The policy is to attract the highest
calibre of executives and reward them for performance that results in long-term growth in shareholder wealth. Executives and
employees are also entitled to participate in the employee share and option arrangements.
The Board policy is to remunerate non-executive directors at market rates for comparable companies for time, commitment and
responsibilities. The Board determines payments to the non-executive directors and reviews their remuneration annually, based
on market practice, duties and accountability. Independent external advice is sought when required. Fees for non-executive
directors are not linked to the performance of the Company. However, to align directors’ interests with shareholder interests, the
directors are encouraged to hold shares in the Company and are able to participate in the employee option plan. Non-executive
directors are not provided with any specified retirement benefits.
All remuneration paid to directors and executives is valued at the cost to the Company and expensed. Shares given to directors
and executives are valued as the difference between the market price of those shares and the amount paid by the director or
executive. Options and performance rights are valued using the Black-Scholes methodology. Details of options and performance
rights provided to directors are detailed in the Remuneration Report.
Non-executive director remuneration
The remuneration of non-executive directors has been set at a maximum of $300,000 as approved by shareholders at the 26
November 2015 annual general meeting.
Performance based remuneration
The Company continues to review and consider the inclusion of performance based remuneration component built into director
and executive remuneration packages.
During the year no performance based option packages were issued to its directors.
The Company received broad approval from Shareholders for an Employee Option Plan (EOP) and Performance Rights Plan (PRP)
at the Annual General Meeting on 29 November 2017. Under the incentive scheme, eligible participants may have been entitled
to three Tranches of future Options, with Tranche 1 vesting 30 June 2018, Tranche 2 vesting 16 January 2019 and Tranche 3
vesting 16 January 2020.
During the year, the Tranche 2 options have been offered and granted to employees, with a total of 5,750,000 Options issued with
an exercise price of $0.035 and which expire on 17 January 2022. Tranche 3 was never offered to any eligible participants and was
terminated when the Company discontinued the above scheme.
During the year the Board approved a new Long Term Incentive Scheme (LTIS) and Short Term Incentive Scheme (STIS) with issues
to be made under the EOP and PRP respectively. On 5 March 2019 the Company issued eligible participants under the scheme,
subject to meeting continuing service conditions, the following series of Options and Performance Rights:
•
•
43,000,000 Unlisted Options vesting after 1 years continuous service on 5 March 2020, exercisable at $0.03 expiring 5 March
2023.
10,000,000 Performance Rights to vest on achievement of performance criteria, as determined by the Company’s Board, by
5 March 2020 or the Performance Rights will lapse.
ENABLING LOW CARBON TECHNOLOGIES PAGE 18
ENABLING LOW CARBON TECHNOLOGIES PAGE 19
ENABLING LOW CARBON TECHNOLOGIES PAGE 19
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Directors' Report
Directors' Report
Subsequent to cessation of service to the Company the following unlisted options issued under its EOP and to directors were
cancelled:
•
•
•
1,700,000 unlisted options with an exercise price of $0.03
3,000,000 unlisted options with an exercise price of $0.10
5,000,000 unlisted options with an exercise price of $0.15
Company performance, shareholder wealth and director’s and executive’s remuneration
Summary of group’s performance and movements in Peak Resources Limited’s share price over the last five years:
Total income
Net loss before tax
Net loss after tax
2019
$
98,795
(4,596,053)
(4,596,053)
2018
$
618,718
(4,903,224)
(4,903,224)
2017
$
1,861,274
(4,886,187)
(4,886,187)
2016
$
9,253
(15,892,428)
(15,892,428)
2015
$
38,426
(4,195,877)
(4,195,877)
Closing share price at end of year
Basic loss per share (cents)
Dividends per share
$0.048
0.58
-
$0.036
0.82
-
$0.067
1.04
-
$0.048
3.95
-
$0.085
1.13
-
The remuneration policy has been tailored to increase goal congruence between shareholders and directors and executives.
Currently, this is facilitated through a policy to issue options and in some instances performance rights to the majority of directors
and executives to encourage the alignment of personal and shareholder interests. The Company believes the policy will be effective
in increasing shareholder wealth. Details of directors and executives interests in shares and options at year end are detailed below.
Details of remuneration
Peter Meurer – Non-Executive Chairman
The relevant Key Management Personnel (KMP) of the group for the 2019 financial year were:
•
• Darren Townsend – Non-Executive Director (Resigned 28 February2019)
•
•
•
•
• Michael Prassas – Executive General Manager Sales, Market & Business Development
• Graeme Scott– Chief financial Officer & Company Secretary
•
Jonathan Murray – Non-Executive Director
John Jetter- Non-Executive Director
Tony Pearson - Non-Executive Director (Appointed 21 August 2018)
Rocky Smith – Chief Executive Officer
Lucas Stanfield – General Manager of Development
Total renumeration for the year was:
Salary and fees
Non-monetary benefits
Superannuation
Share based payments
Total
Remuneration of individual KMP’s were:
2019
$
1,371,249
103,032
57,950
395,256
1,927,487
2018
$
1,647,780
88,830
64,923
34,489
1,836,022
ENABLING LOW CARBON TECHNOLOGIES PAGE 20
ENABLING LOW CARBON TECHNOLOGIES PAGE 21
ENABLING LOW CARBON TECHNOLOGIES PAGE 21
Short term benefits
Share based payments
Proportion related to:
Post- employ-
ment benefits
Salary &
fees
Non-
monetary
Super-
annuation
Performance
Rights
Options
Total
Equity#
Performance#
$
$
$
$
$
$
%
30-Jun-19
Directors
Peter Meurer
Darren Townsend1
Jonathan Murray
John Jetter
Tony Pearson2
Executives
Rocky Smith3
Michael Prassas4
Graeme Scott5
Lucas Stanfield
Total
50,000
26,667
40,000
40,000
34,517
191,184
389,091
275,974
280,000
235,000
85,573
17,459
11,875
23,750
22,325
57,950
57,950
20,714
13,316
13,316
11,837
59,183
59,183
1,180,065
1,371,249
103,032
103,032
� The % excludes the value of the options which were written back during the year.
1 Mr Townsend ceased employment with the company on 28 February 2019.
2 Mr Pearson was appointed 21 August 2018.
-
-
-
-
-
-
-
54,367
(613)
22,452
22,452
-
83,170
52,450
52,450
49,345
104,367
26,054
62,452
62,452
34,517
578,548
371,074
369,516
318,507
98,658
289,842
237,415 1,637,645
336,073 1,927,487
3 Mr Smith has a salary of $377,775 and also received an insurance allowance of $11,316 under his employment contract.
4 Mr Prassas received his superannuation entitlement for the half year to 31 December 2018 as salary totalling $11,875. He also received a cash payment of $14,099
for his annual flight allowance under his employment contract.
5 Mr Scott received a retention bonus of $30,000 included in his Salary and fees for the period.
Salary &
fees
Non-
Super-
Performance
monetary
annuation
Rights*
Options
Total
Equity
Performance#
$
$
$
$
$
$
%
%
30-Jun-18
Directors
Peter Meurer
Peter Harold4
Darren Townsend1
David Hammond1
Jonathan Murray
John Jetter
Executives
Rocky Smith2
Michael Prassas
Graeme Scott
Lucas Stanfield3
Total
9,444
30,000
190,464
185,031
35,000
35,000
484,939
414,091
273,750
240,000
235,000
61,658
27,172
19,798
(447,065)
258,204
315,876
2,850
8,666
8,282
(298,043)
(149,022)
-
-
-
-
-
22,800
22,325
45,125
64,923
160,785
-
-
32,473
32,473
32,473
170,229
32,850
(66,440)
44,291
67,473
67,473
89,340
44,670
44,670
44,670
565,089
345,592
307,470
301,995
1,162,841
1,647,780
88,830
88,830
223,350
1,520,146
(447,065) 481,554 1,836,022
* The value of the performance rights expensed from date of issue to 30 June 2017 totalling $447,805 ($298,043 for Darren Townsend and $149,022 for David
Hammond) were written back during the year on cancellation of the rights due to the vesting conditions not having beenmeet.
� The % excludes the value of the performance rights which were written back during the year.
¹ Darren Townsend and David Hammond ceased executive employment during the year. Included in their salary and fees is accrued leave entitlements paid out
totalling $62,754 for Darren Townsend and $97,851 for David Hammond.
² Rocky Smith received a performance bonus relating to the completion of the BFS totalling $25,000 included in his Salary and fees for the period.
³ Lucas Stanfield become a KMP on 2 October 2017. His remuneration for the full year has been included in this report.
⁴ Peter Harold resigned on 31 December 2017
%
52%
0%
36%
36%
0%
34%
14%
14%
14%
15%
14%
17%
94%
0%
14%
0%
48%
48%
34%
15%
12%
14%
15%
15%
21%
0%
0%
0%
0%
0%
0%
4%
4%
4%
4%
4%
3%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
9%
0%
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Directors' Report
Directors' Report
Subsequent to cessation of service to the Company the following unlisted options issued under its EOP and to directors were
cancelled:
•
•
•
1,700,000 unlisted options with an exercise price of $0.03
3,000,000 unlisted options with an exercise price of $0.10
5,000,000 unlisted options with an exercise price of $0.15
Company performance, shareholder wealth and director’s and executive’s remuneration
Summary of group’s performance and movements in Peak Resources Limited’s share price over the last five years:
Total income
Net loss before tax
Net loss after tax
2019
$
98,795
2018
$
2017
$
618,718
1,861,274
2016
$
9,253
2015
$
38,426
(4,596,053)
(4,903,224)
(4,886,187)
(15,892,428)
(4,195,877)
(4,596,053)
(4,903,224)
(4,886,187)
(15,892,428)
(4,195,877)
Closing share price at end of year
$0.048
$0.036
$0.067
$0.048
$0.085
Basic loss per share (cents)
Dividends per share
0.58
-
0.82
-
1.04
-
3.95
-
1.13
-
The remuneration policy has been tailored to increase goal congruence between shareholders and directors and executives.
Currently, this is facilitated through a policy to issue options and in some instances performance rights to the majority of directors
and executives to encourage the alignment of personal and shareholder interests. The Company believes the policy will be effective
in increasing shareholder wealth. Details of directors and executives interests in shares and options at year end are detailed below.
Details of remuneration
The relevant Key Management Personnel (KMP) of the group for the 2019 financial year were:
Peter Meurer – Non-Executive Chairman
• Darren Townsend – Non-Executive Director (Resigned 28 February2019)
Jonathan Murray – Non-Executive Director
John Jetter- Non-Executive Director
Tony Pearson - Non-Executive Director (Appointed 21 August 2018)
Rocky Smith – Chief Executive Officer
• Michael Prassas – Executive General Manager Sales, Market & Business Development
• Graeme Scott– Chief financial Officer & Company Secretary
Lucas Stanfield – General Manager of Development
•
•
•
•
•
•
Total renumeration for the year was:
Salary and fees
Non-monetary benefits
Superannuation
Share based payments
Total
Remuneration of individual KMP’s were:
2019
$
1,371,249
103,032
57,950
395,256
2018
$
1,647,780
88,830
64,923
34,489
1,927,487
1,836,022
Short term benefits
Post- employ-
ment benefits
Share based payments
Proportion related to:
Salary &
fees
Non-
monetary
Super-
annuation
Performance
Rights
Options
Total
Equity#
Performance#
30-Jun-19
Directors
Peter Meurer
Darren Townsend1
Jonathan Murray
John Jetter
Tony Pearson2
Executives
Rocky Smith3
Michael Prassas4
Graeme Scott5
Lucas Stanfield
Total
$
$
$
$
$
$
50,000
26,667
40,000
40,000
34,517
191,184
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
54,367
(613)
22,452
22,452
-
98,658
104,367
26,054
62,452
62,452
34,517
289,842
389,091
275,974
280,000
235,000
1,180,065
1,371,249
85,573
17,459
-
-
103,032
103,032
-
11,875
23,750
22,325
57,950
57,950
20,714
13,316
13,316
11,837
59,183
59,183
83,170
52,450
52,450
49,345
578,548
371,074
369,516
318,507
237,415 1,637,645
336,073 1,927,487
%
52%
0%
36%
36%
0%
34%
14%
14%
14%
15%
14%
17%
%
0%
0%
0%
0%
0%
0%
4%
4%
4%
4%
4%
3%
� The % excludes the value of the options which were written back during the year.
1 Mr Townsend ceased employment with the company on 28 February 2019.
2 Mr Pearson was appointed 21 August 2018.
3 Mr Smith has a salary of $377,775 and also received an insurance allowance of $11,316 under his employment contract.
4 Mr Prassas received his superannuation entitlement for the half year to 31 December 2018 as salary totalling $11,875. He also received a cash payment of $14,099
for his annual flight allowance under his employment contract.
5 Mr Scott received a retention bonus of $30,000 included in his Salary and fees for the period.
Salary &
fees
Non-
monetary
Super-
annuation
Performance
Rights*
Options
Total
Equity
Performance#
$
$
$
$
$
$
%
%
9,444
30,000
190,464
185,031
35,000
35,000
484,939
414,091
273,750
240,000
235,000
1,162,841
1,647,780
-
-
-
-
-
-
61,658
27,172
-
-
88,830
88,830
-
2,850
8,666
8,282
-
-
19,798
-
-
22,800
22,325
45,125
64,923
-
-
(298,043)
(149,022)
-
-
(447,065)
160,785
-
32,473
-
32,473
32,473
258,204
170,229
32,850
(66,440)
44,291
67,473
67,473
315,876
-
-
-
-
-
565,089
89,340
345,592
44,670
307,470
44,670
301,995
44,670
1,520,146
223,350
(447,065) 481,554 1,836,022
94%
0%
14%
0%
48%
48%
34%
15%
12%
14%
15%
15%
21%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
9%
0%
30-Jun-18
Directors
Peter Meurer
Peter Harold4
Darren Townsend1
David Hammond1
Jonathan Murray
John Jetter
Executives
Rocky Smith2
Michael Prassas
Graeme Scott
Lucas Stanfield3
Total
* The value of the performance rights expensed from date of issue to 30 June 2017 totalling $447,805 ($298,043 for Darren Townsend and $149,022 for David
Hammond) were written back during the year on cancellation of the rights due to the vesting conditions not having beenmeet.
� The % excludes the value of the performance rights which were written back during the year.
¹ Darren Townsend and David Hammond ceased executive employment during the year. Included in their salary and fees is accrued leave entitlements paid out
totalling $62,754 for Darren Townsend and $97,851 for David Hammond.
² Rocky Smith received a performance bonus relating to the completion of the BFS totalling $25,000 included in his Salary and fees for the period.
³ Lucas Stanfield become a KMP on 2 October 2017. His remuneration for the full year has been included in this report.
⁴ Peter Harold resigned on 31 December 2017
ENABLING LOW CARBON TECHNOLOGIES PAGE 20
ENABLING LOW CARBON TECHNOLOGIES PAGE 21
ENABLING LOW CARBON TECHNOLOGIES PAGE 21
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Directors' Report
Options and performance rights granted / vested / cancelled during the year ended 30 June 2019
Options granted during the year
30-Jun-19
Directors
Peter Meurer
Darren Townsend1
Jonathan Murray
John Jetter
Tony Pearson²
Executives
Rocky Smith
Michael Prassas
Graeme Scott
Lucas Stanfield
Total
Date of
issue
Number
of options
issued
Value
per
Option*
Total
value of
issue $
Vesting
Date#
Exercise
Price
Expiry
Date
Number
vested during the
year
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
17-Jan-19
5-Mar-19
17-Jan-19
5-Mar-19
17-Jan-19
5-Mar-19
17-Jan-19
5-Mar-19
$0.0099
$0.0126
$0.0099
$0.0126
$0.0099
$0.0126
$0.0099
$0.0126
1,500,000
11,000,000
750,000
7,250,000
750,000
7,250,000
750,000
6,750,000
36,000,000
36,000,000
14,878
138,470
7,439
91,264
7,439
91,264
7,439
84,970
443,165
443,165
17-Jan-19
5-Mar-20
17-Jan-19
5-Mar-20
17-Jan-19
5-Mar-20
17-Jan-19
5-Mar-20
$0.035
$0.030
$0.035
$0.030
$0.035
$0.030
$0.035
$0.030
17-Jan-22
5-Mar-23
17-Jan-22
5-Mar-23
17-Jan-22
5-Mar-23
17-Jan-22
5-Mar-23
-
-
-
-
-
1,500,000
-
750,000
-
750,000
-
750,000
-
3,750,000
3,750,000
Directors' Report
* Options are valued using the Black-Scholes method on date of grant.
# Unvested Options vest on achievement of milestones and length of service criteria.
Performance Rights granted during the year
Date of
issue
Number of
performance
rights issued
Value per
performance
right*
Total
value of
issue $
Vesting
Exercise
Date#
Price
Expiry
Date
vested during
the year
Number
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
5-Mar-19
5-Mar-19
5-Mar-19
5-Mar-19
3,500,000
2,250,000
2,250,000
2,000,000
10,000,000
10,000,000
$0.024
$0.024
$0.024
$0.024
5-Mar-20
5-Mar-20
5-Mar-20
5-Mar-20
84,000
54,000
54,000
48,000
240,000
240,000
-
-
-
-
-
5-Mar-23
5-Mar-23
5-Mar-23
5-Mar-23
-
-
-
-
-
-
-
-
-
-
-
30-Jun-19
Directors
Peter Meurer
Darren Townsend
Jonathan Murray
John Jetter
Tony Pearson
Executives
Rocky Smith
Michael Prassas
Graeme Scott
Lucas Stanfield
Total
Rights will lapse.
* Performance Rights are valued using the Black-Scholes method on date of grant.
# The unvested Performance Rights to vest on achievement of performance criteria, as determined by the Company’s Board, by 5 March 2020 or the Performance
* Options are valued using the Black-Scholes method on date of grant.
# Unvested Options vest on achievement of length of service criteria.
1 Mr Townsend resigned 28 February 2019.
2 Subject to shareholder approval, the Company plans to issue Mr Pearson 2,000,000 options exercisable at $0.05, 3,000,000 options exercisable at $0.10 and
5,000,000 options exercisable at $0.15 otherwise on the same terms and conditions as those series on issue to the other Company directors.
No Performance Rights were granted during the year ended 30 June 2018.
Shareholdings of KMP’s
Options granted during the year ended 30 June 2018
30-Jun-18
Directors
Peter Meurer
Darren Townsend
Jonathan Murray
John Jetter
Executives
Rocky Smith
Michael Prassas
Graeme Scott
Lucas Stanfield
Total
Date of
issue
Number
of options
issued
Value
per
Option*
21-Jun-18
21-Jun-18
21-Jun-18
21-Jun-18
21-Jun-18
21-Jun-18
21-Jun-18
21-Jun-18
21-Jun-18
21-Jun-18
21-Jun-18
21-Jun-18
16-Jan-18
16-Jan-18
16-Jan-18
16-Jan-18
$0.0159
$0.0130
$0.0127
$0.0159
$0.0130
$0.0127
$0.0159
$0.0130
$0.0127
$0.0159
$0.0130
$0.0127
$0.0298
$0.0298
$0.0298
$0.0298
10,000,000
5,000,000
15,000,000
2,000,000
3,000,000
5,000,000
2,000,000
3,000,000
5,000,000
2,000,000
3,000,000
5,000,000
60,000,000
3,000,000
1,500,000
1,500,000
1,500,000
7,500,000
67,500,000
Total
value of
issue $
159,300
64,850
190,350
31,860
38,910
63,450
31,860
38,910
63,450
31,860
38,910
63,450
817,160
89,340
44,670
44,670
44,670
223,350
1,040,510
Vesting
Date#
Exercise
Price
Expiry
Date
Number
vested during the
year
30-Jun-19
Opening Balance
Granted as
Remuneration
Exercise of
Options/PRs
Other
Movements
Closing
Balance
21-Jun-18
21-Jun-18
21-Jun-18
21-Jun-18
$0.0500
$0.1000
$0.1500
$0.0500
$0.1000
$0.1500
$0.0500
$0.1000
$0.1500
$0.0500
$0.1000
$0.1500
21-Jun-21
21-Jun-22
21-Jun-23
21-Jun-21
21-Jun-22
21-Jun-23
21-Jun-21
21-Jun-22
21-Jun-23
21-Jun-21
21-Jun-22
21-Jun-23
30-Jun-18
30-Jun-18
30-Jun-18
30-Jun-18
$0.065
$0.065
$0.065
$0.065
16-Jan-21
16-Jan-21
16-Jan-21
16-Jan-21
10,000,000
-
-
2,000,000
-
-
2,000,000
-
-
2,000,000
-
-
16,000,000
-
3,000,000
1,500,000
1,500,000
1,500,000
7,500,000
23,500,000
Directors
Peter Meurer
Darren Townsend*
Jonathan Murray
John Jetter
Tony Pearson
Executives
Rocky Smith
Michael Prassas
Graeme Scott
Lucas Stanfield
Total
1,250,000
675,000
2,638,753
-
-
-
4,563,753
1,249,989
3,750,000
325,000
5,324,989
9,888,742
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(675,000)
1,250,000
2,638,753
(675,000)
3,888,753
-
-
-
-
1,249,989
3,750,000
325,000
5,324,989
9,213,742
(675,000)
* Mr Townsend ceased to be KMP’s during the period and his holdings are not reported at period end.
ENABLING LOW CARBON TECHNOLOGIES PAGE 22
ENABLING LOW CARBON TECHNOLOGIES PAGE 23
ENABLING LOW CARBON TECHNOLOGIES PAGE 23
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
ENABLING LOW CARBON TECHNOLOGIES PAGE 3
Directors' Report
Options and performance rights granted / vested / cancelled during the year ended 30 June 2019
Options granted during the year
Date of
issue
Number
of options
issued
Value
per
Option*
Total
value of
issue $
Vesting
Exercise
Date#
Price
Expiry
Date
Number
vested during the
year
30-Jun-19
Directors
Peter Meurer
Darren Townsend1
Jonathan Murray
John Jetter
Tony Pearson²
Executives
Rocky Smith
Michael Prassas
Graeme Scott
Lucas Stanfield
Total
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
17-Jan-19
5-Mar-19
17-Jan-19
5-Mar-19
17-Jan-19
5-Mar-19
17-Jan-19
5-Mar-19
$0.0099
$0.0126
$0.0099
$0.0126
$0.0099
$0.0126
$0.0099
$0.0126
1,500,000
11,000,000
750,000
7,250,000
750,000
7,250,000
750,000
6,750,000
36,000,000
36,000,000
138,470
7,439
91,264
7,439
91,264
7,439
84,970
443,165
443,165
14,878
17-Jan-19
5-Mar-20
17-Jan-19
5-Mar-20
17-Jan-19
5-Mar-20
17-Jan-19
5-Mar-20
$0.035
$0.030
$0.035
$0.030
$0.035
$0.030
$0.035
$0.030
17-Jan-22
5-Mar-23
17-Jan-22
5-Mar-23
17-Jan-22
5-Mar-23
17-Jan-22
5-Mar-23
1,500,000
750,000
750,000
750,000
3,750,000
3,750,000
* Options are valued using the Black-Scholes method on date of grant.
# Unvested Options vest on achievement of length of service criteria.
1 Mr Townsend resigned 28 February 2019.
Options granted during the year ended 30 June 2018
Darren Townsend
21-Jun-18
Jonathan Murray
21-Jun-18
30-Jun-18
Directors
Peter Meurer
John Jetter
Executives
Rocky Smith
Michael Prassas
Graeme Scott
Lucas Stanfield
Total
21-Jun-18
21-Jun-18
21-Jun-18
21-Jun-18
21-Jun-18
21-Jun-18
21-Jun-18
21-Jun-18
21-Jun-18
21-Jun-18
16-Jan-18
16-Jan-18
16-Jan-18
16-Jan-18
$0.0159
$0.0130
$0.0127
$0.0159
$0.0130
$0.0127
$0.0159
$0.0130
$0.0127
$0.0159
$0.0130
$0.0127
$0.0298
$0.0298
$0.0298
$0.0298
10,000,000
5,000,000
15,000,000
2,000,000
3,000,000
5,000,000
2,000,000
3,000,000
5,000,000
2,000,000
3,000,000
5,000,000
3,000,000
1,500,000
1,500,000
1,500,000
7,500,000
67,500,000
Total
value of
issue $
159,300
64,850
190,350
31,860
38,910
63,450
31,860
38,910
63,450
31,860
38,910
63,450
89,340
44,670
44,670
44,670
223,350
1,040,510
60,000,000
817,160
21-Jun-18
21-Jun-18
21-Jun-18
21-Jun-18
$0.0500
$0.1000
$0.1500
$0.0500
$0.1000
$0.1500
$0.0500
$0.1000
$0.1500
$0.0500
$0.1000
$0.1500
21-Jun-21
21-Jun-22
21-Jun-23
21-Jun-21
21-Jun-22
21-Jun-23
21-Jun-21
21-Jun-22
21-Jun-23
21-Jun-21
21-Jun-22
21-Jun-23
30-Jun-18
30-Jun-18
30-Jun-18
30-Jun-18
$0.065
$0.065
$0.065
$0.065
16-Jan-21
16-Jan-21
16-Jan-21
16-Jan-21
10,000,000
2,000,000
2,000,000
2,000,000
16,000,000
3,000,000
1,500,000
1,500,000
1,500,000
7,500,000
23,500,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Directors' Report
* Options are valued using the Black-Scholes method on date of grant.
# Unvested Options vest on achievement of milestones and length of service criteria.
Performance Rights granted during the year
30-Jun-19
Directors
Peter Meurer
Darren Townsend
Jonathan Murray
John Jetter
Tony Pearson
Executives
Rocky Smith
Michael Prassas
Graeme Scott
Lucas Stanfield
-
-
-
-
-
5-Mar-19
5-Mar-19
5-Mar-19
5-Mar-19
Date of
issue
Number of
performance
rights issued
Value per
performance
right*
Total
value of
issue $
Vesting
Date#
Exercise
Price
Expiry
Date
Number
vested during
the year
-
-
-
-
-
3,500,000
2,250,000
2,250,000
2,000,000
10,000,000
10,000,000
-
-
-
-
-
$0.024
$0.024
$0.024
$0.024
-
-
-
-
-
-
-
-
-
-
5-Mar-20
5-Mar-20
5-Mar-20
5-Mar-20
84,000
54,000
54,000
48,000
240,000
240,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
5-Mar-23
5-Mar-23
5-Mar-23
5-Mar-23
-
-
-
-
-
-
-
-
-
-
-
Total
* Performance Rights are valued using the Black-Scholes method on date of grant.
# The unvested Performance Rights to vest on achievement of performance criteria, as determined by the Company’s Board, by 5 March 2020 or the Performance
Rights will lapse.
2 Subject to shareholder approval, the Company plans to issue Mr Pearson 2,000,000 options exercisable at $0.05, 3,000,000 options exercisable at $0.10 and
5,000,000 options exercisable at $0.15 otherwise on the same terms and conditions as those series on issue to the other Company directors.
Shareholdings of KMP’s
No Performance Rights were granted during the year ended 30 June 2018.
Date of
issue
Number
of options
Value
per
issued
Option*
Vesting
Exercise
Date#
Price
Expiry
Date
Number
vested during the
year
30-Jun-19
Opening Balance
Granted as
Remuneration
Exercise of
Options/PRs
Other
Movements
Closing
Balance
Directors
Peter Meurer
Darren Townsend*
Jonathan Murray
John Jetter
Tony Pearson
Executives
Rocky Smith
Michael Prassas
Graeme Scott
Lucas Stanfield
Total
1,250,000
675,000
2,638,753
-
-
4,563,753
1,249,989
3,750,000
325,000
-
5,324,989
9,888,742
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(675,000)
-
-
-
(675,000)
-
-
-
-
-
(675,000)
1,250,000
-
2,638,753
-
-
3,888,753
1,249,989
3,750,000
325,000
-
5,324,989
9,213,742
* Mr Townsend ceased to be KMP’s during the period and his holdings are not reported at period end.
ENABLING LOW CARBON TECHNOLOGIES PAGE 22
ENABLING LOW CARBON TECHNOLOGIES PAGE 23
ENABLING LOW CARBON TECHNOLOGIES PAGE 23
ENABLING LOW CARBON TECHNOLOGIES PAGE 3
Directors' Report
Option Holdings of KMP’s including performance rights
30-Jun-19
Directors
Peter Meurer
Darren Townsend*
Jonathan Murray
John Jetter
Tony Pearson
Executives
Rocky Smith
Michael Prassas
Graeme Scott
Lucas Stanfield
Total
Opening
Balance
Granted as
Remuneration
Exercise of
Options &
PRs
Expired/
Cancelled1
Other
Movements
Closing
Balance
Vested at
30 June
30,416,666
10,037,500
10,424,376
10,000,000
-
60,878,542
3,520,827
2,958,333
1,641,666
1,500,000
9,620,826
70,499,368
-
-
-
-
-
-
16,000,000
10,250,000
10,250,000
9,500,000
46,000,000
46,000,000
-
-
-
-
-
-
-
-
-
-
-
-
-
(8,037,500)
(91,042)
-
-
(8,128,542)
(312,494)
(625,000)
(100,000)
-
(1,037,494)
(9,166,036)
-
(2,000,000)
-
-
-
(2,000,000)
-
-
-
-
-
(2,000,000)
30,416,666
-
10,333,334
10,000,000
-
50,750,000
19,208,333
12,583,333
11,791,666
11,000,000
54,583,332
105,333,332
10,416,666
-
2,333,334
2,000,000
-
14,750,000
3,208,333
2,333,333
1,541,666
1,500,000
8,583,332
23,333,332
Directors' Report
Graeme Scott – CFO & Company Secretary (appointed 3 November 2014)
Graeme is employed under an ESA. The agreement provides for an annual salary of $250,000 effective 1 November 2017, plus
superannuation, expenses, discretionary performance bonuses and eligibility for options. The Executive is entitled to leave in
accordance with the relevant legislation. Graeme’s engagement has no fixed term but is subject to a three month notice period
from either party except six months’ notice following a change of control termination.
Other transactions
During the year Steinepreis Paganin Lawyers and Consultants, a legal practice associated with Mr Jonathan Murray received
$20,010 (2018: $191,327) as fees for the provision of legal advice. Balance outstanding at 30 June 2019 and included in trade
creditors $10,946 (30 June 2018: $35,332).
These costs have not been included in directors’ remuneration as these fees were not paid to individual directors in relation to the
management of the affairs of the Company. All transactions were entered into on normal commercial terms.
(End of Remuneration Report)
OPTIONS AND PERFORMANCE RIGHTS
At the date of this report Listed options on issue are:
* Mr Townsend ceased to be KMP’s during the period and his holdings are not reported at period end.
1 8,000,000 options issued to Mr Townsend expired for failure to meet the vesting conditions. A further 1,166,036 PEKOB listed options (including 37,500 options
for Townsend) issued to KMP’s expired unexercised, these options were granted through participation in the Company’s capital raisings and had an exercise price
of $0.06 and expired on 1 November 2018.
CODE
PEKOC
Expiry Date
14 June 2020
Exercise Price
Number under option
$0.06
61,088,247
Unissued ordinary shares of the Company under option to service providers only are:
Performance income as a proportion of total income
Mr Scott received a retention bonus totalling $30,000 which is included in his total reported Salary and fees of $280,000 for the
period. No other bonuses have been paid to executives during the year.
Service agreements:
The key terms of the service agreements with the KMP’s are:
Peter Meurer – Non-Executive Chairman (Appointed 23 April 2018)
Under Peter’s agreement annual directors fees of $50,000 effective 23 April 2018 were payable. No retirement benefits are
provided for.
Jonathan Murray / John Jetter / Tony Pearson / Darren Townsend (Resigned 28 February 2019) - Non-Executive Directors
Non-Executive Directors are appointed by letter agreement with no fixed term ceasing on resignation or removal as a director in
accordance with the Corporations Act. Fees are currently set at $40,000 per annum effective 1 July 2018. No retirement benefits
are provided for.
Rocky Smith – Chief Executive Officer - (Transitioned from COO to CEO 21 September 2017)
Rocky is employed under an ESA. The agreement provides for an annual salary of $377,775 inclusive of superannuation, plus
private health and life cover insurance, annual airfares, expenses, discretionary performance bonuses and options. The Executive
is entitled to leave in accordance with the relevant legislation. Rocky’s engagement has no fixed term but is subject to a six month
notice period from either party.
Michael Prassas – Executive General Manager Sales, Marketing and Business Development (appointed 18 February 2016)
Michael is employed under an ESA. The agreement provides for an annual salary of $250,000, plus superannuation, plus private
health, annual airfares, expenses, discretionary performance bonuses and options. The Executive is entitled to leave in accordance
with the relevant legislation. Michael’s engagement has no fixed term but is subject to a six month notice period from either party.
Lucas Stanfield – Development Manager (appointed executive 2 October 2017)
Lucas is employed under an ESA. The agreement provides for an annual salary of $235,000 effective 1 November 2016, plus
superannuation, expenses, discretionary performance bonuses and eligibility for options. The Executive is entitled to leave in
accordance with the relevant legislation. Lucas’s engagement has no fixed term but is subject to a three month notice period from
either party except six months’ notice following a change of control termination.
ENABLING LOW CARBON TECHNOLOGIES PAGE 24
Unissued ordinary shares of the Company under option to directors, employees and former employees are:
Exercise Price
Number under option
Expiry Date
27 February 2021
14 June 2021
Expiry Date
16 January 2021
21 June 2021
21 June 2022
21 June 2023
17 January 2022
5 March 2023
Exercise Price
Number under option
$0.06
$0.065
$0.065
$0.05
$0.10
$0.15
$0.035
$0.03
4,000,000
9,000,000
11,750,000
16,000,000
11,000,000*
25,000,000*
5,750,000
41,300,000*
* Vesting subject to length of service.
During the year 81,111,930 PEKOB listed Options with an exercise price of $0.06 expired unexercised.
During the year 9,700,000 Unlisted employee and director options with exercises prices ranging from $0.03 to $0.15 expired
through the failure to achieve the vesting conditions.
Details of options issued during the year are detailed in the Remuneration Report.
At the date of this report Performance Rights on issue to directors and employees are:
Expiry Date
5 March 2020
Exercise Price
$Nil
Number of Performance
Rights
10,000,000*
*The unvested Performance Rights to vest on achievement of performance criteria, as determined by the Company’s Board, by 5 March 2020 or the Performance
Rights will lapse.
Details of Performance Rights issued during the year are detailed in the Remuneration Report.
Option or rights holders do not have any right, by virtue of the option or right to participate in any share issue of the
Company or any related body corporate.
ENABLING LOW CARBON TECHNOLOGIES PAGE 25
ENABLING LOW CARBON TECHNOLOGIES PAGE 25
ENABLING LOW CARBON TECHNOLOGIES PAGE 3
Directors' Report
Graeme Scott – CFO & Company Secretary (appointed 3 November 2014)
Graeme is employed under an ESA. The agreement provides for an annual salary of $250,000 effective 1 November 2017, plus
superannuation, expenses, discretionary performance bonuses and eligibility for options. The Executive is entitled to leave in
accordance with the relevant legislation. Graeme’s engagement has no fixed term but is subject to a three month notice period
from either party except six months’ notice following a change of control termination.
Other transactions
During the year Steinepreis Paganin Lawyers and Consultants, a legal practice associated with Mr Jonathan Murray received
$20,010 (2018: $191,327) as fees for the provision of legal advice. Balance outstanding at 30 June 2019 and included in trade
creditors $10,946 (30 June 2018: $35,332).
(8,128,542)
(2,000,000)
50,750,000
14,750,000
These costs have not been included in directors’ remuneration as these fees were not paid to individual directors in relation to the
management of the affairs of the Company. All transactions were entered into on normal commercial terms.
(2,000,000)
105,333,332
23,333,332
At the date of this report Listed options on issue are:
(End of Remuneration Report)
OPTIONS AND PERFORMANCE RIGHTS
Directors' Report
Option Holdings of KMP’s including performance rights
30-Jun-19
Directors
Peter Meurer
Darren Townsend*
Jonathan Murray
John Jetter
Tony Pearson
Executives
Rocky Smith
Michael Prassas
Graeme Scott
Lucas Stanfield
Total
30,416,666
10,037,500
10,424,376
10,000,000
-
60,878,542
3,520,827
2,958,333
1,641,666
1,500,000
9,620,826
70,499,368
-
-
-
-
-
-
16,000,000
10,250,000
10,250,000
9,500,000
46,000,000
46,000,000
Opening
Balance
Granted as
Remuneration
Expired/
Cancelled1
Other
Movements
Closing
Balance
Vested at
30 June
Exercise of
Options &
PRs
(8,037,500)
(2,000,000)
(91,042)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(312,494)
(625,000)
(100,000)
(1,037,494)
(9,166,036)
-
-
-
-
-
-
-
-
-
30,416,666
10,416,666
10,333,334
10,000,000
2,333,334
2,000,000
-
-
-
-
19,208,333
12,583,333
11,791,666
11,000,000
54,583,332
3,208,333
2,333,333
1,541,666
1,500,000
8,583,332
* Mr Townsend ceased to be KMP’s during the period and his holdings are not reported at period end.
1 8,000,000 options issued to Mr Townsend expired for failure to meet the vesting conditions. A further 1,166,036 PEKOB listed options (including 37,500 options
for Townsend) issued to KMP’s expired unexercised, these options were granted through participation in the Company’s capital raisings and had an exercise price
of $0.06 and expired on 1 November 2018.
Performance income as a proportion of total income
Mr Scott received a retention bonus totalling $30,000 which is included in his total reported Salary and fees of $280,000 for the
period. No other bonuses have been paid to executives during the year.
Service agreements:
The key terms of the service agreements with the KMP’s are:
Peter Meurer – Non-Executive Chairman (Appointed 23 April 2018)
Under Peter’s agreement annual directors fees of $50,000 effective 23 April 2018 were payable. No retirement benefits are
provided for.
are provided for.
Jonathan Murray / John Jetter / Tony Pearson / Darren Townsend (Resigned 28 February 2019) - Non-Executive Directors
Non-Executive Directors are appointed by letter agreement with no fixed term ceasing on resignation or removal as a director in
accordance with the Corporations Act. Fees are currently set at $40,000 per annum effective 1 July 2018. No retirement benefits
Rocky Smith – Chief Executive Officer - (Transitioned from COO to CEO 21 September 2017)
Rocky is employed under an ESA. The agreement provides for an annual salary of $377,775 inclusive of superannuation, plus
private health and life cover insurance, annual airfares, expenses, discretionary performance bonuses and options. The Executive
notice period from either party.
Michael Prassas – Executive General Manager Sales, Marketing and Business Development (appointed 18 February 2016)
Michael is employed under an ESA. The agreement provides for an annual salary of $250,000, plus superannuation, plus private
health, annual airfares, expenses, discretionary performance bonuses and options. The Executive is entitled to leave in accordance
with the relevant legislation. Michael’s engagement has no fixed term but is subject to a six month notice period from either party.
Lucas Stanfield – Development Manager (appointed executive 2 October 2017)
Lucas is employed under an ESA. The agreement provides for an annual salary of $235,000 effective 1 November 2016, plus
superannuation, expenses, discretionary performance bonuses and eligibility for options. The Executive is entitled to leave in
accordance with the relevant legislation. Lucas’s engagement has no fixed term but is subject to a three month notice period from
either party except six months’ notice following a change of control termination.
ENABLING LOW CARBON TECHNOLOGIES PAGE 24
Expiry Date
27 February 2021
14 June 2021
Exercise Price
Number under option
$0.06
$0.065
4,000,000
9,000,000
Unissued ordinary shares of the Company under option to directors, employees and former employees are:
Expiry Date
16 January 2021
21 June 2021
21 June 2022
21 June 2023
17 January 2022
5 March 2023
* Vesting subject to length of service.
Exercise Price
Number under option
$0.065
$0.05
$0.10
$0.15
$0.035
$0.03
11,750,000
16,000,000
11,000,000*
25,000,000*
5,750,000
41,300,000*
During the year 81,111,930 PEKOB listed Options with an exercise price of $0.06 expired unexercised.
During the year 9,700,000 Unlisted employee and director options with exercises prices ranging from $0.03 to $0.15 expired
through the failure to achieve the vesting conditions.
is entitled to leave in accordance with the relevant legislation. Rocky’s engagement has no fixed term but is subject to a six month
Details of options issued during the year are detailed in the Remuneration Report.
At the date of this report Performance Rights on issue to directors and employees are:
Expiry Date
5 March 2020
Exercise Price
$Nil
Number of Performance
Rights
10,000,000*
*The unvested Performance Rights to vest on achievement of performance criteria, as determined by the Company’s Board, by 5 March 2020 or the Performance
Rights will lapse.
Details of Performance Rights issued during the year are detailed in the Remuneration Report.
Option or rights holders do not have any right, by virtue of the option or right to participate in any share issue of the
Company or any related body corporate.
ENABLING LOW CARBON TECHNOLOGIES PAGE 25
ENABLING LOW CARBON TECHNOLOGIES PAGE 25
Expiry Date
14 June 2020
Unissued ordinary shares of the Company under option to service providers only are:
Number under option
61,088,247
Exercise Price
$0.06
CODE
PEKOC
ENABLING LOW CARBON TECHNOLOGIES PAGE 3
Directors' Report
INDEMNIFYING OFFICERS OR AUDITOR
During the financial year, the company paid a premium in respect of a contract insuring the directors and officers of the Company
and related body corporates against a liability incurred as such a director, secretary or executive officer to the extent permitted
by the Corporations Act 2001. The contract of insurance prohibits disclosure of the nature of the liability and the amount of the
premium.
The Company has not otherwise, during or since the end of the financial year, except to the extent permitted by law, indemnified
or agreed to indemnify an officer or auditor of the Company or of any related body corporate against a liability incurred as such
an office or auditor.
To the extent permitted by law, The Company has agreed to indemnify its auditors, Ernst & Young, as part of the terms of its audit
engagement agreement against claims by third parties arising from the audit (for an unspecified amount). No payment has been
made to indemnify Ernst & Young during or since the financial year.
Auditor's Independence
Declaration
Ernst & Young
11 Mounts Bay Road
Perth WA 6000 Australia
GPO Box M939 Perth WA 6843
Tel: +61 8 9429 2222
Fax: +61 8 9429 2436
ey.com/au
Auditor’s Independence Declaration to the Directors of Peak Resources
As lead auditor for the audit of the financial report of Peak Resources Limited for the financial year ended
30 June 2019, I declare to the best of my knowledge and belief, there have been:
PROCEEDINGS ON BEHALF OF COMPANY
no contraventions of the auditor independence requirements of the Corporations Act 2001 in
No person has applied to the court under legislation such as section 237 of the Corporations Act of Australia for leave to bring
proceedings on behalf of the company, or to intervene in any proceedings to which the company is a party, for the purpose of taking
responsibility on behalf of the company for all or part of those proceedings. No proceedings have been brought or intervened in on
behalf of the consolidated entity with leave of the court under such legislation.
relation to the audit; and
no contraventions of any applicable code of professional conduct in relation to the audit.
This declaration is in respect of Peak Resources Limited and the entities it controlled during the financial
AUDITOR'S INDEPENDENCE DECLARATION
The lead auditor's independence declaration for the year ended 30 June 2019 has been received anad can be found immediately
following the Directors' report
No amounts have been paid or payable to the auditor for non-audit services, payments to the auditors are set out in Note 5 to the
Financial Statements.
The Board of Directors is satisfied that the provision of non-audit services performed during the year by the Company's auditors
is compatible with the general standard of independance for auditors imposed by the Corporations Act 2001. The directors are
satisfied that the services did not compromise the external auditors independence for the following reason:
• All non- audit services have been reviewed and approved to ensure that they do not impact the integrity and objectivity of
•
the auditor; and
The nature of the services provided does not compromise the general principles relating to the auditors independence as set
out in the APES 110 (Code of Ethics for Professional Accountants)
The Directors' report is signed in accordance with a resolution of Directors made pursuant to s.298(2) of the Corporations Act 2001.
On behalf of the Directors,
Peter Meurer
Non-Executive Chairman
Perth 13th September 2019
Limited
a)
b)
year.
Ernst & Young
Darryn Hall
Partner
Perth
13 September 2019
ENABLING LOW CARBON TECHNOLOGIES PAGE 26
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
DH:DA:PEAK:003
ENABLING LOW CARBON TECHNOLOGIES PAGE 27
ENABLING LOW CARBON TECHNOLOGIES PAGE 27
ENABLING LOW CARBON TECHNOLOGIES PAGE 3
Auditor's Independence
Declaration
Ernst & Young
11 Mounts Bay Road
Perth WA 6000 Australia
GPO Box M939 Perth WA 6843
Tel: +61 8 9429 2222
Fax: +61 8 9429 2436
ey.com/au
Auditor’s Independence Declaration to the Directors of Peak Resources
Limited
As lead auditor for the audit of the financial report of Peak Resources Limited for the financial year ended
30 June 2019, I declare to the best of my knowledge and belief, there have been:
a)
b)
no contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit; and
no contraventions of any applicable code of professional conduct in relation to the audit.
This declaration is in respect of Peak Resources Limited and the entities it controlled during the financial
year.
Ernst & Young
Darryn Hall
Partner
Perth
13 September 2019
Directors' Report
INDEMNIFYING OFFICERS OR AUDITOR
During the financial year, the company paid a premium in respect of a contract insuring the directors and officers of the Company
and related body corporates against a liability incurred as such a director, secretary or executive officer to the extent permitted
by the Corporations Act 2001. The contract of insurance prohibits disclosure of the nature of the liability and the amount of the
premium.
an office or auditor.
The Company has not otherwise, during or since the end of the financial year, except to the extent permitted by law, indemnified
or agreed to indemnify an officer or auditor of the Company or of any related body corporate against a liability incurred as such
To the extent permitted by law, The Company has agreed to indemnify its auditors, Ernst & Young, as part of the terms of its audit
engagement agreement against claims by third parties arising from the audit (for an unspecified amount). No payment has been
made to indemnify Ernst & Young during or since the financial year.
PROCEEDINGS ON BEHALF OF COMPANY
No person has applied to the court under legislation such as section 237 of the Corporations Act of Australia for leave to bring
proceedings on behalf of the company, or to intervene in any proceedings to which the company is a party, for the purpose of taking
responsibility on behalf of the company for all or part of those proceedings. No proceedings have been brought or intervened in on
behalf of the consolidated entity with leave of the court under such legislation.
AUDITOR'S INDEPENDENCE DECLARATION
The lead auditor's independence declaration for the year ended 30 June 2019 has been received anad can be found immediately
following the Directors' report
Financial Statements.
No amounts have been paid or payable to the auditor for non-audit services, payments to the auditors are set out in Note 5 to the
The Board of Directors is satisfied that the provision of non-audit services performed during the year by the Company's auditors
is compatible with the general standard of independance for auditors imposed by the Corporations Act 2001. The directors are
satisfied that the services did not compromise the external auditors independence for the following reason:
• All non- audit services have been reviewed and approved to ensure that they do not impact the integrity and objectivity of
the auditor; and
•
The nature of the services provided does not compromise the general principles relating to the auditors independence as set
out in the APES 110 (Code of Ethics for Professional Accountants)
The Directors' report is signed in accordance with a resolution of Directors made pursuant to s.298(2) of the Corporations Act 2001.
On behalf of the Directors,
Peter Meurer
Non-Executive Chairman
Perth 13th September 2019
ENABLING LOW CARBON TECHNOLOGIES PAGE 26
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
DH:DA:PEAK:003
ENABLING LOW CARBON TECHNOLOGIES PAGE 27
ENABLING LOW CARBON TECHNOLOGIES PAGE 27
ENABLING LOW CARBON TECHNOLOGIES PAGE 3
Independent Auditor's
Report
Independent Auditor's
Report
Ernst & Young
11 Mounts Bay Road
Perth WA 6000 Australia
GPO Box M939 Perth WA 6843
Tel: +61 8 9429 2222
Fax: +61 8 9429 2436
ey.com/au
Independent Auditor's Report to the Members of Peak Resources Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Peak Resources Limited (the ‘Company’) and its subsidiaries
(collectively the ‘Group’), which comprises the consolidated statement of financial position as at 30 June
2019, the consolidated statement of comprehensive income, the consolidated statement of changes in
equity and the consolidated statement of cash flows for the year then ended, notes to the financial
statements, including a summary of significant accounting policies, and the directors' declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act
2001, including:
a)
b)
giving a true and fair view of the consolidated financial position of the Group as at 30 June 2019
and of its consolidated financial performance for the year ended on that date; and
complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial
Report section of our report. We are independent of the Group in accordance with the auditor
independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting
Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (the
Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled our other
ethical responsibilities in accordance with the Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our opinion.
Material uncertainty related to going concern
We draw attention to Note 2(a) in the financial report, which describes the principal conditions that raise
doubt about the Group’s ability to continue as a going concern. These conditions indicate the existence of
a material uncertainty that may cast significant doubt about the Group’s ability to continue as a going
concern. The financial report does not include any adjustments relating to the recoverability and
classification of recorded asset amounts or to the amounts and classification of liabilities that might be
necessary should the entity not continue as a going concern. Our opinion is not modified in respect of this
matter.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our
audit of the financial report of the current year. These matters were addressed in the context of our audit
of the financial report as a whole, and in forming our opinion thereon, but we do not provide a separate
opinion on these matters. For each matter below, our description of how our audit addressed the matter
is provided in that context. In addition to the matter described in the Material Uncertainty Related to
Going Concern section, we have determined the matter described below to be the key audit matters to be
communicated in our report.
We have fulfilled the responsibilities described in the Auditor’s Responsibilities for the Audit of the
Financial Report section of our report, including in relation to these matters. Accordingly, our audit
included the performance of procedures designed to respond to our assessment of the risks of material
misstatement of the financial report. The results of our audit procedures, including the procedures
performed to address the matters below, provide the basis for our audit opinion on the accompanying
financial report.
Recoverability of the investment in associate
Why significant
How our audit addressed the key audit matter
As at 30 June 2019, the Group holds a 75% interest in
We assessed the reasonableness of the Group’s impairment
Peak African Minerals (“PAM”). PAM is a Mauritian
assessment process and the resultant recoverable value
company that currently owns 100% of the shares in PR
determined for the Ngualla Project. Our audit procedures
NG Minerals Limited (“PRNG”), the 100% owner of the
included the following:
Ngualla Project.
The Group’s investment in PAM is accounted for using
associate with reference to project economic models
► Assessed the recoverability of the investment in
the equity method. The carrying amount of the
investment in PAM amounted to $33.4 million (2018:
$31.1 million). Disclosure of the investment in PAM is
included in Note 3 to the financial report including
reference to the status of a Special Mining License in
Tanzania over one of PRNG’s 3 licenses.
The Group considered the fair value of the Ngualla
Project imputed by the acquisition of 25% of PAM in
exchange for the issue of equity in Peak Resources
Limited, as announced on 29 July 2019.
It also considered, the results of its bankable
feasibility study and follow up internal process
optimisation studies for the Ngualla Project carried
out in 2018 and 2019. The Group incorporated these
into an overall assessment for the recoverability of the
investment in associate. The Group has determined
that the recoverable amount is higher than the
carrying amount. Accordingly, they assessed that it is
reasonable that no impairment was recognised as at
30 June 2019.
and assumptions included in the recoverable amount
determination such as commodity prices, capital and
operating costs, foreign exchange rates and discount
rates.
► Assessed the competence, capabilities and
objectivity of the Group’s internal experts involved
on project economic models.
►
Involved our valuation specialists to assist us in
evaluating the methodology used in the impairment
model and the reasonableness of the discount rate
and commodity prices used in the computation.
► Performed market comparison of commodity prices
and conducted a price sensitivity analysis to assess
the impact of the changes in the commodity prices.
► Reviewed legal correspondence between the Group
and its external legal counsel with respect to the
status of PRNG’s mining and prospecting license
rights applications and the status of its tenure over
the areas to which the project relates.
This was considered a key audit matter because of the
significant judgment and estimation involved in the
determining the recoverable amount of the Ngualla
Project, including assumptions relating to commodity
prices, capital and operating costs and an appropriate
discount rate to reflect the risk having regard to the
current status of the Ngualla Project.
► Considered the imputed fair value of the project
given the intention to acquire the minority interest of
20% and 5% from Appian and IFC, respectively, by
way of the issue of equity as announced in the
restructure set out in the August 2019 ASX
announcement, and the requirement to make solely
lead the progression of the project.
► We reviewed the adequacy of disclosures in the
annual financial report.
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
HD:DA:PEAK:002
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
HD:DA:PEAK:002
ENABLING LOW CARBON TECHNOLOGIES PAGE 28
ENABLING LOW CARBON TECHNOLOGIES PAGE 29
ENABLING LOW CARBON TECHNOLOGIES PAGE 29
ENABLING LOW CARBON TECHNOLOGIES PAGE 3
Independent Auditor's
Report
Independent Auditor's
Report
Ernst & Young
11 Mounts Bay Road
Perth WA 6000 Australia
GPO Box M939 Perth WA 6843
Tel: +61 8 9429 2222
Fax: +61 8 9429 2436
ey.com/au
Independent Auditor's Report to the Members of Peak Resources Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Peak Resources Limited (the ‘Company’) and its subsidiaries
(collectively the ‘Group’), which comprises the consolidated statement of financial position as at 30 June
2019, the consolidated statement of comprehensive income, the consolidated statement of changes in
equity and the consolidated statement of cash flows for the year then ended, notes to the financial
statements, including a summary of significant accounting policies, and the directors' declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act
giving a true and fair view of the consolidated financial position of the Group as at 30 June 2019
and of its consolidated financial performance for the year ended on that date; and
complying with Australian Accounting Standards and the Corporations Regulations 2001.
2001, including:
a)
b)
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial
Report section of our report. We are independent of the Group in accordance with the auditor
independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting
Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (the
Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled our other
ethical responsibilities in accordance with the Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our opinion.
Material uncertainty related to going concern
We draw attention to Note 2(a) in the financial report, which describes the principal conditions that raise
doubt about the Group’s ability to continue as a going concern. These conditions indicate the existence of
a material uncertainty that may cast significant doubt about the Group’s ability to continue as a going
concern. The financial report does not include any adjustments relating to the recoverability and
classification of recorded asset amounts or to the amounts and classification of liabilities that might be
necessary should the entity not continue as a going concern. Our opinion is not modified in respect of this
matter.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our
audit of the financial report of the current year. These matters were addressed in the context of our audit
of the financial report as a whole, and in forming our opinion thereon, but we do not provide a separate
opinion on these matters. For each matter below, our description of how our audit addressed the matter
is provided in that context. In addition to the matter described in the Material Uncertainty Related to
Going Concern section, we have determined the matter described below to be the key audit matters to be
communicated in our report.
We have fulfilled the responsibilities described in the Auditor’s Responsibilities for the Audit of the
Financial Report section of our report, including in relation to these matters. Accordingly, our audit
included the performance of procedures designed to respond to our assessment of the risks of material
misstatement of the financial report. The results of our audit procedures, including the procedures
performed to address the matters below, provide the basis for our audit opinion on the accompanying
financial report.
Recoverability of the investment in associate
Why significant
How our audit addressed the key audit matter
As at 30 June 2019, the Group holds a 75% interest in
Peak African Minerals (“PAM”). PAM is a Mauritian
company that currently owns 100% of the shares in PR
NG Minerals Limited (“PRNG”), the 100% owner of the
Ngualla Project.
The Group’s investment in PAM is accounted for using
the equity method. The carrying amount of the
investment in PAM amounted to $33.4 million (2018:
$31.1 million). Disclosure of the investment in PAM is
included in Note 3 to the financial report including
reference to the status of a Special Mining License in
Tanzania over one of PRNG’s 3 licenses.
The Group considered the fair value of the Ngualla
Project imputed by the acquisition of 25% of PAM in
exchange for the issue of equity in Peak Resources
Limited, as announced on 29 July 2019.
It also considered, the results of its bankable
feasibility study and follow up internal process
optimisation studies for the Ngualla Project carried
out in 2018 and 2019. The Group incorporated these
into an overall assessment for the recoverability of the
investment in associate. The Group has determined
that the recoverable amount is higher than the
carrying amount. Accordingly, they assessed that it is
reasonable that no impairment was recognised as at
30 June 2019.
This was considered a key audit matter because of the
significant judgment and estimation involved in the
determining the recoverable amount of the Ngualla
Project, including assumptions relating to commodity
prices, capital and operating costs and an appropriate
discount rate to reflect the risk having regard to the
current status of the Ngualla Project.
We assessed the reasonableness of the Group’s impairment
assessment process and the resultant recoverable value
determined for the Ngualla Project. Our audit procedures
included the following:
► Assessed the recoverability of the investment in
associate with reference to project economic models
and assumptions included in the recoverable amount
determination such as commodity prices, capital and
operating costs, foreign exchange rates and discount
rates.
► Assessed the competence, capabilities and
objectivity of the Group’s internal experts involved
on project economic models.
►
Involved our valuation specialists to assist us in
evaluating the methodology used in the impairment
model and the reasonableness of the discount rate
and commodity prices used in the computation.
► Performed market comparison of commodity prices
and conducted a price sensitivity analysis to assess
the impact of the changes in the commodity prices.
► Reviewed legal correspondence between the Group
and its external legal counsel with respect to the
status of PRNG’s mining and prospecting license
rights applications and the status of its tenure over
the areas to which the project relates.
► Considered the imputed fair value of the project
given the intention to acquire the minority interest of
20% and 5% from Appian and IFC, respectively, by
way of the issue of equity as announced in the
restructure set out in the August 2019 ASX
announcement, and the requirement to make solely
lead the progression of the project.
► We reviewed the adequacy of disclosures in the
annual financial report.
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
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A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
HD:DA:PEAK:002
ENABLING LOW CARBON TECHNOLOGIES PAGE 28
ENABLING LOW CARBON TECHNOLOGIES PAGE 29
ENABLING LOW CARBON TECHNOLOGIES PAGE 29
ENABLING LOW CARBON TECHNOLOGIES PAGE 3
Independent Auditor's
Report
Independent Auditor's
Report
Adoption of AASB 9 Financial Instruments
Why significant
How our audit addressed the key audit matter
As at 30 June 2019, the Group adopted AASB 9
Financial Instruments, the Australian equivalent to
IFRS 9, and the standard has been applied beginning 1
July 2018.
We assessed the accuracy and appropriateness of the
Group’s accounting calculations determined for the loan
receivables due from/(to) PAM and its wholly controlled
entities. Our audit procedures included the following:
Under AASB 9, loan receivables due from or to PAM
and its wholly controlled entities are each classified at
fair value through profit and loss. This resulted in an
opening balance adjustment on adoption of AASB 9 as
set out in Note 2(b) and ongoing revaluations through
profit and loss.
There are no changes to the classification and
measurement for the Group’s financial liabilities.
Due to the complexity involved in the assessment of
the transition effect applied to the loan receivables at
1 July 2018, this was considered a key audit matter.
► Understood with reference to supporting
documentation and discussion with management the
key terms of the financial arrangements between the
Group and PAM.
►
Involved our internal specialists to assist us in
assessing the reasonableness of key inputs in the
Group’s fair value calculation.
► Tested the mathematical accuracy of the Group’s fair
value calculations.
► Ensured the appropriate exchange rates are applied
to the translation of foreign denominated currencies
to Australian dollar at transition date.
► Reviewed the adequacy of disclosures in the annual
financial report.
Information Other than the Financial Report and Auditor’s Report Thereon
The Directors are responsible for the other information. The other information comprises the information
included in the Company’s 2019 Annual Report other than the financial report and our auditor’s report
thereon. We obtained the Directors’ Report that is to be included in the Annual Report, prior to the date
of this auditor’s report, and we expect to obtain the remaining sections of the Annual Report after the
date of this auditor’s report.
Our opinion on the financial report does not cover the other information and accordingly we do not
express any form of assurance conclusion thereon, with the exception of the Remuneration Report and
our related assurance opinion.
In connection with our audit of the financial report, our responsibility is to read the other information and,
in doing so, consider whether the other information is materially inconsistent with the financial report or
our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed on the other information obtained prior to the date of this
auditor’s report, we conclude that there is a material misstatement of this other information, we are
required to report that fact. We have nothing to report in this regard.
Responsibilities of the Directors for the Financial Report
The Directors of the Company are responsible for the preparation of the financial report that gives a true
and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for
such internal control as the Directors determine is necessary to enable the preparation of the financial
report that gives a true and fair view and is free from material misstatement, whether due to fraud or
error.
In preparing the financial report, the Directors are responsible for assessing the Group’s ability to
continue as a going concern, disclosing, as applicable, matters relating to going concern and using the
going concern basis of accounting unless the Directors either intend to liquidate the Group or to cease
operations, or have no realistic alternative but to do so.
Auditor's Responsibilities for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes
our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit
conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material if,
individually or in the aggregate, they could reasonably be expected to influence the economic decisions of
users taken on the basis of this financial report.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional
judgment and maintain professional scepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the financial report, whether due to fraud
or error, design and perform audit procedures responsive to those risks, and obtain audit evidence
that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a
material misstatement resulting from fraud is higher than for one resulting from error, as fraud
may involve collusion, forgery, intentional omissions, misrepresentations, or the override of
internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the entity’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the Directors.
Conclude on the appropriateness of the Directors’ use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to events
or conditions that may cast significant doubt on the entity’s ability to continue as a going concern.
If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s
report to the related disclosures in the financial report or, if such disclosures are inadequate, to
modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our
auditor’s report. However, future events or conditions may cause the entity to cease to continue as
a going concern.
Evaluate the overall presentation, structure and content of the financial report, including the
disclosures, and whether the consolidated financial report represents the underlying transactions
and events in a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the business
activities within the Group to express an opinion on the financial report. We are responsible for the
direction, supervision and performance of the Group audit. We remain solely responsible for our
audit opinion.
identify during our audit.
We communicate with the Directors regarding, among other matters, the planned scope and timing of the
audit and significant audit findings, including any significant deficiencies in internal control that we
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
HD:DA:PEAK:002
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
HD:DA:PEAK:002
ENABLING LOW CARBON TECHNOLOGIES PAGE 30
ENABLING LOW CARBON TECHNOLOGIES PAGE 31
ENABLING LOW CARBON TECHNOLOGIES PAGE 31
ENABLING LOW CARBON TECHNOLOGIES PAGE 3
Independent Auditor's
Report
Independent Auditor's
Report
Adoption of AASB 9 Financial Instruments
Why significant
How our audit addressed the key audit matter
As at 30 June 2019, the Group adopted AASB 9
We assessed the accuracy and appropriateness of the
Financial Instruments, the Australian equivalent to
Group’s accounting calculations determined for the loan
IFRS 9, and the standard has been applied beginning 1
receivables due from/(to) PAM and its wholly controlled
July 2018.
entities. Our audit procedures included the following:
Under AASB 9, loan receivables due from or to PAM
► Understood with reference to supporting
and its wholly controlled entities are each classified at
documentation and discussion with management the
fair value through profit and loss. This resulted in an
key terms of the financial arrangements between the
opening balance adjustment on adoption of AASB 9 as
Group and PAM.
set out in Note 2(b) and ongoing revaluations through
profit and loss.
There are no changes to the classification and
measurement for the Group’s financial liabilities.
Due to the complexity involved in the assessment of
the transition effect applied to the loan receivables at
1 July 2018, this was considered a key audit matter.
►
Involved our internal specialists to assist us in
assessing the reasonableness of key inputs in the
Group’s fair value calculation.
► Tested the mathematical accuracy of the Group’s fair
value calculations.
► Ensured the appropriate exchange rates are applied
to the translation of foreign denominated currencies
to Australian dollar at transition date.
► Reviewed the adequacy of disclosures in the annual
financial report.
Information Other than the Financial Report and Auditor’s Report Thereon
The Directors are responsible for the other information. The other information comprises the information
included in the Company’s 2019 Annual Report other than the financial report and our auditor’s report
thereon. We obtained the Directors’ Report that is to be included in the Annual Report, prior to the date
of this auditor’s report, and we expect to obtain the remaining sections of the Annual Report after the
date of this auditor’s report.
Our opinion on the financial report does not cover the other information and accordingly we do not
express any form of assurance conclusion thereon, with the exception of the Remuneration Report and
our related assurance opinion.
In connection with our audit of the financial report, our responsibility is to read the other information and,
in doing so, consider whether the other information is materially inconsistent with the financial report or
our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed on the other information obtained prior to the date of this
auditor’s report, we conclude that there is a material misstatement of this other information, we are
required to report that fact. We have nothing to report in this regard.
Responsibilities of the Directors for the Financial Report
The Directors of the Company are responsible for the preparation of the financial report that gives a true
and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for
such internal control as the Directors determine is necessary to enable the preparation of the financial
report that gives a true and fair view and is free from material misstatement, whether due to fraud or
error.
In preparing the financial report, the Directors are responsible for assessing the Group’s ability to
continue as a going concern, disclosing, as applicable, matters relating to going concern and using the
going concern basis of accounting unless the Directors either intend to liquidate the Group or to cease
operations, or have no realistic alternative but to do so.
Auditor's Responsibilities for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes
our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit
conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material if,
individually or in the aggregate, they could reasonably be expected to influence the economic decisions of
users taken on the basis of this financial report.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional
judgment and maintain professional scepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the financial report, whether due to fraud
or error, design and perform audit procedures responsive to those risks, and obtain audit evidence
that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a
material misstatement resulting from fraud is higher than for one resulting from error, as fraud
may involve collusion, forgery, intentional omissions, misrepresentations, or the override of
internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the entity’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the Directors.
Conclude on the appropriateness of the Directors’ use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to events
or conditions that may cast significant doubt on the entity’s ability to continue as a going concern.
If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s
report to the related disclosures in the financial report or, if such disclosures are inadequate, to
modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our
auditor’s report. However, future events or conditions may cause the entity to cease to continue as
a going concern.
Evaluate the overall presentation, structure and content of the financial report, including the
disclosures, and whether the consolidated financial report represents the underlying transactions
and events in a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the business
activities within the Group to express an opinion on the financial report. We are responsible for the
direction, supervision and performance of the Group audit. We remain solely responsible for our
audit opinion.
We communicate with the Directors regarding, among other matters, the planned scope and timing of the
audit and significant audit findings, including any significant deficiencies in internal control that we
identify during our audit.
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
HD:DA:PEAK:002
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
HD:DA:PEAK:002
ENABLING LOW CARBON TECHNOLOGIES PAGE 30
ENABLING LOW CARBON TECHNOLOGIES PAGE 31
ENABLING LOW CARBON TECHNOLOGIES PAGE 31
ENABLING LOW CARBON TECHNOLOGIES PAGE 3
Independent Auditor's
Report
We also provide the Directors with a statement that we have complied with relevant ethical requirements
regarding independence, and to communicate with them all relationships and other matters that may
reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated to the Directors, we determine those matters that were of most
significance in the audit of the financial report of the current year and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should
not be communicated in our report because the adverse consequences of doing so would reasonably be
expected to outweigh the public interest benefits of such communication.
Report on the Audit of the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 18 to 26 of the Directors' report for the year
ended 30 June 2019.
In our opinion, the Remuneration Report of Peak Resources Limited for the year ended 30 June 2019,
complies with section 300A of the Corporations Act 2001.
Responsibilities
The Directors of the Company are responsible for the preparation and presentation of the Remuneration
Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an
opinion on the Remuneration Report, based on our audit conducted in accordance with Australian
Auditing Standards.
Ernst & Young
Darryn Hall
Partner
Perth
13 September 2019
Consolidated Statement of
Comprehensive Income
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the Year Ended 30 June 2019
Interest income
R&D rebate received
Other income
Total income
Employee benefits expenses
Share based payments expenses
Depreciation expenses
Borrowing costs
Administrative and other costs
Technical feasibility costs
Share of loss of associate
Loss before income tax
Income tax expense
Loss after income tax
Other comprehensive income/(loss), net of tax
Items that could be transferred to profit or loss in future:
Exchange differences on translation of foreign operations
Group’s share of associate’s other comprehensive income
Total comprehensive loss for the year
Loss per share (in cents)
Basic and Diluted loss per share
Note
4
4
4
4
3
7
2019
$
98,245
-
550
98,795
(902,217)
(471,005)
(5,886)
2018
$
39,635
561,907
17,176
618,718
(732,455)
(459,792)
(11,232)
(1,163,204)
(1,499,506)
(1,096,476)
(132,000)
(763,939)
(27,260)
(924,060)
(2,027,758)
(4,596,053)
(4,903,224)
-
-
(4,596,053)
(4,903,224)
(156,378)
1,683,792
(48,576)
1,068,269
(3,068,639)
(3,883,531)
The statement should be read in conjunction with the accompanying notes
6
(0.58)
(0.82)
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
HD:DA:PEAK:002
ENABLING LOW CARBON TECHNOLOGIES PAGE 32
ENABLING LOW CARBON TECHNOLOGIES PAGE 33
ENABLING LOW CARBON TECHNOLOGIES PAGE 33
ENABLING LOW CARBON TECHNOLOGIES PAGE 3
Independent Auditor's
Report
We also provide the Directors with a statement that we have complied with relevant ethical requirements
regarding independence, and to communicate with them all relationships and other matters that may
reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated to the Directors, we determine those matters that were of most
significance in the audit of the financial report of the current year and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should
not be communicated in our report because the adverse consequences of doing so would reasonably be
expected to outweigh the public interest benefits of such communication.
Report on the Audit of the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 18 to 26 of the Directors' report for the year
In our opinion, the Remuneration Report of Peak Resources Limited for the year ended 30 June 2019,
complies with section 300A of the Corporations Act 2001.
The Directors of the Company are responsible for the preparation and presentation of the Remuneration
Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an
opinion on the Remuneration Report, based on our audit conducted in accordance with Australian
ended 30 June 2019.
Responsibilities
Auditing Standards.
Ernst & Young
Darryn Hall
Partner
Perth
13 September 2019
Consolidated Statement of
Comprehensive Income
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the Year Ended 30 June 2019
Interest income
R&D rebate received
Other income
Total income
Employee benefits expenses
Share based payments expenses
Depreciation expenses
Borrowing costs
Administrative and other costs
Technical feasibility costs
Share of loss of associate
Loss before income tax
Income tax expense
Loss after income tax
Other comprehensive income/(loss), net of tax
Items that could be transferred to profit or loss in future:
Exchange differences on translation of foreign operations
Group’s share of associate’s other comprehensive income
Total comprehensive loss for the year
Loss per share (in cents)
Basic and Diluted loss per share
The statement should be read in conjunction with the accompanying notes
Note
4
4
4
4
3
7
2019
$
98,245
-
550
98,795
(902,217)
(471,005)
(5,886)
(1,163,204)
(1,096,476)
(132,000)
2018
$
39,635
561,907
17,176
618,718
(732,455)
(459,792)
(11,232)
(1,499,506)
(763,939)
(27,260)
(924,060)
(2,027,758)
(4,596,053)
(4,903,224)
-
-
(4,596,053)
(4,903,224)
(156,378)
1,683,792
(48,576)
1,068,269
(3,068,639)
(3,883,531)
6
(0.58)
(0.82)
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
HD:DA:PEAK:002
ENABLING LOW CARBON TECHNOLOGIES PAGE 32
ENABLING LOW CARBON TECHNOLOGIES PAGE 33
ENABLING LOW CARBON TECHNOLOGIES PAGE 33
ENABLING LOW CARBON TECHNOLOGIES PAGE 3
Consolidated Statement of
Financial Position
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 30 June 2019
Consolidated Statement of
Cash Flows
CONSOLIDATED STATEMENT OF CASH FLOWS
For the Year Ended 30 June 2019
Note
2019
$
2018
$
Note
2019
$
2018
$
ASSETS
Current assets
Cash and cash equivalents
Trade and other receivables
Other financial assets
Loans – due from associates measured at amortised cost
Loans – due from associates measured at fair value through
profit or loss (FVPTL)
Prepayments
Total current assets
Non-current assets
Loans – due from associates measured at FVPTL
Property plant and equipment
Investment in associate
Investments
Other assets
Total non-current assets
Total assets
LIABILITIES
Current liabilities
Trade and other payables
Provisions
Loans and borrowings – due to other parties
Total current liabilities
Non-current liabilities
Other payables
Loans and borrowings – due to associate
Total non-current liabilities
Total liabilities
Net assets
EQUITY
Contributed equity
Reserves
Accumulated losses
Total equity
8
9
10
11
11
11
12
3
13
14
15
16
17
15
17
19
18
2,147,324
6,468,748
17,275
30,000
63,487
30,000
-
1,526,145
446,532
-
6,929
12,275
2,648,060
8,100,655
416,961
6,196
-
6,731
33,509,484
31,114,813
8,000
127,254
8,000
127,254
34,067,895
31,256,798
36,715,955
39,357,453
276,252
196,668
1,824,095
2,297,015
1,430,011
5,041,789
6,471,800
8,768,815
345,809
160,451
-
506,260
870,170
6,763,386
7,633,556
8,139,816
27,947,140
31,217,637
77,223,630
77,217,398
6,017,400
4,042,304
(55,293,890)
(50,042,065)
27,947,140
31,217,637
OPERATING ACTIVITIES
Payments to suppliers and employees
Interest received
R&D rebate received
Borrowing costs paid
Cash used in operating activities
INVESTING ACTIVITIES
Acquisition of property, plant and equipment
Proceeds from sale of non-current assets
Payment for Site 2 Land Purchase Option
Contributions to associates
Cash used in investing activities
FINANCING ACTIVITIES
Proceeds from issue of equity shares
Reduction in performance bonds – restricted cash
Costs of issuing equity shares
Repayment of borrowings
Proceeds from borrowings
(Loan to) Borrowings from associate and other parties
Cash generated from financing activities
Net decrease in cash and cash equivalents
Balance at the beginning of the year
Effect of foreign currency translation
Balance at the end of the year
-
-
-
-
-
(1,513,664)
(1,583,327)
110,309
25,406
578,241
(315,823)
(969,000)
(1,719,178)
(1,948,680)
(5,350)
(2,100,117)
(2,105,467)
(3,207)
1,743
(127,253)
(2,592,080)
(2,720,797)
6,232
12,867,878
25,000
(901,699)
(3,147,729)
559,282
(560,031)
272,306
(140,008)
(298,618)
(421,501)
9,104,114
(4,246,146)
6,468,748
(75,278)
2,147,324
4,434,637
2,125,680
(91,569)
6,468,748
8
3
8
The statement should be read in conjunction with the accompanying notes
The statement should be read in conjunction with the accompanying notes
ENABLING LOW CARBON TECHNOLOGIES PAGE 34
ENABLING LOW CARBON TECHNOLOGIES PAGE 35
ENABLING LOW CARBON TECHNOLOGIES PAGE 35
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Consolidated Statement of
Financial Position
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 30 June 2019
Consolidated Statement of
Cash Flows
CONSOLIDATED STATEMENT OF CASH FLOWS
For the Year Ended 30 June 2019
Note
2019
$
2018
$
Note
2019
$
2018
$
Loans – due from associates measured at amortised cost
Loans – due from associates measured at fair value through
Loans – due from associates measured at FVPTL
ASSETS
Current assets
Cash and cash equivalents
Trade and other receivables
Other financial assets
profit or loss (FVPTL)
Prepayments
Total current assets
Non-current assets
Property plant and equipment
Investment in associate
Investments
Other assets
Total non-current assets
Total assets
LIABILITIES
Current liabilities
Trade and other payables
Provisions
Total current liabilities
Non-current liabilities
Other payables
Loans and borrowings – due to other parties
Loans and borrowings – due to associate
Total non-current liabilities
Total liabilities
Net assets
EQUITY
Contributed equity
Reserves
Accumulated losses
Total equity
8
9
10
11
11
11
12
3
13
14
15
16
17
15
17
19
18
2,147,324
6,468,748
63,487
30,000
-
1,526,145
17,275
30,000
446,532
6,929
12,275
2,648,060
8,100,655
416,961
6,196
8,000
127,254
33,509,484
31,114,813
34,067,895
31,256,798
36,715,955
39,357,453
-
-
6,731
8,000
127,254
276,252
196,668
1,824,095
2,297,015
1,430,011
5,041,789
6,471,800
8,768,815
345,809
160,451
-
506,260
870,170
6,763,386
7,633,556
8,139,816
27,947,140
31,217,637
77,223,630
77,217,398
6,017,400
4,042,304
(55,293,890)
(50,042,065)
27,947,140
31,217,637
OPERATING ACTIVITIES
Payments to suppliers and employees
Interest received
R&D rebate received
Borrowing costs paid
Cash used in operating activities
INVESTING ACTIVITIES
Acquisition of property, plant and equipment
Proceeds from sale of non-current assets
Payment for Site 2 Land Purchase Option
Contributions to associates
Cash used in investing activities
FINANCING ACTIVITIES
Proceeds from issue of equity shares
Reduction in performance bonds – restricted cash
Costs of issuing equity shares
Repayment of borrowings
Proceeds from borrowings
(Loan to) Borrowings from associate and other parties
Cash generated from financing activities
Net decrease in cash and cash equivalents
Balance at the beginning of the year
Effect of foreign currency translation
Balance at the end of the year
(1,513,664)
(1,583,327)
110,309
-
(315,823)
25,406
578,241
(969,000)
(1,719,178)
(1,948,680)
(5,350)
-
-
(2,100,117)
(2,105,467)
6,232
-
-
(560,031)
272,306
(3,207)
1,743
(127,253)
(2,592,080)
(2,720,797)
12,867,878
25,000
(901,699)
(3,147,729)
559,282
(140,008)
(298,618)
(421,501)
9,104,114
(4,246,146)
6,468,748
(75,278)
2,147,324
4,434,637
2,125,680
(91,569)
6,468,748
8
3
8
The statement should be read in conjunction with the accompanying notes
The statement should be read in conjunction with the accompanying notes
ENABLING LOW CARBON TECHNOLOGIES PAGE 34
ENABLING LOW CARBON TECHNOLOGIES PAGE 35
ENABLING LOW CARBON TECHNOLOGIES PAGE 35
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Consolidated Statement of
Changes in Equity
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the Year Ended 30 June 2019
Contributed
Equity
Share
based
payment
reserve
Foreign
currency
translation
reserve
Accumulated
losses
$
$
$
$
At 1 July 2017
65,251,219
2,037,316
525,503
(45,138,841)
Loss for the year 2018
Other comprehensive income
Group’s share of associate’s other
comprehensive income
Total comprehensive loss for the
year
Equity issued
Performance rights exercised
Equity based payments
Transaction costs
At 30 June 2018
At 1 July 2018
-
-
-
-
-
-
-
12,867,878
-
-
(901,699)
-
-
-
459,792
-
-
(48,576)
(4,903,224)
-
1,068,269
-
1,019,693
(4,903,224)
-
-
-
-
-
-
-
-
77,217,398
2,497,108
1,545,196
(50,042,065)
77,217,398
2,497,108
1,545,196
(50,042,065)
Effect of adoption of AASB 9
-
-
(23,323)
(655,772)
At 1 July 2018 Restated
77,217,398
2,497,108
1,521,873
(50,697,837)
Loss for the year 2019
Other comprehensive income
Group’s share of associate’s other
comprehensive income
Total comprehensive loss for the
year
Equity issued
Performance rights exercised
Equity based payments
Transaction costs
-
-
-
-
6,232
-
-
-
-
-
-
-
(156,378)
1,683,792
(4,596,053)
-
-
-
-
-
471,005
-
1,527,414
(4,596,053)
-
-
-
-
-
-
-
-
Total equity
$
22,675,197
(4,903,224)
(48,576)
1,068,269
(3,883,531)
12,867,878
-
459,792
(901,699)
31,217,637
31,217,637
(679,095)
30,538,542
(4,596,053)
(156,378)
1,683,792
(3,068,639)
6,232
-
471,005
-
At 30 June 2019
77,223,630
2,968,113
3,049,287
(55,293,890)
27,947,140
The statement should be read in conjunction with the accompanying notes
Notes to Financial Statements
a) Basis of Preparation
noted.
Statement of compliance
Going concern
Notes to Financial Statement
1. CORPORATE INFORMATION
The financial report of Peak Resources Limited for the year ended 30 June 2019 was authorised for issue in accordance with a
resolution of the directors on 12 September 2019.
Peak Resources Limited is a for profit company limited by shares incorporated in Australia whose shares are publicly traded on
the Australian Securities Exchange (ASX). The address of its registered office and principal place of business is disclosed in the
introduction to the Annual Report.
The principal activity of the Group during the year was exploration and evaluation of mineral licences.
2. SIGNIFICANT ACCOUNTING POLICIES
The consolidated financial statements have been prepared on the basis of historical cost, except for other assets and non-current
assets which are measured at fair value through profit or loss. All amounts are presented in Australian Dollars unless otherwise
The functional and presentation currency is Australian Dollars.
The financial report is a general purpose financial report which has been prepared in accordance with the Corporations Act 2001,
Australian Accounting Standards and Interpretations, and complies with other requirements of the law.
Compliance with Australian Accounting Standards ensures that the financial statements and notes of the Group comply with
International Financial Reporting Standards (IFRS).
The Group has net current assets of $351,045 (2018: net current assets $7,594,395) and incurred an operating and investing cash
outflow of $3,824,645 (30 June 2018: $4,669,477) for the year ended 30 June 2019. The Group’s ability to continue as a going
concern and meet its debts as and when they fall due is dependent on the ability to raise additional capital.
As reported, with $2.15m cash at bank at the end of the reporting period Peak is well funded in the short term to meet its share
of the Ngualla Project costs, and its corporate and administration requirements. The Company also recently completed new share
placement in August 2019 which resulted in the Company raising approximately $4.795m before costs. A total of 119,888,380 new
fully paid ordinary shares were issued at $0.04 per share. In order to progress the project further, on a time-frame planned by
management, the Group’s cashflow forecasts also suggest there will be a need in the future to obtain further funding.
In the directors’ opinion, there are reasonable grounds to believe that the Company has the ability to raise further funding as
and when required. However, in the event that additional funding is not forthcoming, there is a material uncertainty whether it
will continue as a going concern and therefore whether it will realise its assets and discharge its liabilities in the normal course
of business and at the amounts stated in the consolidated financial statements. No adjustments have been made relating to the
recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Group
not continue as a going concern.
ENABLING LOW CARBON TECHNOLOGIES PAGE 36
ENABLING LOW CARBON TECHNOLOGIES PAGE 37
ENABLING LOW CARBON TECHNOLOGIES PAGE 37
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Consolidated Statement of
Changes in Equity
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the Year Ended 30 June 2019
At 1 July 2017
65,251,219
2,037,316
525,503
(45,138,841)
Contributed
Equity
Share
based
payment
reserve
Foreign
currency
translation
reserve
Accumulated
losses
$
$
(4,903,224)
(48,576)
1,068,269
12,867,878
(901,699)
459,792
77,217,398
2,497,108
1,545,196
(50,042,065)
77,217,398
2,497,108
1,545,196
(50,042,065)
(4,596,053)
(156,378)
1,683,792
1,527,414
(4,596,053)
6,232
471,005
$
-
-
-
-
-
-
-
-
-
-
-
-
$
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Total equity
$
22,675,197
(4,903,224)
(48,576)
1,068,269
(3,883,531)
12,867,878
-
459,792
(901,699)
31,217,637
31,217,637
(679,095)
30,538,542
(4,596,053)
(156,378)
1,683,792
(3,068,639)
6,232
471,005
-
-
Loss for the year 2018
Other comprehensive income
Group’s share of associate’s other
comprehensive income
Total comprehensive loss for the
year
Equity issued
Performance rights exercised
Equity based payments
Transaction costs
At 30 June 2018
At 1 July 2018
Loss for the year 2019
Other comprehensive income
Group’s share of associate’s other
comprehensive income
Total comprehensive loss for the
year
Equity issued
Performance rights exercised
Equity based payments
Transaction costs
Effect of adoption of AASB 9
(23,323)
(655,772)
At 1 July 2018 Restated
77,217,398
2,497,108
1,521,873
(50,697,837)
At 30 June 2019
77,223,630
2,968,113
3,049,287
(55,293,890)
27,947,140
The statement should be read in conjunction with the accompanying notes
Notes to Financial Statements
Notes to Financial Statement
1. CORPORATE INFORMATION
The financial report of Peak Resources Limited for the year ended 30 June 2019 was authorised for issue in accordance with a
resolution of the directors on 12 September 2019.
Peak Resources Limited is a for profit company limited by shares incorporated in Australia whose shares are publicly traded on
the Australian Securities Exchange (ASX). The address of its registered office and principal place of business is disclosed in the
introduction to the Annual Report.
The principal activity of the Group during the year was exploration and evaluation of mineral licences.
2. SIGNIFICANT ACCOUNTING POLICIES
1,019,693
(4,903,224)
a) Basis of Preparation
The consolidated financial statements have been prepared on the basis of historical cost, except for other assets and non-current
assets which are measured at fair value through profit or loss. All amounts are presented in Australian Dollars unless otherwise
noted.
The functional and presentation currency is Australian Dollars.
Statement of compliance
The financial report is a general purpose financial report which has been prepared in accordance with the Corporations Act 2001,
Australian Accounting Standards and Interpretations, and complies with other requirements of the law.
Compliance with Australian Accounting Standards ensures that the financial statements and notes of the Group comply with
International Financial Reporting Standards (IFRS).
Going concern
The Group has net current assets of $351,045 (2018: net current assets $7,594,395) and incurred an operating and investing cash
outflow of $3,824,645 (30 June 2018: $4,669,477) for the year ended 30 June 2019. The Group’s ability to continue as a going
concern and meet its debts as and when they fall due is dependent on the ability to raise additional capital.
As reported, with $2.15m cash at bank at the end of the reporting period Peak is well funded in the short term to meet its share
of the Ngualla Project costs, and its corporate and administration requirements. The Company also recently completed new share
placement in August 2019 which resulted in the Company raising approximately $4.795m before costs. A total of 119,888,380 new
fully paid ordinary shares were issued at $0.04 per share. In order to progress the project further, on a time-frame planned by
management, the Group’s cashflow forecasts also suggest there will be a need in the future to obtain further funding.
In the directors’ opinion, there are reasonable grounds to believe that the Company has the ability to raise further funding as
and when required. However, in the event that additional funding is not forthcoming, there is a material uncertainty whether it
will continue as a going concern and therefore whether it will realise its assets and discharge its liabilities in the normal course
of business and at the amounts stated in the consolidated financial statements. No adjustments have been made relating to the
recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Group
not continue as a going concern.
ENABLING LOW CARBON TECHNOLOGIES PAGE 36
ENABLING LOW CARBON TECHNOLOGIES PAGE 37
ENABLING LOW CARBON TECHNOLOGIES PAGE 37
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Notes to Financial Statements
Notes to Financial Statements
b) Adoption of new or revised accounting standards
The standard has been applied as at 1 July 2018 without adjusting comparatives. The impace on elements of the statement of
financial position (increase/decrease) as at 1 July 2018:
The accounting policies adopted in the preparation of the annual financial report are consistent with those followed in the
preparation of the Group’s annual consolidated financial statements for the year ended 30 June 2018, except for the adoption
of new standards and interpretations effective as of 1 July 2018. The impact of the adoption of the significant new accounting
standards on the Group’s consolidated financial statements are detailed below.
Impact of new standards applied for the first time
AASB 15 Revenue from contracts with customers (AASB 15)
AASB 15, the Australian equivalent of IFRS 15 Revenues from contracts with customers, supersedes AASB 111 Construction Contracts
(IAS 11), AASB 118 Revenue (IAS 18) and related Interpretations and applies to all revenue arising from contracts with customers,
unless those contracts are in the scope of other standards. The new standard establishes a five-step model to account for revenue
arising from contracts with customers. Under AASB 15, revenue is recognised at an amount that reflects the consideration to which
an entity expects to be entitled in exchange for transferring goods or services to a customer.
The standard requires entities to exercise judgement, taking into consideration all of the relevant facts and circumstances when
applying each step of the model to contracts with their customers. The standard also specifies the accounting for the incremental
costs of obtaining a contract and the costs directly related to fulfilling a contract.
The Group adopted AASB 15 using the modified retrospective method of adoption. There was no impact on the Group in adopting
AASB 15. Based on the nature and status of the investments in projects, the Group does not have any direct contracts with
customers and accordingly has no revenue impacted by the Standard. The Group has considered the adoption of the Standard
on the accounting policies applied by its investment in the associate company (Peak African Minerals) in earning its revenues and
accordingly the share of profit or loss of the investment in associate recognised by the Company. In undertaking that assessment,
it was noted that the Standard had no impact on the recognition or measurement of revenue earned in the current or comparative
periods. The Group has set out below its accounting policy with respect to the sale of rare earth products by the associate company
under AASB15.
Revenue accounting policy
Revenue is recognised when or as the Group transfers control of goods or services to a customer at the amount to which the Group
expects to be entitled. If the consideration promised includes a variable amount, the Group estimates the amount of consideration
to which it will be entitled. Revenue from the sale of products is recognised as and when control of the asset is transferred to the
customer, which is typically on delivery of the product.
AASB 9 Financial Instruments (as revised in 2014) (AASB 9)
AASB 9, the Australian equivalent to IFRS 9 replaces AASB 139 Financial Instruments: Recognition and Measurement (IAS 39) for
annual periods beginning on or after 1 January 2018, bringing together all three aspects of the accounting for financial instruments:
classification and measurement; impairment; and hedge accounting.
AASB 9 and the related amendments to other accounting standards introduced three significant areas of change from AASB 139
Financial Instruments: Classification and Measurement:
• a new model for classification and measurement of financial assets andliabilities;
• a new expected loss impairment model for determining impairment allowances;and
• a redesigned approach to hedge accounting.
Loans - due from associates measured at amortised cost1
Loans - due from associates measured at fair value through profit or loss1
ASSETS
Current assets
Total current assets
Non-current assets
Investment in associate2
Total non-current assets
Total assets
Net assets
EQUITY
Reserves
Accumulated losses
Total equity
Consolidated
1 July 2018
RESTATED
$
-
1,312,228
7,886,738
30,649,635
30,791,619
38,678,358
30,538,542
30 June 2018
$
-
1,526,145
8,100,655
31,114,813
31,256,798
39,357,453
31,217,637
4,018,981
4,042,304
(50,697,837)
(50,042,065)
30,538,542
31,217,637
Classification and measurement
Under AASB 9, debt financial instruments are subsequently measured at fair value through profit or loss (FVPL), amortised cost,
or fair value through other comprehensive income (FVOCI). The classification is based on two criteria: The Group's business
model for managing the assets (whether to hold the financial assets in order to collect contractual cash flows); and whether the
instruments' contractual cash flows represent 'solely payments of principal and interest' on the principal amount outstanding (the
'SPPI criterion')
The assesment of the Group's business models was made as of the date of initial application, 1 July 2018, and then applied
retrospectively to those financial assets that were not derecognised before 1 July 2018. The assesment of whether contractual
cash flows on debt instruments are solely comprised of principal and interest was made on the facts and circumstances as at the
intial recognition of the assets.
The classification and measurement requirements of AASB 9 resulted in the following changes:
1 The loan receivables due from associate companies PRNG Minerals Limited and Peak African Minerals is now classified at
fair value through profit and loss. Accordinly, the statement of financial position as at 1 July 2018 was restated, resulting in:
•
decrease to the value of the loan receivables from associates of $213,917 and reclassifying these loans as being measured at
fair value through profit and loss;
2 The Group’s 75% interest in PAM is accounted for using the equity method in the consolidated financial statements and this
restatement results in the Group’s investment in associate decreasing by AUD465,179 (USD343,814) representing the 75% of
the transition effect in PAM with a corresponding increase in the Group’s share of loss in PAM, being reflected in the Group’s
accumulated losses.
ENABLING LOW CARBON TECHNOLOGIES PAGE 38
ENABLING LOW CARBON TECHNOLOGIES PAGE 39
ENABLING LOW CARBON TECHNOLOGIES PAGE 39
ENABLING LOW CARBON TECHNOLOGIES PAGE 3
Notes to Financial Statements
Notes to Financial Statements
b) Adoption of new or revised accounting standards
The accounting policies adopted in the preparation of the annual financial report are consistent with those followed in the
preparation of the Group’s annual consolidated financial statements for the year ended 30 June 2018, except for the adoption
of new standards and interpretations effective as of 1 July 2018. The impact of the adoption of the significant new accounting
standards on the Group’s consolidated financial statements are detailed below.
Impact of new standards applied for the first time
AASB 15 Revenue from contracts with customers (AASB 15)
AASB 15, the Australian equivalent of IFRS 15 Revenues from contracts with customers, supersedes AASB 111 Construction Contracts
(IAS 11), AASB 118 Revenue (IAS 18) and related Interpretations and applies to all revenue arising from contracts with customers,
unless those contracts are in the scope of other standards. The new standard establishes a five-step model to account for revenue
arising from contracts with customers. Under AASB 15, revenue is recognised at an amount that reflects the consideration to which
an entity expects to be entitled in exchange for transferring goods or services to a customer.
The standard requires entities to exercise judgement, taking into consideration all of the relevant facts and circumstances when
applying each step of the model to contracts with their customers. The standard also specifies the accounting for the incremental
costs of obtaining a contract and the costs directly related to fulfilling a contract.
The Group adopted AASB 15 using the modified retrospective method of adoption. There was no impact on the Group in adopting
AASB 15. Based on the nature and status of the investments in projects, the Group does not have any direct contracts with
customers and accordingly has no revenue impacted by the Standard. The Group has considered the adoption of the Standard
on the accounting policies applied by its investment in the associate company (Peak African Minerals) in earning its revenues and
accordingly the share of profit or loss of the investment in associate recognised by the Company. In undertaking that assessment,
it was noted that the Standard had no impact on the recognition or measurement of revenue earned in the current or comparative
periods. The Group has set out below its accounting policy with respect to the sale of rare earth products by the associate company
under AASB15.
Revenue accounting policy
Revenue is recognised when or as the Group transfers control of goods or services to a customer at the amount to which the Group
expects to be entitled. If the consideration promised includes a variable amount, the Group estimates the amount of consideration
to which it will be entitled. Revenue from the sale of products is recognised as and when control of the asset is transferred to the
customer, which is typically on delivery of the product.
AASB 9 Financial Instruments (as revised in 2014) (AASB 9)
AASB 9, the Australian equivalent to IFRS 9 replaces AASB 139 Financial Instruments: Recognition and Measurement (IAS 39) for
annual periods beginning on or after 1 January 2018, bringing together all three aspects of the accounting for financial instruments:
classification and measurement; impairment; and hedge accounting.
AASB 9 and the related amendments to other accounting standards introduced three significant areas of change from AASB 139
Financial Instruments: Classification and Measurement:
• a new model for classification and measurement of financial assets andliabilities;
• a new expected loss impairment model for determining impairment allowances;and
• a redesigned approach to hedge accounting.
The standard has been applied as at 1 July 2018 without adjusting comparatives. The impace on elements of the statement of
financial position (increase/decrease) as at 1 July 2018:
ASSETS
Current assets
Loans - due from associates measured at amortised cost1
Loans - due from associates measured at fair value through profit or loss1
Total current assets
Non-current assets
Investment in associate2
Total non-current assets
Total assets
Net assets
EQUITY
Reserves
Accumulated losses
Total equity
Consolidated
1 July 2018
$
RESTATED
30 June 2018
$
-
1,312,228
7,886,738
30,649,635
30,791,619
38,678,358
30,538,542
1,526,145
-
8,100,655
31,114,813
31,256,798
39,357,453
31,217,637
4,018,981
(50,697,837)
30,538,542
4,042,304
(50,042,065)
31,217,637
Classification and measurement
Under AASB 9, debt financial instruments are subsequently measured at fair value through profit or loss (FVPL), amortised cost,
or fair value through other comprehensive income (FVOCI). The classification is based on two criteria: The Group's business
model for managing the assets (whether to hold the financial assets in order to collect contractual cash flows); and whether the
instruments' contractual cash flows represent 'solely payments of principal and interest' on the principal amount outstanding (the
'SPPI criterion')
The assesment of the Group's business models was made as of the date of initial application, 1 July 2018, and then applied
retrospectively to those financial assets that were not derecognised before 1 July 2018. The assesment of whether contractual
cash flows on debt instruments are solely comprised of principal and interest was made on the facts and circumstances as at the
intial recognition of the assets.
The classification and measurement requirements of AASB 9 resulted in the following changes:
1 The loan receivables due from associate companies PRNG Minerals Limited and Peak African Minerals is now classified at
fair value through profit and loss. Accordinly, the statement of financial position as at 1 July 2018 was restated, resulting in:
•
decrease to the value of the loan receivables from associates of $213,917 and reclassifying these loans as being measured at
fair value through profit and loss;
2 The Group’s 75% interest in PAM is accounted for using the equity method in the consolidated financial statements and this
restatement results in the Group’s investment in associate decreasing by AUD465,179 (USD343,814) representing the 75% of
the transition effect in PAM with a corresponding increase in the Group’s share of loss in PAM, being reflected in the Group’s
accumulated losses.
ENABLING LOW CARBON TECHNOLOGIES PAGE 38
ENABLING LOW CARBON TECHNOLOGIES PAGE 39
ENABLING LOW CARBON TECHNOLOGIES PAGE 39
ENABLING LOW CARBON TECHNOLOGIES PAGE 3
Notes to Financial Statements
Notes to Financial Statements
The loan receivables due to the Group’s associate company, Peak African Minerals (PAM) is now also classified at fair value through
profit and loss. Accordingly, the statement of financial position of PAM as at 1 July 2018 was restated, resulting in the following
transition effect in PAM:
• A decrease to the value of the loan receivable from associates of $589,140 (USD$435,434) and reclassifying it as being
measured at fair value through profit and loss.
an increase in accumulated losses amounting to $589,140 (USD$435,434).
•
Transition to AASB 16
The Group plans to adopt AASB 16 retrospectively to each prior reporting period presented. The Group will elect to apply the
standard to contracts that were previously identified as leases applying AASB 117 and AASB Interpretation 4. The Group will
therefore not apply the standard to contracts that were not previously identified as containing a lease applying AASB 117 and
AASB Interpretation 4. The Group has only one lease which expires on 31 December 2020. Based on initial assessment, the Group
believes the impact of AASB 16 is not material.
The cumulative impacts on equity are:
•
•
•
increase in accumulated losses amounting to $655,772;
decrease in reserves amounting to $23,323;
overall decrease to equity totalling $679,095.
Impairment
The adoption of AASB 9 has fundamentally changed the Group’s accounting for impairment losses for financial assets by replacing
IAS 39’s incurred loss approach with a forward-looking expected credit loss (ECL) approach. AASB 9 requires the Group to recognise
an allowance for ECLs for all debt instruments not held at fair value through profit or loss and contract assets.
Upon the adoption of AASB 9, the Group did not recognise additional impairment on its financial assets as below:
•
•
For trade receivables, the Group applies a simplified approach in calculating ECLs. As at the date of transition, the ECL has
been assessed as insignificant.
For other financial assets, the ECL is insignificant as this is held with highly-rated financial institutions
There are no changes to the classification and measurement for the Group's financial liabilities
Standards issued but not yet effective
Significant Australian Accounting Standards and Interpretations that are issued, but are not yet effective, up to the date of issuance
of the Group’s financial statements are disclosed below. The Group intends to adopt these new standards and interpretations, if
applicable, when they become effective.
AASB 16 Leases
AASB 16 was issued in January 2016 and it replaces AASB 117 Leases, AASB Interpretation 4 Determining whether an Arrangement
contains a Lease, AASB Interpretation-115 Operating Leases-Incentives and AASB Interpretation 127 Evaluating the Substance of
Transactions Involving the Legal Form of a Lease. AASB 16 sets out the principles for the recognition, measurement, presentation
and disclosure of leases and requires lessees to account for all leases under a single on-balance sheet model similar to the
accounting for finance leases under AASB 117. The standard includes two recognition exemptions for lessees – leases of ’low-value’
assets (e.g., personal computers) and short-term leases (i.e., leases with a lease term of 12 months or less). At the commencement
date of a lease, a lessee will recognise a liability to make lease payments (i.e., the lease liability) and an asset representing the
right to use the underlying asset during the lease term (i.e., the right-of-use asset). Lessees will be required to separately recognise
the interest expense on the lease liability and the depreciation expense on the right-of-use asset. Lessees will be also required
to remeasure the lease liability upon the occurrence of certain events (e.g., a change in the lease term, a change in future lease
payments resulting from a change in an index or rate used to determine those payments). The lessee will generally recognise the
amount of the remeasurement of the lease liability as an adjustment to the right-of-use asset. Lessor accounting under AASB 16
is substantially unchanged from today’s accounting under AASB 117. Lessors will continue to classify all leases using the same
classification principle as in AASB 117 and distinguish between two types of leases: operating and finance leases. AASB 16, which is
effective for annual periods beginning on or after 1 January 2019, requires lessees and lessors to make more extensive disclosures
than under AASB117.
AASB Interpretation 23 Uncertainty over Income Tax Treatment
The Interpretation addresses the accounting for income taxes when tax treatments involve uncertainty that affects the application
of AASB 112 and does not apply to taxes or levies outside the scope of AASB 112, nor does it specifically include requirements
relating to interest and penalties associated with uncertain tax treatments. The Interpretation specifically addresses the following:
- Whether an entity considers uncertain tax treatmentsseparately
-
-
-
The assumptions an entity makes about the examination of tax treatments by taxation authorities
How an entity determines taxable profit (tax loss), tax bases, unused tax losses, unused tax credits and tax rates
How an entity considers changes in facts and circumstances
An entity has to determine whether to consider each uncertain tax treatment separately or together with one or more other
uncertain tax treatments. The approach that better predicts the resolution of the uncertainty should be followed. The interpretation
is effective for annual reporting periods beginning on or after 1 January 2019, but certain transition reliefs are available. The Group
will apply the interpretation from its effective date. Since the Group operates in a complex multinational tax environment, applying
the Interpretation may affect its consolidated financial statements. In addition, the Group may need to establish processes and
procedures to obtain information that is necessary to apply the Interpretation on a timely basis.
c) Basis of consolidation
if and only if the Group has:
The consolidated financial statements of Peak Resources Limited comprise the financial statements of the Group and its subsidiaries
as at 30 June 2019. Control is achieved when the Group is exposed, or has rights, to variable returns from its involvement with the
investee and has the ability to affect those returns through its power over the investee. Specifically, the Group controls an investee
-Power over the investee (i.e. existing rights that give it the current ability to direct the relevant activities of the investee)
-Exposure, or rights, to variable returns from its involvement with the investee, and
-The ability to use its power over the investee to affect its returns
When the Group has less than a majority of the voting or similar rights of an investee, the Group considers all relevant facts and
circumstances in assessing whether it has power over an investee, including:
-The contractual arrangement with the other vote holders of the investee
-Rights arising from other contractual arrangements
-The Group’s voting rights and potential voting rights
The Group re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or
more of the three elements of control. Consolidation of a subsidiary begins when the Group obtains control over the subsidiary
and ceases when the Group loses control of the subsidiary. Assets, liabilities, income and expenses of a subsidiary acquired or
disposed of during the year are included in the statement of comprehensive income from the date the Group gains control until
the date the Group ceases to control the subsidiary.
All inter-company balances and transactions between entities in the economic entity, including any unrealised profits or losses, have
been eliminated on consolidation. Accounting policies of subsidiaries have been changed where necessary to ensure consistency
with those policies applied by the parent entity. All controlled entities have a June financial year-end.
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ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Notes to Financial Statements
Notes to Financial Statements
The loan receivables due to the Group’s associate company, Peak African Minerals (PAM) is now also classified at fair value through
profit and loss. Accordingly, the statement of financial position of PAM as at 1 July 2018 was restated, resulting in the following
transition effect in PAM:
• A decrease to the value of the loan receivable from associates of $589,140 (USD$435,434) and reclassifying it as being
measured at fair value through profit and loss.
an increase in accumulated losses amounting to $589,140 (USD$435,434).
Transition to AASB 16
The Group plans to adopt AASB 16 retrospectively to each prior reporting period presented. The Group will elect to apply the
standard to contracts that were previously identified as leases applying AASB 117 and AASB Interpretation 4. The Group will
therefore not apply the standard to contracts that were not previously identified as containing a lease applying AASB 117 and
AASB Interpretation 4. The Group has only one lease which expires on 31 December 2020. Based on initial assessment, the Group
believes the impact of AASB 16 is not material.
AASB Interpretation 23 Uncertainty over Income Tax Treatment
The Interpretation addresses the accounting for income taxes when tax treatments involve uncertainty that affects the application
of AASB 112 and does not apply to taxes or levies outside the scope of AASB 112, nor does it specifically include requirements
relating to interest and penalties associated with uncertain tax treatments. The Interpretation specifically addresses the following:
- Whether an entity considers uncertain tax treatmentsseparately
-
-
-
The assumptions an entity makes about the examination of tax treatments by taxation authorities
How an entity determines taxable profit (tax loss), tax bases, unused tax losses, unused tax credits and tax rates
How an entity considers changes in facts and circumstances
An entity has to determine whether to consider each uncertain tax treatment separately or together with one or more other
uncertain tax treatments. The approach that better predicts the resolution of the uncertainty should be followed. The interpretation
is effective for annual reporting periods beginning on or after 1 January 2019, but certain transition reliefs are available. The Group
will apply the interpretation from its effective date. Since the Group operates in a complex multinational tax environment, applying
the Interpretation may affect its consolidated financial statements. In addition, the Group may need to establish processes and
procedures to obtain information that is necessary to apply the Interpretation on a timely basis.
c) Basis of consolidation
The consolidated financial statements of Peak Resources Limited comprise the financial statements of the Group and its subsidiaries
as at 30 June 2019. Control is achieved when the Group is exposed, or has rights, to variable returns from its involvement with the
investee and has the ability to affect those returns through its power over the investee. Specifically, the Group controls an investee
if and only if the Group has:
-Power over the investee (i.e. existing rights that give it the current ability to direct the relevant activities of the investee)
-Exposure, or rights, to variable returns from its involvement with the investee, and
-The ability to use its power over the investee to affect its returns
When the Group has less than a majority of the voting or similar rights of an investee, the Group considers all relevant facts and
circumstances in assessing whether it has power over an investee, including:
-The contractual arrangement with the other vote holders of the investee
-Rights arising from other contractual arrangements
-The Group’s voting rights and potential voting rights
The Group re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or
more of the three elements of control. Consolidation of a subsidiary begins when the Group obtains control over the subsidiary
and ceases when the Group loses control of the subsidiary. Assets, liabilities, income and expenses of a subsidiary acquired or
disposed of during the year are included in the statement of comprehensive income from the date the Group gains control until
the date the Group ceases to control the subsidiary.
All inter-company balances and transactions between entities in the economic entity, including any unrealised profits or losses, have
been eliminated on consolidation. Accounting policies of subsidiaries have been changed where necessary to ensure consistency
with those policies applied by the parent entity. All controlled entities have a June financial year-end.
•
•
•
•
•
•
The cumulative impacts on equity are:
increase in accumulated losses amounting to $655,772;
decrease in reserves amounting to $23,323;
overall decrease to equity totalling $679,095.
Impairment
The adoption of AASB 9 has fundamentally changed the Group’s accounting for impairment losses for financial assets by replacing
IAS 39’s incurred loss approach with a forward-looking expected credit loss (ECL) approach. AASB 9 requires the Group to recognise
an allowance for ECLs for all debt instruments not held at fair value through profit or loss and contract assets.
Upon the adoption of AASB 9, the Group did not recognise additional impairment on its financial assets as below:
For trade receivables, the Group applies a simplified approach in calculating ECLs. As at the date of transition, the ECL has
been assessed as insignificant.
For other financial assets, the ECL is insignificant as this is held with highly-rated financial institutions
There are no changes to the classification and measurement for the Group's financial liabilities
Significant Australian Accounting Standards and Interpretations that are issued, but are not yet effective, up to the date of issuance
of the Group’s financial statements are disclosed below. The Group intends to adopt these new standards and interpretations, if
Standards issued but not yet effective
applicable, when they become effective.
AASB 16 Leases
AASB 16 was issued in January 2016 and it replaces AASB 117 Leases, AASB Interpretation 4 Determining whether an Arrangement
contains a Lease, AASB Interpretation-115 Operating Leases-Incentives and AASB Interpretation 127 Evaluating the Substance of
Transactions Involving the Legal Form of a Lease. AASB 16 sets out the principles for the recognition, measurement, presentation
and disclosure of leases and requires lessees to account for all leases under a single on-balance sheet model similar to the
accounting for finance leases under AASB 117. The standard includes two recognition exemptions for lessees – leases of ’low-value’
assets (e.g., personal computers) and short-term leases (i.e., leases with a lease term of 12 months or less). At the commencement
date of a lease, a lessee will recognise a liability to make lease payments (i.e., the lease liability) and an asset representing the
right to use the underlying asset during the lease term (i.e., the right-of-use asset). Lessees will be required to separately recognise
the interest expense on the lease liability and the depreciation expense on the right-of-use asset. Lessees will be also required
to remeasure the lease liability upon the occurrence of certain events (e.g., a change in the lease term, a change in future lease
payments resulting from a change in an index or rate used to determine those payments). The lessee will generally recognise the
amount of the remeasurement of the lease liability as an adjustment to the right-of-use asset. Lessor accounting under AASB 16
is substantially unchanged from today’s accounting under AASB 117. Lessors will continue to classify all leases using the same
classification principle as in AASB 117 and distinguish between two types of leases: operating and finance leases. AASB 16, which is
effective for annual periods beginning on or after 1 January 2019, requires lessees and lessors to make more extensive disclosures
than under AASB117.
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ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Notes to Financial Statements
Notes to Financial Statements
If the Group loses control over a subsidiary, it derecognises the related assets, liabilities, non-controlling interest and other
components of equity, while any resultant gain or loss is recognised in profit or loss. Any investment retained is recognised at
fair value. Where controlled entities have entered or left the economic entity during the year, their operating results have been
included/excluded from the date control was obtained or until the date control ceased through an equity transaction.
is recognised in the profit or loss.
Foreign currency transactions
On disposal of a foreign operation, the deferred cumulative amount recognised in equity relating to that particular foreign operation
d) Investment in associates
An associate is an entity over which the Group has significant influence. Significant influence is the power to participate in
the financial and operating policy decisions of the investee, but is not control or joint control over those policies. The Group’s
investments in its associates are accounted for using the equity method. Under the equity method, the investment in an associate
is initially measured at cost. The carrying amount of the investment is adjusted to recognise changes in the Group’s share of net
assets of the associate since the entity became an associate.
The statement of profit or loss reflects the Group’s share of the results of operations of the associate. Any change in other
comprehensive income (OCI) of those investees is presented as part of the Group’s OCI. In addition when there has been a change
recognised directly in the equity of an associate, the Group recognises its share of any changes, when applicable, in the statement
of changes in equity. Unrealised gains or losses resulting from transactions between the Group and associate are eliminated to the
extent of the interest in the associate.
The aggregate of the Group’s share of profit or loss of an associate is shown on the face of the statement of profit or loss outside
operating profit and represents profit or loss after tax and non-controlling interests in the subsidiaries of the associate. The financial
statement of the associate are prepared for the same reporting period as the Group. When necessary, adjustments are made to
bring the accounting policies in line with those of the Group.
After application of the equity method, the Group determines whether it is necessary to recognise an impairment loss on its
investment in its associate. At each reporting date, the Group determines whether there is objective evidence that the investment
in the associate is impaired. If there is such evidence, the Group calculates the amount of impairment as the difference between
the recoverable amount of the associate and its carrying value,and then recognises the loss as ‘Share of profit of an associate’ in
the statement of profit or loss.
Upon loss of significant influence over the associate, the Group measures and recognises any retained investment at its fair value.
Any difference between the carrying amount of the associate upon loss of significant influence and the fair value of the retained
investment and proceeds from disposal is recognized in profit and loss.
g) Employee benefits
The Group is treating its receipt of the R&D rebate as government grant.
e) Foreign Currency Translation
The financial statements have been presented in Australian Dollars.
Translation of foreign operations
As at the reporting date the assets and liabilities of foreign operations are translated at the rate of exchange ruling at the reporting
date and the statement of comprehensive income, statement cash flows and statement of changes in equity are translated
at the weighted average exchange rates for the year. The exchange differences arising on translation are recognised in other
comprehensive income and accumulated balances are carried forward as a separate component of equity.
Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates
at the dates of the initial transactions. Non-monetary items measured at fair value in a foreign currency are translated using
the exchange rates at the date when the fair value is determined. The gain or loss arising on translation of non-monetary items
measured at fair value is treated in line with the recognition of gain or loss on change in fair value of the item (i.e., translation
differences on items whose fair value gain or loss is recognised in other comprehensive income or profit or loss are also recognised
in other comprehensive income or profit or loss, respectively).
h) Leases
i) Income tax
In preparing the financial statements of each individual group entity, transactions in foreign currencies are initially recorded in
the functional currency at the exchange rates ruling at the date of the transaction. Monetary assets and liabilities denominated in
foreign currencies are retranslated at the rate of exchange ruling at the reporting date, and gain or loss in exchange rate movements
are recognised in profit or loss.
f) Revenue
met before revenue is recognised:
Rendering of services
parties.
Interest
R&D rebate grant
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the entity and the revenue can be
reliably measured. AASB 15 establishes a five-step model to account for revenue arising from contracts with customers and requires
that revenue be recognised at an amount that reflects the consideration to which an entity expects to be entitled in exchange for
transferring goods or services to a customer. AASB 15 requires entities to exercise judgement, taking into consideration all of the
relevant facts and circumstances when applying each step of the model to contracts with their customers. These steps must be
Revenue from a contract to provide services is recognised by reference to the stage of completion at rates agreed between the
Revenue is recognised as the interest accrues on the financial asset carried at amortised cost.
Government grants are recognised when there is reasonable assurance that the grant will be received and all conditions will be
complied with. When the grant relates to an expense item, it is recognised as income over the period necessary to match the grant
on a systematic basis to the costs that it is intended to compensate. When the grant relates to an asset, it is deducted from the
asset to which it relates, the net value of which is amortised over its expected useful life.
Employee benefits such as salary and wages are measured at the rate at which the entity expects to settle the liability; and
recognised during the period over which the employee services are being rendered.
Provision is made for the company’s liability for employee benefits arising from services rendered by employees to balance date.
Employee benefits that are expected to be settled within one year have been measured at the amounts expected to be paid when
the liability is settled, plus related on-costs. Employee benefits payable later than one year have been measured at the present
value of the estimated future cash outflows to be made for those benefits.
Superannuation entitlements
Contributions are made by the company to employee superannuation funds and are charged as expenses when incurred.
Lease payments for operating leases, where substantially all the risks and benefits remain with the lessor, are charged as expenses
on a straight line basis over the lease term.
Deferred income tax is provided on all temporary differences at the reporting date between the tax bases of assets and liabilities
and their carrying amounts for the financial reporting purposes.
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Notes to Financial Statements
Notes to Financial Statements
If the Group loses control over a subsidiary, it derecognises the related assets, liabilities, non-controlling interest and other
components of equity, while any resultant gain or loss is recognised in profit or loss. Any investment retained is recognised at
fair value. Where controlled entities have entered or left the economic entity during the year, their operating results have been
included/excluded from the date control was obtained or until the date control ceased through an equity transaction.
d) Investment in associates
An associate is an entity over which the Group has significant influence. Significant influence is the power to participate in
the financial and operating policy decisions of the investee, but is not control or joint control over those policies. The Group’s
investments in its associates are accounted for using the equity method. Under the equity method, the investment in an associate
is initially measured at cost. The carrying amount of the investment is adjusted to recognise changes in the Group’s share of net
assets of the associate since the entity became an associate.
The statement of profit or loss reflects the Group’s share of the results of operations of the associate. Any change in other
comprehensive income (OCI) of those investees is presented as part of the Group’s OCI. In addition when there has been a change
recognised directly in the equity of an associate, the Group recognises its share of any changes, when applicable, in the statement
of changes in equity. Unrealised gains or losses resulting from transactions between the Group and associate are eliminated to the
extent of the interest in the associate.
The aggregate of the Group’s share of profit or loss of an associate is shown on the face of the statement of profit or loss outside
operating profit and represents profit or loss after tax and non-controlling interests in the subsidiaries of the associate. The financial
statement of the associate are prepared for the same reporting period as the Group. When necessary, adjustments are made to
bring the accounting policies in line with those of the Group.
On disposal of a foreign operation, the deferred cumulative amount recognised in equity relating to that particular foreign operation
is recognised in the profit or loss.
Foreign currency transactions
In preparing the financial statements of each individual group entity, transactions in foreign currencies are initially recorded in
the functional currency at the exchange rates ruling at the date of the transaction. Monetary assets and liabilities denominated in
foreign currencies are retranslated at the rate of exchange ruling at the reporting date, and gain or loss in exchange rate movements
are recognised in profit or loss.
f) Revenue
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the entity and the revenue can be
reliably measured. AASB 15 establishes a five-step model to account for revenue arising from contracts with customers and requires
that revenue be recognised at an amount that reflects the consideration to which an entity expects to be entitled in exchange for
transferring goods or services to a customer. AASB 15 requires entities to exercise judgement, taking into consideration all of the
relevant facts and circumstances when applying each step of the model to contracts with their customers. These steps must be
met before revenue is recognised:
Rendering of services
Revenue from a contract to provide services is recognised by reference to the stage of completion at rates agreed between the
parties.
Interest
Revenue is recognised as the interest accrues on the financial asset carried at amortised cost.
After application of the equity method, the Group determines whether it is necessary to recognise an impairment loss on its
investment in its associate. At each reporting date, the Group determines whether there is objective evidence that the investment
in the associate is impaired. If there is such evidence, the Group calculates the amount of impairment as the difference between
the recoverable amount of the associate and its carrying value,and then recognises the loss as ‘Share of profit of an associate’ in
the statement of profit or loss.
R&D rebate grant
Government grants are recognised when there is reasonable assurance that the grant will be received and all conditions will be
complied with. When the grant relates to an expense item, it is recognised as income over the period necessary to match the grant
on a systematic basis to the costs that it is intended to compensate. When the grant relates to an asset, it is deducted from the
asset to which it relates, the net value of which is amortised over its expected useful life.
Upon loss of significant influence over the associate, the Group measures and recognises any retained investment at its fair value.
Any difference between the carrying amount of the associate upon loss of significant influence and the fair value of the retained
investment and proceeds from disposal is recognized in profit and loss.
e) Foreign Currency Translation
The financial statements have been presented in Australian Dollars.
Translation of foreign operations
As at the reporting date the assets and liabilities of foreign operations are translated at the rate of exchange ruling at the reporting
date and the statement of comprehensive income, statement cash flows and statement of changes in equity are translated
at the weighted average exchange rates for the year. The exchange differences arising on translation are recognised in other
comprehensive income and accumulated balances are carried forward as a separate component of equity.
Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates
at the dates of the initial transactions. Non-monetary items measured at fair value in a foreign currency are translated using
the exchange rates at the date when the fair value is determined. The gain or loss arising on translation of non-monetary items
measured at fair value is treated in line with the recognition of gain or loss on change in fair value of the item (i.e., translation
differences on items whose fair value gain or loss is recognised in other comprehensive income or profit or loss are also recognised
in other comprehensive income or profit or loss, respectively).
The Group is treating its receipt of the R&D rebate as government grant.
g) Employee benefits
Employee benefits such as salary and wages are measured at the rate at which the entity expects to settle the liability; and
recognised during the period over which the employee services are being rendered.
Provision is made for the company’s liability for employee benefits arising from services rendered by employees to balance date.
Employee benefits that are expected to be settled within one year have been measured at the amounts expected to be paid when
the liability is settled, plus related on-costs. Employee benefits payable later than one year have been measured at the present
value of the estimated future cash outflows to be made for those benefits.
Superannuation entitlements
Contributions are made by the company to employee superannuation funds and are charged as expenses when incurred.
h) Leases
Lease payments for operating leases, where substantially all the risks and benefits remain with the lessor, are charged as expenses
on a straight line basis over the lease term.
i) Income tax
Deferred income tax is provided on all temporary differences at the reporting date between the tax bases of assets and liabilities
and their carrying amounts for the financial reporting purposes.
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ENABLING LOW CARBON TECHNOLOGIES PAGE 3
Notes to Financial Statements
Notes to Financial Statements
Deferred income tax liabilities are recognised for all taxable temporary differences except
- Where the deferred income tax liability arises from the initial recognition of an asset or liability in a transaction that is not a
business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss;and
- In respect of taxable temporary differences associated with investments in subsidiaries, associates and interests in joint ventures,
when the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences
will not reverse in the foreseeable future.
Deferred income tax assets are recognised for all deductible temporary differences, carry-forward of unused tax assets and unused
tax losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences,
and the carry-forward of unused tax assets and unused tax losses can be utilised except
- Where the deferred income tax asset relating to the deductible temporary differences arises from the initial recognition of
an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the
accounting profit nor taxable profit or loss; and
- In respect of deductible temporary differences associated with investments in subsidiaries, associates and interests in joint
ventures, deferred tax assets are recognised only to the extent that it is probable that the temporary differences will reverse in
the foreseeable future and taxable profit will be available against which the temporary differences can be utilised.
The carrying amount of deferred income tax assets is reviewed at each balance sheet date and reduced to the extent that it is no
longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be utilised.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset
is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the
reporting date.
Income taxes relating to items recognised directly in equity are recognised in equity and not in the profit or loss.
j) Other taxes
Revenues, expenses and assets are recognised net of the amount of GST/VAT except:
When the GST/VAT incurred on a purchase of goods and services is not recoverable from the taxation authority, in which case the
GST/VAT is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and Receivables
and payables, which are stated with the amount of GST/VAT included.
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument
l) Financial Instruments
of another entity.
Financial assets
Initial recognition and measurement
Financial assets are classified, at initial recognition, as subsequently measured at amortised cost, fair value through other
comprehensive income (OCI), and fair value through profit or loss.
The classification of financial assets at initial recognition depends on the financial asset’s contractual cash flow characteristics and
the Group’s business model for managing them. With the exception of trade receivables that do not contain a significant financing
component or for which the Group has applied the practical expedient, the Group initially measures a financial asset at its fair value
plus, in the case of a financial asset not at fair value through profit or loss, transaction costs. Trade receivables that do not contain
a significant financing component or for which the Group has applied the practical expedient are measured at the transaction price
determined under AASB 15.
In order for a financial asset to be classified and measured at amortised cost or fair value through OCI, it needs to give rise to cash
flows that are ‘solely payments of principal and interest (SPPI)’ on the principal amount outstanding. This assessment is referred to
as the SPPI test and is performed at an instrument level.
The Group’s business model for managing financial assets refers to how it manages its financial assets in order to generate cash
flows. The business model determines whether cash flows will result from collecting contractual cash flows, selling the financial
Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in
the market place (regular way trades) are recognised on the trade date, i.e., the date that the Group commits to purchase or sell
assets, or both.
the asset.
Subsequent measurement
For purposes of subsequent measurement, financial assets are classified in four categories:
Financial assets at amortised cost (debt instruments)
Financial assets at fair value through OCI with recycling of cumulative gains and losses (debt instruments)
Financial assets designated at fair value through OCI with no recycling of cumulative gains and losses upon
The net amount of GST/VAT recoverable from, or payable to, the taxation authority is included as part of receivables or payables
in the statement of financial position.
derecognition (equity instruments)
Financial assets at fair value through profit or loss
GST/VAT component of cash flows arising from investing and financing activities, which is recoverable from, or payable to, the
taxation authority, is classified as part of operating cash flows.
Financial assets at amortised cost (debt instruments)
Commitments and contingencies are disclosed net of the amount of GST/VAT recoverable from, or payable to, the taxation
authority.
k) Earnings per share
a. Basic earnings per share
Basic earnings per share is determined by dividing the group operating result after income tax attributable to members by
weighted average number of ordinary shares outstanding during the financial year, adjusted for bonus elements in ordinary
shares issued during the year.
b. Diluted earnings per share
Diluted EPS is calculated by dividing the profit attributable to ordinary equity holders of the parent (after adjusting for interest
on the convertible preference shares) by the weighted average number of ordinary shares outstanding during the year plus the
weighted average number of ordinary shares that would be issued on conversion of all the dilutive potential ordinary shares into
ordinary shares.
Financial assets designated at fair value through OCI (equity instruments)
Upon initial recognition, the Group can elect to classify irrevocably its equity investments as equity instruments designated at fair
value through OCI when they meet the definition of equity under IAS 32 Financial Instruments: Presentation and are not held for
trading. The classification is determined on an instrument-by-instrument basis.
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-
-
-
-
-
-
This category is the most relevant to the Group. The Group measures financial assets at amortised cost if both of the following
conditions are met:
The financial asset is held within a business model with the objective to hold financial assets in order to collect
contractual cash flows; and
The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of
principal and interest on the principal amountoutstanding
Financial assets at amortised cost are subsequently measured using the effective interest (EIR) method and are subject to
impairment. Gains and losses are recognised in profit or loss when the asset is derecognised, modified or impaired. The Group’s
financial assets at amortised cost includes trade receivables, and loans to an associate.
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 - Where the deferred income tax liability arises from the initial recognition of an asset or liability in a transaction that is not a
business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss;and
- In respect of taxable temporary differences associated with investments in subsidiaries, associates and interests in joint ventures,
when the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences
will not reverse in the foreseeable future.
Deferred income tax assets are recognised for all deductible temporary differences, carry-forward of unused tax assets and unused
tax losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences,
and the carry-forward of unused tax assets and unused tax losses can be utilised except
- Where the deferred income tax asset relating to the deductible temporary differences arises from the initial recognition of
an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the
accounting profit nor taxable profit or loss; and
- In respect of deductible temporary differences associated with investments in subsidiaries, associates and interests in joint
ventures, deferred tax assets are recognised only to the extent that it is probable that the temporary differences will reverse in
the foreseeable future and taxable profit will be available against which the temporary differences can be utilised.
The carrying amount of deferred income tax assets is reviewed at each balance sheet date and reduced to the extent that it is no
longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be utilised.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset
is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the
Income taxes relating to items recognised directly in equity are recognised in equity and not in the profit or loss.
reporting date.
j) Other taxes
Revenues, expenses and assets are recognised net of the amount of GST/VAT except:
When the GST/VAT incurred on a purchase of goods and services is not recoverable from the taxation authority, in which case the
GST/VAT is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and Receivables
and payables, which are stated with the amount of GST/VAT included.
The net amount of GST/VAT recoverable from, or payable to, the taxation authority is included as part of receivables or payables
in the statement of financial position.
taxation authority, is classified as part of operating cash flows.
Commitments and contingencies are disclosed net of the amount of GST/VAT recoverable from, or payable to, the taxation
Basic earnings per share is determined by dividing the group operating result after income tax attributable to members by
weighted average number of ordinary shares outstanding during the financial year, adjusted for bonus elements in ordinary
authority.
k) Earnings per share
a. Basic earnings per share
shares issued during the year.
b. Diluted earnings per share
Notes to Financial Statements
Notes to Financial Statements
Deferred income tax liabilities are recognised for all taxable temporary differences except
l) Financial Instruments
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument
of another entity.
Financial assets
Initial recognition and measurement
Financial assets are classified, at initial recognition, as subsequently measured at amortised cost, fair value through other
comprehensive income (OCI), and fair value through profit or loss.
The classification of financial assets at initial recognition depends on the financial asset’s contractual cash flow characteristics and
the Group’s business model for managing them. With the exception of trade receivables that do not contain a significant financing
component or for which the Group has applied the practical expedient, the Group initially measures a financial asset at its fair value
plus, in the case of a financial asset not at fair value through profit or loss, transaction costs. Trade receivables that do not contain
a significant financing component or for which the Group has applied the practical expedient are measured at the transaction price
determined under AASB 15.
In order for a financial asset to be classified and measured at amortised cost or fair value through OCI, it needs to give rise to cash
flows that are ‘solely payments of principal and interest (SPPI)’ on the principal amount outstanding. This assessment is referred to
as the SPPI test and is performed at an instrument level.
The Group’s business model for managing financial assets refers to how it manages its financial assets in order to generate cash
flows. The business model determines whether cash flows will result from collecting contractual cash flows, selling the financial
assets, or both.
Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in
the market place (regular way trades) are recognised on the trade date, i.e., the date that the Group commits to purchase or sell
the asset.
Subsequent measurement
For purposes of subsequent measurement, financial assets are classified in four categories:
-
-
-
-
Financial assets at amortised cost (debt instruments)
Financial assets at fair value through OCI with recycling of cumulative gains and losses (debt instruments)
Financial assets designated at fair value through OCI with no recycling of cumulative gains and losses upon
derecognition (equity instruments)
Financial assets at fair value through profit or loss
GST/VAT component of cash flows arising from investing and financing activities, which is recoverable from, or payable to, the
Financial assets at amortised cost (debt instruments)
This category is the most relevant to the Group. The Group measures financial assets at amortised cost if both of the following
conditions are met:
-
-
The financial asset is held within a business model with the objective to hold financial assets in order to collect
contractual cash flows; and
The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of
principal and interest on the principal amountoutstanding
Financial assets at amortised cost are subsequently measured using the effective interest (EIR) method and are subject to
impairment. Gains and losses are recognised in profit or loss when the asset is derecognised, modified or impaired. The Group’s
financial assets at amortised cost includes trade receivables, and loans to an associate.
Diluted EPS is calculated by dividing the profit attributable to ordinary equity holders of the parent (after adjusting for interest
on the convertible preference shares) by the weighted average number of ordinary shares outstanding during the year plus the
weighted average number of ordinary shares that would be issued on conversion of all the dilutive potential ordinary shares into
ordinary shares.
Financial assets designated at fair value through OCI (equity instruments)
Upon initial recognition, the Group can elect to classify irrevocably its equity investments as equity instruments designated at fair
value through OCI when they meet the definition of equity under IAS 32 Financial Instruments: Presentation and are not held for
trading. The classification is determined on an instrument-by-instrument basis.
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ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Notes to Financial Statements
Notes to Financial Statements
Gains and losses on these financial assets are never recycled to profit or loss. Dividends are recognised as other income in the
statement of profit or loss when the right of payment has been established, except when the Group benefits from such proceeds
as a recovery of part of the cost of the financial asset, in which case, such gains are recorded in OCI. Equity instruments designated
at fair value through OCI are not subject to impairment assessment. The Group elected to classify irrevocably its non-listed equity
investments under this category.
Financial assets at fair value through profit or loss
Financial assets at fair value through profit or loss include financial assets held for trading, financial assets designated upon initial
recognition at fair value through profit or loss, or financial assets mandatorily required to be measured at fair value. Financial
assets are classified as held for trading if they are acquired for the purpose of selling or repurchasing in the near term. Derivatives,
including separated embedded derivatives, are also classified as held for trading unless they are designated as effective hedging
instruments. Financial assets with cash flows that are not solely payments of principal and interest are classified and measured
at fair value through profit or loss, irrespective of the business model. Notwithstanding the criteria for debt instruments to be
classified at amortised cost or at fair value through OCI, as described above, debt instruments may be designated at fair value
through profit or loss on initial recognition if doing so eliminates, or significantly reduces, an accounting mismatch. Financial assets
at fair value through profit or loss are carried in the statement of financial position at fair value with net changes in fair value
recognised in the statement of profit or loss.
This category includes derivative instruments and listed equity investments which the Group had not irrevocably elected to classify
at fair value through OCI. Dividends on listed equity investments are also recognised as other income in the statement of profit or
loss when the right of payment has been established.
A derivative embedded in a hybrid contract, with a financial liability or non-financial host, is separated from the host and accounted
for as a separate derivative if: the economic characteristics and risks are not closely related to the host; a separate instrument with
the same terms as the embedded derivative would meet the definition of a derivative; and the hybrid contract is not measured at
fair value through profit or loss. Embedded derivatives are measured at fair value with changes in fair value recognised in profit or
loss. Reassessment only occurs if there is either a change in the terms of the contract that significantly modifies the cash flows that
would otherwise be required or a reclassification of a financial asset out of the fair value through profit or loss category.
A derivative embedded within a hybrid contract containing a financial asset host is not accounted for separately. The financial asset
host together with the embedded derivative is required to be classified in its entirety as a financial asset at fair value through profit
or loss.
Derecognition
A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is primarily derecognised
(i.e., removed from the Group’s consolidated statement of financial position) when:
-
-
The rights to receive cash flows from the asset have expired;or
The Group has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash
flows in full without material delay to a third party under a ‘pass-through’ arrangement; and either (a) the Group has transferred
substantially all the risks and rewards of the asset, or (b) the Group has neither transferred nor retained substantially all the
risks and rewards of the asset, but has transferred control of the asset
When the Group has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, it
evaluates if, and to what extent, it has retained the risks and rewards of ownership. When it has neither transferred nor retained
substantially all of the risks and rewards of the asset, nor transferred control of the asset, the Group continues to recognise the
transferred asset to the extent of its continuing involvement. In that case, the Group also recognises an associated liability. The
transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Group has
retained. Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the
original carrying amount of the asset and the maximum amount of consideration that the Group could be required to repay.
Impairment of financial assets
The Group recognises an allowance for expected credit losses (ECLs) for all debt instruments not held at fair value through
profit or loss. ECLs are based on the difference between the contractual cash flows due in accordance with the contract and
all the cash flows that the Group expects to receive, discounted at an approximation of the original effective interest rate. The
expected cash flows will include cash flows from the sale of collateral held or other credit enhancements that are integral to
the contractual terms.
ECLs are recognised in two stages. For credit exposures for which there has not been a significant increase in credit risk since
initial recognition, ECLs are provided for credit losses that result from default events that are possible within the next 12-months
(a 12-month ECL). For those credit exposures for which there has been a significant increase in credit risk since initial recognition,
a loss allowance is required for credit losses expected over the remaining life of the exposure, irrespective of the timing of the
default (a lifetime ECL).
For trade receivables, further disclosure relating to impairment is provided in part (n) below.
Financial liabilities
Initial recognition and measurement
Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss, loans and
borrowings, payables, or as derivatives designated as hedging instruments in an effective hedge, as appropriate.
All financial liabilities are recognised initially at fair value and, in the case of loans and borrowings and payables, net of directly
attributable transaction costs. The Group’s financial liabilities include trade and other payables, loans and borrowings including
bank overdrafts, and derivative financial instruments.
The measurement of financial liabilities depends on their classification, as described below
Subsequent measurement
Loans and borrowings
This is the category most relevant to the Group. After initial recognition, interest-bearing loans and borrowings are subsequently
measured at amortised cost using the EIR method. Gains and losses are recognised in profit or loss when the liabilities are
derecognised as well as through the EIR amortisation process.
Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral
part of the EIR. The EIR amortisation is included as finance costs in the statement of profit or loss.
This category generally applies to interest-bearing loans and borrowings.
Derecognition
loss.
A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When an existing
financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing
liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and
the recognition of a new liability. The difference in the respective carrying amounts is recognised in the statement of profit or
The financial instruments of the Group are (i) cash and cash equivalents; (ii) trade and other receivables; (iii) trade and other
payables, iv) investments carried at fair value through profit or loss; (v) loans due from associates measured at fair value through
profit or loss; (vi) other financial assets, including bank deposits.
m) Cash and Cash Equivalents
Cash and short-term deposits in the statement of financial position comprise cash at bank and in hand and short term deposits
with an original maturity of three months or less.
For the purposes of the Cash Flow Statement, cash and cash equivalents consist of cash and cash equivalents as defined above,
net of outstanding bank overdrafts.
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ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Notes to Financial Statements
Notes to Financial Statements
Gains and losses on these financial assets are never recycled to profit or loss. Dividends are recognised as other income in the
statement of profit or loss when the right of payment has been established, except when the Group benefits from such proceeds
as a recovery of part of the cost of the financial asset, in which case, such gains are recorded in OCI. Equity instruments designated
at fair value through OCI are not subject to impairment assessment. The Group elected to classify irrevocably its non-listed equity
investments under this category.
Financial assets at fair value through profit or loss
Financial assets at fair value through profit or loss include financial assets held for trading, financial assets designated upon initial
recognition at fair value through profit or loss, or financial assets mandatorily required to be measured at fair value. Financial
assets are classified as held for trading if they are acquired for the purpose of selling or repurchasing in the near term. Derivatives,
including separated embedded derivatives, are also classified as held for trading unless they are designated as effective hedging
instruments. Financial assets with cash flows that are not solely payments of principal and interest are classified and measured
at fair value through profit or loss, irrespective of the business model. Notwithstanding the criteria for debt instruments to be
classified at amortised cost or at fair value through OCI, as described above, debt instruments may be designated at fair value
through profit or loss on initial recognition if doing so eliminates, or significantly reduces, an accounting mismatch. Financial assets
at fair value through profit or loss are carried in the statement of financial position at fair value with net changes in fair value
recognised in the statement of profit or loss.
This category includes derivative instruments and listed equity investments which the Group had not irrevocably elected to classify
at fair value through OCI. Dividends on listed equity investments are also recognised as other income in the statement of profit or
loss when the right of payment has been established.
A derivative embedded in a hybrid contract, with a financial liability or non-financial host, is separated from the host and accounted
for as a separate derivative if: the economic characteristics and risks are not closely related to the host; a separate instrument with
the same terms as the embedded derivative would meet the definition of a derivative; and the hybrid contract is not measured at
fair value through profit or loss. Embedded derivatives are measured at fair value with changes in fair value recognised in profit or
loss. Reassessment only occurs if there is either a change in the terms of the contract that significantly modifies the cash flows that
would otherwise be required or a reclassification of a financial asset out of the fair value through profit or loss category.
A derivative embedded within a hybrid contract containing a financial asset host is not accounted for separately. The financial asset
host together with the embedded derivative is required to be classified in its entirety as a financial asset at fair value through profit
or loss.
Derecognition
-
-
A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is primarily derecognised
(i.e., removed from the Group’s consolidated statement of financial position) when:
The rights to receive cash flows from the asset have expired;or
The Group has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash
flows in full without material delay to a third party under a ‘pass-through’ arrangement; and either (a) the Group has transferred
substantially all the risks and rewards of the asset, or (b) the Group has neither transferred nor retained substantially all the
risks and rewards of the asset, but has transferred control of the asset
When the Group has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, it
evaluates if, and to what extent, it has retained the risks and rewards of ownership. When it has neither transferred nor retained
substantially all of the risks and rewards of the asset, nor transferred control of the asset, the Group continues to recognise the
transferred asset to the extent of its continuing involvement. In that case, the Group also recognises an associated liability. The
transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Group has
retained. Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the
original carrying amount of the asset and the maximum amount of consideration that the Group could be required to repay.
Impairment of financial assets
The Group recognises an allowance for expected credit losses (ECLs) for all debt instruments not held at fair value through
profit or loss. ECLs are based on the difference between the contractual cash flows due in accordance with the contract and
all the cash flows that the Group expects to receive, discounted at an approximation of the original effective interest rate. The
expected cash flows will include cash flows from the sale of collateral held or other credit enhancements that are integral to
the contractual terms.
ECLs are recognised in two stages. For credit exposures for which there has not been a significant increase in credit risk since
initial recognition, ECLs are provided for credit losses that result from default events that are possible within the next 12-months
(a 12-month ECL). For those credit exposures for which there has been a significant increase in credit risk since initial recognition,
a loss allowance is required for credit losses expected over the remaining life of the exposure, irrespective of the timing of the
default (a lifetime ECL).
For trade receivables, further disclosure relating to impairment is provided in part (n) below.
Financial liabilities
Initial recognition and measurement
Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss, loans and
borrowings, payables, or as derivatives designated as hedging instruments in an effective hedge, as appropriate.
All financial liabilities are recognised initially at fair value and, in the case of loans and borrowings and payables, net of directly
attributable transaction costs. The Group’s financial liabilities include trade and other payables, loans and borrowings including
bank overdrafts, and derivative financial instruments.
Subsequent measurement
The measurement of financial liabilities depends on their classification, as described below
Loans and borrowings
This is the category most relevant to the Group. After initial recognition, interest-bearing loans and borrowings are subsequently
measured at amortised cost using the EIR method. Gains and losses are recognised in profit or loss when the liabilities are
derecognised as well as through the EIR amortisation process.
Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral
part of the EIR. The EIR amortisation is included as finance costs in the statement of profit or loss.
This category generally applies to interest-bearing loans and borrowings.
Derecognition
A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When an existing
financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing
liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and
the recognition of a new liability. The difference in the respective carrying amounts is recognised in the statement of profit or
loss.
The financial instruments of the Group are (i) cash and cash equivalents; (ii) trade and other receivables; (iii) trade and other
payables, iv) investments carried at fair value through profit or loss; (v) loans due from associates measured at fair value through
profit or loss; (vi) other financial assets, including bank deposits.
m) Cash and Cash Equivalents
Cash and short-term deposits in the statement of financial position comprise cash at bank and in hand and short term deposits
with an original maturity of three months or less.
For the purposes of the Cash Flow Statement, cash and cash equivalents consist of cash and cash equivalents as defined above,
net of outstanding bank overdrafts.
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ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Notes to Financial Statements
Notes to Financial Statements
n) Trade and Other Receivables
Trade receivables, which generally have 30-90 day terms, are recognised initially at fair value and subsequently at amortised
cost, less provisions for expected credit losses. For trade receivables, the Group applies a simplified approach in calculating ECLs.
Therefore, the Group does not track changes in credit risk, but instead recognises a loss allowance based on lifetime ECLs at each
reporting date. The Group has established a provision matrix that is based on its historical credit loss experience, adjusted for
forward-looking factors specific to the debtors and the economic environment
o) Property, plant and equipment
Plant and equipment is stated at cost less accumulated depreciation and any impairment in value.
The useful life of the assets have been set at the following levels to determine the depreciation rates:
Plant and equipment: 2 to 5 years.
An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected to
arise from the continued use of the asset.
Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the
carrying amount of the item) is included in the profit or loss in the period the item is derecognised.
Impairment
Exploration and evaluation assets are assessed for impairment when facts and circumstances suggest that the carrying amount of
an exploration and evaluation asset may exceed its recoverable amount. The recoverable amount of the exploration and evaluation
asset (for the cash generating unit(s) to which it has been allocated being no larger than the relevant area of interest) is estimated
to determine the extent of the impairment loss (if any).
The recoverable amount of exploration and evaluation assets is the higher of fair value less costs to sell and value in use. In
assessing value in use, the estimated future cash flows are discounted to their present value using a pre- tax discount rate that
reflects current market assessments of the time value of money and the risks specific to the asset.
An impairment exists when the carrying amount of an asset or cash-generating unit exceeds its estimated recoverable amount.
The asset or cash-generating unit is then written down to its recoverable amount. Any impairment losses are recognised in profit
or loss.
Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised estimate of its
recoverable amount, but only to the extent that the increased carrying amount does not exceed the carrying amount that would
have been determined had no impairment loss been recognised for the asset in previous years.
Where a decision has been made to proceed with development in respect of a particular area of interest, the relevant exploration
and evaluation asset is tested for impairment and the balance is then reclassified to production assets.
The carrying values of plant and equipment are reviewed for impairment at each reporting date, with recoverable amount being
estimated when events or changes in circumstances indicate that the carrying value may be impaired. Impairment losses, if any,
are recognised in the profit or loss.
q) Trade and Other Payables
Derecognition and disposal
An item of property, plant and equipment is derecognised upon disposal or when no further future economic benefits are expected
from its use or disposal. Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal
proceeds and the carrying amount of the asset) is included in profit or loss in the year the asset is derecognised.
r) Provisions
Trade payables and other payables are initially recognised at fair value, then carried at amortised cost. They represent liabilities
for goods and services provided to the Group prior to the end of the financial year that are unpaid and arising when the Group
becomes obliged to make future payments in respect of the purchase of these goods and services. The amounts are unsecured
and are usually paid within 30 days of recognition.
p) Deferred exploration and evaluation costs
Exploration and evaluation expenditure in relation to each separate area of interest is recognised as an exploration and evaluation
asset in the year in which they are incurred where the following conditions are satisfied:
The rights to tenure of the area of interest are current; and at least one of the following conditions is also met:
•
•
the exploration and evaluation expenditures are expected to be recouped through successful development and exploration of
the area of interest, or alternatively, by its sale; or
exploration and evaluation activities in the area of interest have not at the reporting date reached a stage which permits
a reasonable assessment of the existence or otherwise of economically recoverable reserves, and active and significant
operations in, or in relation to, the area of interest are continuing.
Exploration and evaluation assets are initially measured at cost and include acquisition of rights to explore, studies, exploratory
drilling and associated activities and an allocation of depreciation and amortisation of assets used in exploration and evaluation
activities. General and administrative costs are only included in the measurement of exploration and evaluation costs where they
are related directly to operational activities in a particular area of interest.
Provisions are recognised when the entity has a present obligation (legal or constructive) as a result of a past event, it is probable
that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be
made of the amount of the obligation.
If the effect of the time value of money is material, provisions are determined by discounting the expected future cash flows at a
pre-tax rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the
liability.
Where discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.
s) Share-based payment transactions
Equity settled transactions:
The Group provides benefits to employees (including senior executives) of the Group in the form of share-based payments,
whereby employees render services in exchange for shares or rights over shares (equity-settled transactions).
The current plans in place to provide these benefits is the Employee Option Plan (EOP) and Performance Rights Plan (PRP), which
provides benefits to directors, senior executives and other eligible participants as determined by the Board.
The cost of these equity-settled transactions with employees is measured by reference to the fair value of the equity instruments
at the date at which they are granted. The fair value is determined using a Black-Scholes model.
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ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Notes to Financial Statements
Notes to Financial Statements
n) Trade and Other Receivables
Trade receivables, which generally have 30-90 day terms, are recognised initially at fair value and subsequently at amortised
cost, less provisions for expected credit losses. For trade receivables, the Group applies a simplified approach in calculating ECLs.
Therefore, the Group does not track changes in credit risk, but instead recognises a loss allowance based on lifetime ECLs at each
reporting date. The Group has established a provision matrix that is based on its historical credit loss experience, adjusted for
forward-looking factors specific to the debtors and the economic environment
o) Property, plant and equipment
Plant and equipment is stated at cost less accumulated depreciation and any impairment in value.
The useful life of the assets have been set at the following levels to determine the depreciation rates:
Plant and equipment: 2 to 5 years.
arise from the continued use of the asset.
An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected to
Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the
carrying amount of the item) is included in the profit or loss in the period the item is derecognised.
Impairment
are recognised in the profit or loss.
Derecognition and disposal
An item of property, plant and equipment is derecognised upon disposal or when no further future economic benefits are expected
from its use or disposal. Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal
proceeds and the carrying amount of the asset) is included in profit or loss in the year the asset is derecognised.
p) Deferred exploration and evaluation costs
Exploration and evaluation expenditure in relation to each separate area of interest is recognised as an exploration and evaluation
asset in the year in which they are incurred where the following conditions are satisfied:
The rights to tenure of the area of interest are current; and at least one of the following conditions is also met:
the exploration and evaluation expenditures are expected to be recouped through successful development and exploration of
the area of interest, or alternatively, by its sale; or
•
•
Exploration and evaluation assets are initially measured at cost and include acquisition of rights to explore, studies, exploratory
drilling and associated activities and an allocation of depreciation and amortisation of assets used in exploration and evaluation
activities. General and administrative costs are only included in the measurement of exploration and evaluation costs where they
are related directly to operational activities in a particular area of interest.
Exploration and evaluation assets are assessed for impairment when facts and circumstances suggest that the carrying amount of
an exploration and evaluation asset may exceed its recoverable amount. The recoverable amount of the exploration and evaluation
asset (for the cash generating unit(s) to which it has been allocated being no larger than the relevant area of interest) is estimated
to determine the extent of the impairment loss (if any).
The recoverable amount of exploration and evaluation assets is the higher of fair value less costs to sell and value in use. In
assessing value in use, the estimated future cash flows are discounted to their present value using a pre- tax discount rate that
reflects current market assessments of the time value of money and the risks specific to the asset.
An impairment exists when the carrying amount of an asset or cash-generating unit exceeds its estimated recoverable amount.
The asset or cash-generating unit is then written down to its recoverable amount. Any impairment losses are recognised in profit
or loss.
Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised estimate of its
recoverable amount, but only to the extent that the increased carrying amount does not exceed the carrying amount that would
have been determined had no impairment loss been recognised for the asset in previous years.
Where a decision has been made to proceed with development in respect of a particular area of interest, the relevant exploration
and evaluation asset is tested for impairment and the balance is then reclassified to production assets.
The carrying values of plant and equipment are reviewed for impairment at each reporting date, with recoverable amount being
estimated when events or changes in circumstances indicate that the carrying value may be impaired. Impairment losses, if any,
q) Trade and Other Payables
Trade payables and other payables are initially recognised at fair value, then carried at amortised cost. They represent liabilities
for goods and services provided to the Group prior to the end of the financial year that are unpaid and arising when the Group
becomes obliged to make future payments in respect of the purchase of these goods and services. The amounts are unsecured
and are usually paid within 30 days of recognition.
r) Provisions
Provisions are recognised when the entity has a present obligation (legal or constructive) as a result of a past event, it is probable
that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be
made of the amount of the obligation.
If the effect of the time value of money is material, provisions are determined by discounting the expected future cash flows at a
pre-tax rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the
liability.
Where discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.
exploration and evaluation activities in the area of interest have not at the reporting date reached a stage which permits
a reasonable assessment of the existence or otherwise of economically recoverable reserves, and active and significant
operations in, or in relation to, the area of interest are continuing.
s) Share-based payment transactions
Equity settled transactions:
The Group provides benefits to employees (including senior executives) of the Group in the form of share-based payments,
whereby employees render services in exchange for shares or rights over shares (equity-settled transactions).
The current plans in place to provide these benefits is the Employee Option Plan (EOP) and Performance Rights Plan (PRP), which
provides benefits to directors, senior executives and other eligible participants as determined by the Board.
The cost of these equity-settled transactions with employees is measured by reference to the fair value of the equity instruments
at the date at which they are granted. The fair value is determined using a Black-Scholes model.
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ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Notes to Financial Statements
Notes to Financial Statements
In valuing equity-settled transactions, no account is taken of any performance conditions, other than conditions linked to the price
of the shares of Peak Resources Limited (market conditions) if applicable.
Impairment of deferred exploration and evaluation costs
The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over the period in which the
performance and/or service conditions are fulfilled, ending on the date on which the relevant employees become fully entitled to
the award (the vesting period).
The cumulative expense recognised for equity-settled transactions at each reporting date until vesting date reflects:
•
•
the extent to which the vesting period has expired and
the Group’s best estimate of the number of equity instruments that will ultimately vest. No adjustment is made for the
likelihood of market performance conditions being met as the effect of these conditions is included in the determination of fair
value at grant date. The profit or loss charge or credit for a period represents the movement in cumulative expense recognised
as at the beginning and end of that period.
No expense is recognised for awards that do not ultimately vest, except for awards where vesting is only conditional upon a market
condition.
Capitalisation of Exploration and Evaluation
The Group assesses the criteria on which exploration and evaluation expenditure is capitalised based on the criteria in Note 2 (p).
If the terms of an equity-settled award are modified, as a minimum an expense is recognised as if the terms had not been
modified. In addition, an expense is recognised for any modification that increases the total fair value of the share-based payment
arrangement, or is otherwise beneficial to the employee, as measured at the date of modification.
If an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and any expense not yet recognised
for the award is recognised immediately. However, if a new award is substituted for the cancelled award and designated as a
replacement award on the date that it is granted, the cancelled and new award are treated as if they were a modification of the
original award, as described in the previous paragraph.
The dilutive effect, if any, of outstanding options is reflected as additional share dilution in the computation of earnings per share.
t) Borrowing costs
Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial
period of time to get ready for its intended use or sale are capitalised as part of the cost of the asset. All other borrowing costs are
expensed in the period in which they occur.
Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds.
u) Critical accounting judgements and estimates
In the application of Australian Accounting Standards, management is required to make judgments about applying accounting
policies and estimates and assumptions about carrying values of assets and liabilities that are not readily apparent from other
sources. The estimates and associated assumptions are based on historical experience and various other factors that are believed
to be reasonable under the circumstance, the results of which form the basis of making the judgments. Actual results may differ
from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in
the period in which the estimate is revised if the revision affects only that period or in the period of the revision and future periods
if the revision affects both current and future periods.
Impairment of investment in associate
Impairment exists when the carrying value of the investment in associate exceeds its recoverable amount. The recoverable amount
is referenced to project economic models and assumptions included in the recoverable amount determination such as commodity
prices, capital and operating costs, foreign exchange rates and discount rates. To the extent that investment in associate is
determined not to be recoverable, the Group recognises the loss within ‘Share of loss of associate’ in the consolidated statement
of comprehensive income.
The future recoverability of deferred exploration and evaluation costs are dependent on a number of factors, including the level
of proved, probable and inferred mineral resources, future technological changes which could impact the cost of mining, future
legal changes (including changes to environment restoration obligations) and changes to commodity prices.
To the extent that deferred exploration and evaluation costs is determined not to be recoverable in the future, this will reduce
profits and net assets in the period in which this determination is made.
Share based payment transactions
The Group measures the cost of equity-settled transactions by reference to the fair value of the equity instruments at the date
at which they are granted. The fair value is determined by using the most appropriate valuation model, which is dependent on
the terms and conditions of the grant. This estimate also requires determination of the most appropriate inputs to the valuation
model including the expected life of the share option, volatility and dividend yield and making assumptions about them.
3. INVESTMENTS IN ASSOCIATES
Pursuant to the closing of stage 1 of the financing transaction with Appian and IFC on 24 July 2015, in which Appian and IFC
acquired a direct 12.5% interest in Peak African Minerals (PAM), the company that held the interests in the Group’s Ngualla
project, it was determined that Peak Resources no longer solely controlled nor did it have joint control of PAM despite maintaining
its majority ownership and beneficial interests in PAM. The company determined that based on its involvement in the PAM Board
(albeit it does not control the Board decisions) along with its ownership interest in the company, Peak Resources is deemed to
have significant influence over PAM and accordingly is considered to be an associate under Australian Accounting Standards.
During the 2017 financial year there was a further dilution of 12.5% ownership interest related to stage 2 of the financing
transaction with Appian and IFC reducing the Group’s remaining interest in the PAM Group to 75%. There were no changes in the
interest held in the PAM Group in the current period.
The Group has an 75% interest in Pan African Minerals (PAM), a company domiciled in Mauritius, that owns 100% of the shares in
PR NG Minerals Limited (“PRNG”), the 100% owner of the Ngualla Project in Tanzania. The Group’s interest in PAM is accounted
for using the equity method in the consolidated financial statements. The following table illustrates the summarised financial
information of the Group’s investment in PAM:
Current assets
Non-current assets
Current liabilities
Non-current liabilities
Equity
Finance Income
$AUD
$AUD
30 June 2019
30 June 2018
109,053
78,330
52,177,063
49,329,168
36,821
8,541,679
164,454
8,530,849
43,707,616
40,712,195
850,305
531,112
ENABLING LOW CARBON TECHNOLOGIES PAGE 50
ENABLING LOW CARBON TECHNOLOGIES PAGE 51
ENABLING LOW CARBON TECHNOLOGIES PAGE 51
ENABLING LOW CARBON TECHNOLOGIES PAGE 3
Notes to Financial Statements
Notes to Financial Statements
In valuing equity-settled transactions, no account is taken of any performance conditions, other than conditions linked to the price
Impairment of deferred exploration and evaluation costs
The future recoverability of deferred exploration and evaluation costs are dependent on a number of factors, including the level
of proved, probable and inferred mineral resources, future technological changes which could impact the cost of mining, future
legal changes (including changes to environment restoration obligations) and changes to commodity prices.
To the extent that deferred exploration and evaluation costs is determined not to be recoverable in the future, this will reduce
profits and net assets in the period in which this determination is made.
Share based payment transactions
The Group measures the cost of equity-settled transactions by reference to the fair value of the equity instruments at the date
at which they are granted. The fair value is determined by using the most appropriate valuation model, which is dependent on
the terms and conditions of the grant. This estimate also requires determination of the most appropriate inputs to the valuation
model including the expected life of the share option, volatility and dividend yield and making assumptions about them.
No expense is recognised for awards that do not ultimately vest, except for awards where vesting is only conditional upon a market
Capitalisation of Exploration and Evaluation
The Group assesses the criteria on which exploration and evaluation expenditure is capitalised based on the criteria in Note 2 (p).
3. INVESTMENTS IN ASSOCIATES
Pursuant to the closing of stage 1 of the financing transaction with Appian and IFC on 24 July 2015, in which Appian and IFC
acquired a direct 12.5% interest in Peak African Minerals (PAM), the company that held the interests in the Group’s Ngualla
project, it was determined that Peak Resources no longer solely controlled nor did it have joint control of PAM despite maintaining
its majority ownership and beneficial interests in PAM. The company determined that based on its involvement in the PAM Board
(albeit it does not control the Board decisions) along with its ownership interest in the company, Peak Resources is deemed to
have significant influence over PAM and accordingly is considered to be an associate under Australian Accounting Standards.
During the 2017 financial year there was a further dilution of 12.5% ownership interest related to stage 2 of the financing
transaction with Appian and IFC reducing the Group’s remaining interest in the PAM Group to 75%. There were no changes in the
interest held in the PAM Group in the current period.
The Group has an 75% interest in Pan African Minerals (PAM), a company domiciled in Mauritius, that owns 100% of the shares in
PR NG Minerals Limited (“PRNG”), the 100% owner of the Ngualla Project in Tanzania. The Group’s interest in PAM is accounted
for using the equity method in the consolidated financial statements. The following table illustrates the summarised financial
information of the Group’s investment in PAM:
Current assets
Non-current assets
Current liabilities
Non-current liabilities
Equity
Finance Income
$AUD
$AUD
30 June 2019
30 June 2018
109,053
78,330
52,177,063
49,329,168
36,821
8,541,679
164,454
8,530,849
43,707,616
40,712,195
850,305
531,112
of the shares of Peak Resources Limited (market conditions) if applicable.
The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over the period in which the
performance and/or service conditions are fulfilled, ending on the date on which the relevant employees become fully entitled to
the award (the vesting period).
The cumulative expense recognised for equity-settled transactions at each reporting date until vesting date reflects:
the extent to which the vesting period has expired and
•
•
the Group’s best estimate of the number of equity instruments that will ultimately vest. No adjustment is made for the
likelihood of market performance conditions being met as the effect of these conditions is included in the determination of fair
value at grant date. The profit or loss charge or credit for a period represents the movement in cumulative expense recognised
as at the beginning and end of that period.
condition.
If the terms of an equity-settled award are modified, as a minimum an expense is recognised as if the terms had not been
modified. In addition, an expense is recognised for any modification that increases the total fair value of the share-based payment
arrangement, or is otherwise beneficial to the employee, as measured at the date of modification.
If an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and any expense not yet recognised
for the award is recognised immediately. However, if a new award is substituted for the cancelled award and designated as a
replacement award on the date that it is granted, the cancelled and new award are treated as if they were a modification of the
original award, as described in the previous paragraph.
The dilutive effect, if any, of outstanding options is reflected as additional share dilution in the computation of earnings per share.
t) Borrowing costs
Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial
period of time to get ready for its intended use or sale are capitalised as part of the cost of the asset. All other borrowing costs are
expensed in the period in which they occur.
Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds.
u) Critical accounting judgements and estimates
In the application of Australian Accounting Standards, management is required to make judgments about applying accounting
policies and estimates and assumptions about carrying values of assets and liabilities that are not readily apparent from other
sources. The estimates and associated assumptions are based on historical experience and various other factors that are believed
to be reasonable under the circumstance, the results of which form the basis of making the judgments. Actual results may differ
from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in
the period in which the estimate is revised if the revision affects only that period or in the period of the revision and future periods
if the revision affects both current and future periods.
Impairment of investment in associate
Impairment exists when the carrying value of the investment in associate exceeds its recoverable amount. The recoverable amount
is referenced to project economic models and assumptions included in the recoverable amount determination such as commodity
prices, capital and operating costs, foreign exchange rates and discount rates. To the extent that investment in associate is
determined not to be recoverable, the Group recognises the loss within ‘Share of loss of associate’ in the consolidated statement
of comprehensive income.
ENABLING LOW CARBON TECHNOLOGIES PAGE 50
ENABLING LOW CARBON TECHNOLOGIES PAGE 51
ENABLING LOW CARBON TECHNOLOGIES PAGE 51
ENABLING LOW CARBON TECHNOLOGIES PAGE 3
Notes to Financial Statements
Notes to Financial Statements
Other Income
Administrative costs
Employee benefits
Depreciation and amortisation expenses
Other expenses
Project costs
Finance costs
Loss before income tax expense
Income tax expense
Loss for the period
Other comprehensive income/(loss)
Total comprehensive income/(loss) for the period
$AUD
30 June 2019
429,127
(133,193)
(39,194)
(21,018)
(507,977)
(1,803,899)
(6,231)
(1,232,080)
-
(1,232,080)
2,245,056
1,012,976
$AUD
30 June 2018
-
(105,959)
(143,038)
(35,710)
(305,758)
(2,639,012)
(5,312)
(2,703,677)
-
(2,703,677)
1,424,359
(1,279,318)
Group's share of loss for the period
Group's share of movement of other comprehensive income for
the period
(924,060)
(2,027,758)
1,683,792
1,068,269
Peak Resources investment in associate:
Opening balance
Retained Earnings adjustment on adoption of IFRS 9
Opening balance (Restated)
Less Group’s share of loss in the associate for the period
Add Group’s share of movement in other comprehensive income in
the associate for the period
31,114,813
(465,178)
30,649,635
(924,060)
29,482,222
-
29,482,222
(2,027,758)
1,683,792
1,068,269
Peaks additional equity investment in PAM during the period
2,100,117
2,592,080
Investment in associate
33,509,484
31,114,813
Classified in the statement of financial position as:
Investment in associate
33,509,484
31,114,813
Tenure over Ngualla Project
The Ngualla Project tenure is held over three licence areas held by PRNG; the area containing the Mineral Resource is subject to a
Special Mining Licence (SML) application lodged in August 2017 for which grant is still pending following enactment of the changes
to the Mining legislation announced by the Tanzanian Government in July 2017. The Prospecting Licence (PL) which PRNG held
over this area, at the time of lodgment of the SML application, expired in September 2017. The Tanzanian Mining Act provides
that the PL will remain valid until grant or refusal to grant an application for a licence is made. The Company expects the SML to be
granted in due course. The other two licence areas are also held by PRNG under granted PLs.
4. INCOME AND EXPENDITURE ITEMS
Included in loss for the year are:
Interest received1
Gain on sale of non-current assets
Australian R&D rebate
Other income
Total other income
Corporate and compliance costs
Occupancy costs
Travel costs
Technical feasibility costs
Auditors’ remuneration
Amounts received or due and receivable by Ernst and Young for:
Audit and review of financial statements
Taxation services
Subsidiaries audit and review of financial statements
Subsidiaries taxation services
2019
$
-
-
98,245
550
98,795
(81,966)
(63,184)
(55,570)
(132,000)
-
-
74,963
7,201
7,201
2018
$
39,635
841
561,907
16,335
618,718
(76,019)
(122,364)
(81,638)
(27,260)
-
-
65,038
5,548
5,548
74,963
65,038
1 This is interest received from instruments held at amortised cost calculated using effective interest method.
ENABLING LOW CARBON TECHNOLOGIES PAGE 52
ENABLING LOW CARBON TECHNOLOGIES PAGE 53
ENABLING LOW CARBON TECHNOLOGIES PAGE 53
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Notes to Financial Statements
Notes to Financial Statements
4. INCOME AND EXPENDITURE ITEMS
Included in loss for the year are:
Interest received1
Gain on sale of non-current assets
Australian R&D rebate
Other income
Total other income
Corporate and compliance costs
Occupancy costs
Travel costs
Technical feasibility costs
Auditors’ remuneration
Amounts received or due and receivable by Ernst and Young for:
Audit and review of financial statements
Taxation services
Subsidiaries audit and review of financial statements
Subsidiaries taxation services
2019
$
98,245
-
-
550
98,795
(81,966)
(63,184)
(55,570)
(132,000)
74,963
-
74,963
7,201
-
7,201
2018
$
39,635
841
561,907
16,335
618,718
(76,019)
(122,364)
(81,638)
(27,260)
65,038
-
65,038
5,548
-
5,548
1 This is interest received from instruments held at amortised cost calculated using effective interest method.
$AUD
$AUD
30 June 2019
30 June 2018
429,127
(133,193)
(39,194)
(21,018)
(507,977)
(1,803,899)
(6,231)
-
(1,232,080)
2,245,056
1,012,976
(1,232,080)
(2,703,677)
(105,959)
(143,038)
(35,710)
(305,758)
(2,639,012)
(5,312)
(2,703,677)
1,424,359
(1,279,318)
-
-
-
Depreciation and amortisation expenses
Other Income
Administrative costs
Employee benefits
Other expenses
Project costs
Finance costs
Loss before income tax expense
Income tax expense
Loss for the period
Other comprehensive income/(loss)
Total comprehensive income/(loss) for the period
Group's share of loss for the period
Group's share of movement of other comprehensive income for
the period
(924,060)
(2,027,758)
1,683,792
1,068,269
Peak Resources investment in associate:
Opening balance
Retained Earnings adjustment on adoption of IFRS 9
Opening balance (Restated)
Less Group’s share of loss in the associate for the period
Add Group’s share of movement in other comprehensive income in
the associate for the period
31,114,813
(465,178)
30,649,635
(924,060)
29,482,222
29,482,222
(2,027,758)
1,683,792
1,068,269
Peaks additional equity investment in PAM during the period
2,100,117
2,592,080
Investment in associate
33,509,484
31,114,813
Classified in the statement of financial position as:
Investment in associate
33,509,484
31,114,813
Tenure over Ngualla Project
The Ngualla Project tenure is held over three licence areas held by PRNG; the area containing the Mineral Resource is subject to a
Special Mining Licence (SML) application lodged in August 2017 for which grant is still pending following enactment of the changes
to the Mining legislation announced by the Tanzanian Government in July 2017. The Prospecting Licence (PL) which PRNG held
over this area, at the time of lodgment of the SML application, expired in September 2017. The Tanzanian Mining Act provides
that the PL will remain valid until grant or refusal to grant an application for a licence is made. The Company expects the SML to be
granted in due course. The other two licence areas are also held by PRNG under granted PLs.
ENABLING LOW CARBON TECHNOLOGIES PAGE 52
ENABLING LOW CARBON TECHNOLOGIES PAGE 53
ENABLING LOW CARBON TECHNOLOGIES PAGE 53
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Notes to Financial Statements
Notes to Financial Statements
5. OPERATING SEGMENTS
6. LOSS PER SHARE
Information reported to the chief operating decision makers for the purposes of resource allocation and assessment of segment
performance focuses on the exploration activities of the Group. The chief operating decision makers include the board of directors.
The Group’s reportable segments under AASB 8 are as follows:
The following reflects the income and share data used in the total operations basic and dilutive earnings per share computations:
Exploration & Development (E&D) – Group’s exploration and development activities for the Ngualla project in Tanzania; and
•
• Unallocated - to manage the corporate affairs of the group.
Basic and Diluted loss per share based on reported losses after tax as set
out in the Statement of Comprehensive Income
The segments have applied the same accounting policies as applied to the Group and disclosed in the notes 1 and 2 to these
financial statements.
Interest income
Other income
Total income
Depreciation and
amortisation
Impairment of exploration
and evaluation costs
Impairment of Investments
Share based payment
expenses
Borrowing costs
Gain on disposal of former
subsidiary
Share of loss of associate
Technical feasibility costs
Other expenses
Income Tax
Segment results
Segment assets
Segment liabilities
Additions to non-current
assets during the year:
Plant and equipment
Investment in associate
30 June 2019
E&D
Unallocated
30 June 2018
E&D
Unallocated
Total
$
98,245
550
98,795
(5,886)
-
-
-
$
-
-
-
-
-
-
-
-
-
(924,060)
(132,000)
$
98,245
550
98,795
(5,886)
-
-
-
-
-
(471,005)
(471,005)
(1,163,204)
(1,163,204)
(924,060)
(2,027,758)
(132,000)
(27,260)
$
-
-
-
-
-
-
-
-
-
$
39,635
579,083
618,718
Total
$
39,635
579,083
618,718
(11,232)
(11,232)
-
-
-
-
(459,792)
(459,792)
(1,499,506)
(1,499,506)
-
-
-
-
(2,027,758)
(27,260)
-
-
(1,998,693)
(1,998,693)
-
-
-
-
(1,496,394)
(1,496,394)
-
-
(1,056,060)
(3,539,993)
(4,596,053)
(2,055,018)
(2,848,206)
(4,903,224)
33,509,484
3,206,471
36,715,955
31,114,813
8,242,640
39,357,453
-
(8,768,815)
(8,768,815)
-
(8,139,816)
(8,139,816)
2,100,117
2,100,117
5,350
-
5,350
5,350
2,100,117
2,105,467
2,592,080
2,592,080
3,207
-
3,207
3,207
2,592,080
2,595,287
Weighted average number of ordinary shares used in calculating
Basic & Diluted loss per share
Anti-dilutive options over ordinary shares and performance rights
excluded from the weighted average number of shares
7. INCOME TAX
a.
The components of tax expense comprise:
Current tax
Deferred tax
Income tax expense reported in statement of comprehensive income
The prima facie tax benefit on loss from ordinary activities before income tax is
b.
reconciled to the income tax as follows:
Prima facie tax benefit on loss from ordinary activities before income tax at
Loss before income tax
30.0% (2018:27.5%)
Add tax effect of:
- Revenue losses not recognised
- Other non-allowable items
- Other deferred tax balances not recognised
Less tax effect of:
- Non-assessable items
Income tax expense reported in statement of comprehensive income
2019
Cents
(0.58)
Nos.
2018
Cents
(0.82)
Nos.
799,220,870
594,373,862
105,888,247
183,054,035
CONSOLIDATED
CONSOLIDATED
4,596,053
4,903,224
(1,378,816)
(1,348,386)
2019
$
-
-
-
643,673
804,265
300,036
369,158
369,158
-
2018
$
-
-
-
509,097
849,119
163,669
173,499
173,499
-
ENABLING LOW CARBON TECHNOLOGIES PAGE 54
ENABLING LOW CARBON TECHNOLOGIES PAGE 55
ENABLING LOW CARBON TECHNOLOGIES PAGE 55
ENABLING LOW CARBON TECHNOLOGIES PAGE 3
Notes to Financial Statements
Notes to Financial Statements
5. OPERATING SEGMENTS
Information reported to the chief operating decision makers for the purposes of resource allocation and assessment of segment
performance focuses on the exploration activities of the Group. The chief operating decision makers include the board of directors.
The Group’s reportable segments under AASB 8 are as follows:
•
Exploration & Development (E&D) – Group’s exploration and development activities for the Ngualla project in Tanzania; and
• Unallocated - to manage the corporate affairs of the group.
The segments have applied the same accounting policies as applied to the Group and disclosed in the notes 1 and 2 to these
financial statements.
Interest income
Other income
Total income
Depreciation and
amortisation
Impairment of exploration
and evaluation costs
Impairment of Investments
Share based payment
expenses
Borrowing costs
Gain on disposal of former
subsidiary
Share of loss of associate
Technical feasibility costs
Other expenses
Income Tax
Segment results
Segment assets
Segment liabilities
Additions to non-current
assets during the year:
Plant and equipment
Investment in associate
$
-
-
-
-
-
-
-
-
-
-
-
-
30 June 2019
E&D
Unallocated
30 June 2018
E&D
Unallocated
$
98,245
550
98,795
(5,886)
Total
$
98,245
550
98,795
(5,886)
$
39,635
579,083
618,718
Total
$
39,635
579,083
618,718
(11,232)
(11,232)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(924,060)
(132,000)
(924,060)
(2,027,758)
(132,000)
(27,260)
(2,027,758)
(27,260)
(1,998,693)
(1,998,693)
(1,496,394)
(1,496,394)
(1,056,060)
(3,539,993)
(4,596,053)
(2,055,018)
(2,848,206)
(4,903,224)
33,509,484
3,206,471
36,715,955
31,114,813
8,242,640
39,357,453
(8,768,815)
(8,768,815)
(8,139,816)
(8,139,816)
2,100,117
2,100,117
5,350
-
5,350
5,350
2,100,117
2,105,467
2,592,080
2,592,080
3,207
-
3,207
3,207
2,592,080
2,595,287
$
-
-
-
-
-
-
-
-
-
-
-
-
6. LOSS PER SHARE
The following reflects the income and share data used in the total operations basic and dilutive earnings per share computations:
Basic and Diluted loss per share based on reported losses after tax as set
out in the Statement of Comprehensive Income
Weighted average number of ordinary shares used in calculating
Basic & Diluted loss per share
Anti-dilutive options over ordinary shares and performance rights
excluded from the weighted average number of shares
2019
Cents
(0.58)
Nos.
2018
Cents
(0.82)
Nos.
799,220,870
594,373,862
105,888,247
183,054,035
7. INCOME TAX
(471,005)
(471,005)
(459,792)
(459,792)
a.
The components of tax expense comprise:
Current tax
Deferred tax
(1,163,204)
(1,163,204)
(1,499,506)
(1,499,506)
Income tax expense reported in statement of comprehensive income
CONSOLIDATED
CONSOLIDATED
2019
$
-
-
-
2018
$
-
-
-
b.
The prima facie tax benefit on loss from ordinary activities before income tax is
reconciled to the income tax as follows:
Loss before income tax
4,596,053
4,903,224
Prima facie tax benefit on loss from ordinary activities before income tax at
30.0% (2018:27.5%)
(1,378,816)
(1,348,386)
Add tax effect of:
- Revenue losses not recognised
- Other non-allowable items
- Other deferred tax balances not recognised
Less tax effect of:
- Non-assessable items
Income tax expense reported in statement of comprehensive income
643,673
804,265
300,036
369,158
369,158
-
509,097
849,119
163,669
173,499
173,499
-
ENABLING LOW CARBON TECHNOLOGIES PAGE 54
ENABLING LOW CARBON TECHNOLOGIES PAGE 55
ENABLING LOW CARBON TECHNOLOGIES PAGE 55
ENABLING LOW CARBON TECHNOLOGIES PAGE 3
Notes to Financial Statements
Notes to Financial Statements
c. Deferred tax recognised at 30.0% (2018:27.5%):
Deferred tax liabilities:
Investment in associate
Accrued interest
Other
Deferred tax assets:
Carry forward revenue losses
Net deferred tax
d. Unrecognised deferred tax assets at 30.0% (2018:27.5%) (Note 1):
Carry forward revenue losses
Carry forward capital losses
Unrealised FX
Capital raising costs
Provisions and accruals
Other
CONSOLIDATED
CONSOLIDATED
2019
$
2018
$
(5,053,678)
(4,527,414)
(1,051)
(4,106)
(4,281)
(3,266)
5,058,835
-
4,534,961
-
1,766,535
1,142,411
295,504
583,737
112,121
628,940
1,292
270,879
395,210
186,081
343,867
7,392
3,388,129
2,345,840
The tax benefits of the above deferred tax assets will only be obtained if:
(a)
the company derives future assessable income of a nature and of an amount sufficient to enable the benefits
to be utilised;
(b)
the company continues to comply with the conditions for deductibility imposed by law; and
(c) no changes in income tax legislation adversely affect the company in utilising the benefits.
Note 1 - the corporate tax rate for eligible companies will reduce from 30% to 25% by 30 June 2022 providing certain turnover
thresholds and other criteria are met. Deferred tax assets and liabilities are required to be measured at the tax rate that is expected
to apply in the future income year when the asset is realised or the liability is settled. The Directors have determined that the
deferred tax balances be measured at the tax rates stated.
Note 2 - Tax Consolidation
For the purpose of income taxation, the Company and its 100% Australian controlled entities have formed a tax consolidated group
effective from 1 July 2012.
8. CASH AND CASH EQUIVALENTS
Reconciliation of cash and cash equivalent
For the purpose of the Cash Flow Statement, cash and cash
equivalents comprise the following:
Cash at bank and in hand
Short term deposits
Reconciliation of operating loss to operating cash flows
Loss for the year
Adjustments for non-cash items:
Fair value adjustments
Share of loss of associate
Share based payments expenses
Depreciation expenses
Foreign exchange gain/loss
Movement in working capital items:
(Increase)/Decrease in trade and other receivables
(Increase)/Decrease in prepayments
Increase/(Decrease) in trade and other payables
Increase/(Decrease) in provisions
2019
$
2018
$
547,324
318,748
1,600,000
6,150,000
2,147,324
6,468,748
(4,596,053)
(4,903,224)
16,603
924,060
471,005
5,886
270,461
46,211
5,347
1,101,084
36,218
-
2,027,758
459,792
11,232
212,908
(34,049)
(7,568)
324,261
(39,790)
(1,719,178)
(1,948,680)
ENABLING LOW CARBON TECHNOLOGIES PAGE 56
ENABLING LOW CARBON TECHNOLOGIES PAGE 57
ENABLING LOW CARBON TECHNOLOGIES PAGE 57
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Notes to Financial Statements
Notes to Financial Statements
c. Deferred tax recognised at 30.0% (2018:27.5%):
Deferred tax liabilities:
Investment in associate
Accrued interest
Other
Deferred tax assets:
Carry forward revenue losses
Net deferred tax
Carry forward revenue losses
Carry forward capital losses
Unrealised FX
Capital raising costs
Provisions and accruals
Other
d. Unrecognised deferred tax assets at 30.0% (2018:27.5%) (Note 1):
CONSOLIDATED
CONSOLIDATED
2019
$
2018
$
(5,053,678)
(4,527,414)
(1,051)
(4,106)
(4,281)
(3,266)
5,058,835
4,534,961
-
-
1,766,535
1,142,411
295,504
583,737
112,121
628,940
1,292
270,879
395,210
186,081
343,867
7,392
3,388,129
2,345,840
The tax benefits of the above deferred tax assets will only be obtained if:
(a)
the company derives future assessable income of a nature and of an amount sufficient to enable the benefits
to be utilised;
(b)
the company continues to comply with the conditions for deductibility imposed by law; and
(c) no changes in income tax legislation adversely affect the company in utilising the benefits.
Note 1 - the corporate tax rate for eligible companies will reduce from 30% to 25% by 30 June 2022 providing certain turnover
thresholds and other criteria are met. Deferred tax assets and liabilities are required to be measured at the tax rate that is expected
to apply in the future income year when the asset is realised or the liability is settled. The Directors have determined that the
deferred tax balances be measured at the tax rates stated.
Note 2 - Tax Consolidation
effective from 1 July 2012.
For the purpose of income taxation, the Company and its 100% Australian controlled entities have formed a tax consolidated group
8. CASH AND CASH EQUIVALENTS
Reconciliation of cash and cash equivalent
For the purpose of the Cash Flow Statement, cash and cash
equivalents comprise the following:
Cash at bank and in hand
Short term deposits
Reconciliation of operating loss to operating cash flows
Loss for the year
Adjustments for non-cash items:
Fair value adjustments
Share of loss of associate
Share based payments expenses
Depreciation expenses
Foreign exchange gain/loss
Movement in working capital items:
(Increase)/Decrease in trade and other receivables
(Increase)/Decrease in prepayments
Increase/(Decrease) in trade and other payables
Increase/(Decrease) in provisions
2019
$
2018
$
547,324
318,748
1,600,000
6,150,000
2,147,324
6,468,748
(4,596,053)
(4,903,224)
16,603
924,060
471,005
5,886
270,461
46,211
5,347
1,101,084
36,218
-
2,027,758
459,792
11,232
212,908
(34,049)
(7,568)
324,261
(39,790)
(1,719,178)
(1,948,680)
ENABLING LOW CARBON TECHNOLOGIES PAGE 56
ENABLING LOW CARBON TECHNOLOGIES PAGE 57
ENABLING LOW CARBON TECHNOLOGIES PAGE 57
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Notes to Financial Statements
Notes to Financial Statements
9.TRADE AND OTHER RECEIVABLES
12. PROPERTY, PLANT & EQUIPMENT
Current
GST receivable
Other receivable
Ageing of receivables
Recoverable within 3 months
Beyond 3 months
2019
$
2018
$
13,772
3,503
45,993
17,494
17,275
63,487
17,275
63,487
-
-
17,275
63,487
Plant and equipment
At cost
Accumulated depreciation
Movement in net carrying amount
Balance at the beginning of the year
Additions
Disposals
Depreciation for the year
Balance at the end of the year
Receivables are non-interest bearing and unsecured
10. OTHER FINANCIAL ASSETS
13. INVESTMENTS
Bank Term Deposit
2019
$
30,000
30,000
2018
$
30,000
30,000
Investment in listed shares – at fair value through profit or loss (Level 1)
14. OTHER ASSETS
A deposit of $30,000 (2018: $30,000) has been secured against a guarantee issued by the bank as a rental deposit for the office
lease. This cash balance is not available for withdrawal until the guarantee is withdrawn.
11. LOANS - DUE FROM ASSOCIATE
Site 2 option payment
Current
Loans – due from associates measured at amortised cost
Loans – due from associates measured at FVPTL
Noncurrent
Loans – due from associates measured at FVPTL
2019
$
-
446,532
416,961
2018
$
1,526,145
-
-
The Associate-company loan receivables are non-recourse, interest free loans and repayable on demand.
863,493
1,526,145
Trade and other payables
Current
Non-current
Other payables
Ageing of payables
Payable within 3 months
Beyond 12 months
The Company has signed a 24 month option on 18 June 2018 for a 250 year lease on a 19 hectare parcel of land in Teesside for a
rare earth refinery and separation plant. The agreement also includes the ability to extend the option for a further 12 months if
required. The option term commenced on 18 June 2018.
15. TRADE AND OTHER PAYABLES
$
2019
2018
$
103,052
97,701
(96,856)
(90,970)
6,196
6,731
6,731
5,351
-
16,500
3,207
(1,744)
(5,886)
(11,232)
6,196
6,731
2019
$
8,000
8,000
2019
$
2018
$
8,000
8,000
2018
$
127,254
127,254
127,254
127,254
2019
$
2018
$
276,252
345,809
1,430,011
870,170
276,252
1,430,011
345,809
870,170
1,706,263
1,215,979
ENABLING LOW CARBON TECHNOLOGIES PAGE 58
ENABLING LOW CARBON TECHNOLOGIES PAGE 59
ENABLING LOW CARBON TECHNOLOGIES PAGE 59
Payables are non-interest bearing, unsecured and are generally payable in 30-90 days
ENABLING LOW CARBON TECHNOLOGIES PAGE 3
Notes to Financial Statements
Notes to Financial Statements
9.TRADE AND OTHER RECEIVABLES
12. PROPERTY, PLANT & EQUIPMENT
Current
GST receivable
Other receivable
Ageing of receivables
Recoverable within 3 months
Beyond 3 months
Bank Term Deposit
Receivables are non-interest bearing and unsecured
10. OTHER FINANCIAL ASSETS
Plant and equipment
At cost
Accumulated depreciation
Movement in net carrying amount
Balance at the beginning of the year
Additions
Disposals
Depreciation for the year
Balance at the end of the year
$
2019
2018
$
103,052
97,701
(96,856)
(90,970)
6,196
6,731
6,731
5,351
-
16,500
3,207
(1,744)
(5,886)
(11,232)
6,196
6,731
13. INVESTMENTS
Investment in listed shares – at fair value through profit or loss (Level 1)
2019
$
8,000
8,000
2018
$
8,000
8,000
14. OTHER ASSETS
A deposit of $30,000 (2018: $30,000) has been secured against a guarantee issued by the bank as a rental deposit for the office
lease. This cash balance is not available for withdrawal until the guarantee is withdrawn.
11. LOANS - DUE FROM ASSOCIATE
Site 2 option payment
2019
$
2018
$
127,254
127,254
127,254
127,254
The Company has signed a 24 month option on 18 June 2018 for a 250 year lease on a 19 hectare parcel of land in Teesside for a
rare earth refinery and separation plant. The agreement also includes the ability to extend the option for a further 12 months if
required. The option term commenced on 18 June 2018.
1,526,145
15. TRADE AND OTHER PAYABLES
863,493
1,526,145
Trade and other payables
Current
Non-current
Other payables
Ageing of payables
Payable within 3 months
Beyond 12 months
2019
$
2018
$
276,252
345,809
1,430,011
870,170
276,252
1,430,011
345,809
870,170
1,706,263
1,215,979
Current
Noncurrent
Loans – due from associates measured at amortised cost
Loans – due from associates measured at FVPTL
Loans – due from associates measured at FVPTL
The Associate-company loan receivables are non-recourse, interest free loans and repayable on demand.
ENABLING LOW CARBON TECHNOLOGIES PAGE 58
ENABLING LOW CARBON TECHNOLOGIES PAGE 59
ENABLING LOW CARBON TECHNOLOGIES PAGE 59
Payables are non-interest bearing, unsecured and are generally payable in 30-90 days
2019
$
2018
$
13,772
3,503
45,993
17,494
17,275
63,487
17,275
63,487
-
-
17,275
63,487
2019
$
30,000
30,000
2018
$
30,000
30,000
2019
2018
$
-
446,532
416,961
$
-
-
ENABLING LOW CARBON TECHNOLOGIES PAGE 3
Notes to Financial Statements
Notes to Financial Statements
16. PROVISIONS
18. RESERVES
Employee benefits - leave entitlements
Annual leave and long service leave
Balance at 1 July
Arising during the year
Utilised during the year
Balance at 30 June
2019
$
2018
$
196,668
160,451
2019
$
2018
$
160,451
200,241
129,837
188,748
(93,620)
(228,538)
196,668
160,451
17. LOANS AND BORROWINGS
Current:
Appian loan facility
Total Current loans & borrowings
Non-current:
Working capital loan facility – Peak African Minerals
Appian loan facility
Total Non-Current loans & borrowings
2019
$
1,824,095
1,824,095
2018
$
-
-
5,041,789
4,756,887
-
2,006,499
5,041,789
6,763,386
Current – Appian loan facility – On 20 September 2016 Appian advanced A$4,179,828 (US$3,145,739) under a full draw down
3 year loan facility. The loan is denominated in US$ with interest of 15% per annum calculated daily and capitalised at the end
of each calendar quarter, payable at the time of the loan repayment. Provisions of the facility provide for partial mandatory
repayment from subsequent capital raisings undertaken by the Company. During the year repayments of principal and interest
totalling $560,031 (US$401,037) were made. At 30 June 2019 the USD principal and capitalised interest balance was US$1,279,657
(2018: US$1,487,012).
Non-current – majority owned associate company Peak African Minerals has provided a working capital loan facility of up to
US$4,209,317 of which the facility is deemed fully drawn down at the end of the financial year. The facility is repayable the earlier
of 29 March 2021 or on the commencement of commercial production from the Ngualla project. Interest accrues at 8% per annum
until repayment.
At 30 June 2017
Share based payment made in 2018
Group’s share of associates FCTR
Exchange difference on translation of foreign
operations
At 30 June 2018
1 July 2018 FCTR adjustment on IFRS 9 adoption
At 1 July 2018 (Restated)
Share based payment made in 2019
Group’s share of associates FCTR
Exchange difference on translation of foreign
operations
At 30 June 2019
Share based
payment
reserve
2,037,316
459,792
2,497,108
471,005
$
-
-
-
-
-
Foreign currency
translation reserve
Total
$
$
-
-
525,503
2,562,819
1,068,269
459,792
1,068,269
(48,576)
(48,576)
(23,323)
(23,323)
1,521,873
4,018,981
1,683,792
471,005
1,683,792
(156,378)
(156,378)
2,497,108
1,545,196
4,042,304
2,968,113
3,049,287
6,017,400
Share based payment reserve – the reserve is used to recognise the value of equity benefits provided to employees and directors
as part of their remuneration, and other parties as part of their compensation for supply of goods and services.
Foreign currency translation reserve – the reserve is used to recognise exchange differences arising from translation of foreign
operations to the Australian dollar.
19. CONTRIBUTED EQUITY
Balance at 30 June 2017
PEK placement @ 4c per share
PEK placement @ 4c per share
PEK 1:8 Entitlement Issue @ 4c per share
PEK 1:8 Entitlement Issue @ 4c per share
PEKOB 6c Option Conversions
PEK placement @ 4c per share
PEK placement @ 4c per share
Equity issue costs
Balance at 30 June 2018
PEKOB 6c Option Conversions
Equity issue costs
Balance at 30 June 2019
15-Sep-17
25-Sep-17
27-Oct-17
2-Nov-17
27-Feb-18
3-May-18
21-Jun-18
1-Nov-18
477,455,131
65,251,219
Nos.
30,625,000
39,375,000
50,056,627
18,375,264
100
86,000,000
97,264,889
$
6
1,225,000
1,575,000
2,002,265
735,011
3,440,000
3,890,596
(901,699)
799,152,011
77,217,398
103,858
-
6,232
-
799,255,869
77,223,630
Ordinary shares have the right to receive dividends as declared, and in the event of winding up the Company, to participate in the
proceeds from the sale of all surplus assets in proportion to the number of and amounts paid upon on shares held. Ordinary shares
entitle their holder to one vote, either in person or by proxy, at a meeting of the Company.
ENABLING LOW CARBON TECHNOLOGIES PAGE 60
ENABLING LOW CARBON TECHNOLOGIES PAGE 61
ENABLING LOW CARBON TECHNOLOGIES PAGE 61
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Notes to Financial Statements
Notes to Financial Statements
16. PROVISIONS
18. RESERVES
Employee benefits - leave entitlements
196,668
160,451
Annual leave and long service leave
Balance at 1 July
Arising during the year
Utilised during the year
Balance at 30 June
Current:
Appian loan facility
Total Current loans & borrowings
Non-current:
Working capital loan facility – Peak African Minerals
Appian loan facility
Total Non-Current loans & borrowings
2019
$
2019
$
2018
$
2018
$
160,451
200,241
129,837
188,748
(93,620)
(228,538)
196,668
160,451
2019
$
1,824,095
1,824,095
2018
$
-
-
5,041,789
4,756,887
-
2,006,499
5,041,789
6,763,386
17. LOANS AND BORROWINGS
Current – Appian loan facility – On 20 September 2016 Appian advanced A$4,179,828 (US$3,145,739) under a full draw down
3 year loan facility. The loan is denominated in US$ with interest of 15% per annum calculated daily and capitalised at the end
of each calendar quarter, payable at the time of the loan repayment. Provisions of the facility provide for partial mandatory
repayment from subsequent capital raisings undertaken by the Company. During the year repayments of principal and interest
totalling $560,031 (US$401,037) were made. At 30 June 2019 the USD principal and capitalised interest balance was US$1,279,657
(2018: US$1,487,012).
until repayment.
Non-current – majority owned associate company Peak African Minerals has provided a working capital loan facility of up to
US$4,209,317 of which the facility is deemed fully drawn down at the end of the financial year. The facility is repayable the earlier
of 29 March 2021 or on the commencement of commercial production from the Ngualla project. Interest accrues at 8% per annum
At 30 June 2017
Share based payment made in 2018
Group’s share of associates FCTR
Exchange difference on translation of foreign
operations
At 30 June 2018
1 July 2018 FCTR adjustment on IFRS 9 adoption
At 1 July 2018 (Restated)
Share based payment made in 2019
Group’s share of associates FCTR
Exchange difference on translation of foreign
operations
Share based
payment
reserve
$
2,037,316
459,792
-
-
2,497,108
-
2,497,108
471,005
-
-
Foreign currency
translation reserve
$
525,503
-
1,068,269
Total
$
2,562,819
459,792
1,068,269
(48,576)
(48,576)
1,545,196
4,042,304
(23,323)
(23,323)
1,521,873
4,018,981
-
1,683,792
471,005
1,683,792
(156,378)
(156,378)
At 30 June 2019
2,968,113
3,049,287
6,017,400
Share based payment reserve – the reserve is used to recognise the value of equity benefits provided to employees and directors
as part of their remuneration, and other parties as part of their compensation for supply of goods and services.
Foreign currency translation reserve – the reserve is used to recognise exchange differences arising from translation of foreign
operations to the Australian dollar.
19. CONTRIBUTED EQUITY
Balance at 30 June 2017
PEK placement @ 4c per share
PEK placement @ 4c per share
PEK 1:8 Entitlement Issue @ 4c per share
PEK 1:8 Entitlement Issue @ 4c per share
PEKOB 6c Option Conversions
PEK placement @ 4c per share
PEK placement @ 4c per share
Equity issue costs
Balance at 30 June 2018
PEKOB 6c Option Conversions
Equity issue costs
Balance at 30 June 2019
15-Sep-17
25-Sep-17
27-Oct-17
2-Nov-17
27-Feb-18
3-May-18
21-Jun-18
1-Nov-18
Nos.
$
477,455,131
65,251,219
30,625,000
39,375,000
50,056,627
18,375,264
100
86,000,000
97,264,889
1,225,000
1,575,000
2,002,265
735,011
6
3,440,000
3,890,596
(901,699)
799,152,011
77,217,398
103,858
-
6,232
-
799,255,869
77,223,630
Ordinary shares have the right to receive dividends as declared, and in the event of winding up the Company, to participate in the
proceeds from the sale of all surplus assets in proportion to the number of and amounts paid upon on shares held. Ordinary shares
entitle their holder to one vote, either in person or by proxy, at a meeting of the Company.
ENABLING LOW CARBON TECHNOLOGIES PAGE 60
ENABLING LOW CARBON TECHNOLOGIES PAGE 61
ENABLING LOW CARBON TECHNOLOGIES PAGE 61
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Notes to Financial Statements
Notes to Financial Statements
Options over ordinary shares
20. SHARE BASED PAYMENTS
At the end of the reporting period, there were 194,888,247 options (including performance rights) over unissued shares as follows:
Employee share option plan
Options over Ordinary Shares
Balance at 30 June 2018
Expired:
PEKOB Listed options with an
exercise price of $0.06
Unlisted options with an
exercise price of $0.10
Unlisted options with an
exercise price of $0.15
Unlisted options with an
exercise price of $0.03
Issued:
Unlisted Options, exercisable
at $0.035 expiring 17 Jan 2022
Unlisted Options vesting after
1 years continuous service on
5 March 2020, exercisable at
$0.03 expiring 5 March 2023
Performance Rights to vest on
achievement of performance
criteria, as determined by the
Company’s Board, by 5 March
2020 or the Performance
Rights will lapse
Exercised:
PEKOB listed options
exercisable at $0.06
Balance at 30 June 2019
Date of expiry/
exercise or issue
Nos
Status
Exercise
Price
Expiry Date
227,054,035
The group has an Employee Option Plan (EOP) for the granting of options to eligible participants which was approved by
Shareholders at a General Meeting of the Company on 29 November 2017. During the financial year ended 30 June 2019 a total
of 48,750,000 Options were issued under the EOP to executives and employees.
Options granted during and as at the year ended 30 June 2019:
1-Nov-18
(81,111,930)
3-May-19
(3,000,000)
3-May-19
(5,000,000)
3-May-19
(1,700,000)
(90,811,930)
17-Jan-19
5,750,000
Vested
0.035
17/01/2022
5-Mar-19
43,000,000
Unvested
0.03
5/03/2023
5-Mar-19
10,000,000
Unvested
-
5/03/2020
Outstanding at 1 July 2017
Granted during the year:
1-Nov-18
(103,858)
194,888,247
Vested &
unvested
$0.00
-$0.035
5/03/2020 -
21/06/2023
During the year 48,750,000 options and 10,000,000 performance rights were issued to employees under the EOP and PRP approved
at the Annual General Meeting held on 29 November 2017. During the period a total of 90,811,930 options expired unexercised
and 103,858 PEKOB options were exercised.
Capital Management Policy
The group’s policy is to effectively manage its capital structure so that it would continue to operate as a going concern. The group
manages its contributed equity and reserves as part of its capital. The group is not subject to any externally imposed capital
requirements.
As is similar with many other exploration companies, the operational requirements of the group are funded through equity and
debt raised in various tranches. The overall capital management policy of the group remains unchanged and is consistent with
prior years.
ENABLING LOW CARBON TECHNOLOGIES PAGE 62
ENABLING LOW CARBON TECHNOLOGIES PAGE 63
ENABLING LOW CARBON TECHNOLOGIES PAGE 63
17-Jan-19 - issue of $0.035 vested options expiring 17-Jan-2022
5,750,000
$0.035
$0.0099
5-Mar-2019 - issue of $0.03 options, vesting after 1 years
continuous service, expiring 05-Mar-2023
43,000,000
$0.03
$0.0126
Outstanding at 1 July 2018
Granted / Vested during the year:
Exercised during the year
Expired during the year
Outstanding at 30 June 2019
Exercisable at 30 June 2019
*WA (weighted average)
Options granted during and as at the year ended 30 June 2018:
Number
*WA Exercise
Price
$0.093
96,750,000
Value
per
option
-
(21,700,000)
123,800,000
46,500,000
-
-
$0.0701
$0.0557
Number
20,466,666
WA Exercise
Price
$0.18
Value per
option
02-Nov-17 - issue of $0.06 vested options expiring 1-Nov-2018
10,000,000
$0.06
$0.0086
11-Dec-17 - issue of $0.06 vested options expiring 1-Nov-2018
2,000,000
$0.06
$0.0140
16-Jan-18 - issue of $0.0625 vested options expiring 16-Jan-2021
11,750,000
$0.065
$0.0298
21-Jun-2018 - issue of $0.05 options, vesting subject to
performance criteria, expiring 21-Jun-2021
21-Jun-2018 - issue of $0.10 options, vesting subject to
performance criteria, expiring 21-Jun-20221
21-Jun-2018 - issue of $0.15 options, vesting subject to
performance criteria, expiring 21-Jun-20232
16,000,000
$0.05
$0.0159
14,000,000
$0.10
$0.0130
30,000,000
$0.15
$0.0127
27-Feb-2018 - issue of $0.06 vested options expiring 27-Feb-2021
4,000,000
$0.06
$0.01885
21-Jun-18 - issue of $0.065 vested options expiring 14-Jun-2021
9,000,000
$0.065
$0.01546
Exercised during the year
Expired during the year
Outstanding at 30 June 2018
Exercisable at 30 June 2018
-
(20,466,666)
96,750,000
52,750,000
-
-
$0.093
$0.058
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 at $0.035 expiring 17 Jan 2022
17-Jan-19
5,750,000
Vested
0.035
17/01/2022
1-Nov-18
(81,111,930)
3-May-19
(3,000,000)
3-May-19
(5,000,000)
3-May-19
(1,700,000)
(90,811,930)
Options over Ordinary Shares
Balance at 30 June 2018
Expired:
PEKOB Listed options with an
exercise price of $0.06
Unlisted options with an
exercise price of $0.10
Unlisted options with an
exercise price of $0.15
Unlisted options with an
exercise price of $0.03
Issued:
Unlisted Options, exercisable
Unlisted Options vesting after
1 years continuous service on
5 March 2020, exercisable at
$0.03 expiring 5 March 2023
Performance Rights to vest on
achievement of performance
criteria, as determined by the
Company’s Board, by 5 March
2020 or the Performance
Rights will lapse
Exercised:
PEKOB listed options
exercisable at $0.06
Balance at 30 June 2019
Notes to Financial Statements
Notes to Financial Statements
Options over ordinary shares
20. SHARE BASED PAYMENTS
At the end of the reporting period, there were 194,888,247 options (including performance rights) over unissued shares as follows:
Employee share option plan
Date of expiry/
exercise or issue
Nos
Status
Expiry Date
Exercise
Price
227,054,035
The group has an Employee Option Plan (EOP) for the granting of options to eligible participants which was approved by
Shareholders at a General Meeting of the Company on 29 November 2017. During the financial year ended 30 June 2019 a total
of 48,750,000 Options were issued under the EOP to executives and employees.
Options granted during and as at the year ended 30 June 2019:
Outstanding at 1 July 2018
Granted / Vested during the year:
Number
*WA Exercise
Price
96,750,000
$0.093
Value
per
option
17-Jan-19 - issue of $0.035 vested options expiring 17-Jan-2022
5,750,000
$0.035
$0.0099
5-Mar-2019 - issue of $0.03 options, vesting after 1 years
continuous service, expiring 05-Mar-2023
43,000,000
$0.03
$0.0126
Exercised during the year
Expired during the year
Outstanding at 30 June 2019
Exercisable at 30 June 2019
*WA (weighted average)
-
(21,700,000)
123,800,000
46,500,000
-
-
$0.0701
$0.0557
5-Mar-19
43,000,000
Unvested
0.03
5/03/2023
Options granted during and as at the year ended 30 June 2018:
5-Mar-19
10,000,000
Unvested
-
5/03/2020
Outstanding at 1 July 2017
Granted during the year:
Number
20,466,666
WA Exercise
Price
$0.18
Value per
option
1-Nov-18
(103,858)
194,888,247
Vested &
unvested
$0.00
-$0.035
5/03/2020 -
21/06/2023
During the year 48,750,000 options and 10,000,000 performance rights were issued to employees under the EOP and PRP approved
at the Annual General Meeting held on 29 November 2017. During the period a total of 90,811,930 options expired unexercised
and 103,858 PEKOB options were exercised.
Capital Management Policy
02-Nov-17 - issue of $0.06 vested options expiring 1-Nov-2018
10,000,000
$0.06
$0.0086
11-Dec-17 - issue of $0.06 vested options expiring 1-Nov-2018
2,000,000
$0.06
$0.0140
16-Jan-18 - issue of $0.0625 vested options expiring 16-Jan-2021
11,750,000
$0.065
$0.0298
21-Jun-2018 - issue of $0.05 options, vesting subject to
performance criteria, expiring 21-Jun-2021
21-Jun-2018 - issue of $0.10 options, vesting subject to
performance criteria, expiring 21-Jun-20221
21-Jun-2018 - issue of $0.15 options, vesting subject to
performance criteria, expiring 21-Jun-20232
16,000,000
$0.05
$0.0159
14,000,000
$0.10
$0.0130
30,000,000
$0.15
$0.0127
27-Feb-2018 - issue of $0.06 vested options expiring 27-Feb-2021
4,000,000
$0.06
$0.01885
The group’s policy is to effectively manage its capital structure so that it would continue to operate as a going concern. The group
manages its contributed equity and reserves as part of its capital. The group is not subject to any externally imposed capital
21-Jun-18 - issue of $0.065 vested options expiring 14-Jun-2021
requirements.
prior years.
As is similar with many other exploration companies, the operational requirements of the group are funded through equity and
debt raised in various tranches. The overall capital management policy of the group remains unchanged and is consistent with
Exercised during the year
Expired during the year
Outstanding at 30 June 2018
Exercisable at 30 June 2018
$0.01546
9,000,000
-
(20,466,666)
96,750,000
52,750,000
$0.065
-
-
$0.093
$0.058
ENABLING LOW CARBON TECHNOLOGIES PAGE 62
ENABLING LOW CARBON TECHNOLOGIES PAGE 63
ENABLING LOW CARBON TECHNOLOGIES PAGE 63
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Notes to Financial Statements
Notes to Financial Statements
1 The Unlisted Options exercisable at $0.10, expiring 21 June 2022 issued to Directors, vesting subject to continuous service and the Company either (a) entering
into an agreement with a strategic partner for the development of its Ngualla Project; or (b) attracting $20 million worth of funding for FEED (Front End Engineering
and Design) for the development of the Ngualla Project.
2 The Unlisted Options exercisable at $0.15, expiring 21 June 2023 issued to Directors, vesting subject to continuous service and the Company settling a funding
package for the development and construction of the Ngualla Project.
The volume weighted exercise price of options issued during the year was $0.031 (2018: $0.104).
The weighted average remaining contractual life for share options outstanding at 30 June 2019 was 3.01 years (2018: 3.94 years).
The weighted average fair value of options issued during the year was $0.0123 per option (2018: $0.0163).
Performance Rights Plan
The group has a Performance Rights Plan (PRP) for the granting of performance rights to eligible participants which was last
approved by Shareholders at a General Meeting of the Company on 29 November 2017.
During the year ended 30 June 2019, 10,000,000 performance rights were issued under the PRP.
Performance rights granted during and as at the year
ended 30 June 2019:
Outstanding at 1 July 2018
Granted during the year:
Exercised during the year*
Expired during the year
Outstanding at 30 June 2019
Number
Exercise
Price
-
-
Value per perfor-
mance
right
10,000,000
$0.00
$0.024
-
-
-
-
10,000,000
$0.00
The options and performance rights have been valued using the Black-Scholes methodology with the following inputs:
Options and performance rights granted during and as at the year ended 30 June 2019:
16-Jan-19 - issue of $0.035 vested options expiring 17-Jan-2022
5-Mar-2019 - issue of $0.03 options, vesting after 1 years continuous service, expiring
5-Mar-2019 - unvested Performance Rights to vest on achievement of performance
criteria by 5 March 2020 or the Performance Rights will lapse
WA Share price on date of grant
WA Risk-free interest rate
Dividend yield
Expected volatility
Value per Option
05-Mar-2023
WA Share price on date of grant
WA Risk-free interest rate
Dividend yield
Expected volatility
Value per Option
WA Share price on date of grant
WA Risk-free interest rate
Dividend yield
Expected volatility
Value per performance right
$0.024
1.50%
0%
77%
$0.0099
$0.024
1.50%
0%
77%
$0.0126
$0.024
1.50%
0%
77%
$0.024
Exercisable at 30 June 2019
*Vest subject to achievement of performance criteria as determined by the Company’s Board.
-
-
Options and performance rights granted during and as at the year ended 30 June 2018:
Performance rights granted during and as at the
year ended 30 June 2018:
Outstanding at 1 July 2017
Granted during the year:
Exercised during the year
Expired during the year
Outstanding at 30 June 2018
Exercisable at 30 June 2018
Value per perfor-
mance
right
Number
Exercise
Price
8,000,000
$0.00
-
-
(8,000,000)
-
-
-
-
-
$0.00
The volume weighted exercise price of rights issued during the year was $0.00 (2018: $0.00)
The weighted average remaining contractual life for rights options outstanding at 30 June 2019 was 0.68 years (2018: 0 years)
The weighted average fair value of rights issued during the year was $0.024 per right (2018: $0.00)
WA Share price on date of grant
WA Risk-free interest rate
Dividend yield
Expected volatility
$0.042
1.50%
0%
77%
The expected volatility reflects the assumption that historical volatility over a period similar to the life of the options is indicative
of future trends, which may not necessarily be the case.
The value of options and performance rights granted are expensed over the vesting period. Included in share based payments
expense of $471,005 (2018: $459,792) is $Nil (2018: $Nil) relating to the shares issued during the year, $411,822* (2018:
$939,661) related to options granted during the year and prior year, and $59,183 (2018:- $479,869*) relating to performance
rights granted in the prior year.
*Write back of non-market based Options and Performance Rights expired unvested during the year.
ENABLING LOW CARBON TECHNOLOGIES PAGE 64
ENABLING LOW CARBON TECHNOLOGIES PAGE 65
ENABLING LOW CARBON TECHNOLOGIES PAGE 65
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Notes to Financial Statements
Notes to Financial Statements
The options and performance rights have been valued using the Black-Scholes methodology with the following inputs:
Options and performance rights granted during and as at the year ended 30 June 2019:
16-Jan-19 - issue of $0.035 vested options expiring 17-Jan-2022
WA Share price on date of grant
WA Risk-free interest rate
Dividend yield
Expected volatility
Value per Option
$0.024
1.50%
0%
77%
$0.0099
5-Mar-2019 - issue of $0.03 options, vesting after 1 years continuous service, expiring
05-Mar-2023
WA Share price on date of grant
WA Risk-free interest rate
Dividend yield
Expected volatility
Value per Option
$0.024
1.50%
0%
77%
$0.0126
5-Mar-2019 - unvested Performance Rights to vest on achievement of performance
criteria by 5 March 2020 or the Performance Rights will lapse
WA Share price on date of grant
WA Risk-free interest rate
Dividend yield
Expected volatility
Value per performance right
$0.024
1.50%
0%
77%
$0.024
Options and performance rights granted during and as at the year ended 30 June 2018:
WA Share price on date of grant
WA Risk-free interest rate
Dividend yield
Expected volatility
$0.042
1.50%
0%
77%
The expected volatility reflects the assumption that historical volatility over a period similar to the life of the options is indicative
of future trends, which may not necessarily be the case.
The value of options and performance rights granted are expensed over the vesting period. Included in share based payments
expense of $471,005 (2018: $459,792) is $Nil (2018: $Nil) relating to the shares issued during the year, $411,822* (2018:
$939,661) related to options granted during the year and prior year, and $59,183 (2018:- $479,869*) relating to performance
rights granted in the prior year.
*Write back of non-market based Options and Performance Rights expired unvested during the year.
1 The Unlisted Options exercisable at $0.10, expiring 21 June 2022 issued to Directors, vesting subject to continuous service and the Company either (a) entering
into an agreement with a strategic partner for the development of its Ngualla Project; or (b) attracting $20 million worth of funding for FEED (Front End Engineering
and Design) for the development of the Ngualla Project.
2 The Unlisted Options exercisable at $0.15, expiring 21 June 2023 issued to Directors, vesting subject to continuous service and the Company settling a funding
package for the development and construction of the Ngualla Project.
The volume weighted exercise price of options issued during the year was $0.031 (2018: $0.104).
The weighted average remaining contractual life for share options outstanding at 30 June 2019 was 3.01 years (2018: 3.94 years).
The weighted average fair value of options issued during the year was $0.0123 per option (2018: $0.0163).
Performance Rights Plan
The group has a Performance Rights Plan (PRP) for the granting of performance rights to eligible participants which was last
approved by Shareholders at a General Meeting of the Company on 29 November 2017.
During the year ended 30 June 2019, 10,000,000 performance rights were issued under the PRP.
Performance rights granted during and as at the year
ended 30 June 2019:
*Vest subject to achievement of performance criteria as determined by the Company’s Board.
Performance rights granted during and as at the
year ended 30 June 2018:
Outstanding at 1 July 2018
Granted during the year:
Exercised during the year*
Expired during the year
Outstanding at 30 June 2019
Exercisable at 30 June 2019
Outstanding at 1 July 2017
Granted during the year:
Exercised during the year
Expired during the year
Outstanding at 30 June 2018
Exercisable at 30 June 2018
Number
Exercise
Price
Value per perfor-
mance
right
10,000,000
$0.00
$0.024
10,000,000
$0.00
Number
Exercise
Price
8,000,000
$0.00
Value per perfor-
mance
right
(8,000,000)
$0.00
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
The volume weighted exercise price of rights issued during the year was $0.00 (2018: $0.00)
The weighted average remaining contractual life for rights options outstanding at 30 June 2019 was 0.68 years (2018: 0 years)
The weighted average fair value of rights issued during the year was $0.024 per right (2018: $0.00)
ENABLING LOW CARBON TECHNOLOGIES PAGE 64
ENABLING LOW CARBON TECHNOLOGIES PAGE 65
ENABLING LOW CARBON TECHNOLOGIES PAGE 65
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Notes to Financial Statements
Notes to Financial Statements
21. CONTINGENCIES AND COMMITMENTS
23. GROUP STRUCTURE
Lease commitments
The company has committed to an office lease of $33,000 per annum for 3 years to 31 December 2020. The lease provides a break
clause during each year of the lease.
The parent and the ultimate parent entity of the Group is Peak Resources Limited, a company listed on the Australian Securities
Up to 1 year
1 to 5 Years
Capital Commitments
At 30 June 2019, the Group has no capital commitments. (2018: Nil).
Contingencies
At 30 June 2019, the Group had no contingencies (2018: Nil).
2019
2018
$
$
16,500
16,500
-
-
16,500
16,500
22. KEY MANAGEMENT PERSONNEL DISCLOSURE
Salary and fees – short term benefits
Non-monetary benefits
Superannuation
Share based payments
2019
$
1,371,249
103,032
57,950
395,256
2018
$
1,647,780
88,830
64,923
34,489
1,927,487
1,836,022
Loans to KMP’s
No loans were made to KMP’s during the financial year (2018: Nil)
Other transaction and balances with KMP’s
During the year Steinepreis Paganin Lawyers and Consultants, a legal practice associated with Mr Jonathan Murray received
$20,010 (2018: $191,327) as fees for the provision of legal advice. Balance outstanding at 30 June 2019 and included in trade
creditors $10,946 (30 June 2018:$35,332).
These costs have not been included in directors’ remuneration as these fees were not paid to individual directors in relation to the
management of the affairs of the Company. All transactions were entered into on normal commercial terms.
Parent and subsdiaries
Exchange.
The components of the Group are:
Parent
Peak Resources Limited
Controlled entities
PRL Pty Ltd
Peak Hill Gold Mines Pty Ltd
Redpalm Pty Ltd
Pan African Exploration Limited
Peak Resources Tanzania Limited
Peak Technology Metals Limited
Associated entities
Peak African Minerals Limited (Directly)
PR Ng Minerals Limited (Indirectly)
management strategy are noted below.
Fair value of financial instruments
Cash and cash equivalents
Trade and other receivables
Other financial assets
Loans due from associate carried at FVPTL
Investments
Trade and other payables
Current loans and borrowings
Non-Current loans and borrowings
Ownership interest
Incorporation
2019
2018
Australia
100%
100%
Australia
Australia
Australia
Australia
Tanzania
U.K
Mauritius
Tanzania
100%
100%
100%
100%
100%
100%
75%
75%
100%
100%
100%
100%
100%
-
75%
75%
2,147,324
6,468,748
2019
$
17,275
30,000
863,493
8,000
(1,706,263)
(1,824,095)
(5,041,789)
2018
$
63,487
30,000
912,895
8,000
(1,215,979)
-
(6,763,386)
24. FINANCIAL INSTRUMENTS
The financial instruments of the Group are (i) cash and cash equivalents; (ii) trade and other receivables; (iii) trade and other
payables, iv) investments carried at fair value through profit or loss; (v) loans due from associates measured at fair value through
profit or loss; (vi) other financial assets, including bank deposits.
The Group’s principal financial instruments are cash and short term deposits. The main purpose of these financial instruments is
to finance the Group’s operations. It is, and has been throughout the period under review, the Group’s policy that no trading in
financial instruments shall be undertaken.
The financial instruments expose the group to certain risks. The nature and extent of such risks, and the management's risk
ENABLING LOW CARBON TECHNOLOGIES PAGE 66
ENABLING LOW CARBON TECHNOLOGIES PAGE 67
ENABLING LOW CARBON TECHNOLOGIES PAGE 67
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Notes to Financial Statements
Notes to Financial Statements
21. CONTINGENCIES AND COMMITMENTS
Lease commitments
clause during each year of the lease.
The company has committed to an office lease of $33,000 per annum for 3 years to 31 December 2020. The lease provides a break
23. GROUP STRUCTURE
Parent and subsdiaries
The parent and the ultimate parent entity of the Group is Peak Resources Limited, a company listed on the Australian Securities
Exchange.
The components of the Group are:
Up to 1 year
1 to 5 Years
Capital Commitments
At 30 June 2019, the Group has no capital commitments. (2018: Nil).
Contingencies
At 30 June 2019, the Group had no contingencies (2018: Nil).
Salary and fees – short term benefits
Non-monetary benefits
Superannuation
Share based payments
2019
2018
$
-
$
-
16,500
16,500
16,500
16,500
2019
$
1,371,249
103,032
57,950
395,256
2018
$
1,647,780
88,830
64,923
34,489
1,927,487
1,836,022
22. KEY MANAGEMENT PERSONNEL DISCLOSURE
Loans to KMP’s
No loans were made to KMP’s during the financial year (2018: Nil)
Other transaction and balances with KMP’s
During the year Steinepreis Paganin Lawyers and Consultants, a legal practice associated with Mr Jonathan Murray received
$20,010 (2018: $191,327) as fees for the provision of legal advice. Balance outstanding at 30 June 2019 and included in trade
creditors $10,946 (30 June 2018:$35,332).
Parent
Peak Resources Limited
Controlled entities
PRL Pty Ltd
Peak Hill Gold Mines Pty Ltd
Redpalm Pty Ltd
Pan African Exploration Limited
Peak Resources Tanzania Limited
Peak Technology Metals Limited
Associated entities
Peak African Minerals Limited (Directly)
PR Ng Minerals Limited (Indirectly)
Ownership interest
Incorporation
2019
2018
Australia
100%
100%
Australia
Australia
Australia
Australia
Tanzania
U.K
Mauritius
Tanzania
100%
100%
100%
100%
100%
100%
75%
75%
100%
100%
100%
100%
100%
-
75%
75%
24. FINANCIAL INSTRUMENTS
The financial instruments of the Group are (i) cash and cash equivalents; (ii) trade and other receivables; (iii) trade and other
payables, iv) investments carried at fair value through profit or loss; (v) loans due from associates measured at fair value through
profit or loss; (vi) other financial assets, including bank deposits.
The Group’s principal financial instruments are cash and short term deposits. The main purpose of these financial instruments is
to finance the Group’s operations. It is, and has been throughout the period under review, the Group’s policy that no trading in
financial instruments shall be undertaken.
The financial instruments expose the group to certain risks. The nature and extent of such risks, and the management's risk
management strategy are noted below.
These costs have not been included in directors’ remuneration as these fees were not paid to individual directors in relation to the
management of the affairs of the Company. All transactions were entered into on normal commercial terms.
Fair value of financial instruments
Cash and cash equivalents
Trade and other receivables
Other financial assets
Loans due from associate carried at FVPTL
Investments
Trade and other payables
Current loans and borrowings
Non-Current loans and borrowings
2019
$
2018
$
2,147,324
6,468,748
17,275
30,000
863,493
8,000
(1,706,263)
(1,824,095)
(5,041,789)
63,487
30,000
912,895
8,000
(1,215,979)
-
(6,763,386)
ENABLING LOW CARBON TECHNOLOGIES PAGE 66
ENABLING LOW CARBON TECHNOLOGIES PAGE 67
ENABLING LOW CARBON TECHNOLOGIES PAGE 67
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Notes to Financial Statements
Notes to Financial Statements
The carrying amount of financial instruments closely approximate their fair value on account of the short maturity cycle except Due
from Associate and Non-current – Loans and Borrowings.
For Due from Associate and Non-current, their fair value is determined by discounting future cash flows using rates currently
available for debt on similar terms, credit risk and remaining maturities (Level 2).
Interest rate risk
market interest rates.
For the Non-current – Loans and borrowings their carrying amounts approximate their fair values as it is subject to commercial
lending rates (Level 2).
the Group’s operations.
Interest rate risk is the risk that fair values and cash flows of the Group’s financial instruments will be affected by changes in the
The Group’s cash and cash equivalents are impacted by interest rate risks. Other receivables and payables have short maturities
and are non-interest bearing. Management believes that the risk of interest rate movement would not have a material impact of
Credit Risk
The group’s credit risks arise from potential default of trade and other receivables, cash and cash equivalents, other financial assets
and amount due from associates. The maximum credit exposure is limited to the carrying amount of trade and other receivables
and amount due from associates $1,735,578 (2018: $1,589,631) at reporting dates.
As at 30 June 2019, the receivable balances consist primarily of GST credits. Management does not consider the GST receivable to
be at risk of default as these are receivable from the Government agencies.
Credit risk from balances with banks and financial instruments is mitigated by holding balances with banks with a high credit rating.
The maximum exposure for cash and cash equivalents is shown below.
There were no significant concentrations of credit risks.
Liquidity risk
The group’s liquidity risks arise from potential inability of the group to meet its financial obligations as and when they fall due,
generally due to shortage of cleared funds. The group is exposed to liquidity risk on account of trade and other payables. The group
manages its liquidity risk through continuously monitoring the cleared funds position; and by utilising short term cash budgets.
The contractual maturity analysis of the group’s financial instruments are noted below:
Up to 3
months
$
2019
> 3 months
$
Total
$
Up to 3
months
$
2018
> 3 months
$
Total
$
(276,252)
(1,430,011)
(1,706,263)
(345,809)
(870,170)
(1,215,979)
(1,824,095)
-
(1,824,095)
-
(6,826,811)
(6,826,811)
-
-
-
-
(6,945,792)
(6,945,792)
(2,100,347)
(8,256,822)
(10,357,169)
(345,809)
(7,815,962)
(8,161,771 )
2,147,324
-
2,147,324
6,468,748
-
6,468,748
Changes in liabilities arising from financing activities during the year ended 30 June 2019:
-
30,000
30,000
-
30,000
30,000
446,532
416,961
863,493
306,524
1,219,621
1,526,145
-
17,275
8,000
-
8,000
17,275
-
63,487
8,000
-
8,000
63,487
2,611,131
454,961
3,066,092
6,838,759
1,257,621
8,096,380
Financial liabilities
Trade and other
payables
Short term loans(1)
Long term loans(2)
Total financial
liabilities
Financial assets
Cash and cash
equivalents
Other financial
assets
Loans due from
associate
Investments
Trade and other
receivables
Total financial
assets
(1) Appian Bridging loan advanced on 20 September 2016 with a 3 year loan facility. Provisions of the facility provide for partial mandatory repayment from
subsequent capital raisings undertaken by the Company
(2) PAM working capital facility is repayable the earlier of 29 March 2021 or on the commencement of commercial production from the Ngualla project.
ENABLING LOW CARBON TECHNOLOGIES PAGE 68
ENABLING LOW CARBON TECHNOLOGIES PAGE 69
ENABLING LOW CARBON TECHNOLOGIES PAGE 69
Management does not closely monitor the interest rates offered on cash and cash equivalents as the Group’s primary objective is
exploration of resources rather than earning interest income. The cash balances are invested at the prevailing short term market
interest rates with credit worthy financial institutions.
The sensitivity of the interest bearing financial instruments to a 1% change in market interest rate are noted below:
2019
$
2018
$
2,147,324
6,468,748
21,473
64,687
(21,473)
(64,687)
Cash and cash equivalents
Impact on profit and equity: +1% movement
Impact on profit and equity: -1% movement
Foreign currency risk
The Group’s exposure to foreign currency price risk is limited to the USD denominated loan balances. At 30 June 2019 the Group
had an outstanding balance of USD $6,236,664 (2018: $5,657,210). The Group will transfer cash and cash equivalents into foreign
currency to meet short term expenditure obligations.
The Group’s expenditure obligations in Tanzania are primarily in US dollars as a result the Group is exposed to fluctuations in the
US dollar to Australian currency. These exposures are not subject to a hedging programme. The Board and management from time
to time having regard to likely forward commitments review this policy.
The following table demonstrate the sensitivity to a reasonably possible change in USD exchange rates, with all other variables
held constant. The impact on the Group’s profit before tax and equity is due to changes in the fair value of the USD denominated
loan balances.
USD$ denominated loan balances in AU$
Impact on profit and equity: +5% movement in USD exchange rate
Impact on profit and equity: -5% movement in USD exchange rate
Commodity price risk
The Group’s exposure to commodity price risk is minimal at this stage of the operation.
2019
$
8,295,894
414,795
(414,795)
2018
$
7,633,556
381,678
(381,678)
1-Jul-18
Cash flows
Other
Movement
30-Jun-19
$
$
$
$
2019
Foreign
exchange
movement
$
(6,763,386)
287,725
(373,620)
(16,603)
(6,865,884)
(6,763,386)
287,725
(373,620)
(16,603)
(6,865,884)
Financial liabilities
Current and Non-current
interest bearing loans and
borrowings
Total liabilities from financing
activities
ENABLING LOW CARBON TECHNOLOGIES PAGE 3
Notes to Financial Statements
Notes to Financial Statements
The carrying amount of financial instruments closely approximate their fair value on account of the short maturity cycle except Due
from Associate and Non-current – Loans and Borrowings.
For Due from Associate and Non-current, their fair value is determined by discounting future cash flows using rates currently
available for debt on similar terms, credit risk and remaining maturities (Level 2).
For the Non-current – Loans and borrowings their carrying amounts approximate their fair values as it is subject to commercial
Interest rate risk
Interest rate risk is the risk that fair values and cash flows of the Group’s financial instruments will be affected by changes in the
market interest rates.
The Group’s cash and cash equivalents are impacted by interest rate risks. Other receivables and payables have short maturities
and are non-interest bearing. Management believes that the risk of interest rate movement would not have a material impact of
the Group’s operations.
Management does not closely monitor the interest rates offered on cash and cash equivalents as the Group’s primary objective is
exploration of resources rather than earning interest income. The cash balances are invested at the prevailing short term market
interest rates with credit worthy financial institutions.
and amount due from associates $1,735,578 (2018: $1,589,631) at reporting dates.
The sensitivity of the interest bearing financial instruments to a 1% change in market interest rate are noted below:
Cash and cash equivalents
Impact on profit and equity: +1% movement
Impact on profit and equity: -1% movement
2019
$
2018
$
2,147,324
6,468,748
21,473
64,687
(21,473)
(64,687)
Foreign currency risk
The Group’s exposure to foreign currency price risk is limited to the USD denominated loan balances. At 30 June 2019 the Group
had an outstanding balance of USD $6,236,664 (2018: $5,657,210). The Group will transfer cash and cash equivalents into foreign
currency to meet short term expenditure obligations.
The Group’s expenditure obligations in Tanzania are primarily in US dollars as a result the Group is exposed to fluctuations in the
US dollar to Australian currency. These exposures are not subject to a hedging programme. The Board and management from time
to time having regard to likely forward commitments review this policy.
The following table demonstrate the sensitivity to a reasonably possible change in USD exchange rates, with all other variables
held constant. The impact on the Group’s profit before tax and equity is due to changes in the fair value of the USD denominated
loan balances.
USD$ denominated loan balances in AU$
Impact on profit and equity: +5% movement in USD exchange rate
Impact on profit and equity: -5% movement in USD exchange rate
Commodity price risk
The Group’s exposure to commodity price risk is minimal at this stage of the operation.
2019
$
8,295,894
414,795
(414,795)
2018
$
7,633,556
381,678
(381,678)
2,147,324
2,147,324
6,468,748
6,468,748
Changes in liabilities arising from financing activities during the year ended 30 June 2019:
30,000
30,000
30,000
30,000
446,532
416,961
863,493
306,524
1,219,621
1,526,145
8,000
8,000
17,275
63,487
8,000
8,000
63,487
-
-
17,275
2,611,131
454,961
3,066,092
6,838,759
1,257,621
8,096,380
(1) Appian Bridging loan advanced on 20 September 2016 with a 3 year loan facility. Provisions of the facility provide for partial mandatory repayment from
subsequent capital raisings undertaken by the Company
(2) PAM working capital facility is repayable the earlier of 29 March 2021 or on the commencement of commercial production from the Ngualla project.
2019
1-Jul-18
Cash flows
$
$
Foreign
exchange
movement
$
Other
Movement
30-Jun-19
$
$
(6,763,386)
287,725
(373,620)
(16,603)
(6,865,884)
(6,763,386)
287,725
(373,620)
(16,603)
(6,865,884)
Financial liabilities
Current and Non-current
interest bearing loans and
borrowings
Total liabilities from financing
activities
ENABLING LOW CARBON TECHNOLOGIES PAGE 68
ENABLING LOW CARBON TECHNOLOGIES PAGE 69
ENABLING LOW CARBON TECHNOLOGIES PAGE 69
lending rates (Level 2).
Credit Risk
The group’s credit risks arise from potential default of trade and other receivables, cash and cash equivalents, other financial assets
and amount due from associates. The maximum credit exposure is limited to the carrying amount of trade and other receivables
As at 30 June 2019, the receivable balances consist primarily of GST credits. Management does not consider the GST receivable to
be at risk of default as these are receivable from the Government agencies.
Credit risk from balances with banks and financial instruments is mitigated by holding balances with banks with a high credit rating.
The maximum exposure for cash and cash equivalents is shown below.
There were no significant concentrations of credit risks.
Liquidity risk
The group’s liquidity risks arise from potential inability of the group to meet its financial obligations as and when they fall due,
generally due to shortage of cleared funds. The group is exposed to liquidity risk on account of trade and other payables. The group
manages its liquidity risk through continuously monitoring the cleared funds position; and by utilising short term cash budgets.
The contractual maturity analysis of the group’s financial instruments are noted below:
2019
> 3 months
Up to 3
months
$
Total
$
Up to 3
months
$
2018
> 3 months
Total
(276,252)
(1,430,011)
(1,706,263)
(345,809)
(870,170)
(1,215,979)
Short term loans(1)
(1,824,095)
(1,824,095)
Long term loans(2)
-
(6,826,811)
(6,826,811)
(6,945,792)
(6,945,792)
(2,100,347)
(8,256,822)
(10,357,169)
(345,809)
(7,815,962)
(8,161,771 )
$
-
-
-
$
-
$
-
-
-
-
-
-
-
Financial liabilities
Trade and other
payables
Total financial
liabilities
Financial assets
Cash and cash
equivalents
Other financial
assets
Loans due from
associate
Investments
Trade and other
receivables
Total financial
assets
ENABLING LOW CARBON TECHNOLOGIES PAGE 3
Notes to Financial Statements
Notes to Financial Statements
26. PARENT ENTITY DISCLOSURE
The following details information related to the parent entity, Peak Resources Limited, at 30 June 2019. The information present-
ed here has been prepared using consistent accounting policies as presented in Note 2.
Changes in liabilities arising from financing activities during the year ended 30 June 2018:
1-Jul-17
Cash flows
$
$
2018
Foreign
exchange
movement
$
(9,181,918)
2,588,447
(169,915)
(9,181,918)
2,588,447
(169,915)
Other
Movement
30-Jun-18
$
-
-
$
(6,763,386)
(6,763,386)
Financial liabilities
Current and Non-current
interest bearing loans and
borrowings
Total liabilities from financing
activities
25. SUBSEQUENT EVENTS
On 29 July 2019, Peak announced a proposed transaction which would restructure the ownership of PAM Group. PAM is the
parent Company of Tanzanian Registered PR NG Minerals Limited which is the holder of the Ngulla Project Exploration Licences
and Special Mining Licence application. Under the transaction, which is subject to completion of legal documentation, approval
of Peak’s shareholders and other regulatory approvals, PAM’s other shareholders Appian and IFC would swap out their PAM
shareholdings for shares in Peak. Appian to receive 327,490,452 and IFC to receive up to 64,268,651 new fully paid ordinary shares
in Peak in return for their respective 20% and 3.85% (diluted) ownership interests in PAM. Following completion of the transaction,
as contemplated, PAM would then become a 100% owned subsidiary of Peak.
On 8 August 2019 Peak completed a placement of 119,888,380 new fully paid ordinary shares in Peak at $0.04 per share to raise
gross proceeds (before costs) of A$4.795m and has subsequently repaid the Appian loan facility in full.
Other than the matters referred to above there were no other events that have a material impact on the financial statements or
operations of the Group and Company.
Financial position
Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
Net assets
Equity
Contributed equity
Share based payment reserve
Accumulated losses
Total equity
Financial performance
Loss for the year
Other comprehensive income
Total comprehensive loss for the year
2019
$
2018
$
2,201,439
6,565,840
22,071,069
31,287,441
24,272,508
37,853,281
2,287,914
499,125
6,006,554
7,633,556
8,294,468
8,132,681
15,978,040
29,720,600
77,539,381
77,533,149
3,031,596
2,560,592
(64,592,937)
(50,373,141)
15,978,040
29,720,600
(2,747,320)
(2,940,704)
-
-
(2,747,320)
(2,940,704)
Peak Resources Limited had no commitments to purchase property, plant and equipment or contingent liabilities, other than the
performance guarantee as referred to in Note 22, at year end.
ENABLING LOW CARBON TECHNOLOGIES PAGE 70
ENABLING LOW CARBON TECHNOLOGIES PAGE 71
ENABLING LOW CARBON TECHNOLOGIES PAGE 71
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Changes in liabilities arising from financing activities during the year ended 30 June 2018:
1-Jul-17
Cash flows
Other
30-Jun-18
Movement
$
$
$
2018
Foreign
exchange
movement
$
(9,181,918)
2,588,447
(169,915)
(6,763,386)
(9,181,918)
2,588,447
(169,915)
(6,763,386)
$
-
-
Financial liabilities
Current and Non-current
interest bearing loans and
borrowings
Total liabilities from financing
activities
25. SUBSEQUENT EVENTS
On 29 July 2019, Peak announced a proposed transaction which would restructure the ownership of PAM Group. PAM is the
parent Company of Tanzanian Registered PR NG Minerals Limited which is the holder of the Ngulla Project Exploration Licences
and Special Mining Licence application. Under the transaction, which is subject to completion of legal documentation, approval
of Peak’s shareholders and other regulatory approvals, PAM’s other shareholders Appian and IFC would swap out their PAM
shareholdings for shares in Peak. Appian to receive 327,490,452 and IFC to receive up to 64,268,651 new fully paid ordinary shares
in Peak in return for their respective 20% and 3.85% (diluted) ownership interests in PAM. Following completion of the transaction,
as contemplated, PAM would then become a 100% owned subsidiary of Peak.
On 8 August 2019 Peak completed a placement of 119,888,380 new fully paid ordinary shares in Peak at $0.04 per share to raise
gross proceeds (before costs) of A$4.795m and has subsequently repaid the Appian loan facility in full.
Other than the matters referred to above there were no other events that have a material impact on the financial statements or
operations of the Group and Company.
Notes to Financial Statements
Notes to Financial Statements
26. PARENT ENTITY DISCLOSURE
The following details information related to the parent entity, Peak Resources Limited, at 30 June 2019. The information present-
ed here has been prepared using consistent accounting policies as presented in Note 2.
Financial position
Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
Net assets
Equity
Contributed equity
Share based payment reserve
Accumulated losses
Total equity
Financial performance
Loss for the year
Other comprehensive income
Total comprehensive loss for the year
2019
$
2018
$
2,201,439
6,565,840
22,071,069
31,287,441
24,272,508
37,853,281
2,287,914
499,125
6,006,554
7,633,556
8,294,468
8,132,681
15,978,040
29,720,600
77,539,381
77,533,149
3,031,596
2,560,592
(64,592,937)
(50,373,141)
15,978,040
29,720,600
(2,747,320)
(2,940,704)
-
-
(2,747,320)
(2,940,704)
Peak Resources Limited had no commitments to purchase property, plant and equipment or contingent liabilities, other than the
performance guarantee as referred to in Note 22, at year end.
ENABLING LOW CARBON TECHNOLOGIES PAGE 70
ENABLING LOW CARBON TECHNOLOGIES PAGE 71
ENABLING LOW CARBON TECHNOLOGIES PAGE 71
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Directors' Declaration
DIRECTORS’ DECLARATION
In accordance with a resolution of the directors of Peak Resources Limited, I state that:
In the opinion of the Directors:
(a)
(b)
(c)
Subject to the matters set out in Note 2 to the Financial Statements there are reasonable grounds to believe that the
company will be able to pay its debts as and when they become due and payable;
the attached financial statements are in compliance with International Financial Reporting Standards, as stated in note 2 to
the financial statements;
the attached financial statements and notes thereto for the financial year ended 30 June 2019 are in accordance with the
Corporations Act 2001, including compliance with accounting standards and giving a true and fair view of the financial
position as at 30 June 2019 and performance of the consolidated entity for the year ended on that date;
(d)
The Directors have been given the declarations required by section 295A of the Corporations Act 2001
Signed in accordance with a resolution of the Directors made pursuant to s295(5) of the Corporations Act 2001.
On behalf of the Directors
Peter Meurer
Non-Executive Chairman
Perth, 13 September 2019
Tenement Schedule and
Reserves and Resources
TENEMENT SCHEDULE
Project
Tenement
%
Status
Arrangement/Comment
Tanzanian Projects
Mikuwo
Mlingi
Ngualla
PL 9157/2013
75*
Granted
PL 10897/2016
75*
Granted
SML 00601/2017
75*
Application
Held by 100% Tanzanian associate company
PR NG Minerals Ltd
Held by 100% Tanzanian associate company
PR NG Minerals Ltd
Held by 100% Tanzanian associate company PR
NG Minerals Ltd
*Peak holds a 75% beneficial interest in the above three licences with Appian and IFC holding a 20% and 5% interest respectively
through their equity interest in Peak African Minerals.
ORE RESERVES AND MINERAL RESOURCES
CORPORATE GOVERNANCE AND INTERNAL CONTROLS
Peak ensures that the Ore Reserve and Mineral Resources estimates are subject to appropriate governance and internal controls
which are reviewed periodically in line with the expansion and development of the Company. The annual review date is 30 June.
The Mineral Resource estimate and Ore Reserve were derived by independent consulting organisations whose staff are highly
competent and professional. Competent Persons named by the company are Members or Fellows of the Australian Institute of Mining
and Metallurgy and/or the Australian Institute of Geoscientists and qualify as Competent Persons as defined in the JORC Code. The
Mineral Resource consultant carried out rigorous reviews of the quality of the database and geological models prior to estimation.
Internal technical reviews are carried out systematically by both of the independent consulting organisations.
The Company confirms that it is not aware of any new information or data that materially affects the information included in the
original market announcements and that all material assumptions and technical parameters underpinning the estimates in the
relevant market announcement continue to apply and have not materially changed. The Company confirms that the form and context
in which the Competent Person's findings are presented have not been materially modified from the original market announcements.
THERE HAS BEEN NO CHANGE TO ORE RESERVES AND MINERAL RESOURCES WITH PREVIOUS YEAR
Ore Reserve estimates
data.
The Ore Reserve estimate was completed by Orelogy Consulting Pty Ltd and released to the ASX on 12 April 2017 titled "Ngualla
Rare Earth Project - Updated Ore Reserve". The release includes a detailed summary of the supporting project assumptions and
Table 1: Classification of Ore Reserve estimates for the Weathered Bastnaesite Zone at Ngualla.
ORE RESERVE AS AT 30 JUNE 2019
JORC CATEGORY
Ore Tonnes
(millions)
REO %
Contained REO
Tonnes
Proved
Probable
Total
17.0
1.5
18.5
4.78
5.10
4.80
813,000
74,000
887,000
ENABLING LOW CARBON TECHNOLOGIES PAGE 72
See Table 2 for the breakdown of individual REO’s. Reported according to the JORC 2012 Code and Guidelines.
ENABLING LOW CARBON TECHNOLOGIES PAGE 73
ENABLING LOW CARBON TECHNOLOGIES PAGE 73
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Directors' Declaration
DIRECTORS’ DECLARATION
In accordance with a resolution of the directors of Peak Resources Limited, I state that:
In the opinion of the Directors:
(a)
Subject to the matters set out in Note 2 to the Financial Statements there are reasonable grounds to believe that the
company will be able to pay its debts as and when they become due and payable;
(b)
the attached financial statements are in compliance with International Financial Reporting Standards, as stated in note 2 to
the financial statements;
(c)
the attached financial statements and notes thereto for the financial year ended 30 June 2019 are in accordance with the
Corporations Act 2001, including compliance with accounting standards and giving a true and fair view of the financial
position as at 30 June 2019 and performance of the consolidated entity for the year ended on that date;
(d)
The Directors have been given the declarations required by section 295A of the Corporations Act 2001
Signed in accordance with a resolution of the Directors made pursuant to s295(5) of the Corporations Act 2001.
On behalf of the Directors
Peter Meurer
Non-Executive Chairman
Perth, 13 September 2019
Tenement Schedule and
Reserves and Resources
TENEMENT SCHEDULE
Project
Tenement
%
Status
Arrangement/Comment
Tanzanian Projects
Mikuwo
Mlingi
Ngualla
PL 9157/2013
75*
Granted
PL 10897/2016
75*
Granted
SML 00601/2017
75*
Application
Held by 100% Tanzanian associate company
PR NG Minerals Ltd
Held by 100% Tanzanian associate company
PR NG Minerals Ltd
Held by 100% Tanzanian associate company PR
NG Minerals Ltd
*Peak holds a 75% beneficial interest in the above three licences with Appian and IFC holding a 20% and 5% interest respectively
through their equity interest in Peak African Minerals.
ORE RESERVES AND MINERAL RESOURCES
CORPORATE GOVERNANCE AND INTERNAL CONTROLS
Peak ensures that the Ore Reserve and Mineral Resources estimates are subject to appropriate governance and internal controls
which are reviewed periodically in line with the expansion and development of the Company. The annual review date is 30 June.
The Mineral Resource estimate and Ore Reserve were derived by independent consulting organisations whose staff are highly
competent and professional. Competent Persons named by the company are Members or Fellows of the Australian Institute of Mining
and Metallurgy and/or the Australian Institute of Geoscientists and qualify as Competent Persons as defined in the JORC Code. The
Mineral Resource consultant carried out rigorous reviews of the quality of the database and geological models prior to estimation.
Internal technical reviews are carried out systematically by both of the independent consulting organisations.
The Company confirms that it is not aware of any new information or data that materially affects the information included in the
original market announcements and that all material assumptions and technical parameters underpinning the estimates in the
relevant market announcement continue to apply and have not materially changed. The Company confirms that the form and context
in which the Competent Person's findings are presented have not been materially modified from the original market announcements.
THERE HAS BEEN NO CHANGE TO ORE RESERVES AND MINERAL RESOURCES WITH PREVIOUS YEAR
Ore Reserve estimates
The Ore Reserve estimate was completed by Orelogy Consulting Pty Ltd and released to the ASX on 12 April 2017 titled "Ngualla
Rare Earth Project - Updated Ore Reserve". The release includes a detailed summary of the supporting project assumptions and
data.
Table 1: Classification of Ore Reserve estimates for the Weathered Bastnaesite Zone at Ngualla.
ORE RESERVE AS AT 30 JUNE 2019
JORC CATEGORY
Ore Tonnes
(millions)
REO %
Contained REO
Tonnes
Proved
Probable
Total
17.0
1.5
18.5
4.78
5.10
4.80
813,000
74,000
887,000
ENABLING LOW CARBON TECHNOLOGIES PAGE 72
See Table 2 for the breakdown of individual REO’s. Reported according to the JORC 2012 Code and Guidelines.
ENABLING LOW CARBON TECHNOLOGIES PAGE 73
ENABLING LOW CARBON TECHNOLOGIES PAGE 73
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Tenement Schedule and
Reserves and Resources
Table 2: Relative components of individual rare earth oxides (including yttrium) as a percentage of total REO for the Ngualla Project Ore Reserve
estimate (refer to Table 1)
REO GRADE (%)
% OF TOTAL REO
RARE EARTH OXIDES
Lanthanum
Cerium
Praseodymium
Neodymium
Samarium
Europium
Gadolinium
Terbium
Dysprosium
Holmium
Erbium
Thulium
Ytterbium
Lutetium
Yttrium
Total REO
Proved
Probable
All
Proved
Probable
All
1.318
2.305
0.228
0.788
0.077
0.014
0.029
0.002
0.004
0.000
0.001
0.000
0.001
0.000
0.010
4.78
1.418
2.456
0.243
0.838
0.082
0.015
0.031
0.002
0.004
0.000
0.002
0.000
0.001
0.000
0.010
5.10
1.326
2.317
0.229
0.792
0.077
0.014
0.030
0.002
0.004
0.000
0.002
0.000
0.001
0.000
0.010
4.80
27.59
48.25
4.77
16.49
1.61
0.30
0.62
0.05
0.07
0.01
0.03
0.00
0.01
0.00
0.20
100.00
27.80
48.15
4.77
16.43
1.61
0.28
0.60
0.05
0.07
0.01
0.03
0.00
0.01
0.00
0.19
100.00
27.61
48.24
4.77
16.49
1.61
0.30
0.62
0.05
0.07
0.01
0.03
0.00
0.01
0.00
0.20
100.00
Values may not balance due to rounding to 0.01%
Ore Reserves
The information in the announcement that relates to Ore Reserve estimates and estimated mine operating costs is based on information
compiled by Mr Ryan Locke, a Competent Person who is a Member of the Australasian Institute of Mining and Metallurgy. Mr Locke is a
Principal Planner and is employed by Orelogy Pty Ltd, an independent consultant to Peak Resources. Mr Locke has sufficient experience
that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify
as a Competent Person as defined in the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources
and Ore Reserves. Ryan Locke consents to the inclusion in the report of the maters based on his information in the form and context
in which it appears.
Mineral Resource estimates
The information in this statement that relates to the Mineral Resource estimates is based on work conducted by Rod Brown of SRK
Consulting (Australasia) Pty Ltd, and the work conducted by Peak Resources, which SRK has reviewed. Rod Brown takes responsibility
for the Mineral Resource estimate. Rod Brown is a Member of The Australian Institute of Mining and Metallurgy and has sufficient
experience that is relevant to the style of mineralisation and type of deposit under consideration, and to the activities undertaken, to
qualify as Competent Person in terms of the Australasian Code for the Reporting of Exploration Results, Mineral Resources and Ore
Reserves (JORC Code, 2012 edition).Rod Brown consents to the inclusion of such information in this report in the form and context in
which it appears.
Project Engineering and Cost Estimation
The information in this report that relates to infrastructure, project execution and cost estimating is based on information compiled
and / or reviewed by Lucas Stanfield who is a Member of the Australasian Institute of Mining and Metallurgy. Lucas Stanfield is the
General Manager – Development for Peak Resources Limited and is a Mining Engineer with sufficient experience relevant to the
activity which he is undertaking to be recognized as competent to compile and report. Lucas consents to the inclusion in the report of
the matters based on his information in the form and context in which it appears.
ENABLING LOW CARBON TECHNOLOGIES PAGE 74
ENABLING LOW CARBON TECHNOLOGIES PAGE 75
ENABLING LOW CARBON TECHNOLOGIES PAGE 75
Tenement Schedule and
Reserves and Resources
Mineral Resource estimates
The Mineral Resource as at 30 June 2019 is detailed in the ASX announcement titled ‘Mineral Resource estimate re-stated to include
barite’ of 2 March 2017. The estimates were reported according to the JORC 2012 Code and Guidelines and were completed by Rod
Brown of SRK Consulting (Australasia) Pty Ltd.
Table 3: Classification of All Mineral Resources for the Ngualla Rare Earth Project at a 1.0% REO cut-off grade.
MINERAL RESOURCE AS AT 30 JUNE 2019
Lower Cut-
off Grade
JORC Category
Ore Tonnes
(millions)
REO %
Contained
REO Tonnes
BaSO4
%
Ngualla All
Mineral
Resources
1.0% REO
Measured
Indicated
Inferred
Total
86.1
112.6
15.7
214.4
2.61
1.81
2.15
2.15
2,250,000
2,040,000
340,000
4,620,000
20.2
13.8
17.6
16.6
* REO (%) includes all the lanthanide elements plus yttrium oxide. See Tables 5 for breakdown of individual REO’s. Figures above may not sum due to rounding. The
number of significant figures does not impy an added level of precision.
The Weathered Bastnaesite Zone Mineral Resource estimate summarised below is a subset and contained within the All Mineral
Resources reported in Table 3 above and is detailed in the same ASX announcements as stated above.
Table 4: Classification of Mineral Resources for the Weathered Bastnaesite Zone mineralisation at a 1.0% and 3.0% REO cut-off grades.
MINERAL RESOURCE AS AT 30 JUNE 2019
Lower Cut-
off Grade
JORC Category
Ore Tonnes
(millions)
REO %
Contained
REO Tonnes
BaSO4
%
Ngualla
Weathered
Bastnaesite
Zone
1.0% REO
3.0% REO
Measured
Indicated
Inferred
Total
Measured
Indicated
Inferred
Total
18.9
1.9
0.5
21.3
17.9
1.7
0.4
19.9
4.75
4.85
4.43
4.75
4.88
5.14
4.84
4.90
900,000
90,000
20,000
1,010,000
870,000
90,000
20,000
980,000
37.8
38.3
31.5
37.7
38.6
39.3
35.4
38.6
* REO (%) includes all the lanthanide elements plus yttrium oxide. See Table 5 for breakdown of individual REO’s. The Weathered Bastnaesite Zone Mineral Resource
is contained within an is a subset of the Total All Ngualla Project Mineral Resource at a 1% REO cut-off grade in Table 3 above. Figures above may not sum due to
rounding. The number of significant figures does not impy an added level of precision.
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Tenement Schedule and
Reserves and Resources
Tenement Schedule and
Reserves and Resources
Table 2: Relative components of individual rare earth oxides (including yttrium) as a percentage of total REO for the Ngualla Project Ore Reserve
estimate (refer to Table 1)
RARE EARTH OXIDES
Lanthanum
Cerium
Praseodymium
Neodymium
Samarium
Europium
Gadolinium
Terbium
Dysprosium
Holmium
Erbium
Thulium
Ytterbium
Lutetium
Yttrium
Total REO
REO GRADE (%)
% OF TOTAL REO
Proved
Probable
All
Proved
Probable
All
1.318
2.305
0.228
0.788
0.077
0.014
0.029
0.002
0.004
0.000
0.001
0.000
0.001
0.000
0.010
4.78
1.418
2.456
0.243
0.838
0.082
0.015
0.031
0.002
0.004
0.000
0.002
0.000
0.001
0.000
0.010
5.10
1.326
2.317
0.229
0.792
0.077
0.014
0.030
0.002
0.004
0.000
0.002
0.000
0.001
0.000
0.010
4.80
27.59
48.25
4.77
16.49
1.61
0.30
0.62
0.05
0.07
0.01
0.03
0.00
0.01
0.00
0.20
27.80
48.15
4.77
16.43
1.61
0.28
0.60
0.05
0.07
0.01
0.03
0.00
0.01
0.00
0.19
27.61
48.24
4.77
16.49
1.61
0.30
0.62
0.05
0.07
0.01
0.03
0.00
0.01
0.00
0.20
100.00
100.00
100.00
Values may not balance due to rounding to 0.01%
Ore Reserves
The information in the announcement that relates to Ore Reserve estimates and estimated mine operating costs is based on information
compiled by Mr Ryan Locke, a Competent Person who is a Member of the Australasian Institute of Mining and Metallurgy. Mr Locke is a
Principal Planner and is employed by Orelogy Pty Ltd, an independent consultant to Peak Resources. Mr Locke has sufficient experience
that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify
as a Competent Person as defined in the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources
and Ore Reserves. Ryan Locke consents to the inclusion in the report of the maters based on his information in the form and context
in which it appears.
Mineral Resource estimates
The information in this statement that relates to the Mineral Resource estimates is based on work conducted by Rod Brown of SRK
Consulting (Australasia) Pty Ltd, and the work conducted by Peak Resources, which SRK has reviewed. Rod Brown takes responsibility
for the Mineral Resource estimate. Rod Brown is a Member of The Australian Institute of Mining and Metallurgy and has sufficient
experience that is relevant to the style of mineralisation and type of deposit under consideration, and to the activities undertaken, to
qualify as Competent Person in terms of the Australasian Code for the Reporting of Exploration Results, Mineral Resources and Ore
Reserves (JORC Code, 2012 edition).Rod Brown consents to the inclusion of such information in this report in the form and context in
which it appears.
Project Engineering and Cost Estimation
The information in this report that relates to infrastructure, project execution and cost estimating is based on information compiled
and / or reviewed by Lucas Stanfield who is a Member of the Australasian Institute of Mining and Metallurgy. Lucas Stanfield is the
General Manager – Development for Peak Resources Limited and is a Mining Engineer with sufficient experience relevant to the
activity which he is undertaking to be recognized as competent to compile and report. Lucas consents to the inclusion in the report of
the matters based on his information in the form and context in which it appears.
Mineral Resource estimates
The Mineral Resource as at 30 June 2019 is detailed in the ASX announcement titled ‘Mineral Resource estimate re-stated to include
barite’ of 2 March 2017. The estimates were reported according to the JORC 2012 Code and Guidelines and were completed by Rod
Brown of SRK Consulting (Australasia) Pty Ltd.
Table 3: Classification of All Mineral Resources for the Ngualla Rare Earth Project at a 1.0% REO cut-off grade.
MINERAL RESOURCE AS AT 30 JUNE 2019
Lower Cut-
off Grade
JORC Category
Ore Tonnes
(millions)
REO %
Contained
REO Tonnes
BaSO4
%
Ngualla All
Mineral
Resources
1.0% REO
Measured
Indicated
Inferred
Total
86.1
112.6
15.7
214.4
2.61
1.81
2.15
2.15
2,250,000
2,040,000
340,000
4,620,000
20.2
13.8
17.6
16.6
* REO (%) includes all the lanthanide elements plus yttrium oxide. See Tables 5 for breakdown of individual REO’s. Figures above may not sum due to rounding. The
number of significant figures does not impy an added level of precision.
The Weathered Bastnaesite Zone Mineral Resource estimate summarised below is a subset and contained within the All Mineral
Resources reported in Table 3 above and is detailed in the same ASX announcements as stated above.
Table 4: Classification of Mineral Resources for the Weathered Bastnaesite Zone mineralisation at a 1.0% and 3.0% REO cut-off grades.
MINERAL RESOURCE AS AT 30 JUNE 2019
Lower Cut-
off Grade
JORC Category
Ore Tonnes
(millions)
REO %
Contained
REO Tonnes
BaSO4
%
Ngualla
Weathered
Bastnaesite
Zone
1.0% REO
3.0% REO
Measured
Indicated
Inferred
Total
Measured
Indicated
Inferred
Total
18.9
1.9
0.5
21.3
17.9
1.7
0.4
19.9
4.75
4.85
4.43
4.75
4.88
5.14
4.84
4.90
900,000
90,000
20,000
1,010,000
870,000
90,000
20,000
980,000
37.8
38.3
31.5
37.7
38.6
39.3
35.4
38.6
* REO (%) includes all the lanthanide elements plus yttrium oxide. See Table 5 for breakdown of individual REO’s. The Weathered Bastnaesite Zone Mineral Resource
is contained within an is a subset of the Total All Ngualla Project Mineral Resource at a 1% REO cut-off grade in Table 3 above. Figures above may not sum due to
rounding. The number of significant figures does not impy an added level of precision.
ENABLING LOW CARBON TECHNOLOGIES PAGE 74
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ENABLING LOW CARBON TECHNOLOGIES PAGE 75
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Tenement Schedule and
Reserves and Resources
Additional Shareholder
Information
Table 5: Relative components of individual rare earth element oxides (including yttrium) as a percentage of total REO for 2018 Total Ngualla +1% REO, Weathered
Bastnaesite Zone +1% REO and Weathered Bastnaesite Zone +3% REO and Mineral Resources summarised in Tables 3 and 4.
ADDITIONAL SHAREHOLDER INFORMATION
NGUALLA 2019 TOTAL
MINERAL RESOURCE
NGUALLA 2019
WEATHERED BASTNAESITE
ZONE RESOURCE
NGUALLA 2019
WEATHERED
BASTNAESITE ZONE
RESOURCE
1% REO
1% REO
3% REO
Number Held as at 7 October 2019
Quoted security distribution
The distribution of members and their holdings of quoted equity securities in the company as at 7 October 2019 were as follows:
Class of Equity Securities
Fully Paid Ordinary Shares
OXIDE
REO grade (%)
Lanthanum
Cerium
Praseodymium
Neodymium
Samarium
Europium
Gadolinium
Terbium
Dysprosium
Holmium
Erbium
Thulium
Ytterbium
Lutetium
Yttrium
La2O3
CeO2
Pr6O11
Nd2O3
Sm2O3
Eu2O3
Gd2O3
Tb4O7
Dy2O3
Ho2O3
Er2O3
Tm2O3
Yb2O3
Lu2O3
Y2O3
Total
* Figures may not sum due to rounding.
0.587
1.039
0.104
0.348
0.036
0.007
0.016
0.001
0.003
0.000
0.001
0.000
0.001
0.000
0.010
2.15
% of total
REO
27.25
48.23
4.81
16.2
1.66
0.34
0.75
0.07
0.16
0.02
0.06
0.00
0.04
0.00
0.47
100
REO grade (%)
% of total REO
REO grade (%)
1.310
2.293
0.227
0.784
0.076
0.014
0.029
0.002
0.004
0.000
0.002
0.000
0.001
0.000
0.010
4.75
27.58
48.27
4.77
16.5
1.60
0.29
0.61
0.05
0.07
0.01
0.03
0.00
0.01
0.00
0.20
100
1.353
2.364
0.234
0.806
0.078
0.014
0.030
0.002
0.004
0.000
0.002
0.000
0.001
0.000
0.010
4.90
% of total
REO
27.63
48.27
4.77
16.5
1.60
0.29
0.61
0.05
0.08
0.01
0.03
0.00
0.01
0.00
0.20
100
1-1,000
1,001 - 5,000
5,001 – 10,000
10,001 - 100,000
100,001 and over
Total
1-1,000
1,001 - 5,000
5,001 – 10,000
10,001 - 100,000
100,001 and over
Total
168
288
298
1,282
805
2,841
-
-
-
25
90
115
There were 925 holders with less than a marketable parcel of fully paid shares.
Number Held as at 7 October 2019
PEKOC $0.06 Options (Expire 14 June 2020)
Class of Equity Securities
Substantial Security holders
Substantial shareholders listed in the Company’s register as at 7 October 2019 were:
Holder
Number of shares
Percentage of issued capital
APPIAN PINNACLE HOLDCO LIMITED
112,351,377
12.22%
Unquoted securities
Class of Equity Security
Unvested $0.00 performance rights expiring 5 March 2020
Unvested $0.03 options expiring 5 March 2023
$0.035 options expiring 17 January 2022
$0.05 options expiring 21 June 2021
$0.06 options expiring 27 February 2021
$0.065 options expiring 16 January 2021
$0.065 options expiring 14 June 2021
Unvested $0.10 options expiring 21 June 2022
Unvested $0.15 options expiring 21 June 2023
Number
10,000,000
41,300,000
5,750,000
16,000,000
4,000,000
11,750,000
9,000,000
11,000,000
25,000,000
Number of Security Holders
4
10
11
11
4
2
3
3
3
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ENABLING LOW CARBON TECHNOLOGIES PAGE 3
NGUALLA 2019 TOTAL
MINERAL RESOURCE
NGUALLA 2019
WEATHERED BASTNAESITE
ZONE RESOURCE
OXIDE
REO grade (%)
REO grade (%)
% of total REO
REO grade (%)
Lanthanum
Cerium
Praseodymium
Neodymium
Samarium
Europium
Gadolinium
Terbium
Dysprosium
Holmium
Erbium
Thulium
Ytterbium
Lutetium
Yttrium
Total
La2O3
CeO2
Pr6O11
Nd2O3
Sm2O3
Eu2O3
Gd2O3
Tb4O7
Dy2O3
Ho2O3
Er2O3
Tm2O3
Yb2O3
Lu2O3
Y2O3
* Figures may not sum due to rounding.
% of total
REO
27.25
48.23
4.81
16.2
1.66
0.34
0.75
0.07
0.16
0.02
0.06
0.00
0.04
0.00
0.47
100
1.310
2.293
0.227
0.784
0.076
0.014
0.029
0.002
0.004
0.000
0.002
0.000
0.001
0.000
0.010
4.75
0.587
1.039
0.104
0.348
0.036
0.007
0.016
0.001
0.003
0.000
0.001
0.000
0.001
0.000
0.010
2.15
27.58
48.27
4.77
16.5
1.60
0.29
0.61
0.05
0.07
0.01
0.03
0.00
0.01
0.00
0.20
100
NGUALLA 2019
WEATHERED
BASTNAESITE ZONE
RESOURCE
3% REO
% of total
REO
27.63
48.27
1.353
2.364
0.234
0.806
0.078
0.014
0.030
0.002
0.004
0.000
0.002
0.000
0.001
0.000
0.010
4.90
4.77
16.5
1.60
0.29
0.61
0.05
0.08
0.01
0.03
0.00
0.01
0.00
0.20
100
Tenement Schedule and
Reserves and Resources
Additional Shareholder
Information
Table 5: Relative components of individual rare earth element oxides (including yttrium) as a percentage of total REO for 2018 Total Ngualla +1% REO, Weathered
Bastnaesite Zone +1% REO and Weathered Bastnaesite Zone +3% REO and Mineral Resources summarised in Tables 3 and 4.
ADDITIONAL SHAREHOLDER INFORMATION
Quoted security distribution
The distribution of members and their holdings of quoted equity securities in the company as at 7 October 2019 were as follows:
1% REO
1% REO
Number Held as at 7 October 2019
1-1,000
1,001 - 5,000
5,001 – 10,000
10,001 - 100,000
100,001 and over
Total
Class of Equity Securities
Fully Paid Ordinary Shares
168
288
298
1,282
805
2,841
There were 925 holders with less than a marketable parcel of fully paid shares.
Number Held as at 7 October 2019
Class of Equity Securities
PEKOC $0.06 Options (Expire 14 June 2020)
1-1,000
1,001 - 5,000
5,001 – 10,000
10,001 - 100,000
100,001 and over
Total
-
-
-
25
90
115
Substantial Security holders
Substantial shareholders listed in the Company’s register as at 7 October 2019 were:
Holder
Number of shares
Percentage of issued capital
APPIAN PINNACLE HOLDCO LIMITED
112,351,377
12.22%
Unquoted securities
Class of Equity Security
Unvested $0.00 performance rights expiring 5 March 2020
Unvested $0.03 options expiring 5 March 2023
$0.035 options expiring 17 January 2022
$0.05 options expiring 21 June 2021
$0.06 options expiring 27 February 2021
$0.065 options expiring 16 January 2021
$0.065 options expiring 14 June 2021
Unvested $0.10 options expiring 21 June 2022
Unvested $0.15 options expiring 21 June 2023
Number
10,000,000
41,300,000
5,750,000
16,000,000
4,000,000
11,750,000
9,000,000
11,000,000
25,000,000
Number of Security Holders
4
10
11
4
2
11
3
3
3
ENABLING LOW CARBON TECHNOLOGIES PAGE 76
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ENABLING LOW CARBON TECHNOLOGIES PAGE 77
ENABLING LOW CARBON TECHNOLOGIES PAGE 3
Additional Shareholder
Information
Names of persons holding greater than 20% of a class of unquoted securities:
Class of Equity Security
Unvested $0.00 performance rights expiring 5 March
2020
Unvested $0.00 performance rights expiring 5 March 2020
Unvested $0.00 performance rights expiring 5 March 2020
Unvested $0.03 options expiring 5 March 2023
$0.035 options expiring 17 January 2022
$0.05 options expiring 21 June 2021
$0.06 options expiring 21 February 2021
$0.06 options expiring 21 February 2021
$0.0625 options expiring 16 January 2021
$0.065 options expiring 14 June 2021
$0.065 options expiring 14 June 2021
Unvested $0.10 options expiring 21 June 2022
Unvested $0.15 options expiring 21 June 2023
Number
3,500,000
2,250,000
2,250,000
11,000,000
1,500,000
10,000,000
2,500,000
1,500,000
3,000,000
4,500,000
3,000,000
5,000,000
15,000,000
Holder
Rocky Smith
Michael Prassas
Graeme Scott
Rocky Smith
Rocky Smith
Meurer Investments Pty Ltd
ACN 161 604 315 Pty Ltd
Tyche Investments Pty ltd
Rocky Smith
Melshare Nominees Pty Ltd
ACN 161 604 315 PTY LTD
Meurer Investments Pty Ltd
Meurer Investments Pty Ltd
Voting Rights
Ordinary Shares
In accordance with the Company’s Constitution, on a show of hands every member present in person or by proxy or attorney or
duly authorised representative has one vote. On a poll every member present in person or by proxy or attorney or duly authorised
representative has one vote for every fully paid ordinary share held.
Restricted Securities
As at 30 June 2019, there were no restricted securities.
Twenty largest security holders
The names of the twenty largest holdings of quoted equity securities as at 7 October 2019 are as follows:
Name
CITICORP NOMINEES PTY LIMITED
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
INTERNATIONAL FINANCE CORPORATION
SAMBOLD PTY LTD
CRX SECURITIES PTY LIMITED
BUSHELL NOMINEES PTY LTD
WASHINGTON H SOUL PATTINSON AND COMPANY LIMITED
JBBM PTY LTD
ERP STRATEGIC MINERALS LLC
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
PINNACLE SUPERANNUATION PTY LIMITED
MORGAN STANLEY AUSTRALIA SECURITIES (NOMINEE) PTY LIMITED
BEPPE SUPER PTY LIMITED
CS FOURTH NOMINEES PTY LIMITED
ASHABIA PTY LTD
BUELL PTY LTD
ONE MANAGED INVESTMENT FUNDS LIMITED
DIRDOT PTY LIMITED
HOTLAKE PTY LTD
ACN 161 604 315 PTY LTD
TOTAL TOP 20
TOTAL
Number Held of
Ordinary Fully Paid
Shares
118,000,766
51,189,561
31,846,257
16,325,000
14,500,000
12,947,401
12,500,000
12,500,000
12,500,000
11,766,894
10,000,000
9,645,457
8,656,250
8,425,423
8,300,000
8,008,790
7,875,000
7,149,882
7,146,366
6,250,000
375,533,047
919,144,249
% Held of Issued
Ordinary Capital
12.84
5.57
3.46
1.78
1.58
1.41
1.36
1.36
1.36
1.28
1.09
1.05
0.94
0.92
0.90
0.87
0.86
0.78
0.78
0.68
40.86%
100.00%
Additional Shareholder
Information
Name
CITICORP NOMINEES PTY LIMITED
MORGAN STANLEY AUSTRALIA SECURITIES PTY LIMITED
Number Held of
PEKOCB$0.06
Options Shares
(Expire 14June
2020)
% Held of Issued
PEKOC Options
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED - A/C 2
MN JEFFERY PTY LIMITED
723 PTY LIMITED
FFKM PTY LTD
ACN 161 604 315 PTY LTD
CS FOURTH NOMINEES PTY LIMITED
JB ADVISORY PTY LIMITED
WISEVEST PTY LTD
NERO RESOURCE FUND PTY LTD
BEPPE SUPER PTY LIMITED
MILA INVESTMENT CO PTY LTD
SPRING STREET HOLDINGS PTY LTD
JBBM PTY LTD
CRX INVESTMENTS PTY LIMITED
MR MICHAEL DIMITRIOS PRASSAS
MR KEVIN GERARD DOYLE
CHELSEA SECURITIES LIMITED
THINKDO PTY LTD
TOTAL TOP 20
TOTAL
8,588,296
4,166,666
3,407,536
2,943,950
2,293,163
2,083,333
2,083,333
2,050,000
1,866,666
1,250,000
1,250,000
1,033,333
1,000,000
833,333
833,333
833,333
833,333
824,999
800,000
583,333
14.06
6.82
5.58
4.82
3.75
3.41
3.41
3.36
3.06
2.05
2.05
1.69
1.64
1.36
1.36
1.36
1.36
1.35
1.31
0.95
39,557,940
61,088,247
64.76%
100.00%
Note: Information in the above schedule is based on data recorded in the Company’s Share Register on the date noted. A listed
holder may hold shareholdings or hold an associated shareholding in addition to those listed above. The data provided is solely
attributable to a HIN or SRN particular to that holding and as such may not necessarily represent the total of all holdings of the
shareholder noted or their associates.
CORPORATE GOVERNANCE STATEMENT
The Company has adopted the recommendations of the ASX Corporate Governance Council’s Principles and Recommendations
(Third Edition) in regard to the Corporate Governance Disclosures and provides disclosure of the Company’s Corporate Governance
Statement on the Company’s website at: http://www.peakresources.com.au/corporate-governance/
ENABLING LOW CARBON TECHNOLOGIES PAGE 78
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ENABLING LOW CARBON TECHNOLOGIES PAGE 79
ENABLING LOW CARBON TECHNOLOGIES PAGE 3 Additional Shareholder
Information
Names of persons holding greater than 20% of a class of unquoted securities:
Class of Equity Security
Unvested $0.00 performance rights expiring 5 March
2020
Unvested $0.00 performance rights expiring 5 March 2020
Unvested $0.00 performance rights expiring 5 March 2020
Unvested $0.03 options expiring 5 March 2023
$0.035 options expiring 17 January 2022
$0.05 options expiring 21 June 2021
$0.06 options expiring 21 February 2021
$0.06 options expiring 21 February 2021
$0.0625 options expiring 16 January 2021
$0.065 options expiring 14 June 2021
$0.065 options expiring 14 June 2021
Unvested $0.10 options expiring 21 June 2022
Unvested $0.15 options expiring 21 June 2023
Number
3,500,000
2,250,000
2,250,000
11,000,000
1,500,000
10,000,000
2,500,000
1,500,000
3,000,000
4,500,000
3,000,000
5,000,000
15,000,000
Holder
Rocky Smith
Michael Prassas
Graeme Scott
Rocky Smith
Rocky Smith
Meurer Investments Pty Ltd
ACN 161 604 315 Pty Ltd
Tyche Investments Pty ltd
Rocky Smith
Melshare Nominees Pty Ltd
ACN 161 604 315 PTY LTD
Meurer Investments Pty Ltd
Meurer Investments Pty Ltd
Voting Rights
Ordinary Shares
In accordance with the Company’s Constitution, on a show of hands every member present in person or by proxy or attorney or
duly authorised representative has one vote. On a poll every member present in person or by proxy or attorney or duly authorised
representative has one vote for every fully paid ordinary share held.
Restricted Securities
As at 30 June 2019, there were no restricted securities.
Twenty largest security holders
The names of the twenty largest holdings of quoted equity securities as at 7 October 2019 are as follows:
Name
CITICORP NOMINEES PTY LIMITED
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
INTERNATIONAL FINANCE CORPORATION
SAMBOLD PTY LTD
CRX SECURITIES PTY LIMITED
BUSHELL NOMINEES PTY LTD
JBBM PTY LTD
ERP STRATEGIC MINERALS LLC
WASHINGTON H SOUL PATTINSON AND COMPANY LIMITED
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
PINNACLE SUPERANNUATION PTY LIMITED
MORGAN STANLEY AUSTRALIA SECURITIES (NOMINEE) PTY LIMITED
BEPPE SUPER PTY LIMITED
CS FOURTH NOMINEES PTY LIMITED
ASHABIA PTY LTD
BUELL PTY LTD
ONE MANAGED INVESTMENT FUNDS LIMITED
DIRDOT PTY LIMITED
HOTLAKE PTY LTD
ACN 161 604 315 PTY LTD
TOTAL TOP 20
TOTAL
Number Held of
Ordinary Fully Paid
Shares
118,000,766
% Held of Issued
Ordinary Capital
12.84
51,189,561
31,846,257
16,325,000
14,500,000
12,947,401
12,500,000
12,500,000
12,500,000
11,766,894
10,000,000
9,645,457
8,656,250
8,425,423
8,300,000
8,008,790
7,875,000
7,149,882
7,146,366
6,250,000
5.57
3.46
1.78
1.58
1.41
1.36
1.36
1.36
1.28
1.09
1.05
0.94
0.92
0.90
0.87
0.86
0.78
0.78
0.68
375,533,047
919,144,249
40.86%
100.00%
Additional Shareholder
Information
Name
CITICORP NOMINEES PTY LIMITED
MORGAN STANLEY AUSTRALIA SECURITIES PTY LIMITED
MN JEFFERY PTY LIMITED
723 PTY LIMITED
FFKM PTY LTD
ACN 161 604 315 PTY LTD
CS FOURTH NOMINEES PTY LIMITED
JB ADVISORY PTY LIMITED
WISEVEST PTY LTD
NERO RESOURCE FUND PTY LTD
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED - A/C 2
BEPPE SUPER PTY LIMITED
MILA INVESTMENT CO PTY LTD
SPRING STREET HOLDINGS PTY LTD
JBBM PTY LTD
CRX INVESTMENTS PTY LIMITED
MR MICHAEL DIMITRIOS PRASSAS
MR KEVIN GERARD DOYLE
CHELSEA SECURITIES LIMITED
THINKDO PTY LTD
TOTAL TOP 20
TOTAL
Number Held of
PEKOCB$0.06
Options Shares
(Expire 14June
2020)
% Held of Issued
PEKOC Options
8,588,296
4,166,666
3,407,536
2,943,950
2,293,163
2,083,333
2,083,333
2,050,000
1,866,666
1,250,000
1,250,000
1,033,333
1,000,000
833,333
833,333
833,333
833,333
824,999
800,000
583,333
14.06
6.82
5.58
4.82
3.75
3.41
3.41
3.36
3.06
2.05
2.05
1.69
1.64
1.36
1.36
1.36
1.36
1.35
1.31
0.95
39,557,940
61,088,247
64.76%
100.00%
Note: Information in the above schedule is based on data recorded in the Company’s Share Register on the date noted. A listed
holder may hold shareholdings or hold an associated shareholding in addition to those listed above. The data provided is solely
attributable to a HIN or SRN particular to that holding and as such may not necessarily represent the total of all holdings of the
shareholder noted or their associates.
CORPORATE GOVERNANCE STATEMENT
The Company has adopted the recommendations of the ASX Corporate Governance Council’s Principles and Recommendations
(Third Edition) in regard to the Corporate Governance Disclosures and provides disclosure of the Company’s Corporate Governance
Statement on the Company’s website at: http://www.peakresources.com.au/corporate-governance/
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Peak Resources Limited
Ground Floor, 5 Ord Street
West Perth, WA 6005
Telephone: +61 8 9200 5360
Email: info@peakresources.com.au
Website: www.peakresources.com.au