Peel Mining 2019 Annual Report Cover Artwork - Ver 8.pdf 1 10/10/2019 11:12:22
C
M
Y
CM
MY
CY
CMY
K
Peel Mining Ltd
ACN 119 343 734
Unit 1, 34 Kings Park Rd, West Perth, WA 6005
telephone: +61 8 9382 3955
www.peelmining.com.au
ACN 119 343 734
2020 ANNUAL REPORT
This page has been intentionally left blank.
Directors
Simon Hadfield
Rob Tyson
Graham Hardie
James Simpson Executive Director Mining
Non-executive Chairman
Managing Director
Non-executive Director
Share Registry
Link Market Services Limited
Level 12, 250 St Georges Terrace
PERTH WA 6000
Telephone +61 1300 554 474
Facsimile: +61 (0)2 9287 0303
Website: www.linkmarketservices.com
Auditors
PricewaterhouseCoopers
Level 15,
125 St Georges Terrace
PERTH WA 6000
Website
www.peelmining.com.au
Company Secretary
Ryan Woodhouse
Registered Office
Unit 1, 34 Kings Park Road
WEST PERTH WA 6005
Telephone: +61 (0)8 9382 3955
Email:
info@peelmining.com.au
Stock Exchange Listing
Securities of Peel Mining Limited are
listed on the Australian Securities
Exchange (ASX)
ASX Code
PEX
ACN
119 343 734
Chairman’s letter
Review of operations
Schedule of tenements
Directors’ report including remuneration report
Consolidated statement of profit and loss and other comprehensive income
Consolidated statement of financial position
Consolidated statement of changes in equity
Consolidated statement of cash flows
Notes to the consolidated financial statements
Directors’ declaration
Auditor’s independence declaration
Independent auditor’s report
Corporate Governance Statement
Shareholder Information
2
4
22
23
36
37
38
39
40
67
68
69
75
84
Peel Mining Limited is a company limited by shares, incorporated and domiciled in Australia. The
financial statements were authorised for issue by the directors on 9 September 2020. The directors
have the power to amend and reissue the financial statements.
PAGE 1
Dear Fellow Shareholders,
The past 12 months has been an exciting year of growth for Peel Mining Limited, which, subsequent to
the year end, grew even further with the Company regaining 100% control of two of its most exciting
projects and in the process, changing its main metal of concern to copper.
The most important event was the recent acquisition by Peel of CBH Resources Limited’s 50% interest
in the Mallee Bull Joint Venture, by exercising its pre-emptive right to match a third party’s unconditional
offer of $17 million. The purchase will return 100% control of the high-grade Mallee Bull copper deposit
and the gold-polymetallic May Day deposit to Peel.
Mallee Bull is one of Australia’s highest-grade undeveloped copper deposits, whilst May Day is an Au-
Ag-Zn-Pb-Cu VMS-style deposit with open pit potential on a granted mining lease, which offers excellent
potential to be advanced to a maiden resource quickly and at low cost. Both deposits are located
centrally within Peel’s strategic land position in the world-class Cobar Basin in NSW, a low-risk and well
established mining jurisdiction.
Shortly after announcing the acquisition of CBH’s 50% share of Mallee Bull, the Company announced
that 100% ownership of the Wirlong copper discovery had also reverted back to Peel. Wirlong is about
30km north of Mallee Bull and has all the hallmarks of other high-grade copper discoveries in the Cobar
Basin. Part of the Cobar Superbasin Project, the project reverted to Peel after the Japanese Government-
owned JOGMEC had spent more than $8 million on exploration. JOGMEC’s decision came very soon after
the Japanese-owned CBH Resources had agreed to sell its 50% share of Mallee Bull back to Peel. Mallee
Bull and Wirlong are both classic “Cobar-style” Cu-Ag-Au-Zn-Pb deposits with similar attributes to the
world-class CSA mine located north of the town of Cobar.
The Mallee Bull purchase ended a successful eight-year partnership with CBH, a 100% subsidiary of
Toho Zinc of Japan, during which CBH contributed more than $13 million to exploration on the project.
It followed an announcement by CBH of the impending closure of its other major Cobar asset, the
Endeavour Mine, and with this the opportunity to utilise some of that mine’s spare milling capacity for
the Mallee Bull project. The purchase followed discussions between the two companies, which began
in late 2019 when Peel Managing Director Rob Tyson and Executive Director (Mining) Jim Simpson
travelled to Tokyo to meet the Chairman of Toho, Mr Kimiyasu Marusaki, with a view to Peel possibly
buying back CBH’s 50% share of Mallee Bull. Settlement is expected to be completed in the next few
months.
To fund the Mallee Bull acquisition, post year end, the Company undertook a successful capital raising
of $17.1 million, comprising a heavily oversubscribed placement to institutional, sophisticated and
professional investors to raise $10.5 million and a 1:8 entitlements offer to raise $6.6 million. The
Company welcomed several new institutional investors who have taken significant stakes in Peel.
The consolidation and control of both the Mallee Bull Joint Venture and the Wirlong project repositions
the focus of Peel to copper. The two deposits, together with the Southern Nights-Wagga Tank project,
deliver the potential critical mass of resources to support Peel’s strategy of establishing a robust
standalone operation supported by multiple mines in the Southern Cobar Basin.
Southern Nights-Wagga Tank is located about 50km from Mallee Bull. It is a high-grade Zn-Pb-Ag-Au-Cu
VMS-style, which remains open along strike and down dip, and shows every sign of growing into a very
large mineral system.
PAGE 2
Peel has now adopted a two-year strategy across its deposits to:
complete significant metallurgical testwork;
• undertake a major drilling programme to establish mineable resources;
• prove up a critical mass of ore reserves and mining inventory;
•
• produce conceptual mine designs;
• engage with engineering firms to prepare a polymetallic mill design to process 1.2Mtpa, with
the mill envisaged to be centrally located amongst Peel’s projects and capable of processing Au-
Ag-Cu-Pb-Zn, the primary metals associated with Peel’s key deposits; and
complete Feasibility Studies to reach a final investment decision.
•
The Company was pleased to welcome new director Jim Simpson in September last year. Jim is a Mining
Engineer with many years of experience in mine management and development particularly in base
metals and gold. He also has extensive experience as a Company Director and CEO. His experience is
proving to be invaluable as the Company moves into the development phase.
Finally, on behalf of all shareholders, I would like to thank our executive team, Rob Tyson, Jim Simpson
and Company Secretary Ryan Woodhouse for achieving significant milestones in the past year. I would
also like to thank our hard-working field workers and office staff who have continued to do a great job
as we battle our way through the COVID-19 crisis.
Yours sincerely
Simon Hadfield
Chairman
9 September 2020
PAGE 3
Peel Mining Limited (“the Company”) is a base and precious metals explorer focused on developing its
projects in the Cobar Region of New South Wales, Australia. Peel Mining Ltd has been active in the Cobar
Superbasin since March 2010. In that time, the Company has grown to become NSW’s predominant
greenfield’s explorer, with the largest single company holding of ~3,500km2 in the Cobar Superbasin.
The Company has made three major discoveries in this time; the Wagga Tank-Southern Nights Lead-
Zinc-Silver dominant discovery, the Mallee Bull Copper dominant discovery and the Wirlong
Copper discovery.
The Wagga Tank Project is located on the western edge of the Cobar Superbasin, ~130 km south of
Cobar or ~30km northwest of Mount Hope and is host to the namesake polymetallic VMS-type deposit.
Mineralisation straddles a broad zone of intense tectonic brecciation and hydrothermal alteration
(sericite-chlorite with local silicification) and occurs as sub-vertical elongate shoots/lenses. Drilling to
date has focused on defining the geometry and extent of large-scale Zn-rich mineralisation at Wagga
Tank-Southern Nights.
The Mallee Bull Project, located about 100km south of Cobar in western NSW, contains the Mallee Bull
copper-polymetallic discovery, the May Day polymetallic deposit and the historic Gilgunnia and 4-Mile
goldfields. The Company and CBH Resources Limited (a wholly owned subsidiary of Toho Zinc Co. Ltd.)
were in a 50:50 Joint Venture over the project tenements EL7461 and ML1361. Subsequent to the year
end, the Company has exercised its pre-emptive right to acquire CBH Resources Limited’s 50% share of
the Mallee Bull Joint Venture by matching a third party’s unconditional offer, regaining 100% control of
the Mallee Bull Project.
Mallee Bull is interpreted to be located in a favourable geological and structural position; it is situated
in the suitably high-stress environment of the “nose” of an anticline, and occurs in a geological sequence
of turbidite and volcaniclastic sediments which are thought to be age equivalent to the Chesney and
Great Cobar Slate Formations found in the immediate Cobar region. Mineralisation occurs either as
massive sulphide or hydrothermal breccia styles within a package of brecciated volcaniclastic and
turbidite sediments comprising siltstones and mudstones and is interpreted to occur as a shoot/lens-
like structure dipping moderately to the west. The deposit is split into three lenses; Silver Ray, Union
and Mallee Bull Deeps.
The Cobar Superbasin Project (CSP) was under a Memorandum of Agreement with Japanese Oil Gas
and Metals National Corporation (JOGMEC) which earned a 50% interest in the project. Post year end,
the Company received written notice from JOGMEC of its decision to withdraw from the CSP, and to
terminate the Memorandum of Agreement. As a result of the termination, JOGMEC’s rights and interests
in CSP tenure will be transferred to the Company at no cost, resulting in the Company regaining 100%
ownership.
The CSP comprises 16 highly prospective tenements covering ~1,400 km2 in the Cobar Basin.
Investigations so far have resulted in the discovery of a significant copper mineralised system at the
Wirlong prospect. Wirlong is defined by >2 km strike of sheared volcanics and sediments; large multi-
element soil geochemical anomalies; and coincident/semi-coincident geophysical anomalies.
PAGE 4
Wagga Tank - Southern Nights (PEX 100%).
Targets: Cobar-style polymetallic mineralisation; Volcanogenic Massive Sulphide mineralisation.
The Company’s primary focus during the year was at the Wagga Tank/Southern Nights prospect
following the successful discovery of the high grade Southern Nights lens in 2017 and the release in July
2019 of its maiden JORC 2012 Indicated and Inferred Mineral Resource Estimate (“MRE”). A close spaced
infill and extensional resource definition drilling programme was designed to progress the Wagga Tank-
Southern Nights Project towards development. Drilling targeted three main zones within the Wagga
Tank-Southern Nights system; the Wagga Tank prospect where the quality of the historic drilling
impacted the Maiden MRE, the Corridor Zone between Wagga Tank and Southern Nights and the
Southern Nights prospect high grade zone to continue to improve resource confidence. In addition,
step out drilling was completed along strike and downdip of the main resource area, testing for
extensions to grow the overall resource base.
During fiscal 2019/20, the Company drilled 30 new holes for 9,475m with an additional 1,866m
completed on diamond tails and wedge drillholes on collars from previous drill programs. The drill
programme resulted in some exceptional drill assays:
Wagga Tank
• WTRCDD218 returning 33.3m @ 1.48% Cu, 1.41 g/t Au, 8 g/t Ag, 0.38% Zn and 0.14% Pb from
201.7m including 8.6m @ 2.72% Cu, 3.73 g/t Au, 15 g/t Ag, 0.26% Zn and 0.37% Pb from 202.4m
• WTRCDD226 returning 15.1m @ 3.43% Zn, 2.07% Pb, 33 g/t Ag and 0.31 g/t Au from 279m including
2.85m @ 7.92% Zn, 6.39% Pb, 110 g/t Ag and 0.74 g/t Au from 291.25m
Corridor Zone
• WTRCDD141 returning 2.1m @ 4.7% Cu, 129 g/t Ag, 0.15 g/t Au, 0.4% Zn and 0.5% Pb from 530.2m;
and 58.3m @ 5.4% Zn, 2.3% Pb, 0.1% Cu, 24 g/t Ag and 0.31 g/t Au from 546.7m including 13.1m
@ 11.1% Zn, 5.7% Pb, 0.05% Cu, 52 g/t Ag and 0.51 g/t Au from 553.9m
• WTRCDD141W1 returning 9m @ 7.6% Zn, 4.7% Pb, 0.1% Cu, 153 g/t Ag and 0.46 g/t Au from 501m
including 2.8m @ 21.6% Zn, 12.7% Pb, 0.4% Cu, 441 g/t Ag and 1.23 g/t Au from 505.1m; and 17m
@ 1.3% Cu, 25 g/t Ag, 0.14 g/t Au, 0.1% Zn, 0.1% Pb from 510m; and 47m @ 6.3% Zn, 2.8% Pb,
0.05% Cu, 24 g/t Ag and 0.28 g/t Au from 573m; and 53m @ 3.4% Zn, 1.9% Pb, 0.1% Cu, 24 g/t Ag
and 0.46 g/t Au from 626m
Southern Nights
• WTRCDD235 returning 23.2m @ 7.72% Zn, 3.33% Pb, 48 g/t Ag, 0.1% Cu, 0.24 g/t Au from 272.8m,
including 10.8m @ 13.1% Zn, 5.22% Pb, 91 g/t Ag, 0.12% Cu, 0.33 g/t Au from 273.5m
• WTRCDD239 returning 41m @ 4.72% Zn, 1.04% Pb, 35 g/t Ag, 0.28% Cu, 0.4 g/t Au from 259m
including 13m @ 8.65% Zn, 1.5% Pb, 28 g/t Ag, 0.4% Cu, 0.38 g/t Au from 278m
A new high-grade zone located at the southern end of Southern Nights returned strong assay results
including some of the highest grade gold mineralisation intersected at Southern Nights:
• WTRCDD238 returning 35m @ 6.3% Zn, 2.59% Pb, 1.5 g/t Ag, 0.24% Cu and 1.87 g/t Au from 232m
including 5.9m @ 17.13% Zn, 8.34% Pb, 376 g/t Ag, 0.26% Cu and 7.6 g/t Au from 232.8m; and 7m
@ 13.3% Zn, 4.4% Pb, 97 g/t Ag, 0.1% Cu, 0.89 g/t Au from 251m
PAGE 5
In March 2020 a substantial resource upgrade at Wagga Tank-Southern Nights was released comprising
an Indicated and Inferred MRE of 4.95Mt @ 5.0% Zn, 2.0% Pb, 78 g/t Ag, 0.3% Cu, and 0.4 g/t Au was
reported within AU$80/t NSR mineable shapes, a 31.5% increase in Indicated and Inferred resource
tonnage from the previous MRE of 3.8Mt @ 5.5% Zn, 2.1% Pb, 75 g/t Ag, 0.27% Cu and 0.31 g/t Au (see
Table 1 below).
Significantly, an increase in Indicated MRE to 2.95Mt @ 5.73% Zn, 2.33% Pb, 86 g/t Ag, 0.23% Cu, 0.36
g/t Au has been reported within AU$80/t NSR mineable shapes, a 161% increase in Indicated
resource tonnage from the previous MRE of 1.13Mt @ 8.8% Zn, 3.5% Pb, 107 g/t Ag, 0.28% Cu, 0.44 g/t
Au.
Table 1 – Southern Nights and Wagga Tank Mineral Resource Estimate as at March 2020
Southern Nights Mineral Resource Estimate
Resource
Classification
Tonnes
(Kt)
Indicated
Inferred
2,540
1,600
Total Resource
4,140
NSR
$/t
173
120
150
Zn
(%)
5.90
3.7
5.0
Pb
(%)
2.30
1.4
2.0
Ag
(g/t)
88.9
59
77
Wagga Tank Mineral Resource Estimate
Resource
Classification
Tonnes
(Kt)
Indicated
Inferred
Total Resource
410
400
810
NSR
$/t
169
180
170
Zn
(%)
4.67
5.3
5.0
Pb
(%)
2.52
2.3
2.4
Ag
(g/t)
64.3
98
81
Cu
(%)
0.19
0.3
0.2
Cu
(%)
0.50
0.3
0.4
Combined Southern Nights-Wagga Tank Mineral Resource Estimate
Resource
Classification
Tonnes
(Kt)
Indicated
Inferred
2,950
2,000
Total Resource
4,950
NSR
$/t
172
130
160
Zn
(%)
5.73
4.0
5.0
Pb
(%)
2.33
1.6
2.0
Ag
(g/t)
85.5
67
78
Cu
(%)
0.23
0.3
0.3
Au
(g/t)
0.33
0.3
0.3
Au
(g/t)
0.53
0.5
0.5
Au
(g/t)
0.36
0.3
0.4
Note: The Wagga Tank – Southern Nights Mineral Resource Estimate utilises AU$80/tonne NSR cut-off
mineable shapes that include minimum mining widths and internal dilution. Net Smelter Return (NSR)
is an estimate of the net recoverable value per tonne including offsite costs, payables, royalties and mill
recoveries. Figures are rounded to reflect the precision of estimates and include rounding errors.
The MRE was reported within mineable shapes generated at AU$80/t NSR with a minimum mining width
of 3 metres and included internal dilution. The Mineral Resource Estimate (MRE) for the Wagga Tank
and Southern Nights deposits is reported in accordance with the Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves (the JORC Code (2012)).
The MRE has been completed by independent mining consultant Mr Jonathon Abbott of MPR Geological
Consultants Pty Ltd (MPR). Mr Abbott accepts responsibility for the mineralisation modelling and the
MRE. Mr Jason McNamara, who was an employee of Peel Mining, accepts responsibility for the sampling
and analytical data upon which the MRE is based. NSR calculations and mineable shape creation was
completed by Antcia Consulting Pty Ltd.
PAGE 6
Figure 1 – Southern Nights-Wagga Tank Block Model Tonnage/Grade Curve – Indicated &
Inferred
300
200
100
e
n
n
o
t
/
$
R
S
N
0
0
Total
Indicated
Inferred
3
6
9
Tonnes (Million)
Note: Figure 1 shows NSR-tonnage curves from evaluation of the combined models on a block by block
basis for cut offs of AU$40 to AU$140/tonne in AU$10 increments relative to the combined Mineral
Resource Estimates reported within trimmed mineable shapes (plotted as black dots). The relatively
close agreement for the two evaluation methods at AU$80/t cut off may not be representative of all cut
offs.
Net Smelter Return
For the reporting of the MRE, a Net Smelter Return (NSR) value was used to reflect the polymetallic
nature of mineralisation. NSR in AU$/t represents the potential value of mineralisation net of all costs
after it leaves site, and was applied to each block within the block model after estimation. The NSR (A$/t)
formula includes assumptions regarding metal prices, exchange rates, metallurgical recoveries, metal
marketing terms (including payabilities and deductions/penalties), freight, smelting and refining
charges, and royalties.
The NSR formula is:
NSR = (metal grades x metallurgical recoveries x payabilities x A$ metal prices) less
(concentrate freight and treatment charges, penalties and royalties)
Metal price assumptions were based off early 2020 Australian dollar metal pricing and are listed in Table
2; metallurgical recovery assumptions are listed in Table 3.
PAGE 7
Mining Assumptions
The MRE is reported within mineable shapes produced by Deswik’s Stope Shape Optimiser (SSO) using
an NSR cut-off of AU$80/t. SSO runs were performed by Antcia Consulting Pty Ltd with NSR inputs
supplied by Peel Mining. The mineable shapes were based upon the smallest mineable unit (SMU) for
the SSO shapes being 5 metres long, 5 metres high, with a minimum mining width of 3 metres. These
inputs were used to provide a balance between practical mining and mineralisation shapes.
Cut-off
The reported MRE includes internal dilution, where required, representing material estimated at below
the AU$80/t NSR cut off but does not include footwall or hanging wall dilution outside the mineralised
domains. The cut-off value includes assumptions regarding mine operating, processing and site
administration costs. Material at this cut-off within mineable shapes is considered by Peel to have
reasonable prospects of extraction.
Table 2 – Metal price assumptions used in MRE
Commodity Price
AU$ Gold Price
AU$ Silver Price
AU$ Pb Price
AU$ Zn Price
AU$ Cu Price
2020 Price
Assumption
2,206
26
2,941
3,382
8,529
Metallurgy and Conceptual Processing Flowsheet
Metallurgical testwork completed by Peel at ALS Burnie has guided the company’s metallurgical
assumptions for the Southern Nights-Wagga Tank MRE. Work to date has comprised approximately 40
flotation tests, multiple gravity precious metals recovery tests and associated mineralogical studies.
As a result, Peel has assumed a conceptual sequential processing flowsheet for the project comprising:
gravity; copper float; lead float; and a bulk zinc-lead float. This flowsheet optimises the theoretical NSR
value of the mineralisation. Cumulative metallurgical recoveries for the economic metals of interest are
listed in Table 3. Metallurgical testwork at ALS Burnie remains ongoing, and the conceptual processing
flowsheet is subject to change in the future.
It is Peel Mining’s opinion that there is reasonable potential for all elements included in the conceptual
processing flowsheet to be recovered and sold.
Table 3 – NSR metallurgical recovery assumptions used in MRE
Metal
Zinc
Lead
Silver
Copper
Gold
Cumulative
Recovery (%)
91
85
73
55
62
PAGE 8
Figure 2 – Wagga Tank-Southern Nights Indicated & Inferred Resource long section.
Planned Activities
The Southern Nights and Wagga Tank deposits remain open along strike and down dip with drilling
planned to follow-up previously intersected gold-rich mineralisation on the southern boundary of the
Southern Nights deposit. It is anticipated that a scoping study will be completed during the year.
Metallurgical testwork remains ongoing with key areas to be investigated including: grind size
establishment; targeted mineralogy on Au and Ag occurrence and mineral species; gravity Au recovery
on lower grade samples; and upgrading Pb and Zn separation.
Historic drilling points to the potential for a shallow gold target at Wagga Tank, which offers significant
upside for a development. A conceptual small open pit could potentially provide early mill feed along
with easier access to any conceptual underground mining scenario at Wagga Tank. In this regard, Peel
has commenced access negotiations to enable follow-up of these significant historic drill intercepts.
PAGE 9
OPE
N
Wagga Tank -
Southern
Nights
Corridor
Wagga Tank =
~300m
Mineralised Strike
~2.7km
Anomalous
RAB/RC
Geochem
Southern Nights =
>700m
Mineralised Strike
OPE
N
Figure 3: Wagga Tank-Southern Nights Drill Plan
PAGE 10
Double Peak Prospect: Gold, Copper, Zinc, Lead, Silver; Western NSW (PEX 100%)
Double Peak is a north-south striking, 120m high razorback ridge situated approximately 15km north
of Mt Hope. The ridge is dominantly comprised of variably altered sediments, subordinate fine to
coarse-grained porphyritic rhyolites and rhyodacites and an intensely altered, variably gossanous
horizon that outcrops extensively along the eastern and western margins of the ridge. Previous drilling
by Peel Mining Ltd has intersected the Mount Allen Granite at depth beneath the ridge. The altered,
gossanous horizon is considered prospective with several historic workings located along it reporting
copper and gold mineralisation in a sheared chloritic matrix. Of these workings, the most significant is
a historic, government-funded adit that was constructed along an intensely silicified, Fe-rich gossanous
portion of the prospective horizon on the western side of the ridge. The adit exposed a Cu-Au rich lode
that is reported to dip between 35-55° east and strikes roughly north-south.
Drilling at Double Peak commenced in February 2020 and comprised three diamond drill holes for a
total of 298.9m focussing on the southern extent of the ridge. DPDD001 and DPDD002 were situated
on the western side of the ridge and drilled to directly test the outcropping silicified, Fe-rich gossan and
possible northern strike extension to the oxide Cu-Au lode exposed in the adit. DPDD001 was drilled -
80° towards 170° to a total depth of 69.5m and intersected a sequence dominated by eastward dipping
chlorite altered sandstone/siltstone with a ~30m interval of intense silica-chlorite-haematite-magnetite
alteration considered to be the expression of the Fe-rich gossan at depth. No significant Cu
mineralisation was encountered, though 8.15m @ 0.35 g/t Au from 3.85m including 1.15m @ 1.47 g/t
Au from 3.85m was intersected (Figure 2).
Figure 4. DPDD001 gold mineralisation
DPDD002 was drilled ~10m to the south of DPDD001, closer to the adit exposing oxide Cu-Au
mineralisation. It was drilled at -80° towards 170° to a total depth of 81.9m. The hole was dominantly
comprised of chlorite altered sediments but included a 1m interval of laminated massive pyrite +/-
haematite overlying an extensive ~27m interval of silica-chlorite-haematite-magnetite alteration similar
in style to that intersected in DPDD001. The hole bottomed in an aphanitic rhyolite. The hole intersected
6.35m @ 0.45 g/t Au from 17.65m including 1m @ 1.35 g/t Au from 21m (Figure 3). This interval included
the laminated massive pyrite and a portion of the underlying silica-chlorite-haematite-magnetite altered
horizon. No significant Cu mineralisation was intersected.
PAGE 11
Figure 5. DPDD002 gold mineralisation
DPDD003 was collared on top of the ridge, 55m to the east of DPDD001 and DPDD002 and drilled at -
70° towards 170°. It was drilled to test a coincident geochemical, gravity and magnetic anomaly (Figure
8). The hole intersected an intercalated sequence of chlorite altered sediments, haematite altered
spherulitic rhyolites and variably altered fine-grained rhyolites in addition to ~10m of coarse-grained
quartz veining postulated to represent a significant structure. No significant mineralisation was
reported.
Planned Activities
Due to its spatial relationship with gold mineralisation and known historic gold and copper
mineralisation, the altered Fe-rich gossanous horizon will continue to be tested by drilling. Its outcrop
pattern (outcropping on the eastern and western side of the ridge) is suggestive of folding, and field
observations have tentatively delineated a gentle, open synclinal style of folding. Follow up programs
of work are being designed to further test this horizon.
Mallee Bull Project
Targets: Cobar-style polymetallic mineralisation; Volcanogenic Massive Sulphide mineralisation.
The Mallee Bull Project, located about 100km south of Cobar in western NSW, contains the Mallee Bull
copper-polymetallic discovery, the May Day polymetallic deposit and the historic Gilgunnia and 4-Mile
goldfields. Mallee Bull contains a JORC Resource of 6.76Mt @ 1.8% Cu, 31g/t Ag, 0.4g/t Au, 0.6% Pb, 0.6%
Zn. (See ASX Announcement release 6th July 2017 “Mallee Bull Resource Grows by 65% to 175,000t
CuEq” for full detail). Successful underground exploration will see the company approval for conversion
to a full mining operation, with the benefit of established infrastructure, sunk capital costs and
streamlined regulatory approval process.
Mallee Bull
During the year, the Company continued compiling and lodging necessary documentation required to
obtain regulatory approval for the establishment of an exploration decline. The NSW Resources
Regulator advised that it requires additional information from various other NSW Government
departments/agencies and the Cobar Shire in relation to the Review of Environmental Factors (REF)
documentation and for Notification of High-Risk Activity application. The Company notes that due to
the closure of CBH Resources Limited’s Endeavour Mine, it is assessing the additional requirements and
PAGE 12
appropriateness of this planned option going forward in advance of making further submissions to the
Resources Regulator.
Furthermore, and subsequent to the end of the 2019/20 fiscal year, the Company announced its
intention to acquire CBH Resources Limited’s 50% share of the Mallee Bull Joint Venture, taking Peel’s
ownership in the project to 100%, by exercising its pre-emptive right, matching a third party’s
unconditional cash offer of $17 million. The purchase will provide the Company with 100% control of
the high-grade Mallee Bull copper deposit and the gold-polymetallic May Day deposit. This is in line with
the Company’s strategy to establish a critical mass of resources to support a robust standalone
operation in the Southern Cobar Basin.
The decision to pursue full ownership was borne primarily from the Company’s decision to seek to
consolidate its asset base following the definition of a maiden resource at Wagga Tank-Southern Nights,
CBH’s announcement in late 2019 of the impending closure of the Endeavour mine, north of Cobar, and
with this, the opportunity to utilise any spare milling capacity. Acquiring 100% of Mallee Bull will
transform Peel’s metal exposure to predominantly copper and also strengthen the Company’s principal
strategy to establish a robust stand-alone processing operation supported by multiple mines (Mallee
Bull, Wagga Tank-Southern Nights, and potentially May Day).
The full ownership of the Mallee Bull deposit will increase the Company’s global resource base to more
than 10Mt, whilst the May Day deposit, located within ML1361, presents Peel with a relatively low-cost
opportunity to establish potential shallow gold-dominant mineable resources.
May Day and Mallee Bull Planned Activities
At May Day, the Company plans to complete an in-pit inferred resource for the deposit based on existing
drill data and previous preliminary metallurgical testwork. This will be followed by resource infill drilling,
further metallurgical testwork and pit optimisations in an effort to produce a mineable resource which
will then form the basis for concept study work. It is envisaged that May Day has the potential to supply
initial feed for the conceptual stand-alone mill.
At Mallee Bull, the Company plans to undertake infill resource drilling in an effort to define a
predominantly indicated classified mineable resource. An existing internal scoping study for Mallee Bull
will then be updated to reflect its potential contribution to a conceptual stand-alone mill.
Cobar Superbasin Project
Targets: Cobar-style polymetallic mineralisation; Volcanogenic Massive Sulphide mineralisation.
Work on the Cobar Superbasin Project continued during the year under the Farm-in Agreement with
Japan Oil, Gas and Metals National Corporation (JOGMEC). Post year end, the Company received written
notice from JOGMEC of its decision to withdraw from the CSP and to terminate the Memorandum of
Agreement. As a result of the termination, JOGMEC’s rights and interests in CSP tenure will be
transferred to the Company at no cost, resulting in the Company regaining 100% ownership.
Wirlong
Work focussed on the Wirlong prospect, located within EL8307, approximately 30km SW of Nymagee
and 80km SSE of Cobar. The Company was initially drawn to the area by the presence of historic copper
workings, a topographic high, a multi-element surface geochemical anomaly and coincident or semi-
coincident magnetic, radiometric, gravity, IP and electromagnetic anomalies. It has since proven to
PAGE 13
represent a very large hydrothermal system hosting significant copper mineralisation along more than
2.5km strike length and to depths of up to 950m.
Drilling during the year at the Wirlong Prospect comprised six reverse circulation (RC) holes at Wirlong
South for a total of 1929m drilled, and three diamond drillholes (WLDD003, WLDD004 and WLDD005)
for a total of 1635m at Wirlong Central.
Three RC holes (WLRC061, WLRC062 and WLRC063) that were drilled at Wirlong South, were designed
to test the along strike potential from significant results seen in WLRC008 and WLRC009. A further two
RC holes (WLRC064 and WLRC065) were designed to test the downdip potential of the significant results
from WLRC008 and WLRC009. All holes drilled were highly anomalous for Zn, Pb, Cu, Ag & Au
mineralisation, however no economic values were recorded.
A program consisting of three diamond drillholes (WLDD003, WLDD004 & WLDD005) at Wirlong central
was undertaken to test a new structural model (NW-SE) for the controls on high-grade copper
mineralisation. The first diamond drillhole, WLDD003, was completed in December 2019 with an
additional 2 diamond drillholes (WLDD004 and WLDD005) completed in February 2020 for a total of
1,635m as part of the program.
Assay results received show significant intercepts in all 3 drillholes with results including:
• WLDD003 returning 4.26m @ 2.22% Cu, 7 g/t Ag from 380m including 0.26m @ 15.85% Cu, 58 g/t
Ag from 384m; and 0.74m @ 14.3% Cu, 66 g/t Ag from 396.2m
• WLDD004 returned multiple zones of significant mineralisation with better results of: 1.15m @
7.71% Cu, 30 g/t Ag from 54.45m, including 0.25m @ 30% Cu, 97 g/t Ag from 54.45m; and 12m @
1.02% Cu, 8 g/t Ag from 264m; and 30m @ 1.64% Cu, 8 g/t Ag from 305m including 14m @ 2.63%
Cu, 12 g/t Ag from 320m
• WLDD005 returning 5.9m @ 3.19% Cu, 13 g/t Ag from 347.1m including 0.65m @ 18.65% Cu, 48
g/t Ag from 351.87m
Down-hole EM was completed on drillholes WLDD003 and WLDD004 with modelling defining a
significant late-time conductor, with approximate dimensions of 120m x 150m and its geometry
consistent with the new structural model. The strike of mineralisation at Wirlong remains open to the
southeast, northwest and downdip.
Planned Activities
The next phase for Wirlong will be geophysical surveying to facilitate further exploration drill targeting,
as well as subsequent infill and extensional drilling, advancing the project towards a maiden mineral
resource estimate.
Sandy Creek
Two reverse circulation (RC) drillholes (PSCRC008 and PSCRC009) totaling 619m were drilling at the
Sandy Creek prospect located south of Wirlong. Drilling tested a flat lying EM plate in the central part
of the Sandy Creek prospect. While no significant mineralisation was encountered in PSCRC008,
PSCRC009 contained some anomalous results including 5m @ 0.68% Zn, 0.31% Pb, 0.04% Cu, 15 g/t Ag,
0.02 g/t Au from 154m and 9m @ 1.37% Zn, 0.81% Pb, 0.01% Cu, 6 g/t Ag, 0.02 g/t Au from 192m. The
cause of the EM plate was found to be disseminated and vein hosted pyrrhotite.
PAGE 14
Figure 6 – Wirlong Phase 7 Drill Plan.
PAGE 15
Figure 7: Cobar Tenements and Prospects (as at 30 June 2020)
PAGE 16
Corporate
COVID-19
During the year, in response to the COVID-19 pandemic, the Company implemented a series of
precautionary measures as part of its OHS policies to ensure that risk around COVID-19 was minimised
for all employees and contractors. These measures included restrictions on non-essential travel, as well
as social distancing and increased awareness around hygiene.
As a result, Peel’s field presence was reduced during the months of April through to June 2020 and no
drilling was undertaken during this period, with New South Wales-based staff performing relatively low-
level field activities. Desktop reviews were undertaken on all projects, with tenement rationalisation a
focus. With restrictions now easing, the Company has restarted drilling at its Cobar projects and has
significant work planned for the remainder of the calendar year.
The Company will continue to monitor the situation and government advice around the pandemic, and
will seek to act in accordance with this advice.
Executive Director Appointment
During the year, the Company appointed mining engineer Mr James (Jim) Simpson as Executive Director
Mining, effective 9 September 2019. The appointment of Mr Simpson to the Board reflected the
Company’s transformation from an exploration to a mining development company.
Saturn Metals Investment
On 9th June 2020, the Company reduced its holding in Saturn Metals Limited by selling 16,000,000
shares (19.0%). The sale was completed at A$0.45 per share with the block trade corner-stoned by large
North American Institutional Investors and high net worth individuals. The sale raised gross proceeds
of A$7.2m placing the Company in a strong financial position. Peel retains a significant holding of
4,000,001 shares (4.54%) in Saturn Metals Limited.
New Frontiers Co-operative Drilling
The Company was successful in being awarded a grant under the New Frontiers Co-operative Drilling
initiative, managed by the Geological Survey of NSW as part of NSW’s Mineral Strategy commitment
promoting investment in NSW. The funding is to be used on the Company’s Double Peak and Siegals
prospects and is up to a maximum total amount of $200,000 (GST exclusive). Drilling at Siegals targeting
strong geophysical anomalies proximal to strong geochemical anomalies is planned for mid-late July
2020 and will be eligible for the funding assistance.
Research and Development
In June 2020, the Company received a $215,449 Research and Development (R&D) Tax Incentive Refund
for activities during 2018/2019 year. The Company continued its R&D project during the current year.
PAGE 17
During the year, Peel Mining Limited released an updated mineral resource estimated for its Wagga
Tank Southern Nights Project. The Mallee Bull Mineral Resource estimate was unchanged for the year,
after being updated in 2016. The Attunga Mineral Resource estimates remained unchanged from the
Resources estimate as at 30 June 2014.
Peel Mining Ltd has ensured that the Mineral Resource estimates are subject to good governance
arrangements and internal controls. The Mineral Resources reported have been generated by
independent external consultants who are experienced in best practices in modelling and estimation
methods. The consultants have also undertaken a review of the quality and suitability of the underlying
information used to generate the resource estimations. Additionally, Peel Mining Ltd carries out regular
reviews and audits of internal processes and external contractors that have been engaged by the
Company.
The Mineral Resources estimates for Mallee Bull and Wagga Tank-Southern Nights (post year end) were
compiled and reported in accordance with the 'Australasian Code for Reporting of Exploration Results,
Mineral Resources and Ore Reserves' (the JORC Code) 2012 Edition, whilst the Attunga Resource
Estimate was completed in accordance with the JORC Code 2004 Edition.
The March 2020 Wagga Tank Southern Nights Mineral Resource Estimate utilises AU$80/tonne NSR cut-
off mineable shapes that include minimum mining widths and internal dilution. Net Smelter Return
(NSR) is an estimate of the net recoverable value per tonne including offsite costs, payables, royalties
and mill recoveries. Figures are rounded to reflect the precision of estimates and include rounding
errors.
March 2020 Southern Nights Mineral Resource Estimate
Resource
Classification
Tonnes
(Kt)
Indicated
Inferred
Total Resource
2,540
1,600
4,140
NSR
$/t
173
120
150
Zn
(%)
5.90
3.7
5.0
Pb
(%)
2.30
1.4
2.0
Ag
(g/t)
88.9
59
77
March 2020 Wagga Tank Mineral Resource Estimate
Resource
Classification
Tonnes
(Kt)
Indicated
Inferred
Total Resource
410
400
810
NSR
$/t
169
180
170
Zn
(%)
4.67
5.3
5.0
Pb
(%)
2.52
2.3
2.4
Ag
(g/t)
64.3
98
81
Cu
(%)
0.19
0.3
0.2
Cu
(%)
0.50
0.3
0.4
March 2020 Combined Southern Nights-Wagga Tank Mineral Resource Estimate
Resource
Classification
Indicated
Inferred
Total Resource
Tonnes
(Kt)
2,950
2,000
4,950
NSR
$/t
172
130
160
Zn
(%)
5.73
4.0
5.0
Pb
(%)
2.33
1.6
2.0
Ag
(g/t)
85.5
67
78
Cu
(%)
0.23
0.3
0.3
Au
(g/t)
0.33
0.3
0.3
Au
(g/t)
0.53
0.5
0.5
Au
(g/t)
0.36
0.3
0.4
PAGE 18
The July 2019 Wagga Tank Southern Nights Mineral Resource Estimate was reported at a 3.5% ZnEq cut-
off, in the 2019 Annual Report.
July 2019 Mineral Resource Estimate for the Southern Nights Deposit
Resource
Classification
Tonnes
Zn (%)
Pb (%)
Ag (g/t)
Cu (%)
Au (g/t)
ZnEq (%)
Indicated
1,126,000
Inferred
2,106,000
Total Resource
3,232,000
8.8
4.5
6.0
3.5
1.5
2.2
107
69
83
0.28
0.14
0.19
0.44
0.13
0.24
14.3
7.2
9.7
July 2019 Mineral Resource Estimate for the Wagga Tank Deposit
Resource
Classification
Tonnes (t)
Zn (%)
Pb (%)
Ag (g/t)
Cu (%)
Au (g/t)
ZnEq (%)
Inferred
532,000
Total Resource
532,000
2.4
2.4
1.2
1.2
31
31
0.74
0.74
0.77
0.77
6.6
6.6
July 2019 Mineral Resource Estimate for the Southern Nights and Wagga Tank Deposit
Resource
Classification
Tonnes
Zn (%)
Pb (%)
Ag (g/t)
Cu (%)
Au (g/t)
ZnEq (%)
Indicated
1,126,000
Inferred
2,638,000
Total Resource
3,764,000
8.8
4.0
5.5
3.5
1.4
2.1
107
62
75
0.28
0.26
0.27
0.44
0.26
0.31
14.3
7.1
9.2
Note: Tonnages and grades are rounded. Discrepancies in totals may exist due to rounding. 1 - Zinc equivalent (ZnEq) has been calculated using
assumptions regarding metal sale prices It is Peel Mining’s opinion that all elements included in the metal equivalent calculation have a reasonable
potential to be recovered and sold. For further detail on the resource please see the ASX announcement “Robust Maiden Resource Confirms
Outstanding Mining & Growth Potential at Southern Nights-Wagga Tank” released on 12th July 2019.
The tables below set out Mineral Resource estimates for 2020, which are unchanged from 2019.
Mallee Bull Mineral Resource estimate at 30 June 2019 based on 1% copper equivalent (CuEq) cut-off
grade
Mineral Resource - as at 30 June 2019
Category
Indicated
Inferred
Total
Kt
1,340
5,420
6,760
CuEq % Cu % Ag g/t
0.91
2
1.8
2.15
2.7
2.6
30
31
31
Au g/t
0.4
0.4
0.4
Pb %
0.96
0.5
0.6
Zn %
1.23
0.4
0.6
Note: The figures in the above table are rounded to reflect the precision of the estimates and include rounding errors.
Attunga Tungsten Deposit Inferred Mineral Resource Estimate based on a 0.2% WO3 equivalent cut-off
Mineral Resource - as at 30 June 2019
WO3equivalent cut-off
0.2
Mt
1.29
WO3Eq % WO3 %
0.73
0.61
Mo %
0.05
Note: The figures in the above table are rounded to reflect the precision of the estimates and include rounding errors.
PAGE 19
Competent Persons Statements
Wagga Tank Southern Nights Deposits
The information in this report that relates to data and geological modelling included in Mineral Resource
estimates is based on information reviewed by Mr Jason McNamara who is a Fellow of The Australasian
Institute of Mining and Metallurgy. Mr McNamara was a full time employee of Peel Mining and has
sufficient experience which 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 Exploration Results, Mineral Resources and Ore
Reserves”. Mr McNamara consents to the inclusion in the documents of the matters based on this
information in the form and context in which it appears.
The information in this report that relates to grade estimation and Mineral Resource estimates is based
on information reviewed by Mr Jason McNamara, who is a Fellow of The Australasian Institute of Mining
and Metallurgy. Mr McNamara was a full time employee of Peel Mining and has sufficient experience
which is relevant to the style of mineralisation and type of deposit under consideration and to the
activity which he is undertaking to qualify as a Competent Person as defined in the 2012 edition of the
“Australasian Code for Reporting Exploration Results, Mineral Resources and Ore Reserves”. Mr
McNamara consents to the inclusion in the documents of the matters based on this information in the
form and context in which it appears. This release may include aspirational targets. These targets are
based on management’s expectations and beliefs concerning future events as of the time of the release
of this document. Targets are necessarily subject to risks, uncertainties and other factors, some of which
are outside the control of Peel Mining that could cause actual results to differ materially from such
statements. Peel Mining makes no undertaking to subsequently update or revise the forward-looking
statements made in this release to reflect events or circumstances after the date of this release.
Mallee Bull
The information in this report that relates to Exploration Results is based on information compiled by
Mr Rob Tyson who is a fulltime employee of the company. Mr Tyson is a member of the Australasian
Institute of Mining and Metallurgy. Mr Tyson has sufficient experience of relevance to the styles of
mineralisation and the types of deposits under consideration, and to the activities undertaken, to qualify
as Competent Persons as defined in the 2012 Edition of the Joint Ore Reserves Committee (JORC)
Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Tyson
consents to the inclusion in this report of the matters based on information in the form and context in
which it appears. Exploration results are based on standard industry practices, including sampling,
assay methods, and appropriate quality assurance quality control (QAQC) measures.
The information in this report that relates to the Mallee Bull Mineral Resource estimates, and reported
by the Company in compliance with JORC 2012 is based on information compiled by Mr Jonathon Abbott,
a Competent Person who is a Member of the Australian Institute of Geoscientists. Mr Abbott is a full-
time employee of MPR Geological Consultants Pty Ltd and is an independent consultant to Peel Mining
Ltd. Mr Abbott has sufficient experience that is relevant to the style of mineralisation and type of deposit
under consideration and to the activity being undertaking to qualify as a Competent Person as defined
in the 2012 Edition of the “Australasian Code for Reporting of Mineral Resources and Ore Reserves”. Mr
Abbott consents to the inclusion in this report of the matters based on his information in the form and
context in which it appears. As at the date of this report, there has been no material changes to the
Mallee Bull Resource estimates.
PAGE 20
Attunga Tungsten Deposit
The information referred to in this report in relation to the Attunga Resource Estimate is based on
information compiled by Mr Murray Hutton, a Competent Person who is a Member of the Australian
Institute of Geoscientists. At the time of calculating the Resource Estimate Mr Hutton was a full time
employee of Geos Mining and was an independent consultant to Peel Mining Ltd.
Mr Hutton 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 2004 Edition of the 'Australasian Code for Reporting of Mineral Resources and Ore Reserves'.
Mr Hutton consented to the inclusion of the matters based on his information in the form and context
in which it appears.
Exploration Results
The information in this report that relates to Exploration Results is based on information compiled by
Mr Rob Tyson who is a fulltime employee of the company. Mr Tyson is a member of the Australasian
Institute of Mining and Metallurgy. Mr Tyson has sufficient experience of relevance to the styles of
mineralisation and the types of deposits under consideration, and to the activities undertaken, to qualify
as Competent Persons as defined in the 2012 Edition of the Joint Ore Reserves Committee (JORC)
Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Tyson
consents to the inclusion in this report of the matters based on information in the form and context in
which it appears. Exploration results are based on standard industry practices, including sampling,
assay methods, and appropriate quality assurance quality control (QAQC) measures.
PAGE 21
Project
Burthong
Gilgunnia South
Glenwood
Hillview
Illewong
Iris Vale
Manuka
Mirrabooka
Mundoe
Mundoe North
Norma Vale
Pine Ridge
Sandy Creek
Tara
Yackerboon
Yara
Attunga
Ruby Silver
Gilgunnia
May Day
Beanbah
Brambah
Linera
Marigold
Michelago
Mt View
Mt Walton
Nombinnie
Wagga Tank
Wongawood
Gromit
Florida
Bilpa
Cymbric Vale
Comarto
Devon
Thunderdome **
Grassmere North
Number
Holder
Peel Interest
EL8534
EL7519
EL8314
EL8125
EL8117
EL8113
EL8071
EL8105
EL7976
EL8201
EL8126
EL8345
EL8307
EL8070
EL8112
EL8114
EL8326
EL7711
EL7461
ML1361
EL8450
EL8655
EL8447
EL8656
EL8451
EL7484
EL8414
EL8751
EL6695
EL7226
EL8872
EL8900
EL8721
EL8722
EL8790
EL8791
EL8877
EL8909
Peel (CSP) Pty Ltd
Peel (CSP) Pty Ltd
Peel (CSP) Pty Ltd
Peel (CSP) Pty Ltd
Peel (CSP) Pty Ltd
Peel (CSP) Pty Ltd
Peel (CSP) Pty Ltd
Peel (CSP) Pty Ltd
Peel (CSP) Pty Ltd
Peel (CSP) Pty Ltd
Peel (CSP) Pty Ltd
Peel (CSP) Pty Ltd
Peel (CSP) Pty Ltd
Peel (CSP) Pty Ltd
Peel (CSP) Pty Ltd
Peel (CSP) Pty Ltd
Peel Mining Ltd
Peel Mining Ltd
Peel Mining Ltd
Peel Mining Ltd
Peel Mining Ltd
Peel Mining Ltd
Peel Mining Ltd
Peel Mining Ltd
Peel Mining Ltd
Peel Mining Ltd
Peel Mining Ltd
Peel Mining Ltd
Peel Mining Ltd
Peel Mining Ltd
Peel Mining Ltd
Peel Mining Ltd
Peel Far West Pty Ltd
Peel Far West Pty Ltd
Peel Far West Pty Ltd
Peel Far West Pty Ltd
Peel Far West Pty Ltd
Peel Far West Pty Ltd
50%*
50%*
50%*
50%*
50%*
50%*
50%*
50%*
50%*
50%*
50%*
50%*
50%*
50%*
50%*
50%*
100%
100%
50%*
50%*
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
* Subsequent to year end, Peel’s interest in the 50% listed entities will revert to 100% with Peel having exercised its pre-emptive
right to acquire CBH Resources Limited’s 50% share of the Mallee Bull Joint Venture, and having received written notice from
JOGMEC of its decision to withdraw from the CSP, and to terminate the Memorandum of Agreement.
** Thunderdome (EL8877) was under application at 30 June 2020, but was granted post year end on 17 July 2020.
PAGE 22
Your directors present their report on the consolidated entity (“Group”) comprising Peel Mining Limited
(“Company”) and the entities it controlled at the end of, or during the financial year ended 30 June 2020
and the comparative period.
Directors
The following persons were directors of Peel Mining Limited during the financial year and up to the date
of this report.
Robert Tyson
Simon Hadfield
Graham Hardie
James Simpson (appointed 9 September 2019)
Directors’ interests in shares and options
Directors’ interests in shares and options as at the date of this report are set out in the table below.
Director
R Tyson
S Hadfield
G Hardie
J Simpson
Principal activities
Number of Shares Directly and Indirectly Held
Number of Options
7,728,420
4,672,567
18,563,501
3,173,243
3,000,000
1,500,000
1,500,000
2,000,000
The principal activity of the Group is the exploration for economic deposits of minerals. For the period
of this report, the emphasis has been on base and precious metals.
Results
The profit for the Group for the financial year after providing for income tax amounted to $3,610,070
(2019: Loss of $2,870,270).
Dividends
No dividends were paid or proposed during the year.
Review of operations
A review of the operations of the Group during the financial year and the results of those operations
are contained in pages 4 to 17 in this report.
PAGE 23
Significant changes in the state of affairs
Mr James Simpson was appointed in the role of Executive Director of Mining of the Company on 9
September 2019. Upon shareholder approval at the AGM held on 28 November 2019, Mr Simpson was
issued 2,000,000 options exercisable at $0.31, of which 1,000,000 vested on 28 November 2019 and
1,000,000 will vest 12 months after commencement.
Contributed equity increased during the financial year by $202,850 through the issue of:
(i) 500,000 new ordinary shares issued at $0.223 cents on the exercise of Graham Hardie’s options.
(ii) 450,000 new ordinary shares issued on the exercise of employee share options raising $91,350.
Details of the changes in contributed equity are disclosed in note 12 to the financial statements.
On 9 June 2020 Peel Mining Limited sold 16,000,000 shares in Saturn Metals Limited, leaving a balance
of 4,000,001 shares held by Peel Mining Limited. The reduction in ownership interest to 4.54% (2019:
31.43%) is no longer considered an associate interest. The remaining shares held by Peel Mining Limited
have been revalued to their fair value at 30 June 2020 and are held in voluntary escrow until 9
September 2020.
Covid-19
From March to June 2020, in response to the COVID-19 pandemic, the Company moved to implement a
series of precautionary measures as part of its OHS policies to ensure that risk around COVID-19 was
minimised for all employees and contractors. These measures included increased focus on workplace
hygiene and restrictions on non-essential travel with changes to field-based rosters, ensuring ongoing
site activities in the near to medium term. The Company’s head office staff also moved to a work-from-
home basis for a period of 6 weeks.
In addition the Company instigated a series of cost-saving measures whilst the immediate effects of
COVID-19 were borne. These included retrenchment of a number of casual staff and all remaining staff,
including management, agreeing to take temporary pay reductions and capped work hours in some
circumstances. Peel’s Non-Executive Directors also agreed to waive their fees from April to June 2020.
The Company will continue to monitor the situation as it develops and will advise of any further
measures, if necessary.
The directors are not aware of any other significant changes in the state of affairs of the Group occurring
during the financial year, other than as disclosed in this report.
Events occurring after balance date
Acquisition of Mallee Bull
In July 2020, Peel received an Initial Transfer Notice (ITN) from CBH Resources Ltd (CBH) after CBH
received an unconditional cash offer of $17,000,000 from a third party for its 50% share of the joint
venture. CBH advised that it intended to accept the third party offer, subject to Peel not exercising its
pre-emptive right.
Peel Mining Limited has had independent confirmation of the validity of the ITN and third party offer
per the conditions of the joint venture agreement. Pursuant to the joint venture agreement between
Peel and CBH, Peel has a pre-emptive right to acquire the joint venture interest on the same terms. Peel
has exercised its right to acquire the joint venture interest to gain 100% ownership of the project with
PAGE 24
a cash offer of $17,000,000. The acquisition is subject to NSW Government Ministerial approval of the
transfer of titles.
Capital Raising
In August 2020, the Company successfully completed a placement of 60 million shares at an issue price
of $0.175 each to raise a gross amount of $10,500,000. This was completed in conjunction with a fully
underwritten 1 for 8 pro-rata entitlement issue to raise a further $6,643,036 at the same price as the
aforementioned placement. Funds from this raising are proposed to be used, in conjunction with
existing cash and liquid investments, for the acquisition of the 50% share of the Mallee Bull Joint Venture
which is currently held by CBH, the costs of the capital raising and for ongoing working capital and
general corporate purposes.
JOGMEC Withdrawal
Notification was received by Peel from JOGMEC on 14 August 2020 that it was withdrawing from the
agreement. The Company and JOGMEC are finalising a deed of mutual release and final expenditure in
relation to the project. The withdrawal results in all rights and interests in the CSP tenure to be
transferred to Peel at no cost, resulting in Peel regaining 100% ownership.
Other than the above, there were no events occurring after balance date requiring separate disclosure.
Likely developments and expected results
It is the Board’s current intention that the Group will seek to progress exploration on current projects.
There is an intention to progress its main projects, being Mallee Bull, May Day, Wagga Tank Southern
Nights and Wirlong towards development. These activities are inherently risky and there are no
certainties that the group will successfully achieve its objectives.
PAGE 25
Information on directors
Simon Hadfield – Non-executive Chairman
Mr Hadfield has more than 30 years company management experience and has held directorships in
publicly-listed industrial and resource companies. Mr Hadfield is a director of RIU Conferences Pty Ltd,
Resource Information Unit, and Sensorum Pty Ltd. No other directorships were held in the past 3 years.
Mr Hadfield is considered an independent director.
Mr Hadfield holds 4,672,567 shares and 1,500,000 share options in Peel Mining Limited.
Robert Maclaine Tyson B.App Sc(Geol).GradDip Applied Finance(SIA) – Managing Director
Mr Tyson is a geologist with more than 20 years resources industry experience having worked in
exploration and mining-related roles for companies including Cyprus Exploration Pty Ltd, Queensland
Metals Corporation NL, Murchison Zinc Pty Ltd, Normandy Mining Ltd and Equigold NL. Mr Tyson is also
a non-executive director of Saturn Metals Limited. No other directorships were held in the past 3 years.
Mr Tyson is not considered an independent director.
Mr Tyson holds 7,728,420 shares and 3,000,000 share options in Peel Mining Limited.
Graham Hardie FCA – Non-executive Director
Mr Hardie is the principal of Hardie Finance Corporation, a private Perth-based property development
company, and is also the principal of Entertainment Enterprises, a private Perth-based hospitality
company. He is a Fellow of the Institute of Chartered Accountants and a former partner in a leading
Chartered Accounting firm. Mr Hardie has extensive commercial and financial experience and has held
board positions on a number of public companies in the mining, media, transport and retail industries.
No other directorships were held in the past 3 years. Mr Hardie is not considered an independent
director.
Mr Hardie holds 18,563,501 shares and 1,500,000 share options in Peel Mining Limited.
James Simpson – Executive Director Mining
Appointed 9 September 2019
Mr Simpson is an experienced Mining Engineer with significant board and management experience. Mr
Simpson was previously the Chief Executive Officer and Managing Director at Aurelia Metals Limited,
Chief Operating Officer & Executive Vice President for Peak Gold Limited; General Manager & Director
at Goldcorp Asia Pacific; and General Manager Mining Lead Zinc at MIM Holdings, Mt Isa. Mr Simpson’s
experience ranges from mine development and management through to corporate and equity market
participation. No other directorships were held in the past 3 years. Mr Simpson is not considered an
independent director.
Mr Simpson holds 3,173,243 shares and 2,000,000 share options in Peel Mining Limited.
Ryan Woodhouse - Company Secretary
Mr Woodhouse has 13 years of experience in the mining and energy industries in the area of accounting
and governance. He holds a Bachelor of Commerce from Curtin University and is a member of the
Institute of Chartered Accountants. Mr Woodhouse currently holds the position of Company Secretary
with both Peel Mining Limited and Saturn Metals Limited.
Mr Woodhouse was appointed Company Secretary on 7 January 2015.
PAGE 26
Meetings of directors
Director’s attendance at directors’ meetings are shown in the following table:
Director
R Tyson
S Hadfield
G Hardie
J Simpson
Number held whilst in office
Number attended
10
10
10
9
10
10
10
9
PAGE 27
The remuneration report is set out under the following headings:
Principles used to determine the nature and amount of remuneration
a)
b) Details of remuneration
Service agreements
c)
Share-based compensation
d)
e) Option holdings of key management personnel
f)
g) Other transactions with directors and key management personnel
h) Additional information
Share holdings of directors
a) Principles used to determine the nature and amount of remuneration
The objective of the remuneration framework of Peel Mining Limited is to ensure reward for
performance is competitive and appropriate for the results delivered. The framework aligns executive
reward with achievement of strategic objectives and the creation of value for shareholders. The board
believes that executive remuneration satisfies the following key criteria:
competitiveness and reasonableness
•
• acceptability to shareholders
• performance linkage / alignment of executive compensation
•
•
transparency
capital management
These criteria result in a framework which can be used to provide a mix of fixed and variable
remuneration, and a blend of short and long-term incentives in line with the Company’s remuneration
policy.
Board and senior management
Fees and payments to the directors and other key management personnel reflect the demands which
are made on, and the responsibilities of, the directors and the senior management. Such fees and
payments are determined by the board and reviewed annually.
Company policy in relation to remunerating executives is that directors are entitled to remuneration
out of the funds of the Company, but the remuneration of the Non-executive Directors may not exceed
in any year the amount fixed by the Company in general meeting for that purpose.
The aggregate of fees of the Non-executive Directors has been fixed at a maximum of $250,000 per
annum to be apportioned among the Non-executive Directors in such a manner as they determine.
Directors are also entitled to be paid reasonable travel, accommodation and other expenses incurred
in consequence of their attendance at board meetings and otherwise in the execution of their duties as
directors. Senior management are paid based on applicable market rates.
Remuneration is not linked to past Group performance but rather towards generating future
shareholder wealth through share price performance. The board and management are issued share
options in the company on a periodic basis as a means to link executive rewards to shareholder value.
PAGE 28
Peel Mining Limited listed on 11 May 2007 at $0.20 per share and the share price at 30 June 2020 was
$0.165 (2019: $0.32). The Company has recorded a loss each financial year to date, except for 2014
during which it recorded a gain on the partial disposal of the Mallee Bull Project, and 2020 during which
it recorded a gain on the partial disposal of Saturn Metals Limited shares. No dividends have been
declared or paid during the reporting period.
Payments to Executives and Directors April to June 2020
Due to the outbreak of Covid-19 and the uncertainties surrounding the impact on the Group, the Board
decided to reduce the level of remuneration paid to all executives and Directors from April 2020 to June
2020. All non-executive director fees were reduced to zero and executive director salaries were reduced
by 20% or deferred. Contract levels of remuneration were reinstated in July 2020.
b) Details of remuneration
Details of the nature and amount of each element of the remuneration of each of the directors of Peel
Mining Limited and other key management personnel of the Group during the year ended 30 June 2020
are set out in the following table:
Table 1: Director and key management personnel remuneration
Short-Term
Employment
Benefits
Cash salary
and fees
$
Post-
Employment
Long-Term
Benefits
Share Based
Payment1
Superannuation
$
Long-service
leave
$
$
Total
$
Performance
Related
%
30 June 2020
Directors
R Tyson
S Hadfield
G Hardie
J Simpson
Total
0%
0%
0%
0%
0%
1. Note Share Based Payment amounts are not cash payments made to directors. The amounts represent the value ascribed by
the Black-Scholes valuation method to options granted. Further information about options granted can be found within the
annual report.
215,692
37,503
37,503
77,000
367,698
437,868
105,329
105,329
284,228
932,754
187,466
64,263
64,263
199,913
515,905
14,219
-
-
-
14,219
20,491
3,563
3,563
7,315
34,932
Short-Term
Employment
Benefits
Cash salary
and fees
$
Post-
Employment
Long-Term
Benefits
Share Based
Payment1
Superannuation
$
Long-service
leave
$
$
Total
$
Performance
Related
%
30 June 2019
Directors
R Tyson
S Hadfield
G Hardie
Total
0%
0%
0%
0%
1. Note Share Based Payment amounts are not cash payments made to directors. The amounts represent the value ascribed by
the Black-Scholes valuation method to options granted. Further information about options granted can be found within the
annual report.
238,846
50,004
50,004
338,854
550,969
189,211
189,211
929,391
279,027
134,457
134,457
547,941
10,405
-
-
10,405
22,691
4,750
4,750
32,191
* Mr Simpson became a Director effective 9 September 2019 and therefore was not remunerated during the 30 June 2019
financial year.
PAGE 29
c) Service agreements
Remuneration and other terms of employment for the directors and key management personnel,
except those of Non-executive Directors are formalised in Employment Agreements or Letters of Offer.
Details of the employment conditions for directors and key management personnel are set out below:
Simon Hadfield (Non-executive Chairman)
Mr Hadfield was appointed a Director of the Company on 20 April 2006. Mr Hadfield has not entered
into a formal contract with the Company in respect to his appointment as a Non-executive Chairman.
Mr Hadfield received cash payments and share options totalling $105,329 (2019: $189,211) in his role
as Chairman of the Company.
Graham Hardie (Non-executive Director)
Mr Hardie was appointed a Director of the Company on 24 February 2010. Mr Hardie has not entered
into a formal contract with the Company in respect to his appointment as a Non-executive Director. Mr
Hardie received cash payments and share options totalling $105,329 (2019: $189,211) in his role as a
Non-executive Director of the Company.
Robert Tyson (Managing Director)
Mr Tyson was appointed a Director of the Company on 20 April 2006. Mr Tyson is employed as the
Managing Director of the Company under an ongoing contract. The terms of his contract state:
• The Managing Director receives fixed remuneration of $230,000 per annum gross, plus
statutory superannuation guarantee.
• The Managing Director is required to give the Company 3 months’ notice of resignation.
• Other than for serious misconduct, the Company is required to give Mr Tyson 3 months’ notice
of termination, plus 3 months’ salary.
• The Managing Director may be invited to participate in the Company’s Employee Share Option
Plan.
Mr Tyson received cash payments, leave entitlements and share options totalling $437,868 (2019:
$550,969) in his role as Managing Director of the Company.
James Simpson (Executive Director Mining)
Mr Simpson was appointed a Director of the Company on 9 September 2019. Mr Simpson is employed
as the Executive Director Mining on a part time basis. The terms of his contract state:
• Salary of $140,000 per annum (plus statutory superannuation) based on 16 hours per week.
• Participation in the Company’s Incentive Option Plan.
• Other than for serious misconduct, the Company is required to give Mr Simpson 3 months’
notice of termination, plus 3 months’ salary.
• Mr Simpson is required to give the Company 3 months’ notice of resignation.
Mr Simpson received cash payments, leave entitlements and share options totalling $284,228 (2019: nil)
in his role as Executive Director Mining of the Company. Mr Simpson commenced his role on 9
September 2019 and therefore had not received any remuneration during the 30 June 2019 financial
year.
PAGE 30
d) Share-based compensation
Details of options over ordinary shares in the Company provided as remuneration to each director and
key management personnel of Peel Mining Limited are set out below. When exercisable, each option is
convertible into one ordinary share of Peel Mining Limited. Further information on the options is set
out in note 22 to the financial statements.
Name
Fair Value at Grant Date
Directors
R Tyson
S Hadfield
G Hardie
J Simpson
2020
$
128,526
64,263
64,263
251,615
2019
$
268,915
134,457
134,457
-
Number of options
granted during year
2019
2020
Number of options vested
during year
2020
2019
1,000,000
500,000
500,000
2,000,000
1,000,000
500,000
500,000
-
1,500,000
500,000
500,000
1,000,000
1,000,000
500,000
500,000
-
*Mr Simpson became a Director effective 9 September 2019 and therefore was not remunerated during the 30 June 2019
financial year.
The assessed fair value at grant date of options granted to the individuals is allocated equally over the
period from grant date to vesting date. Fair values at grant date have been determined using a Black-
Scholes option pricing model that takes into account the exercise price, term of the option, impact of
dilution, share price at grant date, price volatility of the underlying share, expected dividend yield and
the risk-free interest rate for the term of the option.
Options over shares in Peel Mining Limited may be granted to Employees under the Company’s
Employee Share Option Plan, which was initially created in June 2008, and recently re-approved by
shareholders at the annual general meeting held on 28 November 2019. The Employee Share Option
Plan is designed to provide long-term incentives for employees to deliver long-term shareholder
returns. Under the plan, participants are granted options 50% of which vest immediately, and the
remainder vest after twelve months provided the employee is still employed by the Company at the
end of the vesting period. Participation in the plan is at the board’s discretion.
PAGE 31
The terms and conditions of each grant of options existing for both directors and employees at
reporting date is as follows:
Grant Date
Date Vested &
Exercisable
Expiry Date
Exercise Price
$
Value per
Option at Grant
Date
$
15 August 2017
15 August 2017 (50%)
15 August 2018 (50%)
15 August 2020
$0.260
$0.11
30 November 2017
30 November 2017 (67%)
30 November 2018 (33%)
30 November 2020
$0.783
$0.33
7 December 2018
7 December 2018
7 December 2021
$0.570
7 December 2018
7 December 2018 (75%)
7 December 2019 (25%)
7 December 2021
$0.641
$0.28
$0.27
28 November 2019
28 November 2019
29 November 2022
$0.32
$0.129
28 November 2019
28 November 2019 (50%)
28 November 2020 (50%)
9 September 2022
$0.31
$0.126
(e) Option holdings of key management personnel (KMP)
30 June
2020
Balance
at the
start of
the
year
Granted
as
compensation
Expired
during
year
Exercised
Other
Change
Balance
at end
of the
year
Vested
and
exercisable
Unvested
Directors
4,000,000
R Tyson
S Hadfield 1,500,000
1,500,000
G Hardie
0
J Simpson
(2,000,000)
(500,000)
-
-
*Mr Simpson became a Director effective 9 September 2019 and therefore was not remunerated during the 30 June 2019
financial year.
- 3,000,000
- 1,500,000
- 1,500,000
- 2,000,000
1,000,000
500,000
500,000
2,000,000
3,000,000
1,500,000
1,500,000
1,000,000
-
-
(500,000)
-
-
-
-
1,000,000
(f) Share holdings of Directors– Shares in Peel Mining Limited (number)
30 June 2020
Directors
G Hardie
R Tyson
S Hadfield
J Simpson
Balance at
1 July 2019
Received
during
the year on
the
exercise of
options
Other changes
during the
year
Balance at
30 June 2020
15,922,890
7,245,000
4,312,564
-
500,000
-
-
-
78,000
-
-
-
16,500,890
7,245,000
4,312,564
-
PAGE 32
*Mr Simpson became a Director effective 9 September 2019 and therefore was not remunerated during the 30 June 2019
financial year.
(g) Other transactions with Directors and key management personnel
Simon Hadfield is a Director of Resource Information Unit Pty Ltd (RIU). RIU leases the Company office
space and charges the Company lease fees on arm’s length commercial terms on a monthly basis. Total
fees charged to the Company by RIU for the year ended 30 June 2020 were $65,556 (2019: $57,245).
During the year the Company participated in conferences organised by RIU Conferences Pty Ltd, to the
value of $9,900 (2019: $27,720), a company of which Mr Hadfield is a Director. These amounts are
included in earnings for the year within administration expenses and on the statement of financial
position within trade and other payables at year-end in relation to any unpaid amounts.
Aggregate amounts of each of the above types of “other transactions” with key management personnel
of Peel Mining Limited:
Amounts recognised as expense
Rent and office management fees
Conferences
h) Additional information
Cash bonuses
Consolidated
2020
$
Consolidated
2019
$
65,556
9,900
75,456
57,245
27,720
84,965
No cash bonuses have been paid by the Company during the reporting period.
Share-based compensation: options
Other than options granted and exercised under the Employee Option Share Plan, as described in (d)
above, there were no options issued to or exercised by directors of Peel Mining Limited or other key
management personnel during the year.
Use of remuneration consultants
During the year ended 30 June 2020, the Group did not employ the services of a remuneration
consultant to review its existing remuneration policies and to provide recommendations in respect of
both executive short-term and long-term incentive plan design.
Voting and comments made at the Company’s 2019 Annual General Meeting
Peel Mining Limited received 99% of “yes” votes on its remuneration report for the 2019 financial year.
The Company did not receive any specific feedback at the AGM or throughout the year on its
remuneration practices.
End of Audited Remuneration Report
PAGE 33
Shares under option
Unissued ordinary shares of the Company under option at the date of this report are as follows:
Date options granted
Expiry date
30 November 2017
7 December 2018
7 December 2018
28 November 2019
28 November 2019
30 November 2020
7 December 2021
7 December 2021
9 September 2022
29 November 2022
Issue price of
shares
$
Number
under option
0.783
0.641
0.570
0.310
0.320
2,000,000
2,000,000
1,562,500
2,000,000
2,000,000
No option holder has any right under the options to participate in any other share issue of the Company.
Shares issued on the exercise of options
Date of Exercise
17 August 2018
25 September 2018
19 October 2018
22 November 2018
22 November 2018
30 November 2018
28 May 2019
10 October 2019
30 October 2019
Issue price of shares
2019
2020
$
$
Number of shares issued
2020
Number
2019
Number
0.19
0.26
0.19
0.216
0.216
0.203
0.203
100,000
100,000
500,000
500,000
500,000
100,000
50,000
0.203
0.223
450,000
500,000
950,000
1,850,000
Indemnification and Insurance of Directors and Officers
During the financial year the Company paid a premium of $56,242.58 (2019: of $58,706.82) to insure
the directors and officers of the Group. The policy indemnifies each director and officer of the Group
against certain liabilities arising in the course of their duties.
Proceedings on behalf of the Company
No person has applied for leave of court to bring proceedings on behalf of the Group or intervene in
any proceedings to which the Group is a party for the purpose of taking responsibility on behalf of the
Group for all or any part of those proceedings. The Group was not a party to any such proceedings
during the year.
PAGE 34
Environmental Regulation
The Group holds exploration licences and mining leases in Australia. These licences specify guidelines
for environmental impacts in relation to exploration activities. The licence conditions provide for the
full rehabilitation of the areas of exploration in accordance with the respective jurisdiction’s guidelines
and standards. The Company is not aware of any significant breaches of the licence condition.
Auditor’s Independence Declaration
A copy of the Auditor’s Independence Declaration as required under section 307C of the Corporations
Act 2001 is included at the end of this financial report.
Non-Audit Services
The Company may decide to employ the auditor on assignments additional to their statutory audit
duties where the auditor’s expertise and experience with the Company are important. The Board has
considered the position and is satisfied that the provision of the non-audit services is compatible with
the general standard of independence for auditors imposed by the Corporations Act 2001.
The Directors are satisfied that the provision of non-audit services by the auditor as set out below did
not compromise the auditor independence requirements of the Corporations Act 2001 for the following
reasons:
• All non-audit services have been reviewed by the Board to ensure they do not impact the impartiality
and objectivity of the auditor; and
• None of the services undermine the general principles relating to the auditor independence as set
out in APEX 110 Code of Ethics for Professional Accountants.
Details of the fees paid to the auditor during the year can be found at note 23 of the notes to the
consolidated financial statements.
This report is made in accordance with a resolution of the board of directors and signed for on behalf
of the board by:
Robert Tyson
Managing Director
Perth, Western Australia
9th September 2020
PAGE 35
Operator management fee
Interest income
Other income
Gain on disposal of asset
Gain on disposal of investment asset
Revenue and other income
Share-based remuneration to directors &
employees
Depreciation expense
Employee and directors’ benefit expenses
Administration expenses
Loss attributable to associate
Profit before income tax
Income tax benefit (expense)
Consolidated
2020
Note $
2019
$
126,460
54,433
50,000
34,772
6,205,925
6,471,590
(614,096)
(113,792)
(613,657)
(1,193,254)
(326,721)
75,442
77,743
-
3,490
-
156,675
(905,335)
(99,120)
(693,737)
(955,697)
(373,056)
3,610,070
(2,870,270)
-
-
14
14
22
8
15
15
3
16
Profit from continuing operations after income tax
3,610,070
(2,870,270)
Items that will not be classified to profit or loss
Changes in the fair value of equity investments at
fair value through other comprehensive income
Total comprehensive income for the year
attributable to the members of Peel Mining
Limited
Basic Earnings per share for the year attributable
to the members of Peel Mining Ltd
Diluted Earnings per share for the year
attributable to the members of Peel Mining Ltd
9
860,000
-
4,470,070
(2,870,270)
0.015
(0.014)
0.013
(0.014)
24
24
The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the
accompanying notes.
PAGE 36
Current Assets
Cash and cash equivalents
Trade and other receivables
Total Current Assets
Non-Current Assets
Security deposits
Property
Plant & equipment
Investment in Saturn Metals Limited
Financial assets
Exploration assets
Total Non-Current Assets
Total Assets
Current Liabilities
Trade and other payables
Total Current Liabilities
Non-Current Liabilities
Deferred Income
Total Non-Current Liabilities
Total Liabilities
Net Assets
Equity
Contributed equity
Accumulated losses
Financial Assets at FVOCI Reserve
Option reserve
Total Equity
Consolidated
Note
2020
$
2019
$
5
7
7
8
8
3
9
6
10
11
12
13
13
13
8,199,092
123,581
8,322,673
6,950,662
368,616
7,319,278
541,866
840,487
386,034
-
2,860,001
41,896,334
46,524,722
521,866
840,487
459,747
3,320,796
-
37,128,536
42,271,432
54,847,395
49,590,710
512,391
512,391
1,024,513
1,024,513
7,363,461
7,363,461
7,875,852
6,881,670
6,881,670
7,906,183
46,971,543
41,684,527
48,977,246
(6,857,906)
860,000
3,992,203
46,971,543
48,774,396
(10,467,976)
-
3,378,107
41,684,527
The above consolidated statement of financial position should be read in conjunction with the accompanying notes.
PAGE 37
Contributed
Equity
$
Accumulated
Losses
$
Fair Value
Through
Other
Comp
Income
Reserve
$
Option
Reserve
$
Total
Equity
$
30,266,457
(7,597,706)
2,472,772
25,141,523
-
19,722,569
(1,214,630)
-
-
(2,870,270)
-
-
-
-
-
-
(2,870,270)
19,722,569
(1,214,630)
905,335
905,335
(2,870,270)
-
(2,870,270)
48,774,396
(10,467,976)
-
3,378,107
41,684,527
-
-
202,850
-
-
3,610,070
-
-
-
-
-
860,000
-
-
-
-
-
-
-
3,610,070
860,000
202,850
-
614,096
614,096
48,977,246
(6,857,906)
860,000
3,992,203
46,971,543
Consolidated
Balance at 1 July 2018
Loss for the year
Total comprehensive
loss for the year
Issue of share capital
Share issue expenses
Share based
payments
Loss for the year
Total comprehensive
loss for the year
Balance at 30 June
2019
Profit for the year
Profit for the year
Other comprehensive
income - revaluation
Issue of share capital
Share issue expenses
Share based
payments
Balance at 30 June
2020
Note
13
12
12
22
13
13
13
12
12
22
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
PAGE 38
Consolidated
Note
2020
$
2019
$
Cash flows from operating activities
Payments to suppliers and employees
Government relief grants
Management fee income
Interest received
Net cash outflow from operating activities
17
Cash flows from investing activities
Payments for exploration expenditure
Transfer to security deposits
Payments for purchase of plant and equipment
Proceeds from sale of investment asset
Research and Development Tax Incentive - E&E Asset
Proceeds as part of E&E asset farm-out
Net cash outflow from investing activities
Cash flows from financing activities
Proceeds from issue of shares
Transaction costs of issue of shares
Net cash inflow from financing activities
(1,876,062)
50,000
126,460
56,064
(1,643,538)
(6,671,425)
(20,000)
(40,079)
7,200,000
1,738,832
481,790
2,689,118
(1,703,902)
-
75,442
78,710
(1,549,750)
(12,588,015)
(36,000)
(193,064)
-
-
517,982
(12,299,097)
202,850
-
202,850
19,722,569
(1,214,630)
18,507,939
Net increase/(decrease) in cash and cash
equivalents
Cash and cash equivalents at the start of year
Cash and cash equivalents at the end of year
1,248,430
4,659,092
5
6,950,662
8,199,092
2,291,570
6,950,662
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.
PAGE 39
1. Subsidiary companies
The consolidated financial statements incorporate the assets, liabilities and results of the following
subsidiaries in accordance with the accounting policy described in note 26(b):
Name
Country of
Incorporation
Class of
Shares
Peel Environmental Services Limited
Apollo Mining Pty Ltd
Peel (CSP) Pty Ltd
Peel Far West Pty Ltd
Australia
Australia
Australia
Australia
Ordinary
Ordinary
Ordinary
Ordinary
Equity holding
2020
%
100.00
100.00
100.00
100.00
Equity holding
2019
%
100.00
100.00
100.00
100.00
2. Interests in other entities
Peel Mining Limited has a 50% interest in a joint arrangement, called the Mallee Bull Joint Venture, which
was formed after CBH Resources Limited (CBH) completed its 50% earn-in to the Mallee Bull Project on
27th March 2015. The joint venture agreement in relation to the Mallee Bull Joint Venture requires
unanimous consent from all parties for all relevant activities. The two joint venture parties own the
assets of the joint venture as tenants in common and their interest in assets and liabilities are several,
separate and distinct.
This entity is therefore classified as a joint operation and the Group recognises its direct right to the
jointly held assets, liabilities, revenues and expenses.
In July 2020, Peel received an Initial Transfer Notice (ITN) from CBH after they received an unconditional
cash offer of $17,000,000 from a third party for its 50% share of the joint venture. CBH advised that it
intended to accept the third party offer, subject to Peel not exercising its pre-emptive right.
Peel Mining Limited has, pursuant to the joint venture agreement between Peel and CBH, exercised its
pre-emptive right and submitted an offer to acquire the joint venture interest to gain 100% ownership
of the project. The joint venture will be dissolved as soon as minister’s consent for the transfer of title
is obtained and the title is transferred.
Peel Mining Limited during the financial year was in a farm-in arrangement, through its wholly owned
subsidiary Peel (CSP) Pty Ltd, with JOGMEC. JOGMEC has earned the right to a 50% interest in the
tenements held by Peel (CSP) Pty Ltd through funding exploration expenditure. Post year end,
notification was received by Peel from JOGMEC that it was withdrawing from the agreement. The
withdrawal results in all rights and interests in the CSP tenure to be transferred to Peel at no cost,
resulting in Peel regaining 100% ownership (see note 20)
During the year, JOGMEC paid the Group $481,790 (2019: $517,982) for exploration on the project and
management fees (refer note 14) as part of pro rata funding. JOGMEC have currently earned the right
to acquire 50% of the Project after completion of Stages 1 & 2 expenditure. The Company and JOGMEC,
prior to their withdrawal, were funding exploration activities pro-rata.
These amounts have been included in the Group’s Consolidated Statement of Cash Flows and
Consolidated Statement of Financial Position (refer note 11), however per the Group’s accounting policy
(see note 26), the contributions are recorded as deferred income. These amounts will offset the
capitalised expenditure incurred resulting in no gain or loss recognised (net effect) until the point at
which the interest is taken up. As JOGMEC will not take up its 50% interest, the full amount of deferred
income will be recognised in profit and loss as a gain, post year end.
PAGE 40
2. Interests in other entities (continued)
Currently no cash held by Peel Mining Limited is restricted to be used on the Cobar Superbasin Project
under the terms of the JOGMEC arrangement.
3. Interests in associate
In prior financial years, Peel Mining Limited equity accounted for its sole associate of the group, Saturn
Metals Limited, as the Group had significant influence over Saturn Metals Limited due to its
shareholding. The entity had share capital consisting solely of ordinary shares, which were held directly
by the group. The country of incorporation or registration was also its principal place of business, and
the proportion of ownership interest was the same as the proportion of voting rights held.
On 9 June 2020 Peel Mining Limited sold 16,000,000 shares in Saturn Metals Limited, leaving a balance
of 4,000,001 shares held by Peel Mining Limited. The reduction in ownership interest to 4.5% (2019:
31.43%) is no longer considered an associate interest and hence, the Group has ceased equity
accounting for its Saturn Metals Limited holding. The remaining shares held by Peel Mining Limited have
been revalued to their fair value, based on the share price of Saturn Metals Limited at 30 June 2020 (see
Note 9 for detail).
Name
of
Entity
Place of
business
% of
ownership
Interest
2020
%
2019
%
Nature of
relationship
Method
Quoted fair value
Carrying amount
2020
$
2019
$
2020
$
2019
$
Saturn
Metals
Ltd
Aus
31.43
Associate
Equity
Method
6,000,000
3,320,796
Total equity accounted investment
3,320,796
PAGE 41
3. Interests in associate (continued)
Statement of financial position
Current assets
Total assets
Current liabilities
Total liabilities
Net assets
Equity
Issued capital
Accumulated losses
Option reserve
Total equity
Statement of profit or loss and other
comprehensive income
Interest Revenue
Comprehensive loss for the year
Total comprehensive loss for the year
Reconciliation to carrying amounts:
Opening balance
Asset acquired during the year
Loss for the period (2019: 31.43%)
Derecognition as associate
Closing carrying value
Associate
2020
$
Associate
2019
$
2,916,109
11,202,308
(572,957)
(572,957)
10,629,351
12,132,001
(2,044,439)
541,789
10,629,351
80,126
(1,267,245)
(1,187,119)
3,693,852
-
(373,056)
-
3,320,796
3,320,796
-
(326,721)
(2,994,075)
-
4. Segment information
Operating segments are reported in a manner consistent with the internal reporting provided to the
chief operating decision maker. The chief decision maker has been identified as the board of directors.
Management has determined that the Group has three reportable segments, being:
Operating Segment
Mallee Bull
CSP
Peel
Activities
Mineral exploration under a joint venture with CBH Resources Limited at
its Mallee Bull prospect.
Mineral exploration under a farm-in agreement with JOGMEC.
All other mineral exploration within Australia.
The Group is focused only on mineral exploration and the Board monitors the Group based on actual
versus budgeted exploration expenditure incurred for these three areas. This internal reporting
framework is the most relevant to assist the Board with making decisions regarding the Group and its
ongoing exploration activities, while also taking into consideration the results of exploration work that
has been performed to date. Decisions regarding the Mallee Bull joint venture are also taken into
account by the board, however exploration decisions are made by the Joint Venture committee, which
is made up of members from both Peel Mining Limited and CBH Resources Limited.
PAGE 42
4. Segment information (continued)
Revenue from external sources
Reportable segment profit/(loss)
Segment assets
Segment liabilities
Revenue from external sources
Reportable segment profit/(loss)
2020
$
Peel
172,805
172,805
2020
$
CSP
2020
$
Mallee Bull
-
-
-
-
2020
$
Total
172,805
172,805
30,451,896
-
9,330,206
(7,363,461)
6,200,754
-
45,982,856
(7,363,461)
2019
$
Peel
75,442
75,442
2019
$
CSP
2019
$
Mallee Bull
-
-
-
-
2019
$
Total
75,442
75,442
Segment assets
Segment liabilities
27,725,027
-
8,060,810
(6,881,670)
5,963,729
-
41,749,566
(6,881,670)
Reconciliation of reportable segment (loss)
Reportable segment profit/ (loss)
Interest & Other income
Unallocated expenses
Associate loss
Profit/(loss) before tax
Reconciliation of reportable net assets
Reportable segment assets
Reportable segment liabilities
Cash
Unallocated Assets
Unallocated liabilities
Total Net Assets
5. Cash & cash equivalents
Cash at bank and in hand
Term deposits with financial institutions
Refer to Note 18 for the policy on financial risk management
6. Exploration and evaluation assets
Consolidated
2020
$
Consolidated
2019
$
172,805
6,295,131
(2,531,145)
(326,721)
3,610,070
45,982,856
(7,363,461)
8,199,092
665,447
(512,391)
46,971,543
75,442
81,233
(2,653,889)
(373,056)
(2,870,270)
41,749,566
(6,881,670)
6,950,662
890,483
(1,024,514)
41,684,527
Consolidated
2020
$
Consolidated
2019
$
8,199,092
-
8,199,092
950,662
6,000,000
6,950,662
All exploration and evaluation expenditure is capitalised under AASB 6 Exploration for and Evaluation
of Mineral Resources. Mineral interest acquisition costs and exploration and evaluation expenditure
incurred is accumulated and capitalised in relation to each identifiable area of interest.
These costs are only carried forward to the extent that the Group’s right to tenure to that area of interest
are current and either the costs are expected to be recouped through successful development and
exploitation of the area of interest (alternatively by sale) or where areas of interest have not at reporting
PAGE 43
6. Exploration and evaluation assets (continued)
date reached a stage which permits a reasonable assessment of the existence or otherwise of
economically recoverable reserves, and active, and significant operations are undertaken in relation to
the area of interest.
Amortisation is not charged on costs carried forward in respect of areas of interest in the exploration
and evaluation phase or development phase until production commences. This policy has resulted in
nil exploration expenditure being written off during the year (2019: nil).
Peel accounts for funds received from the ATO under the Research and Development (R&D) Tax
Incentive Scheme as an offset to the Exploration and Evaluation asset, where the initial expenses to
which it relates were capitalised. A portion of the R&D Tax Incentive Grant relates to corporate
overheads, this portion has been recognised as other income.
At cost
Reconciliation
Opening balance
Exploration expenditure
Impairment Expense
Research and development tax incentive grant
Closing balance
Consolidated
Consolidated
2020
$
2019
$
41,896,334
37,128,536
37,128,536
6,506,630
-
(1,738,832)
41,896,334
24,585,053
12,543,483
-
-
37,128,536
The recoverability of the carrying amount of the exploration and evaluation assets is dependent on the
successful development and commercial exploitation, or alternatively the sale, of the respective areas
of interest.
7. Trade and other receivables
Trade receivables are amounts due from customers for goods sold or services performed in the
ordinary course of business. They are generally due for settlement within 30 days and therefore are all
classified as current. Trade receivables are recognised initially at the amount of consideration that is
unconditional unless they contain significant financing components, when they are recognised at fair
value. The Group holds the trade receivables with the objective to collect the contractual cash flows and
therefore measures them subsequently at amortised cost using the effective interest method.
The Group applies the AASB 9 simplified approach to measuring expected credit losses which uses a
lifetime expected loss allowance for all trade receivables. Other current receivables and prepayments
were previously presented together with trade receivables but are now presented as other financial
assets at amortised cost (receivables) and other current assets (prepayments) in the balance sheet, to
reflect their different nature.
In determining the recoverability of a trade or other receivable using the expected credit loss model,
the Group performs a risk analysis considering the type and age of the outstanding receivables, the
creditworthiness of the counterparty, contract provisions, letter of credit and timing of payment.
No material provision for credit losses was required to be recognised in the current period ending 30
June 2020.
PAGE 44
7. Trade and other receivables (continued)
The Group classifies its financial assets as loans and receivables. Management determines the
classification at initial recognition and where applicable re-evaluates this designation at the end of each
reporting period. Loans and receivables are carried at amortised cost using the effective interest
method. The Group assesses at the end of each financial period whether a financial asset is impaired.
Security deposits are non-derivative financial assets with fixed or determinable payments that are not
quoted in an active market.
Receivables (Current)
Trade and other receivables
GST recoverable from taxation authority
Accrued income
Prepayments
Refer to Note 18 for the policy on financial risk management
Receivables (Non-current)
Security deposits in relation to exploration tenements
8. Property, plant & equipment
Consolidated
2020
$
Consolidated
2019
$
33,149
28,130
-
62,302
123,581
39,624
278,072
1,631
49,289
368,616
541,866
541,866
521,866
521,866
Property (Land held at cost)
Property, being interests in freehold land, is held at historical cost and is not depreciated as per AASB 116
Property, Plant and Equipment.
Plant and equipment
All assets acquired, including plant and equipment are initially recorded at their cost of acquisition,
being the fair value of the consideration provided plus incidental costs directly attributable to the
acquisition. Depreciation on plant and equipment is calculated using the straight-line method to allocate
their cost or revalued amounts over their estimated useful lives from the time the asset is held ready for
use as follows:
- Plant
- Vehicles
- Office equipment
- Computer software
3-10 years
3-5 years
3-5 years
3-5 years
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each
reporting period. An asset’s carrying amount is written down immediately to its recoverable amount if
the asset’s carrying amount is impaired.
An item of plant and equipment is derecognised upon disposal or when no future economic benefits are
expected from its use or disposal.
Any gain or loss arising on de-recognition of the asset (calculated as the difference between net disposal
proceeds and the carrying amount of the asset) is included in profit or loss in the year the asset is
derecognised.
PAGE 45
8. Property, plant & equipment (continued)
Impairment of assets
At each reporting date, the Group assesses whether there is any indication that an asset may be
impaired. Where an indicator of impairment exists, the Company makes a formal estimate of
recoverable amount. Where the carrying amount of an asset exceeds its recoverable amount the asset
is considered impaired and is written down to its recoverable amount.
Recoverable amount is the greater of fair value less costs of disposal and value in use. It is determined
for an individual asset, unless the asset’s value in use cannot be estimated to be close to its fair value
less costs of disposal and it does not generate cash inflows that are largely independent of those from
other assets or groups of assets, in which case, the recoverable amount is determined for the cash-
generating unit to which the asset belongs. The estimated future cash flows are discounted to their
present value using a pre-tax discount rate reflecting current market assessments of the time value of
money and the risks specific to the asset.
Nil impairment losses have been recognised for the year ending 30 June 2020 (2019: $nil).
Property
Freehold land (at cost)
Plant and equipment
Depreciating plant and equipment
Less accumulated depreciation
Total property, plant and equipment
Reconciliation
Carrying amount at beginning of year
Additions
Depreciation expense
Accumulated depreciation on disposals
Disposals
Closing balance
Consolidated
2020
$
Consolidated
2019
$
840,487
840,487
889,020
(502,986)
386,034
1,226,521
1,300,235
40,078
(113,792)
16,512
(16,512)
1,226,521
865,454
(405,706)
459,747
1,300,235
1,217,462
193,065
(99,120)
-
(11,172)
1,300,235
9. Financial assets at fair value through other comprehensive income
Classification of financial assets at fair value through other comprehensive income
Financial assets at fair value through other comprehensive income (FVOCI) held by the Group comprise of
equity securities, which are not held for trading, and which the group has irrevocably elected at initial
recognition to recognise in this category. These are strategic investments and the group considers this
classification to be more relevant. On disposal of these equity investments, any related balance within the
FVOCI reserve is reclassified to retained earnings. Note 26 sets out the remaining accounting policies in
relation to Financial Assets.
PAGE 46
9. Financial assets at fair value through other comprehensive income (continued)
Equity investments at fair value through other comprehensive income
Equity investments at FVOCI comprise the following individual investments:
Non-current assets
Listed securities
Saturn Metals Limited
Consolidated
2020
$
Consolidated
2019
$
2,860,001
2,860,001
-
-
Amounts recognised in profit or loss and other comprehensive income
During the year, the following gains were recognised in profit and loss and other comprehensive income.
Gains recognised in other comprehensive
income
Related to equity investments
Consolidated
2020
$
Consolidated
2019
$
860,000
860,000
-
-
Recognised fair value measurements
Fair value hierarchy
This section explains the judgements and estimates made in determining the fair values of the financial
instruments that are recognised and measured at fair value in the financial statements. To provide an
indication about the reliability of the inputs used in determining fair value, the group has classified its
financial instruments into the three levels prescribed under the accounting standards. An explanation
of each level follows under the table.
Recurring fair value measurements as
at 30 June 2020
Level 1
Level 2
Level 3
Total
$
$
$
$
Financial Assets
Financial Assets at fair value through other
comprehensive income (FVOCI)
Equity securities – mining sector
Total financial assets
2,860,001
2,860,001
-
-
-
-
2,860,001
2,860,001
Peel Mining Limited did not have any financial assets at fair value through other comprehensive income
(FVOCI) as at 30 June 2019, therefore no comparative for the previous year is available.
Recognised fair value measurements
There were no transfers between the levels for recurring fair value measurements during the year.
The group’s policy is to recognise transfers into and out of fair value hierarchy levels as at the end of
the reporting period.
PAGE 47
9. Financial assets at fair value through other comprehensive income (continued)
Level 1: The fair value of financial instruments traded in active markets (such as publicly traded
derivatives and equity securities) is based on quoted market prices at the end of the reporting period.
The quoted market price used for financial assets held by the group is the current bid price. These
instruments are included in level 1.
Level 2: The fair value of financial instruments that are not traded in an active market (for example,
over-the-counter derivatives) is determined using valuation techniques which maximise the use of
observable market data and rely as little as possible on entity-specific estimates. If all significant inputs
required to fair value an instrument are observable, the instrument is included in level 2.
Level 3: If one or more of the significant inputs is not based on observable market data, the instrument
is included in level 3. This is the case for unlisted equity securities.
All of the resulting fair value estimates for the year ended 30 June 2020 are included in level 1.
10. Trade and other payables
These amounts represent liabilities for goods and services provided to the Group prior to the end of the
financial year which are unpaid. The amounts are unsecured and are usually payable within 30 days of
invoice. They are recognised initially at fair value and subsequently at amortised cost.
Trade payables
Accrued expenses & other payables
11. Deferred income
Consolidated
2020
$
Consolidated
2019
$
214,865
297,526
512,391
563,563
460,950
1,024,513
Japan Oil Gas and Metals National Corporation (“JOGMEC”) farm-in agreement
On 30 September 2014, JOGMEC and Peel executed a Memorandum of Agreement (‘MoA”) pursuant to
which JOGMEC could earn up to a 50% interest in certain exploration tenements held by Peel.
Under the terms of this agreement a wholly owned subsidiary of Peel incurred expenses in relation to
the farm-in and JOGMEC contributed to these expenses by way of cash call. Based on the terms of the
agreement, Peel will account for the MoA as per its policy and the agreement with JOGMEC (above),
refer note 2, except the Management Fee of 10% on all expenditure, refer note 14, which is accrued as
cash calls are received.
Funds from farm-out of asset to JOGMEC
Total Deferred Income
Consolidated
2020
$
7,363,461
7,363,461
Consolidated
2019
$
6,881,670
6,881,670
Notification was received by Peel from JOGMEC on 14 August 2020 that it was withdrawing from the
agreement. The withdrawal results in all rights and interests in the CSP tenure to be transferred to Peel
at no cost, resulting in Peel regaining 100% ownership. JOGMEC will now not take up its 50% interest
and the full amount of deferred income will be recognised in profit and loss as a gain in the year of
notification.
PAGE 48
12. Contributed equity
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares
or options are shown in equity as a deduction, net of tax, from the proceeds. Incremental costs directly
attributable to the issue of new shares or options for the acquisition of a business are not included in the
cost of the acquisition as part of the purchase consideration.
If the entity acquires its own equity instruments, e.g. as the result of a share buy-back, those instruments
are deducted from equity and the associated shares are cancelled. No gain or loss is recognised in the
profit or loss and the consideration paid including any directly attributable incremental costs (net of
income taxes) are recognised directly in equity.
(a) Share capital
Consolidated and Parent Entity
2019
2020
Number of
Shares
$
Number of
Shares
$
Authorised and issued, ordinary shares fully paid
243,683,611 48,977,246
242,733,611 48,774,396
(b) Movements in ordinary share capital
Opening balance, 1 July
Shares issued as a result of exercise of options
Shares issued as a result of share placements
Shares issued as a result of rights entitlement
Transaction costs on share issues
Closing balance, 30 June
242,733,611
950,000
-
-
-
243,683,611
48,774,396 184,035,969
1,850,000
32,580,646
24,266,996
-
48,977,246 242,733,611
202,850
-
-
-
30,266,457
386,450
10,600,000
8,736,119
(1,214,630)
48,774,396
(c) Ordinary shares
Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the
Company in proportion to the number of and amounts paid on the shares held.
On a show of hands every holder of ordinary shares present at a meeting in person or by proxy, is
entitled to one vote, and upon a poll each share provides an entitlement to one vote.
(d) Options
Information relating to options issued during the year is set out in note 22.
(e) Capital risk management
In employing its capital, the Company seeks to ensure that it will be able to continue as a going
concern and in time provide value to shareholders by way of increased market capitalisation and/or
dividends. In the current stage of its development, the Company has invested its available capital in
acquiring and exploring mining tenements. As is appropriate at this stage, the Company is funded
entirely by equity. As it moves forward to develop its tenements towards production, the Company
will adjust its capital structure to support its operational and strategic objectives, by raising additional
capital or taking on debt, as is seen to be appropriate from time to time given the overriding objective
of creating shareholder value. In this regard, the board will consider each step forward in the
development of the Company on its merits and in the context of the then capital markets, in deciding
how to structure funding arrangements.
PAGE 49
13. Reserves and accumulated losses
(i) Accumulated losses
Opening balance
Profit/(Loss) for the year
Profit/(Loss) attributable to associate
Closing balance
(ii) Option reserve
Opening balance
Option expenses (employee/director options)
Closing balance
(iii) Financial assets at FVOCI reserve
Opening balance
Fair value movement on financial assets
Closing balance
Nature and purpose of option reserve
Consolidated
2020
$
Consolidated
2019
$
(10,467,976)
3,936,791
(326,721)
(6,857,906)
(7,597,706)
(2,497,214)
(373,056)
(10,467,976)
3,378,107
614,096
3,992,203
2,472,772
905,335
3,378,107
-
860,000
860,000
-
-
-
The option reserve represents the fair value of equity benefits provided to directors and employees as part of
their remuneration for services provided to the Company paid for by the issue of equity.
Share options and reserve movements
2020
2019
Number
$
Number
$
Opening balance
10,150,000
3,378,107
8,400,000
2,472,772
Issued to directors, employees and
contractors
Lapsed
Exercised
Closing balance
4,000,000
614,096
3,600,000
905,335
(2,737,500)
(950,000)
10,462,500
-
-
3,992,203
-
(1,850,000)
10,150,000
-
-
3,378,107
Exercisable at $0.203 each on or before 10
October 2019
Exercisable at $0.223 each on or before 28
November 2019
Exercisable at $0.260 each on or before 15 August
2020
Exercisable at $0.783 each on or before 30
November 2020
Exercisable at $0.641 each on or before 7
December 2021
Exercisable at $0.570 each on or before 7
December 2021
Exercisable at $0.310 each on or before 9
September 2022
Exercisable at $0.320 each on or before 29
November 2022
-
-
900,000
2,000,000
2,000,000
1,562,500
2,000,000
2,000,000
10,462,500
-
-
-
-
-
-
-
-
-
650,000
3,000,000
900,000
2,000,000
2,000,000
1,600,000
-
-
10,150,000
-
-
-
-
-
-
-
-
-
The expected life of the options is based on historical data and is not necessarily indicative of exercise
patterns that may occur. The expected volatility reflects the assumption that the historical volatility is
indicative of future trends, which may also not necessarily be the actual outcome. No other features of
options granted were incorporated into the measurement of fair value (note 22).
PAGE 50
13. Reserves and accumulated losses (continued)
Nature and purpose of financial assets at FVOCI reserve
The Group has elected to recognise the changes in the fair value of certain investments in equity
securities in OCI, as explained in note 9. These changes are accumulated within the FVOCI reserve
within equity. The group transfers amounts from this reserve to retained earnings when the relevant
equity securities are derecognised.
14. Operator Management Fee and Other Income
Income recognition
Income is recognised to the extent that it is probable that the economic benefit will flow to the Group
and the income can be reliably measured. The following specific recognition criteria must also be met
before income is recognised.
Operator Management Fee
Peel Mining Limited receives a 10% management fee on all exploration expenses from Peel (CSP) Pty
Ltd as the operator of the CSP Project, under the JOGMEC farm-in arrangement. The income is accrued
when expenditure is incurred. This revenue falls under the adoption of AASB 15 effective 1 July 2018 as
it is identified to be a single performance obligation and separately identifiable from the deferred
income (refer note 11). Management has assessed the impact and disclosures required and determined
nil impact to the financial statements, refer note 26.
Interest income
Interest income is recognised as the interest accrues using the effective interest rate method.
R&D Tax Incentive grant income
Peel accounts for funds received from the ATO under the Research and Development (“R&D”) Tax
Incentive Scheme as an offset to the Exploration and Evaluation asset, where the initial expenses to
which it relates were capitalised. Where a portion of the R&D Tax Incentive Grant relates to corporate
overheads, this portion has been recognised as other income.
Recognition of associate
Peel has elected to apply the full gain recognition in accounting for the disposal of an asset to an
associate. Under this method when control of a subsidiary is lost a gain or loss is recognised on both
the retained interest in the entity and the portion no longer owned.
On 9 June 2020 Peel Mining Limited sold 16,000,000 shares in Saturn Metals Limited, leaving a balance
of 4,000,001 shares held by Peel Mining Limited. The sale of the shares resulted in a reduction in
ownership interest to 4.54% (2019: 31.43%), which is no longer considered an associate interest. The
remaining shares held by Peel Mining Limited have been revalued to their fair value, based on the share
price of Saturn Metals Limited at 30 June 2020 (refer to note 9 for detail). The gain on disposal of the
investment in Saturn Metals Limited was calculated by taking into account the proceeds of the sale, the
holding value of the asset to Peel Mining Limited and the losses attributable to the associate recognised
over the course of the investment period.
PAGE 51
14. Operator Management Fee and Other Income (continued)
All other items of income on the consolidated statement of profit or loss and other comprehensive
income are listed below:
Government relief grants
Gain or (Loss) on disposal of assets (De-recognition of
subsidiaries)
Gain or (Loss) on disposal of assets (Property, Plant & Equipment)
Gain or (Loss) on disposal of assets (Investment in Associate)
15. Expenses
Loss before income taxes includes the following specific expenses:
Employees and director’s benefit expenses
Employee costs
Directors fees
Superannuation and oncosts
Administration expenses
Corporate
Consultants
16. Income tax
Consolidated
2020
$
Consolidated
2019
$
50,000
-
34,772
6,205,925
6,290,697
-
14,662
(11,172)
-
3,490
Consolidated
2020
$
377,225
101,067
135,365
613,657
Consolidated
2019
$
437,779
100,008
155,950
693,737
881,670
311,584
1,193,254
791,551
164,146
955,697
The income tax expense (or benefit) for the period is the tax payable (or refundable) on the current
period’s taxable income based on the notional income tax rate for each jurisdiction adjusted by changes
in deferred tax assets and liabilities attributable to temporary differences and to unused tax losses.
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 financial reporting purposes.
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.
A deferred income tax asset is not recognised where the deferred income tax asset relating to the
deductible temporary difference arises from the initial recognition of an asset or liability in a transaction
that is not a business combination and, at the time of the transaction, affects neither the accounting
profit nor taxable income or when the deductible temporary difference is associated with investments
in subsidiaries, associates or interests in joint ventures, in which case a deferred tax asset is only
recognised to the extent that it is probable that the temporary difference will reverse in the foreseeable
future and taxable profit will be available against which the temporary difference can be utilised.
The carrying amount of deferred income tax assets are reviewed at each reporting date and reduced to
the extent it is no longer probable that sufficient taxable income will be available to allow all or part of
the deferred income tax asset to be utilised.
PAGE 52
16. Income tax (continued)
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 at the reporting date. Income taxes relating to items recognised directly in equity are
recognised in equity and not in profit and loss for the year.
During the year, the Group made an accounting profit before income tax of $3,610,070. The Group
utilised current and carried forward taxable losses to offset the taxable liability to nil. The Group has
carried forward tax adjusted losses arising in Australia of $8,836,585 (2019: $9,796,698) available for
offset against future assessable income of the Group. The deferred tax asset in respect of these losses
has been used to offset a deferred tax liability. The net deferred tax asset attributable to the residual
tax losses of $7,780,725 has not been brought to account until convincing evidence exists that
assessable income will be earned of a nature and amount to enable such benefit to be realised.
17. Reconciliation of cash flows from operating activities to earnings after income tax
For statement of cash flows preparation purposes, cash and cash equivalents includes cash on hand
and short term deposits held at call (other than deposits used as cash backing for performance bonds)
with financial institutions. Any bank overdrafts are shown within borrowings in the current liabilities on
the statement of financial position.
Net cash outflow from operating activities
Adjustments for
Share-based payments
Depreciation
Gain on disposal of asset
Loss of associate
Change in operating assets and liabilities
(Increase) / decrease in receivables
(Increase) / decrease in provisions
Increase / (decrease) in payables
Profit (Loss) after income tax
18. Financial risk management
Overview
Consolidated
2020
$
(1,643,538)
Consolidated
2019
$
(1,549,750)
(614,096)
(113,792)
6,240,697
(326,721)
7,356
76,708
(16,544)
3,610,070
(905,335)
(99,120)
3,490
(373,056)
(34,102)
-
87,603
(2,870,270)
The Group is exposed to financial risks through the normal course of its business operations. The key
risks impacting the Group’s financial instruments are considered to be, interest rate risk, liquidity risk,
and credit risk. The Group’s financial instruments exposed to these risks are cash and cash equivalents,
security deposits, trade receivables, trade payables and other payables.
Credit risk
Credit risk arises from cash and cash equivalents, deposits with banks and financial institutions, as well
as credit exposures to wholesale and retail customers, including outstanding receivables. Management
assesses the credit quality of the counterparties by taking into account its financial position, past
experience and other factors. For banks and financial institutions, management considers independent
ratings and only dealing with banks licensed to operate in Australia.
PAGE 53
18. Financial risk management (continued)
The Company applies the AASB 9 simplified approach to measuring expected credit losses which uses
a lifetime expected loss allowance for all trade receivables and contract assets. To measure the
expected credit losses, trade receivables and contract assets have been grouped based on shared credit
risk characteristics and the days past due.
Tax receivables and prepayments do not meet the definition of financial assets.
Risk management
The Group limits its exposure to credit risk in relation to cash and cash equivalents and other financial
assets by only utilising banks and financial institutions with acceptable credit ratings.
The Group operates in the mining exploration sector and does not have trade receivables from
customers. It does however have credit risk arising from other receivables.
Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due.
The Group’s approach to managing liquidity is to ensure, as far as possible, that it will have sufficient
liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring
unacceptable losses or risking damage to the Group’s reputation. The Group manages liquidity by
maintaining adequate reserves by continuously monitoring forecast and actual cash flows ensuring
there are appropriate plans in place to finance these future cash flows.
Typically, the Group ensures it has sufficient cash on hand to meet expected operational expenses,
including the servicing of financial obligations; this excludes the potential impact of extreme
circumstances that cannot reasonably be predicted, such as natural disasters.
Financial obligations
Note
Consolidated
Carrying Amount
2020
$
2019
$
Trade and other payables
10
512,391
1,024,513
Interest rate risk
Interest rate risk is the risk that the Group’s financial position will be adversely affected by movements
in interest rates, cash and cash equivalents at variable rates exposes the Group to cashflow interest
rate risk. The Group is not exposed to fair value interest rate risk as all of its financial assets and liabilities
are carried at amortised amount.
Profile
At the reporting date the interest rate profile of the consolidated entity’s interest-bearing financial
instruments was:
Variable rate instruments
Short term cash deposits
Security deposits
Note
5
7
Consolidated
Carrying Amount
2020
$
-
541,866
2019
$
6,000,000
521,866
PAGE 54
18. Financial risk management (continued)
Cash flow sensitivity analysis for variable rate instruments of the consolidated entity
At 30 June 2020 if interest rates had changed +/- 100 basis points from year end rates with all other
variables held constant, equity and post-tax profit/(loss) would have been $38,456 lower/higher (2019:
($69,507) lower/higher). This is based on a calculated weighted average balance of short term cash
deposits during the financial year of $3,845,588.
Capital Management
The Directors’ objectives when managing capital are to ensure that the Group can fund its operations
and continue as a going concern, so that it may continue to provide returns for shareholders and
benefits for other stakeholders. Due to the nature of the Group’s activities, being mineral exploration,
the Group does not have ready access to credit facilities, with the primary source of funding being equity
raisings. Therefore, the focus of the Group’s capital risk management is the current working capital
position against the requirements of the Group to meet exploration programmes and corporate
overheads.
The Group’s strategy is to ensure appropriate liquidity is maintained to meet anticipated operating
requirements, with a view to initiating appropriate capital raisings as required.
The working capital position of the Group were as follows:
Cash and cash equivalents
Trade and other receivables
Trade and other payables
Note
5
7
10
2020
$
2019
$
8,199,092
6,950,662
123,581
368,616
(512,391)
(1,024,513)
Working capital position
7,810,282
6,294,765
Fair values
The carrying values of all financial assets and financial liabilities, as disclosed in the Consolidated
Statement of Financial Position, are the same as their fair values, due to their short-term nature.
19. Contingencies & Commitments
The Group had no contingent assets or liabilities as at 30 June 2020 (2019: $Nil).
Operating lease commitments – Peel Mining Limited as lessee
The Company has entered into a commercial property lease agreement for its Perth office, which has
been on a month-by-month basis since July 2015.
The group had no other operating lease commitments within 12, before 60 or later than 60 months as
at 30 June 2020.
PAGE 55
19. Contingencies & Commitments (continued)
Exploration commitments
Under the terms of mineral tenement licences held by the Group in New South Wales, there are no
minimum annual expenditure obligations required to be expended during the forthcoming financial
year in order for the tenements to maintain a status of good standing.
Work programs are submitted on application and renewal which may be subject to variation from time
to time in accordance with the relevant state department’s regulations. The Group may at any time
relinquish tenements, and avoid expenditure required on work programs, or may seek exemptions
from the relevant authority. The Groups only commitments in relation to these tenements are the
payment of annual rents which for the upcoming year total $139,700 (2019: $141,080).
20. Events after the reporting period
Acquisition of Mallee Bull
In July 2020, Peel received an Initial Transfer Notice (ITN) from CBH Resources Ltd (CBH) after CBH
received an unconditional cash offer of $17,000,000 from a third party for its 50% share of the joint
venture. CBH advised that it intended to accept the third party offer, subject to Peel not exercising its
pre-emptive right.
Peel Mining Limited has had independent confirmation of the validity of the ITN and third party offer
per the conditions of the joint venture agreement. Pursuant to the joint venture agreement between
Peel and CBH, Peel has a pre-emptive right to acquire the joint venture interest on the same terms. Peel
has exercised its right to acquire the joint venture interest to gain 100% ownership of the project for a
cash offer of $17,000,000. The acquisition is conditional on NSW Government Ministerial approval of
the transfer of the titles.
Capital Raising
In August 2020, the Company successfully completed a placement of 60 million shares at an issue price
of $0.175 each to raise a gross amount of $10,500,000. This was completed in conjunction with a fully
underwritten 1 for 8 pro-rata entitlement issue to raise a further $6,643,036 at the same price as the
aforementioned placement. Funds from this raising are proposed to be used, in conjunction with
existing cash and liquid investments, for the acquisition of the 50% share of the Mallee Bull Joint Venture
which is currently held by CBH, the costs of the capital raising and for ongoing working capital and
general corporate purposes.
JOGMEC Withdrawal
Notification was received by Peel from JOGMEC on 14 August 2020 that it was withdrawing from the
agreement. The Company and JOGMEC are finalising a deed of mutual release and final expenditure in
relation to the project. The withdrawal results in all rights and interests in the CSP tenure to be
transferred to Peel at no cost, resulting in Peel regaining 100% ownership.
Other than the above, there were no events occurring after balance date requiring separate disclosure.
PAGE 56
21. Related parties
(a) Compensation of key management personnel
Short-term employee benefits
Post-employment benefits
Long-term benefits
Share-based payments
Consolidated
2020
$
Consolidated
2019
$
367,698
34,931
14,219
515,906
932,754
338,854
32,191
10,406
547,941
929,392
(b) Other transactions with key management personnel
Simon Hadfield, is a Director of Resource Information Unit Pty Ltd (RIU) and RIU Conferences Pty Ltd.
RIU leases office space to the Company and charges rental lease fees on arm’s length commercial terms
on a monthly basis. Total fees charged to the Company by RIU for the year ended 30 June 2020 were
$65,556 (2019: $57,245).
During the year the Company participated in conferences, to the value of $9,900 (2019: $27,720)
organised by RIU Conferences Pty Limited. These amounts are included in profit for the year within
administration expenses.
Aggregate amounts of each of the above types of “other transactions” with key management personnel
of Peel Mining Limited:
Amounts recognised as expense
Rent and office management fees
Conferences
(c) Transaction with Saturn Metals Limited
Consolidated
2020
$
Consolidated
2019
$
65,556
9,900
75,456
57,245
27,720
84,965
Peel Mining Limited (PEX) holds 4.5% of Saturn Metals Limited (2019: 31.43%). Saturn Metals Limited
engaged Peel Mining Limited in a non-exclusive basis to perform and provide administrative services
and facilities through a service agreement.
Proceeds from management services provided to associate
Consolidated
2020
$
163,499
Consolidated
2019
$
153,238
Outstanding balances arising from sale of services with related parties
Saturn Metals Limited
Consolidated
2020
$
Consolidated
2019
$
9,023
11,183
Other than the above, the Group had no other transactions with related parties.
PAGE 57
22. Share–based payments
Share-based compensation benefits to directors, employees and consultants are provided at the
discretion of the board.
The fair value of options granted is recognised as an expense with a corresponding increase in equity.
The fair value is measured at grant date and recognised over the period during which the recipient
becomes unconditionally entitled to the options.
The fair value at grant date is independently determined using a Black-Scholes option pricing model
that takes into account the exercise price, term of the option, share price at grant date, expected price
volatility of the underlying share, expected dividend yield and the risk-free interest rate for the term of
the option.
(a) Employee share option plan
During the year the Company granted options to employees through its employee share option plan
(“ESOP”).
Total expenses arising from share-based payment transactions recognised in the profit and loss during
the year were as follows:
Options granted to employees
Consolidated
2020
Number
2,000,000
2020
$
2019
Number
2019
$
298,104
1,600,000
357,394
An employee share option plan, designed to provide long-term incentives for senior employees to
deliver long-term shareholder returns, was established in June 2008. Under the plan, participants are
granted options of which 50% are vested immediately and the remainder after 12 months employment
with the Company. During the 2020 financial year, Executive Director Jim Simpson was issued 2,000,000
options under the plan, which was approved by shareholders at the Annual General Meeting held on
the 28th November 2019.
Options granted under the plan carry no dividend or voting rights.
When exercisable, each employee option granted during the 30 June 2020 financial year, is convertible
into one ordinary share at an exercise price of 31 cents.
Set out below are summaries of options granted under the plan.
30 June 2020
Grant
date
Expiry
date
Exercise
price
Balance
at start of
the year
Granted
during the
year
Exercised
during the
year
Lapsed
during
the year
Balance
at end of
the year
$
Number
Number
Number
Number
Number
Vested and
exercisable
at end of
the year
Number
28 Nov 19
9 Sep 22
0.310
-
2,000,000
7 Dec 18
7 Dec 21
0.570
1,600,000
15 Aug 17
15 Aug 20
0.260
900,000
10 Oct 16
10 Oct’19
0.203
650,000
-
-
-
-
-
-
- 2,000,000
1,000,000
(37,500)
1,562,500
1,562,500
-
900,000
900,000
(450,000)
(200,000)
-
-
PAGE 58
22. Share–based payments (continued)
30 June 2019
Grant
date
Expiry
date
Exercise
price
Balance
at start of
the year
Granted
during the
year
Exercised
during
the year
Lapsed
during
the year
Balance
at end of
the year
$
Number
Number Number Number Number
Vested and
exercisable
at end of
the year
Number
7 Dec 18
7 Dec 21
0.570
-
1,600,000
-
15 Aug 17
15 Aug 20
0.260
1,000,000
10 Oct 16
10 Oct’19
0.203
800,000
19 Oct 15
19 Oct’18
0.190
600,000
-
-
-
(100,000)
(150,000)
(600,000)
-
-
-
-
1,600,000
800,000
900,000
900,000
650,000
650,000
-
-
Fair value of options granted
The assessed fair value at grant date of options granted to employees during the period ended 30
June 2020 was $0.13 per option (2019: $0.28).
The model inputs for options granted during the years ended 30 June 2020 and 30 June 2019 included:
Options are granted for no consideration
and vest accordingly
Exercise Price
Grant Date
Expiry Date
Share Price at Grant Date
Expected price volatility
Expected dividend yield
Risk-free interest rate
(b) Director options
Employee Options
2020
50% vest immediately
50% vest in one year from
grant date
$0.31
28 Nov 2019
9 Sep 2022
$0.27
80%
0.00%
0.77%
2019
50% vest immediately
50% vest in one year from
grant date
$0.57
7 Dec 2018
7 Dec 2021
$0.48
100%
0.00%
1.93%
During the year the Company, with shareholder approval, granted options to its directors.
Total expenses arising from share-based payment transactions recognised in the profit and loss during
the year were as follows:
Options granted to directors
2020
Number
2,000,000
Consolidated
2019
Number
2020
$
315,992
2,000,000
2019
$
547,941
PAGE 59
22. Share–based payments (continued)
Set out below are summaries of director options granted.
30 June 2020
Grant
date
Expiry
date
Exercise
price
Balance
at start of
the year
Granted
during
the year
Exercised
during
the year
Lapsed
during
the year
Balance
at end of
the year
Vested and
exercisable
at end of
the year
$
Number
Number
Number
Number
Number
Number
28 Nov 19
29 Nov 22
0.320
-
2,000,000
7 Dec 18
7 Dec 21
0.641
2,000,000
30 Nov 17
30 Nov 20
0.783
2,000,000
28 Nov 16
28 Nov 19
0.223
3,000,000
-
-
-
-
-
-
- 2,000,000
2,000,000
- 2,000,000
2,000,000
- 2,000,000
2,000,000
(500,000)
(2,500,000)
-
-
30 June 2019
Grant
date
Expiry
date
Exercise
price
Balance
at start of
the year
Granted
during
the year
Exercised
during
the year
Lapsed
during
the year
Balance
at end of
the year
Vested and
exercisable
at end of
the year
$
Number
Number
Number
Number
Number
Number
7 Dec 18
7 Dec 21
0.641
-
2,000,000
30 Nov 17
30 Nov 20
0.783
2,000,000
28 Nov 16
28 Nov 19
0.223
3,000,000
7 Dec 15
7 Dec 18
0.216
1,000,000
-
-
-
-
-
-
- 2,000,000
1,500,000
- 2,000,000
2,000,000
- 3,000,000
3,000,000
(1,000,000)
-
-
-
Fair value of options granted
The assessed fair value at grant date of options granted to directors during the period ended 30 June
2020 was $0.13 per option (2019: $0.27).
The model inputs for options granted during the years ended 30 June 2020 and 2019 included:
Options are granted for no consideration and
vest accordingly
Exercise Price
Grant Date
Expiry Date
Share Price at Grant Date
Expected Price Volatility
Expected Dividend Yield
Risk-free interest rate
(c) Acquisition – Share based payment
Executive and Non-executive Director Options
2020
2,000,000 vest immediately
$0.320
28 Nov 2019
29 Nov 2022
$0.270
80%
0.00%
0.77%
2019
1,500,000 vest immediately
500,000 vest 7 Nov 19
$0.641
7 Dec 2018
7 Dec 2021
$0.475
100%
0.00%
1.93%
Peel Mining Limited made no acquisitions using share-based payments during the year.
PAGE 60
22. Share–based payments (continued)
(d) Weighted averages – Options
The weighted average exercise price $0.50 (2019: $0.47).
The weighted average fair value of options is $0.21 (2019: $0.21).
The weighted average remaining contractual life is 1.46 years (2019: 1.39 years).
23. Remuneration of auditors
Amounts paid or due and payable to
PricewaterhouseCoopers
Audit and review of financial reports
Taxation services
Indirect taxation services
Total
24. Earnings per share
Consolidated
2020
$
Consolidated
2019
$
52,100
52,100
11,388
82,500
93,888
52,100
52,100
9,000
-
9,000
Basic earnings per share is calculated by dividing the profit or loss attributable to equity holders of the
Company, excluding any costs of servicing equity other than ordinary shares, by the weighted average
number of ordinary shares outstanding during the financial year, adjusted for bonus elements in
ordinary shares issued during the year.
Diluted loss per share adjusts the figures used in the determination of basic earnings per share to take
into account the after income tax effect of interest and other financing costs associated with dilutive
potential ordinary shares and the weighted average number of shares assumed to have been issued
for no consideration in relation to dilutive potential ordinary shares.
Basic earnings per share
Profit (Loss) from continuing operations attributable to the ordinary
equity holders of the Company
Diluted earnings per share
Profit (Loss) from continuing operations attributable to the ordinary
equity holders of the Company
Reconciliation of earnings used in calculation of earnings per share
Profit (Loss) used in calculating basic profit (loss) per share
Weighted average number of shares used as the denominator
Weighted average number of shares used in
calculating basic earnings per share
Effect of dilutive securities
Consolidated
2020
2019
0.015
(0.014)
0.013
(0.014)
3,610,070
(2,870,270)
Consolidated
Number of
Shares
2020
Number of
Shares
2019
243,391,534
212,232,696
Options on issue at reporting date could potentially dilute earnings per share in the future.
PAGE 61
25. Parent entity information
Statement of financial position
Current assets
Total assets
Current liabilities
Total liabilities
Net assets
Equity
Issued capital
Share option reserve
Financial Assets at FVOCI Reserve
Accumulated losses
Total equity
Statement of profit or loss and other
comprehensive income
Interest Revenue
Other income
Comprehensive loss for the year
Total comprehensive loss for the year
Parent entity
2020
$
8,250,083
47,457,390
(485,847)
(485,847)
46,971,543
48,934,083
3,992,203
860,000
(6,814,743)
46,971,543
2019
$
7,084,805
42,569,890
(885,364)
(885,364)
41,684,526
48,731,233
3,378,107
-
(10,424,814)
41,684,526
54,433
6,417,157
(2,861,520)
3,610,070
77,743
78,932
(3,026,946)
(2,870,271)
Commitments for the parent entity are the same as those for the consolidated entity and are set out in
note 19.
The Group had impaired values held by subsidiaries Apollo Hill Limited and Peel Environment Limited
as these companies are now being held dormant. The parent entity has not entered into a deed of cross
guarantee nor are there any contingent liabilities at year-end.
26. Statement of significant accounting policies
The principal accounting policies adopted in the preparation of the financial report are set out below.
These policies have been consistently applied to all the years presented, unless otherwise stated. The
financial report includes the financial statements for the Group which comprises Peel Mining Limited
and its controlled entities at the end of, or during the financial years ended 30 June 2020 and the
comparative period.
(a) Basis of preparation
These general purpose financial statements have been prepared in accordance with Australian
Accounting Standards, other authoritative pronouncements of the Australian Accounting Standards
Board, Australian Accounting Interpretations and the Corporations Act 2001. Peel Mining Limited is a
for-profit entity for the purpose of preparing the financial statements.
As at 30 June 2020, the Group made a net profit/(loss) after tax of $3,610,070 (2019: ($2,870,270)). The
ongoing capital requirements of the Group are dependent on the Group’s ability to raise funds in the
future.
The Directors have prepared a cash flow forecast, which indicates that the Group will have sufficient
cash flows to meet all commitments and working capital requirements for the twelve month period
from the date of signing this financial report. Based on the cash flow forecasts and other factors referred
to above, the directors are satisfied that the basis of preparation is appropriate.
PAGE 62
26. Statement of significant accounting policies (continued)
Compliance with IFRS
The financial statements and notes of the Group comply with International Financial Reporting
Standards (IFRS).
Historical cost convention
These financial statements have been prepared under the historical cost convention.
(b) Principles of consolidation
The consolidated financial statements are those of the consolidated entity, comprising Peel Mining
Limited (“the parent entity”) and entities controlled during the year and at reporting date (“Group”). A
controlled entity is any entity that the Group is exposed to, or has rights to, variable returns from its
involvement with the entity and has the ability to affect those returns through its power to direct the
activities of the entity.
Information from the financial statements of the controlled entities is included from the date the parent
company obtains control until such time as control ceases. Where there is a loss of control of a
subsidiary, the consolidated financial statements include the results for the part of the reporting period
during which the parent company has control.
Subsidiary acquisitions are accounted for using the acquisition method of accounting.
The financial statements of subsidiaries are prepared for the same reporting period as the parent entity,
using consistent accounting policies.
All intercompany balances and transactions, including unrealised profits arising from intra-Group
transactions, have been eliminated in full. Unrealised losses are eliminated except where costs cannot
be recovered.
Investments in subsidiaries are carried at cost in the parent entity.
Under AASB 11 Joint Arrangements investments in joint arrangements are classified as either joint
operations or joint ventures. The classification depends on the contractual rights and obligations of
each investor, rather than the legal structure of the joint arrangement.
Joint operations
Peel Mining Limited recognises its direct right to the assets, liabilities, revenues and expenses of joint
operations and its share of any jointly held or incurred assets, liabilities, revenues and expenses. These
have been incorporated in the financial statements under the appropriate headings.
Details of joint operations are set out in note 2.
(c) Fair value estimation
The fair value of financial assets and financial liabilities must be estimated for recognition and
measurement or for disclosure purposes.
The carrying value less impairment provision of trade receivables and payables are assumed to
approximate their fair values due to their short-term nature. The fair value of financial liabilities for
PAGE 63
26. Statement of significant accounting policies (continued)
disclosure purposes is estimated by discounting the future contractual cash flows at the current market
interest rate that is available to the Group for similar financial instruments.
(d) Accounting for farmouts
The Group may enter into transactions whereby a third party (“Farmee”) may earn a right to acquire an
interest in assets owned by the Group by meeting certain obligations agreed to by both parties. As the
terms of farm-ins are not generic management assess each agreement on a transaction by transaction
basis and determines the appropriate accounting treatment based on the terms of the agreement.
(e) Leases
AASB 16 Leases eliminates the classifications of operating leases and finance leases for lessees. Except
for short-term leases and leases of low-value assets, rights-of-use assets and corresponding lease
liabilities are recognised in the statement of financial position. The right-of-use asset is depreciated over
the shorter of the asset’s useful life and the lease term on a straight-line basis, while the lease liability
is reduced by an allocation of each lease payment. Payments associated with short-term leases and
leases of low-value assets are recognised on a straight-line basis as an expense in profit or loss. Short-
term leases are leases with a lease term of 12 months or less. Low-value assets comprise IT-equipment
and small items of office furniture.
As at 30 June 2020, the Group did not recognise any lease assets or lease liabilities on the balance sheet.
During the prior period, the Group classified the lease for its office space as an operating lease with
payments recognised as an expense as incurred. As the contract term is less than 12 months, and
considered short-term, the Group elects to recognise the lease payments directly as an expense in profit
or loss.
The Group has considered other significant contracts, such as those for drilling, and determined that
there are no other contracts that meet the definition of a lease under AASB 16.
(f)
Investments and other financial assets
The group classifies its financial assets in the following measurement categories:
•
•
those to be measured subsequently at fair value (either through OCI or through profit or loss),
and
those to be measured at amortised cost.
The classification depends on the entity’s business model for managing the financial assets and the
contractual terms of the cash flows
For assets measured at fair value, gains and losses will either be recorded in profit or loss or OCI. For
investments in equity instruments that are not held for trading, this will depend on whether the group
has made an irrevocable election at the time of initial recognition to account for the equity investment
at fair value through other comprehensive income (FVOCI).
The group reclassifies debt investments when and only when its business model for managing those
assets changes.
PAGE 64
26. Statement of significant accounting policies (continued)
Recognition and derecognition
Regular way purchases and sales of financial assets are recognised on trade date, being the date on
which the group commits to purchase or sell the asset. Financial assets are derecognised when the
rights to receive cash flows from the financial assets have expired or have been transferred and the
group has transferred substantially all the risks and rewards of ownership.
Measurement
At initial recognition, the group measures a financial asset at its fair value plus, in the case of a financial
asset not at fair value through profit or loss (FVPL), transaction costs that are directly attributable to the
acquisition of the financial asset. Transaction costs of financial assets carried at FVPL are expensed in
profit or loss.
Financial assets with embedded derivatives are considered in their entirety when determining whether
their cash flows are solely payment of principal and interest.
Equity instruments
The group subsequently measures all equity investments at fair value. Where the group’s management
has elected to present fair value gains and losses on equity investments in OCI, there is no subsequent
reclassification of fair value gains and losses to profit or loss following the derecognition of the
investment. Dividends from such investments continue to be recognised in profit or loss as other
income when the group’s right to receive payments is established.
Changes in the fair value of financial assets at FVPL are recognised in other gains/(losses) in the
statement of profit or loss as applicable. Impairment losses (and reversal of impairment losses) on
equity investments measured at FVOCI are not reported separately from other changes in fair value.
(g) Employee benefits
Short-term obligations
Liabilities for wages and salaries, including non-monetary benefits and leave entitlements that are
expected to be settled wholly within 12 months after the end of the period in which the employees
render the related service are recognised in respect of employees’ services up to balance date and are
measured at the amounts expected to be paid when the liabilities are settled.
(h) Goods and services tax
Revenues, expenses and assets are recognised net of goods and services tax (“GST”), except where the
amount of GST incurred is not recoverable from the taxation authority. In these circumstances the GST
is recognised as part of the cost of acquisition of the asset or as part of the expense item.
Receivables and payables are stated with the amount of GST included. The net amount of GST
recoverable is included as a current asset in the statement of financial position.
Cash flows are included in the statement of cash flows on a gross basis. The GST components of cash
flows arising from investing and financing activities which are recoverable from the taxation authority
are classified as operating cash flows.
PAGE 65
26. Statement of significant accounting policies (continued)
(i) New accounting standards and amendments
Certain new accounting standards and interpretations have been published that are mandatory for the
30 June 2020 reporting period and have not been early adopted by the group. These standards are not
expected to have a material impact on the entity in the current or future reporting periods and on
foreseeable future transactions.
(j) Critical accounting estimates and judgements
The directors evaluate estimates and judgements incorporated into the financial report based on
historical knowledge and best available current information.
The Company makes estimates and judgements in applying the accounting policies. Critical judgements
in respect of accounting policies relate to exploration assets, where exploration expenditure is
capitalised in certain circumstances. Recoverability of the carrying amount of any exploration assets is
dependent on the successful development and commercial exploitation or sale of the respective areas
of interest.
Share-based payment transactions
The Group measures the cost of equity-settled share-based payment transactions with employees by
reference to the fair value of the equity instruments at the grant date. The fair value is determined using
a Black-Scholes model. The accounting estimates and assumptions relating to equity-settled share-
based payments would have no impact on the carrying amounts of assets and liabilities within the next
annual reporting period but may impact expenses and equity.
Impairment of capitalised exploration and evaluation expenditure
It is the Group’s policy to capitalise costs relating to exploration and evaluation activities. The future
recoverability of capitalised exploration and evaluation expenditure is dependent upon a number of
factors, including whether the Group decides to exploit the related lease itself or, if not, whether it
successfully recovers the related exploration and evaluation asset through sale.
Factors that could impact future recoverability include the level of reserves and resources, future
technological changes which could impact the cost of mining, future legal changes (including changes
to environmental restoration obligations) and changes to commodity prices.
To the extent that capitalised exploration and evaluation expenditure is determined not to be
recoverable in the future, profits and net assets will be reduced in the period in which the determination
is made.
PAGE 66
The board of directors of Peel Mining Limited declares that:
(a) the financial statements, comprising the consolidated statement of profit or loss and other
comprehensive income, consolidated statement of financial position, consolidated statement of
cash flows, consolidated statement of changes in equity and accompanying notes are in
accordance with the Corporations Act 2001 and:
(i) comply with Accounting Standards and the Corporations Regulations 2001 and other
mandatory professional reporting requirements ; and
(ii) give a true and fair view of the consolidated financial position as at 30 June 2020 and of its
performance for the financial year ended on that date of the consolidated entity.
(b) In the directors’ opinion, there are reasonable grounds to believe that the Company will be able
to pay its debts as and when they become due and payable;
(c) the board of directors have been given the declaration by the chief executive officer and chief
financial officer required by Section 295A of the Corporations Act 2001.
This declaration is made in accordance with a resolution of the board of directors and is signed for and
on behalf of the directors by:
Robert Tyson
Managing Director
Perth, Western Australia
9th September 2020
PAGE 67
Auditor’s Independence Declaration
As lead auditor for the audit of Peel Mining Limited for the year ended 30 June 2020, I declare that to
the best of my knowledge and belief, there have been:
(a)
no contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit, and
(b)
no contraventions of any applicable code of professional conduct in relation to the audit.
This declaration is in respect of Peel Mining Limited and the entities it controlled during the period.
Helen Bathurst
Partner
PricewaterhouseCoopers
Perth
9 September 2020
PricewaterhouseCoopers, ABN 52 780 433 757
Brookfield Place, 125 St Georges Terrace, PERTH WA 6000, GPO Box D198, PERTH WA 6840
T: +61 8 9238 3000, F: +61 8 9238 3999, www.pwc.com.au
Liability limited by a scheme approved under Professional Standards Legislation.
Independent auditor’s report
To the members of Peel Mining Limited
Report on the audit of the financial report
Our opinion
In our opinion:
The accompanying financial report of Peel Mining Limited (the Company) and its controlled entities
(together the Group) is in accordance with the Corporations Act 2001, including:
(a)
giving a true and fair view of the Group's financial position as at 30 June 2020 and of its
financial performance for the year then ended, and
(b)
complying with Australian Accounting Standards and the Corporations Regulations 2001.
What we have audited
The Group financial report comprises:
•
•
•
•
•
•
the consolidated statement of financial position as at 30 June 2020
the consolidated statement of changes in equity for the year then ended
the consolidated statement of cash flows for the year then ended
the consolidated statement of profit or loss and other comprehensive income for the year then
ended
the notes to the consolidated financial statements, which include a summary of significant
accounting policies, and
the directors’ declaration.
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 believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our opinion.
Independence
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 (including Independence
Standards) (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.
PricewaterhouseCoopers, ABN 52 780 433 757
Brookfield Place, 125 St Georges Terrace, PERTH WA 6000, GPO Box D198, PERTH WA 6840
T: +61 8 9238 3000, F: +61 8 9238 3999, www.pwc.com.au
Liability limited by a scheme approved under Professional Standards Legislation.
Our audit approach
An audit is designed to provide reasonable assurance about whether the financial report is free from
material misstatement. Misstatements may arise due to fraud or error. They are considered material if
individually or in aggregate, they could reasonably be expected to influence the economic decisions of
users taken on the basis of the financial report.
We tailored the scope of our audit to ensure that we performed enough work to be able to give an
opinion on the financial report as a whole, taking into account the geographic and management
structure of the Group, its accounting processes and controls and the industry in which it operates.
Materiality
Audit scope
Key audit matters
• Our audit focused on where
the Group made subjective
judgements; for example,
significant accounting
estimates involving
assumptions and inherently
uncertain future events.
•
The Group's operational and
financial processes are
managed by a corporate
function in Perth.
• Amongst other relevant topics,
we communicated the following
key audit matters to the Audit
and Risk Committee:
− Basis of preparation of the
financial report
− Carrying value of exploration
and evaluation assets.
•
These are further described in
the Key audit matters section of
our report.
•
For the purpose of our audit
we used overall Group
materiality of $548,400 which
represents approximately 1%
of the Group’s total assets.
• We applied this threshold,
together with qualitative
considerations, to determine
the scope of our audit and the
nature, timing and extent of
our audit procedures and to
evaluate the effect of
misstatements on the financial
report as a whole.
• We chose Group's total assets
because, in our view, it is the
benchmark against which the
performance of the Group is
most commonly measured
whilst in the exploration phase.
• We utilised a 1% threshold
based on our professional
judgement, noting it is within
the range of commonly
acceptable thresholds.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the financial report for the current period. The key audit matters were addressed in the
context of our audit of the financial report as a whole, and in forming our opinion thereon, and we do
not provide a separate opinion on these matters. Further, any commentary on the outcomes of a
particular audit procedure is made in that context.
Key audit matter
How our audit addressed the key audit matter
Basis of preparation of the financial report
The financial statements have been prepared
by the Group on a going concern basis, which
contemplates that the Group will continue to
meet its commitments, realise its assets and
settle its liabilities in the normal course of
business.
The Group is in the exploration and
evaluation phase and generates management
fee income from its JOGMEC arrangement. It
relies on funding from its shareholders or
other sources to continue as a going concern.
These funds are used to meet expenditure
requirements to maintain the good standing of
the Group’s tenements, progress project
feasibility studies, to cover corporate
overheads and to fund the acquisition of
projects.
In determining the appropriateness of the
going concern basis of preparation of the
financial report, the Group made a number of
judgements, including expenditure required to
progress the Group’s current projects and
future acquisitions and the minimum corporate
overhead expenditure required to continue
operations.
Assessing the appropriateness of the basis of
preparation for the Group’s financial report
was a key audit matter due to its importance to
the financial report and the judgement
involved in forecasting future cash flows for a
period of at least 12 months from the date of
the financial report.
In assessing the appropriateness of the
going concern basis of preparation for the
Group’s financial report, we performed
the following procedures, amongst others:
● Agreed the amounts received from the
capital raising during the year and
subsequent to year end to third party bank
support.
● Evaluated the appropriateness of the
Group's assessment of its ability to
continue as a going concern, including
whether the period covered is at least 12
months from the date of the financial
report and that relevant information of
which we are aware as a result of the audit
has been included.
●
Inquired of management and the directors
whether they were aware of any events or
conditions, including beyond the period of
assessment that may cast significant doubt
on the Group's ability to continue as a
going concern.
● Compared the key underlying data and
assumptions in the Group’s cash flow
forecast to approved budgets and
historical cash outflows, including an
assessment of the reasonableness of
exploration and evaluation expenditure for
the forecast period by comparing forecast
expenditure to actual expenditure incurred
in prior periods.
● Developed an understanding of what
forecast expenditure in the cash flow
forecast is committed and what could be
Key audit matter
How our audit addressed the key audit matter
Carrying value of exploration and evaluation
assets
(Refer to note 6)
As at 30 June 2020, the Group had capitalised
exploration and evaluation assets of
$41,896,334 relating to mining, exploration and
prospecting licenses across New South Wales.
This was a key audit matter because of the
relative size of the exploration and evaluation
balance in the consolidated statement of
financial position and the risk of impairment
should the result of exploration activities not
be positive, or the Group relinquish certain
exploration licences as it continues to assess
future viability.
considered discretionary, including
committed expenditure for future
acquisitions.
● Assessed management’s historical
accuracy of cash flow forecasting by
comparing actual results to prior period
forecasts.
● We evaluated the adequacy of disclosures
in light of the requirements of Australian
Accounting Standards.
We performed the following procedures,
amongst others:
●
Inquired with management and directors
to develop an understanding of the
current status and future intentions for
the Group’s exploration projects.
● Assessed whether the Group retained right
of tenure for all of its exploration licence
areas by obtaining licence status records
from relevant government databases.
● Obtained management’s
exploration expenditure forecasts
supporting their assessment of
indicators of impairment and
compared these to the approved
budgets and future cash flow
forecasts of the Group.
●
Inquired of management and directors as
to the future planned expenditure on
capitalised exploration and evaluation
assets and assessed plans for future
expenditure to maintain the good standing
of the Group’s tenements.
Other information
The directors are responsible for the other information. The other information comprises the
information included in the annual report for the year ended 30 June 2020, but does not include the
financial report and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not
express any form of assurance conclusion thereon.
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 that we 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 ability of the Group to
continue as a going concern, disclosing, as applicable, matters related 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 the financial report.
A further description of our responsibilities for the audit of the financial report is located at the
Auditing and Assurance Standards Board website at:
https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf. This description forms part of
our auditor's report.
Report on the remuneration report
Our opinion on the remuneration report
We have audited the remuneration report included in pages 28 to 33 of the directors’ report for the
year ended 30 June 2020.
In our opinion, the remuneration report of Peel Mining Limited for the year ended 30 June 2020
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.
PricewaterhouseCoopers
Helen Bathurst
Partner
Perth
9 September 2020
ASX BEST PRACTICE RECOMMENDATIONS
This statement outlines the main corporate governance practices that were formally in place from 15
September 2014 onwards and were updated 1 September 2020. These corporate governance practices
comply with the ASX Corporate Governance Council recommendations unless otherwise stated.
COMPANY VALUES
The Company’s culture is based on striving to achieve excellence in all we do through perseverance and
teamwork.
The core values we seek our board, management, staff and contractors to commit to are:
Safety – undertaking all activities in a safe and responsible manner
Sustainability – undertaking our activities in an effort to create a better future for all stakeholders
Integrity – acting honestly and reliably in all actions and dealings
Respect – accepting others for who they are, and giving consideration to their opinions and rights
Excellence – striving to be the best that we can be and persisting when faced with challenges
Perseverance – persistence in undertaking our activities despite difficulty or challenges in achieving
success
BOARD OF DIRECTORS
The Board operates in accordance with the broad principles set out in its’ Corporate Governance Plan
(Plan), which is available from the corporate governance information section of the Company website
at www.peelmining.com.au.
ROLE AND RESPONSIBILITIES OF THE BOARD
The Board is responsible for ensuring that the Company is managed in a manner which protects and
enhances the interests of its’ shareholders and takes into account the interests of all stakeholders. This
includes setting the strategic directions for the company, establishing goals for management and
monitoring the achievement of these goals.
A summary of the key responsibilities of the Board include:
➢
➢
➢
➢
➢
➢
Strategy - Providing strategic guidance to the Company, including contributing to the
development of and approving the corporate strategy;
Financial performance
performance;
- Approving budgets, monitoring management and
financial
Financial reporting and audits - Monitoring financial performance including approval of the
annual and half-year financial reports and liaison with the external auditors;
Leadership selection and performance - Appointment, performance assessment and removal
of the Managing Director. Ratifying the appointment and/or removal of other senior management,
including the Company Secretary and other Board members;
Remuneration - Management of the remuneration and reward systems and structures for
Executive management and staff;
Risk management - Ensuring that appropriate risk management systems and internal controls
are in place; and
PAGE 75
➢
Relationships with the exchanges, regulators and continuous disclosure - Ensuring that the
capital markets are kept informed of all relevant and material matters and ensuring effective
communications with shareholders.
The Company Secretary is accountable directly to the Board, through the Chairman, on all matters to do
with the proper functioning of the board. All directors have direct access to the Company Secretary.
The Board has delegated to management responsibility for the day-to-day operation and administration
of the Company is delegated by the board to the Managing Director. The Board ensures that the
Managing Director and the management team is appropriately qualified and experienced to discharge
their responsibilities and has in place procedures to assess the performance of the Managing Director
and Executive Directors.
The roles of Chairman and Managing Director are not combined. The Managing Director is accountable
to the Board for all authority delegated to the position.
Whilst there is a clear division between the responsibilities of the Board and management, the Board is
responsible for ensuring that management’s objectives and activities are aligned with the expectations
and risks identified by the Board. The Board has a number of mechanisms in place to ensure this is
achieved including:
➢ Board approval and monitoring of a strategic plan;
➢ approval of annual and semi-annual budgets and monitoring actual performance against budget;
and
➢ procedures are in place to incorporate presentations to each Board meeting by financial and
operations management.
COMPOSITION OF THE BOARD
The names, skills, experiences and period of office of the Directors of the Company in office at the date
of this Statement are set out in the Director’s Report. A summary of these skills and experiences are
provided in table 1.
The composition of the Board is determined using the following principles.
➢ Persons nominated as Non-executive Directors shall be expected to have qualifications, experience
and expertise of benefit to the Company and to bring an independent view to the Board’s
deliberations. Persons nominated as Executive Directors must be of sufficient stature and security
of employment to express independent views on any matter;
➢ The Chairperson should ideally be independent, but in any case be Non-executive and be elected by
the Board based on his/her suitability for the position;
➢ The roles of Chairperson and Managing Director should not be held by the same individual;
➢ All Non-executive Directors are expected voluntarily to review their membership of the Board from
time-to-time taking into account length of service, age, qualifications and expertise relevant to the
Company’s then current policy and programme, together with the other criteria considered
desirable for composition of a balanced board and the overall interests of the Company;
➢ The Company considers that the Board should have at least three Directors (minimum required
under the Company's Constitution) and to have a majority of independent Directors but
acknowledges that this may not be possible at all times due to the size of the Company. Currently
the Board has four Directors, with only Mr Hadfield as independent. The number of Directors is
maintained at a level which will enable effective spreading of workload and efficient decision making.
The Board has accepted the following definition of an independent Director:
PAGE 76
An independent Director is a Director who is not a member of management (a Non-executive Director)
and who:
➢
➢
➢ does not hold more than 5% of the voting shares of the Company and is not an officer of, or
otherwise associated directly or indirectly with, a shareholder of more than 5% of the voting
shares of the Company;
is not, or has not been, employed in an executive capacity by the Company or any of its child
entities and there has not been a period of at least three years between ceasing such
employment and serving on the board;
is not, or has not within the last three years been, a partner, director or senior employee of a
provider of material professional services or a material consultant to the Company or any of its
child entities;
is not, or has not been within the last three years, in a material business relationship (eg as a
supplier or customer) with the Company or any of its child entities, or an officer of, or otherwise
associated with, someone with such a relationship;
is not a substantial security holder of the Company or an officer of, or otherwise associated with,
a substantial security holder of the Company;
➢
➢
➢ does not have a material contractual relationship with the Company or its child entities other
than as a Director;
➢ does not have close family ties with any person who falls within any of the categories described
above; or
➢ has not been a Director of the Company for such a period that his or her independence may
have been compromised.
The materiality thresholds are assessed on a case-by-case basis, taking into account the relevant
Director’s specific circumstances, rather than referring to a general materiality threshold.
All Board Members receive performance-based remuneration as outlined in the Remuneration Report.
However, the Board are of the opinion that these incentives are aligned with the Company’s objectives
and the quantum received do not compromise the independence of the individual director.
Table 1: Skills and Experience Matrix of Peel Mining Limited’s Directors
Area
Business and Finance
Leadership
Sustainability &
Stakeholder
Industry Specific (Australia)
Competence
Accounting, Tax, Business Strategy, Corporate Financing, Financial
Literacy, Agreements/Fiscal Terms and Risk Management, Marketing
Business Leadership, Executive Management and Mentoring, Public
Listed Company Experience
Community Relations, Corporate Governance, Environmental Issues,
Government Affairs, Health & Safety, Human Resources, Industrial
Relations and Remuneration
Precious Metals – Geology Exploration & Production, Base Metals –
Geology Exploration & Production, Precious Metals – Mining
Engineering, Base Metals – Mining Engineering, Mineral Economics.
The directors on the Board collectively have a combination of skills and experience in the competencies
set out in the table above. These competencies are set out in the skills matrix that the Board uses to
assess the skills and experience of each director and the combined capabilities of the Board. Where an
existing or projected competency gap is identified, the Board will address those gaps. The Board does
not currently consider that there are any existing or projected competency gaps.
PAGE 77
INDEPENDENT PROFESSIONAL ADVICE AND ACCESS TO COMPANY INFORMATION
Each Director has the right to seek independent external professional advice as they considered
necessary at the expense of the Company, subject to prior consultation with the Chairman. A copy of
any such advice received is made available to all members of the Board.
NOMINATION COMMITTEE / APPOINTMENT OF NEW DIRECTORS
Because of the size of the Group and the size of the Board, the Directors do not believe it is appropriate
to establish a separate Nomination Committee. The board has adopted a Nomination Committee
Charter and will act in accordance with the Charter and hold special meetings or sessions as required.
The Board are confident that this process for selection and review is stringent and full details of all
Directors are provided to shareholders in the annual report and on the internet.
The composition of the Board is reviewed on an annual basis to ensure the Board has the appropriate
mix of expertise and experience. Where a vacancy exists, through whatever cause, or where it is
considered that the Board would benefit from the services of a new Director with particular skills, the
Board determines the selection criteria for the position based on the skills deemed necessary for the
Board to best carry out its responsibilities and then appoints the most suitable candidate who must
stand for election at the next general meeting of shareholders.
Non-executive Directors do not have written agreements setting out the key terms and conditions of
their appointment because the Company’s constitution and the ASX Listing Rules govern the term of
each director’s appointment. Directors are required to retire by rotation. Common law and the
Corporations Act govern the duties of directors and members are required to approve the maximum
fees paid to Non-executive Directors. Executive directors enter into an employment agreement which
governs the terms of their appointment.
The Board undertakes appropriate checks prior to nominating a director for election by shareholders.
These checks include a police and reference checks. Shareholders are provided with all material
information in its possession concerning a director standing for election or re-election in the relevant
notice of meeting.
An informal induction is provided to all new directors, which includes meeting with technical and
financial personnel to understand Peel Mining Limited’s business, including strategies, risks, company
policies and health and safety.
All Directors are required to maintain professional development necessary to maintain their skills and
knowledge needed to perform their duties. In addition to training provided by relevant professional
affiliations of the Directors, additional development is provided through attendance at seminars and
provision of technical papers on industry related matters and developments offered by various
professional organisations, such as accounting firms and legal advisors. The Board will approve and
review continuing professional development programs and procedures for Directors to ensure that
they can effectively discharge their responsibilities.
TERM OF OFFICE
Under the Company's Constitution, the minimum number of Directors is three. At each Annual General
Meeting, one third of the Directors (excluding the Managing Director) must resign, with Directors
resigning by rotation based on the date of their appointment. Directors resigning by rotation may offer
themselves for re-election. Where standing for re-election as a Director, the term of office served by the
Director and a statement of whether the Board considers the candidate to be independent and if the
Board supports the re-election of the candidate will be provided to shareholders.
PAGE 78
PERFORMANCE OF DIRECTORS AND MANAGING DIRECTOR
The performance of all Directors, the Board as a whole and the Managing Director and Company
Secretary is reviewed annually.
The Board meets once a year with the specific purpose of conducting a review of its composition and
performance. This review includes:
➢ comparison of the performance of the Board against the requirements of the Corporate
Governance Plan;
➢ assessment of the performance of the Board over the previous twelve months having regard to the
corporate strategies, operating plans and the annual budget;
identification of any particular goals and objectives of the Board for the next year;
➢ review the Board’s interaction with management;
➢
➢ review the type and timing of information provided to the directors; and
➢
identification of any necessary or desirable improvements to Board or committee charters.
A review was undertaken during the reporting period.
PERFORMANCE OF SENIOR EXECUTIVES
The Managing Director is responsible for assessing the performance of the key executives within the
Company. This is to be performed through a formal process involving a formal meeting with each senior
executive. The basis of evaluation of senior executives will be on agreed performance measures.
A review of senior executives was undertaken during the reporting period.
CONFLICT OF INTEREST
In accordance with the Corporations Act 2001 and the Company’s constitution, Directors must keep the
Board advised, on an ongoing basis, of any interest that could potentially conflict with those of the
Company. Where the Board believes a significant conflict exists, the Director concerned does not receive
the relevant Board papers and is not present at the Board meeting whilst the item is considered. Details
of Directors related entity transactions with the Company are set out in the related parties note in the
financial statements.
DIVERSITY
Peel Mining Limited recognises the benefits arising from employee and Board diversity, including a
broader pool of high quality employees, improving employee retention, accessing different perspectives
and ideas and benefiting from all available talent. Diversity includes, but is not limited to, gender, age,
ethnicity and cultural background.
The Diversity Policy defines the initiatives which assist Peel Mining Limited with maintaining and
improving the diversity of its workforce. A copy of the Diversity Policy can be found in the company’s
Corporate Governance Framework on the Company’s website. The Company currently has a naturally
diverse workplace in terms of gender, age, ethnicity and cultural background, and believes that currently
meets the objectives of its policy. As such no formal measurable objectives have been required or set
for achieving diversity. This will be monitored by the Board on an annual basis.
The policy was formally adopted by the Company on the 23 September 2015 and updated as at 1st
September 2020.
PAGE 79
The respective proportions of men and women on the Board, in senior executive positions and across
the whole organisation are set out in the table below:
Proportion of Women
Organisation as a whole
Executive Management Team
Board
REMUNERATION
Proportion of women
8 out of 21 (38%)
0 out of 2 (0%)
0 out of 4 (0%)
The performance of the Company depends upon the quality of its Directors and Executives. To prosper,
the Company must attract, motivate and retain highly skilled Directors and Executives.
To this end, the Company embodies the following principles in its remuneration framework:
➢ Provide competitive rewards to attract high quality Executives and Management;
➢ Design executive remuneration to attract, retain and motivate high quality senior executives;
➢ Link Executive rewards to shareholder value; and
➢ Establish appropriate performance hurdles in relation to variable Executive and Management
remuneration.
A full discussion of the Company’s remuneration philosophy and framework and the remuneration
received by Directors and Executives in the current year is included in the remuneration report, which
is contained within the Report of the Directors.
There are no schemes for retirement benefits for Non-executive Directors, other than superannuation.
BOARD REMUNERATION COMMITTEE
Once the Board is of a sufficient size and structure, and the Company’s operations are of a sufficient
magnitude, to assist the Board in fulfilling its duties, the Board will establish a Remuneration
Committee. Until that time, the Board has adopted a Remuneration Committee Charter and will act in
accordance with the Charter. The full Board will hold special meetings or sessions as required to review
any matters of significance affecting the remuneration of the Board and employees of the Company.
The Board are confident that this process is stringent and full details of remuneration policies and
payments are provided to shareholders in the annual report and on the web.
AUDIT AND RISK COMMITTEE
Due to the limited size of the Company and of its operations and financial affairs, the use of a separate
audit committee is not considered appropriate. The Board assures integrity of the financial statements
by:
a) reviewing the Company’s statutory financial statements to ensure the reliability of the financial
information presented and compliance with current laws, relevant regulations and accounting
standards;
b) monitoring compliance of the accounting records and procedures in conjunction with the
Company’s auditor, on matters overseen by the Australian Securities and Investments Commission,
ASX and Australian Taxation Office;
PAGE 80
c) ensuring that management reporting procedures, and the system of internal control, are of a
sufficient standard to provide timely, accurate and relevant information as a sound basis for
management of the Group’s business;
d) reviewing audit reports and management letters to ensure prompt action is taken;
e) when required, nominating the external auditor and at least annually review the external auditor
in terms of their independence and performance in relation to the adequacy of the scope and
quality of the annual statutory audit and half-year review and the fees charged.
RISK OVERSIGHT AND MANAGEMENT
The Board determines the Company’s ‘risk profile’ and is responsible for overseeing and approving risk
management strategy and policies, internal compliance and internal control systems. In summary, the
Company policies are designed to ensure strategic, operational, legal, reputation and financial risks are
identified, assessed, effectively and efficiently managed and monitored to enable achievement of the
Company’s business objectives.
The Company has exposure to economic risks, including general economy wide economic risks and risks
associated with the economic cycle which impact on the price and demand for minerals which affects
the sentiment for investment in exploration companies.
There will be a requirement in the future for the Company to raise additional funding to pursue its
business objectives. The Company’s ability to raise capital may be affected by these economic risks.
The Company has in place risk management procedures and processes to identify, manage and
minimise its exposure to these economic risks where appropriate.
The operations and proposed activities of the Company are subject to State and Federal laws and
regulations concerning the environment. As with most exploration projects and mining operations, the
Company’s activities are expected to have an impact on the environment, particularly if advanced
exploration or mine development proceed. It is the Company’s intention to conduct its activities to the
highest standard of environmental obligation, including compliance with all environmental laws.
The Board currently considers that the Company does not have any material exposure to social
sustainability risk.
The Company’s Corporate Code of Conduct outlines the Company’s commitment to integrity and fair
dealing in its business affairs and to a duty of care to all employees, clients and stakeholders. The code
sets out the principles covering appropriate conduct in a variety of contexts and outlines the minimum
standard of behaviour expected from employees when dealing with stakeholders.
The Board reviewed the Risk Management Framework, including the policies, procedures and the
Company’s Risks during the reporting period.
A summary of Peel Mining Limited’s Risk Management review procedures can be found in the corporate
governance information section of the Company website at www.peelmining.com.au.
Considerable importance is placed on maintaining a strong control environment. The Board actively
promotes a culture of quality and integrity. Control procedures cover management accounting, financial
reporting, compliance and other risk management issues.
No internal audit function is currently in place due to the size of the Company, however the Board
regularly assesses the need for an internal audit function. The Board encourages management
PAGE 81
accountability for the Company’s financial reports by ensuring ongoing financial reporting during the
year to the Board. Half yearly, the Financial Controller (or equivalent) and the Managing Director are
required to state in writing to the Board that in all material respects:
Declaration required under s295A of the Corporations Act 2001 –
the financial records of the Company for the financial period have been properly maintained;
the financial statements and notes comply with the accounting standards;
the financial statements and notes for the financial year give a true and fair view; and
➢
➢
➢
➢ any other matters that are prescribed by the Corporations Act regulations as they relate to the
financial statements and notes for the financial year are satisfied.
Additional declaration required as part of corporate governance –
➢
the risk management and internal compliance and control systems in relation to financial risks
are sound, appropriate and operating efficiently and effectively.
These declarations were received for the June 2020 financial year.
CODE OF CONDUCT
The Company has developed a Code of Conduct (the Code) which has been fully endorsed by the Board
and applies to all directors and employees. The Code is regularly reviewed and updated as necessary to
ensure it reflects the highest standards of behaviour and professionalism and the practices necessary
to maintain confidence in the Company’s integrity.
The Code of Conduct embraces the values of:
Integrity & Objectivity
➢
➢ Excellence
➢ Commercial Discipline
The Board encourages all stakeholders to report unlawful/unethical behaviour and actively promotes
ethical behaviour and protection for those who report potential violations in good faith.
TRADING IN PEEL MINING LIMITED SECURITIES BY DIRECTORS, OFFICERS AND EMPLOYEES
The Board has adopted a specific policy in relation to Directors and officers, employees and other
potential insiders buying and selling shares.
Directors, officers, consultants, management and other employees are prohibited from trading in the
Company’s shares, options and other securities if they are in possession of price-sensitive information.
The Company's Security Trading Policy is provided to each new employee as part of their induction
training.
The Directors are satisfied that the Company has complied with its policies on ethical standards,
including trading in securities.
PAGE 82
CONTINUOUS DISCLOSURE
The Board has a Market Disclosure Policy to ensure the compliance of the Company with the various
laws and ASX Listing Rule obligations in relation to disclosure of information to the market. The
Managing Director is responsible for ensuring that all employees are familiar with and comply with the
policy.
The Company is committed to:
a) complying with the general and continuous disclosure principles contained in the Corporations Act
and the ASX Listing rules;
b) preventing the selective or inadvertent disclosure of material price sensitive information;
c) ensuring shareholders and the market are provided with full and timely information about the
Company’s activities; and
d) ensuring that all market participants have equal opportunity to receive externally available
information issued by the Company.
SHAREHOLDER COMMUNICATIONS STRATEGY
The Company recognises the value of providing current and relevant information to its shareholders.
The Company has adopted a Shareholder Communications Strategy which can be found in the
Company’s Corporate Governance Plan, and accessed from Peel Mining Limited’s website at
http://www.peelmining.com.au.
Information is communicated to shareholders through the annual and half yearly financial reports,
quarterly reports on activities, announcements through the Australian Stock Exchange and the media,
on the Company’s web site and through the Chairman’s address at the annual general meeting. After
the Annual General Meeting, the Managing Director provides shareholders with a presentation.
Afterwards all directors are available to meet with any shareholders and answer questions.
Shareholders are encouraged to contact the Company through the Contact Us section on Peel Mining
Limited’s website, to submit any questions via email, or call.
The Company’s website provides communication details for its Share Registry, including an email
address for shareholder enquiries direct to the Share Registry.
In addition, news announcements and other information are sent by email to all persons who have
requested their name to be added to the email list. If requested, the Company will provide general
information by email.
The Company will, wherever practicable, take advantage of new technologies that provide greater
opportunities for more effective communications with shareholders.
The Company ensures that its external auditor is present at all Annual General Meetings to enable
shareholders to ask questions relevant to the audit directly to the auditor.
All resolutions at shareholder meetings will be decided by a poll.
COMPANY WEBSITE
Peel Mining Limited has made available details of all its corporate governance principles, which can be
found
the Company website at
http://www.peelmining.com.au.
the corporate governance
information section of
in
PAGE 83
Information relating to shareholders at 4 September 2020
Distribution of shareholders
Range
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 – 999,999,999
Total
Twenty largest shareholders
1. ST BARBARA LTD
2. POINT NOMINEES PTY LTD
3. WINCHESTER INVESTMENTS GROUP PTY LIMITED
4. HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
5. PERTH CAPITAL PTY LTD
6. PERTH CAPITAL PTY LTD
7.
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
8. BELGRAVIA STRATEGIC EQUITIES PTY LTD
9. HAMPTON HILL MINING NL
10. ARIKI INVESTMENTS PTY LIMITED
11. JAYLEAF HOLDINGS PTY LTD
12. GIBSON MINERALS LIMITED
13. BNP PARIBAS NOMS PTY LTD
14. TREASURY SERVICES GROUP PTY LTD
15. JETOSEA PTY LTD
16. WARRAMBOO HOLDINGS PTY LTD
17. WYTHENSHAWE PTY LTD
18. WYTHENSHAWE PTY LTD
19. KERONGA DEVELOPMENTS PTY LTD
20. MR ROBERT MACLAINE TYSON
Number of
Holders
Number of
Ordinary
Shares
24,900
680,716
1,273,701
23,017,845
%
0.01
0.20
0.37
6.74
86
235
164
637
266
316,646,652
92.68
1,391
341,643,814
100.00
Number of
Ordinary
Shares
%
41,537,109
12.16
17,350,751
16,319,502
15,857,177
15,534,915
15,499,589
12,980,837
12,293,795
11,643,750
9,598,892
7,269,990
6,428,571
6,218,130
5,714,286
4,924,087
4,140,403
3,498,750
3,414,863
2,973,243
2,877,625
5.08
4.78
4.64
4.55
4.54
3.80
3.60
3.41
2.81
2.13
1.88
1.82
1.67
1.44
1.21
1.02
1.00
0.87
0.84
216,076,265
63.25
PAGE 84
Substantial shareholders
1.
2.
3.
Hampton Hill Mining NL and Associates
St Barbara Limited
Point Nominees Pty Ltd and Associates
Number of
Ordinary
Shares
%
55,507,270
16.25
41,537,109
12.16
18,563,501
5.43
PAGE 85
At the prevailing market price of $0.265 per share there were 136 shareholders with less than a
marketable parcel of shares at 4 September 2020.
At 4 September 2020 there were 1,388 holders of ordinary shares in the Company.
At the date of this report there were no shares or options restricted by the ASX.
Unquoted securities
At the date of this report the Company had 10,462,500 unlisted share options on issue.
Voting Rights
The voting rights attaching to the ordinary shares, set out in Clause 12.11 of the Company’s Constitution
are:
“Subject to any rights or restrictions for the time being attached to any class or classes of Shares, at
meetings of Shareholders or classes of Shareholders:
1. each Shareholder entitled to vote may vote in person or by proxy, attorney or Representative;
2. on a show of hands, every person present who is a Shareholder or a proxy, attorney or
Representative of a Shareholder has one vote; and
3. on a poll, every person present who is a Shareholder or a proxy, attorney or Representative of a
Shareholder shall, in respect of each fully paid Share held by him, or in respect of which he is
appointed a proxy, attorney or Representative, have one vote for the Share, but in respect of partly
paid Shares, shall have such number of votes being equivalent to the proportion which the amount
paid (not credited) is of the total amounts paid and payable in respect of those Shares (excluding
amounts credited)”
PAGE 86
Peel Mining 2019 Annual Report Cover Artwork - Ver 8.pdf 1 10/10/2019 11:12:22
C
M
Y
CM
MY
CY
CMY
K
Peel Mining Ltd
ACN 119 343 734
Unit 1, 34 Kings Park Rd, West Perth, WA 6005
telephone: +61 8 9382 3955
www.peelmining.com.au
ACN 119 343 734
2020 ANNUAL REPORT