ABN 11 127 171 877
2016
ANNUAL
REPORT
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
CORPORATE DIRECTORY
DIRECTORS
AUDITOR
Mr Phillip Jackson
Mr Paul Roberts
Mr David Kelly
Non-executive Chairman
Managing Director
Non-executive Director
Moore Stephens
Level 18, 530 Collins Street
MELBOURNE VIC 3000
Company Secretary
Mr Eric Moore
REGISTERED OFFICE
Suite 2, Level 2
20 Kings Park Road
WEST PERTH WA 6005
Telephone: +61 8 6143 1840
Fax: +61 8 9321 4692
Email: info@predictivediscovery.com
Web Site: www.predictivediscovery.com
POSTAL ADDRESS
PO Box 1710
WEST PERTH WA 6872
CONTENTS
CHAIRMAN’S REPORT
REVIEW OF OPERATIONS
DIRECTORS’ REPORT
STATEMENT OF COMPREHENSIVE INCOME
STATEMENT OF FINANCIAL POSITION
STATEMENT OF CHANGES IN EQUITY
STATEMENT OF CASH FLOWS
NOTES TO THE FINANCIAL STATEMENTS
DIRECTORS’ DECLARATION
INDEPENDENT AUDITOR’S REPORT
AUDITOR’S INDEPENDENCE DECLARATION
SHAREHOLDER INFORMATION
MINERAL TENEMENT INFORMATION
SHARE REGISTRY
Link Market Services Limited
Level 4, 152 St Georges Terrace
PERTH WA 6000
Telephone: +61 8 9211 6670
Email: info@linkmarketservices.com.au
ASX CODE
PDI
3
4
21
30
31
32
33
34
58
59
61
62
64
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
CHAIRMAN’S REPORT
Dear Shareholder
Predictive Discovery Limited (‘PDI’) has continued to make progress in the past year despite ongoing
difficult market conditions for junior gold explorers.
Our Cote D’Ivoire joint venture with Toro Gold Limited has generated exciting drill results from both the
Boundiali and Kokoumbo exploration permits. The Nyangboue Prospect at Boundiali appears to be
particularly promising with the identification of a gold mineralised zone, containing some very high gold
grades, which is now known to be at least 1.2km long. Elsewhere, we have received high grade gold values
from drilling on the Kokoumbo permit and defined a large gold-in-soil geochemical anomaly on the
Ferkessedougou South permit.
Elsewhere in Cote D’Ivoire, we have farmed-in to the exciting Bobosso gold project where previous
exploration had already identified a large gold mineralised system. We look forward to exploring this
ground in the upcoming field season.
In Burkina Faso, we have now calculated an Exploration Target on prospects close to our Bongou gold
deposit. We have also been in discussions with potential investors about a project-level joint venture which
can develop the Bongou district through to mine production via a multi-pit mining approach.
Our strategy has changed over the past year. The Company is now operating with a West Africa-focused,
“project generator” business model, whereby we will acquire the right to explore on high quality ground,
undertake early stage exploration up to the drilling stage, and then seek joint venture partners with mine
development credentials to help us advance gold discoveries through to development. The Toro Joint
Venture provides a good example of the model we are seeking to follow and provides some vindication of
the quality of exploration ground we have been able to acquire.
We thank you for your strong support during the past year. We successfully raised $1.3 million via a fully
subscribed Rights Issue in November-December 2015, at a particularly difficult time in the investment cycle,
which reflects how strongly our shareholders have supported our activities and evolving business strategy. I
am pleased to say that this support has been rewarded in recent months through a substantial rise in our
share price, which has, in turn, enabled us to raise a further $3 million to support our exploration strategy.
Two Directors, Phil Henty and Tim Markwell, retired from the Board in late 2015. I wish to record my thanks
to them for their dedicated service to the Company over past years.
Thank you also to our Managing Director, Paul Roberts, my fellow Director, David Kelly, and our staff in
Australia and Burkina Faso. This has been another challenging year and the Company has again been
obliged to cut costs wherever possible. Despite this, we have managed to continue to advance our projects
with the assistance of our shareholders and joint venture partners. I thank everyone for their dedication to
Predictive.
Phillip Jackson
Chairman
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HIGHLIGHTS
In 2015-16, Predictive Discovery Limited (PDI) made substantial progress on its exploration projects, mainly
through its joint ventures in West Africa and Victoria. Highlights of the year included:
Toro Joint Venture:
o Excellent RC drill results from the Nyangboue Prospect in the Boundiali permit in Cote
D’Ivoire (Quarterly Report to 30 June 2016), including:
28m at 4.0g/t Au from 3m, including 1m at 49.7g/t Au
14m at 5.5g/t Au from 32m, including 1m at 31.6g/t Au
9m at 7.9g/t Au from 99m, including 1m at 44.7g/t Au
20m at 2.0g/t Au from 0m, including 1m at 14.4g/t Au
7m at 3.8g/t Au from 33m, including 1m at 11.3g/t Au
o Highly encouraging diamond drill results from the Kokoumbo permit in Cote D’Ivoire
(Quarterly Report to 30 June 2016), including:
7.5m at 16.0g/t Au from 0m, including 1.5m at 74.2g/t Au
7.5m at 1.6g/t Au from 0m
1.5m at 14.9g/t Au from 87m
o Large gold-in-soil geochemical anomalies recorded on Boundiali, Kokoumbo and
Ferkessedougou permits in Cote D’Ivoire.
Cape Clear Joint Venture:
o Encouraging diamond drill results from the British Banner prospect on the Cape Clear
Exploration Licence in Victoria (Quarterly Report to 31 March 2016):
3.8m at 6.7g/t Au from 265.7m including 1.3m at 17.5g/t Au
4.5m at 2.5g/t Au from 326.5m including 0.7m at 10.4g/t Au
Calculation of an Exploration Target on prospects located within 10km of the Bongou Deposit.
Signature of a farm-in agreement with XMI SARL on the Bobosso project in Cote D’Ivoire and
commencement of field work there.
INTRODUCTION
PDI is exploring for large, high value gold deposits in West Africa.
In Cote D’Ivoire, the Company has interests in six granted exploration permits and two permit applications,
totalling 3,133km2 (Figure 1), which are being actively explored under the terms of a joint venture with
Toro Gold Limited. PDI is also conducting exploration under an agreement on the Bobosso Project, which
covers a further 1,200km2 (Figure 1).
In Burkina Faso, the Company has an effective Burkina-based team and a large regional tenement package
in the north-east of the country covering 1,222km2 (Figure 9). PDI’s exploration focus is on the high-grade
Bongou gold discovery and the surrounding area. A formal Mineral Resource Estimate on Bongou resulted
in 184,000oz of gold in the Inferred and Indicated Mineral Resource categories with an average grade of
2.6g/t Au, including 136,000oz at 3.8g/t Au (ASX release dated 4 September, 2014).
PDI also holds an Exploration Licence in Victoria (Figure 11) which was drilled in the December and March
Quarters by joint venture partner, Cape Clear Minerals Pty Ltd.
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Predictive’s strategy is to identify early stage exploration projects, explore them up to the initial drilling
stage, and then maintain a high level of exploration activity on its more advanced projects through project-
level funding – either via joint ventures or direct cash investments into private companies which hold the
Company’s ground. The Toro and Cape Clear Joint Ventures are clear evidence that this model is working
well and generating significant newsflow.
Figure 1: Map of the Birimian Gold Belt showing major mines and important PDI project areas.
COTE D’IVOIRE
Background
Predictive has been increasingly focused on Cote D’Ivoire in recent years. The country covers over a third of
the highly prospective Birimian gold belt, more than any other country in West Africa. Cote D’Ivoire is highly
underexplored for gold because the exploration investment boom in the last decade largely bypassed the
country because of political instability. Since the accession of President Alassane Ouattara in 2011 and his
comfortable re-election last year, and with investment certainty provided by an updated Mining Act and a
forward-looking Mines Administration, Cote D’Ivoire has become a highly attractive exploration investment
destination.
Predictive is in joint venture with Toro Gold Limited (Toro), a UK-based company, on six granted permits
and two permit applications in Cote D’Ivoire and with XMI SARL, an Ivoirian company, on two additional
permits and one permit application covering the Bobosso Project (Figure 2). The Toro Joint Venture
operates through Predictive Discovery Limited’s subsidiary, Predictive Cote D’Ivoire SARL (Predictive CI).
Predictive now has interests in exploration ground in Cote D’Ivoire covering 4,333 km2.
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Figure 2: Locality map showing the initial Toro Joint Venture permits (i.e. Boundiali, Kokoumbo, Ferkessedougou S and
Kounahiri), location of the GIV Joint Venture permits and permit applications (which also fall within the Toro JV), and
the permits covered by PDI’s agreement with XMI SARL over the Bobosso Project (ASX).
Toro Gold Joint Venture
Background
The Toro Joint Venture operates through Predictive Discovery Limited’s subsidiary, Predictive Cote D’Ivoire
SARL (Predictive CI) of which Predictive now holds 49%. Toro can earn a further 14% of Predictive CI by
spending US$2.5 million, which would then lift its equity to 65%. Predictive plans to contribute 35% of the
ongoing expenditure once Toro achieves its 65% equity.
Boundiali Permit
The Boundiali exploration permit is located within a very well mineralised greenstone belt which contains
the large operating Tongon and Syama gold mines in Cote D’Ivoire and Mali respectively (Figure 2). The
southern part of this belt has had little exploration to date and represents a first class opportunity to make
new large gold discoveries.
Predictive was granted the Boundiali permit in January 2014. The Company’s first exploration program on
the permit was a BLEG stream sediment survey (ASX release dated 4/8/14) which discovered a series of
strong stream sediment anomalies, the best of which, a 24ppb Au anomaly, lies downstream of the
Nyangboue Prospect gold mineralised zone discovered in the recent drilling.
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Figure 3: Toro Gold soil sampling grid covering the entire Boundiali exploration permit (results reported to the ASX on
20/10/15 and 23/3/16). Results in grade intervals are shown for all of Toro soil results to date. The large Nyangboue
Prospect gold anomaly and two other coherent gold anomalies are highlighted on this map. Rock chip locations are
shown as small black triangles.
Toro carried out a soil sampling program covering the entire Boundiali permit initially on 800m spaced
lines. Infill sampling highlighted three areas of coherent soil anomalies (Figure 3; December 2015 and
March 2016 Quarterly Reports). A high quality 2km long plus 100ppb Au anomaly was selected for RC
drilling (see below).
Boundiali Drilling Program (Nyangboue Prospect)
The RC drilling program on the Boundiali permit consisted of 92 RC holes totalling 5,496m.
The RC holes were drilled:
on eight east-west oriented lines, of which six are spaced 320m apart. The northernmost and
southernmost lines are 160m from their neighbours (Figure 4). Hole collars are approximately 40m
apart,
mostly to depths of 50-60m, with the exceptions of a few holes which were extended or re-drilled
to between 117m and 130m depth,
towards the west and angled at 50 degrees.
Drill assay highlights (reported on 23/6/16, 25/7/16, 8/8/16, 12/9/16 and 13/10/16) were as follows:
BRC003 - 28m at 4.04g/t Au from 3m, including 1m at 49.7g/t Au
BRC004 - 20m at 1.97g/t Au from 0m
BRC004 - 14m at 5.51g/t Au from 32m, including 1m at 31.6g/t Au
BRC004BIS (twin hole) – 20m at 10.45g/t Au from 38m including 1m at 145.5g/t Au
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BRC006 – 9m at 7.9 g/t Au from 99m including 1m at 44.7g/t Au
BRC023 – 7m at 3.8g/t Au from 33m including 1m at 11.3g/t Au
BRC048 – 28m at 1.55g/t Au from 1m including 1m at 27.4g/t Au
BRC010 – 30m at 0.92g/t Au from 14m including 2m at 7.68g/t Au
BRC085 – 1m at 10.65g/t Au from 37m
BRC010 – 4m at 5.38g/t Au from 4m including 1m at 15.15g/t Au.
Figure 4: RC drill hole collar locations on a gold-in-soil geochemical contour plan, highlighting locations of gold
mineralised zones in the southern 2km portion of the Nyangboue Prospect. Gold geochemical contours are
superimposed on satellite imagery.
This drilling has revealed a substantial new body of gold mineralisation in multiple zones up to 1.2km long
(Figure 4). Initial observations from logging these drill holes and mapping the limited rock exposures at
surface are as follows:
The mineralised zone appears to lie within a large and complex ductile shear zone containing:
o quartz-sericite schists which are interpreted to be derived from volcano-sedimentary rocks,
o granitic intrusives,
o sediments,
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o
felsic volcanics with quartz phenocrysts,
o possible mylonites (extremely strongly sheared rocks) and
o possible mafic volcanics.
Sparse rock outcrops indicate that shearing dips steeply to the east, which is why holes were drilled
towards the west.
Gold values are generally associated with zones of quartz veining (1-2cm veinlets) - both smoky
grey quartz and white quartz.
Visible gold has been panned from some of the RC drill chips and fines. Follow-up screen fire assays
on intervals with high gold grades and/or visible gold are therefore planned.
The dip and dip direction of the mineralisation is not yet understood. Follow-up diamond drilling is
required to address this question.
The sheared rock sequence contains minor sulphides, including pyrite, pyrrhotite and arsenopyrite.
Kokoumbo Permit
Predictive CI is earning a 90% interest in the Kokumbo exploration permit in southern Cote D’Ivoire from an
Ivoirian company, Ivoir Negoce. The Kokumbo permit covers an area of historic artisanal and French
colonial era mining located in a highly prospective belt of rocks which also includes the Bonikro gold mine,
currently in production by Newcrest, and Agbaou gold mine, where Endeavour Mining commenced
commercial production in January 2014 (Figure 2).
Toro commenced work by carrying out geological mapping and rock and soil samples. The soil sampling
defined two large areas of gold anomalism (September 2015 Quarterly Report):
A WNW orientated, 6km long gold geochemical anomaly with peak values of 3.4 and 3.3g/t Au.
An area of over 2 km2, covering the historic Kokumbo workings and surrounding area, and with
peak soil values of 1.2 and 1.3g/t Au.
Figure 5: Location of Kokoumbo diamond drilling, superimposed on a gridded image of gold in soil
geochemistry (ASX release dated 15/9/15). The Kokoumbo Hill sites are in the centre of a large area of gold in
soil anomalies and substantial historical and recent artisanal mine workings.
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Kokoumbo Diamond Drilling Program
15 diamond drill holes totalling 1,610m were completed in April 2016. The diamond drilling program tested
three prospects, with the main focus being Kokoumbo Hill (Figure 5).
The majority of the holes drilled contained some gold mineralisation, including the following (June 2016
Quarterly Report):
Kokoumbo Hill Prospect:
KOD001: 7.5m at 16.0g/t Au from 0m, including 1.5m at 74g/t Au from 6.0m.
KOD002: 7.5m at 1.6g/t Au from 0m
KOD003: 4.5m at 3.4g/t Au from 0m
KOD005: 7.5m at 1.5g/t Au from 12m, including 1.5m at 8.9g/t Au
KOD010: 1.5m at 14.9g/t Au from 87m
Sereme Prospect:
KOD014: 3.0m at 1.9g/t Au from 39m
KOD015: 1.5m at 4.1/t Au from 1.5m
KOD015: 1.5m at 4.6/t Au from 18.7m
Toro’s work on the Kokoumbo Hill Prospect has identified near surface gold mineralisation both in chip-
channel sampling and RC drilling, some of which is high grade (e.g. the KOD001 intercept). While some gold
values were obtained in colluvial material, most are from weathered or fresh bedrock including the highest
grade values to date. A chip-channel sampling program (ASX release dated 10/11/15) indicated an
association between encouraging gold values and a microdiorite containing rare quartz phenocrysts. Such
rocks tend to contain lower titanium values than the surrounding basalts. A combination of core logging
and titanium measurements (using a portable XRF machine) shows that such an association is also present
in some of the drill intercepts, most definitively in the KOD001 and KOD005 intercepts.
The principal gold mineralised zone identified from the drilling (holes KOD001-005) is open to the east and
the south, the best results obtained to date being on the southernmost drill line.
Ferkessedougou South Permit
The Ferkessdougou exploration permit was selected by PDI on the basis of a country scale structural
analysis using the Company’s Predictore methods.
Toro Gold Soil Sampling Program
Toro undertook reconnaissance soil sampling of the northern two thirds of the Ferkessedougou permit in
the September and December Quarters of 2015 (ASX release 10/11/15). Infill soil sampling 200 x 50m grid
of a 3km long gold anomalous zone identified in the initial survey was completed and reported in the
March Quarter of 2016 (ASX release 28/4/16 – see Figure 6).
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Figure 6: Ferkessedougou geochemical map on satellite imagery background - showing location of the northern gold-
in-soil anomaly including values above 0.5g/t Au (plus 500ppb Au).
The infill sampling showed that there is a coherent gold anomalous zone in the northern part of the permit
with values above 20ppb Au extending over 4km (Figure 6). Within that zone, there is a 2km long
continuous anomaly above 50ppb along with other shorter strike length gold anomalous features. There
are a number of encouraging high values (>500ppb Au or >0.5g/t Au), ranging from 509 to 895 ppb Au.
Bobosso Project (XMI Joint Venture)
Background
The Bobosso Project consists of two granted exploration permits, Bassawa and Wendene, and one permit
application, Dabakala, in northern Cote D’Ivoire (Figure 2), which are held by an Ivoirian company, XMI SARl
(XMI). Bassawa and Wendene are located in the southern extension of the well mineralised Hounde Belt in
Burkina Faso, which includes Semafo’s Mana Mine (5 Moz in ore resources and reserves).
Predictive has entered into an agreement with XMI SARL whereby it can provide funding or arrange for
third parties to invest in the Bobosso Project. Details of the agreement were released to the ASX on
28/10/15. At present, PDI’s equity in the project is approximately 35%.
Historical Data
Historical soil sampling by Equigold (ASX release 28/10/15) obtained many anomalous results over the
Bassawa permit and Wendene permit applications. Of particular note is a 7km2 area in Wendene in which
most of the values are above 100ppb Au (Figure 7). This area contains 729 soil samples with an average
arithmetic value of 394ppb Au (0.39g/t Au) and peak values of 39.8g/t Au, 20.2g/t Au and 6.89g/t Au.
There are numerous plus 100ppb Au anomalous values outside of this area, many of which are untested by
drilling.
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Figure 7: Bobosso gold in soil geochemical anomaly showing location of all historical RC holes, highlighting all holes
with gold intercepts of at least 2 g x m and showing cross section location.
569 RC holes and 11 diamond drill holes were completed in the area of the 7km2 anomaly. Of these, 221
holes contained at least one 2gxm intercept at a cut-off grade of 0.5 g/t Au. Most of these intercepts were
at shallow depths. The average (vertical) depth tested by drilling was approximately 80m. Historic RC and
diamond drill intercepts (September 2015 Quarterly Report) include the following:
BRC047: 32m at 1.93g/t Au from 12m
BRC053: 2m at 29.70g/t Au from 0m
BRC083: 5m at 20.60g/t Au from 48m
BRC097: 7m at 5.36g/t Au from 17m
BRC262: 35m at 1.56g/t Au from 65m
BRC278: 7m at 9.52g/t Au from 26m
BRC311: 2m at 29.16g/t Au from 66m
BRC343: 25m at 1.45g/t Au from 11m
BRC552: 9m at 5.01g/t Au from 4m
BRC557: 31m at 1.18g/t Au from 59m
BRC561: 9m at 4.21g/t Au from 12m
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Figure 8: Cross section through Bobosso gold mineralised system, located as shown on Figure 7.
Geological Analysis
Predictive’s analysis of this data along with results of re-logging and surface geological mapping and review
of historic aeromagnetic data recorded after the drilling was completed indicates that:
The historic drilling was directed at an oblique angle (25 to 30 degrees) to the structures which
appear to control mineralisation. Thus structures mapped by the aeromagnetic data and
distribution of drilled gold mineralisation appear to strike ENE (approximately 075-080°) and the
holes are largely drilled to the east on an ESE azimuth (approximately 105°).
Several prospective structures mapped by aeromagnetics are undrilled.
The drilled area covers a major gold mineralised system with numerous separate zones of gold
mineralisation, apparently with variable vein and/or mineralised shear orientations.
Gold mineralisation continuity is not completely understood. However, there is a strong
correlation between gold values and primary silica-sericite-pyrite alteration, which can be traced on
some sections from hole to hole.
In some areas, the mineralisation has an apparent flat dip (e.g. Figure 8), which may be a result of
drilling near parallel to the strike of more steeply dipping mineralisation.
Elevated gold values near surface are quite common, and help explain the very large gold anomaly.
These values may be explained by partly lateritised alluvium/colluvium formed by erosion of the
underlying mineralisation.
The host rock consists of largely carbonatised mafic volcanics with lesser volcaniclastics and mafic
to intermediate intrusives. Granites are known in the area but no felsic intrusives have yet been
observed in core of RC drill chips.
According to the historical drill logs, the depth of weathering averages about 30m.
Most of the historical drilling was conducted on 200m spaced drill lines. It is unlikely that a formal
resource estimation could be made using such widely spaced drill lines. Nevertheless, Predictive
believes that, when supported by the results of new infill drilling, this data is sufficiently well
documented for use in a future resource calculation because:
o
the digital database includes hole collar information, downhole survey data, assays,
geological logs and drill core photography,
o based on Predictive’s field visit, many hole collar markers appear to be intact, allowing
validation of the drill locations by an independent expert, and
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o most of the RC drill gold analysis certificates are now held by Predictive.
Few or no villagers live or farm directly on the Bobosso gold-in-soil geochemical anomaly. There
are signs of recent artisanal mining activity. Predictive’s relationships with the local village
communities are excellent.
Local infrastructure is generally quite good. The nearest town, Dabakala, is connected to Cote
D’Ivoire’s sealed road network and is a 90 minute drive from the project area. There is also a
substantial power line which runs within 10 kilometres of the Bobosso gold anomaly.
There is a significant discovery opportunity for PDI at the Bobosso Project because of both the large gold
mineralised system that is evidently present at Bobosso itself and the extensive regional potential along
strike.
Bobosso Work Program
PDI has undertaken a series of relatively low cost work programs to date, including:
Pitting and metallurgical testwork of gold-bearing colluvial gold material within the 7km2 gold
anomaly,
Clarifying the geological
interpretation of some key sections through the Bobosso gold
mineralisation by re-logging drill holes and surface mapping,
Undertaking a regional targeting exercise to identify gold mineralisation potential along strike from
the Bobosso prospect both in the Wendene and Bassawa exploration permits.
XMI has also applied for a third permit (Dabakala – northernmost area within Bobosso permit group, Figure
2).
BURKINA FASO GOLD PROJECTS
Background
PDI’s Burkina Faso projects are all located within the Birimian gold belts in West Africa. These belts contain
numerous gold ore deposits (Figure 1), many of which are in production.
The Company’s tenement holding covers 1,222km2 including approximately 100km of strike length in the
Samira Hill greenstone belt in eastern Burkina Faso (the Bonsiega permit group, Figure 9). This belt hosts
the 2.5 million ounce Samira Hill gold deposit across the border in Niger and contains numerous active
artisanal gold mine sites along its length. PDI owns 100%, or has the rights to earn 95% to 100% of all its
permits in Burkina Faso.
PDI has discovered gold mineralisation on multiple prospects in Eastern Burkina Faso during the past four
years including the Bongou gold deposit. A formal Mineral Resource Estimate on Bongou resulted in
184,000oz of gold in the Inferred and Indicated Mineral Resource categories with an average grade of
2.6g/t Au, including 136,000oz at 3.8g/t Au (ASX release dated 4 September, 2014).
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Figure 9: Location of PDI’s Burkina Faso permits, highlighting the Bongou Prospect. Each dot within the permit outlines
is a drilled prospect with ore grade and width gold intercepts. Note that the nearby operating Samira Hill gold mine in
Niger contains resources, reserves and past production of 2.5 million ounces (source: www.semafo.com).
Figure 10: Geology of the SE Bonsiega Permit Group, including the Bongou Prospect and nearby exploration targets
Exploration Target near Bongou
In August 2015, the Company calculated an Exploration Target on drilled prospects within 10km of the
Bongou gold deposit (ASX release dated 3rd September 2015).
The Exploration Target detailed in the following table is estimated to be in a range of 9.4 to 10.4 million
tonnes averaging between approximately 1.5 to 1.7g/t Au and containing approximately 460,000 to
563,000 ounces of gold, as follows:
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for
3
Figure
Prospect Names
(see
locations)
Dave
Laterite Hill
Near Bongou (W2/W8)
Prospect 71
Target 92
Totals
Million Tonnes
Grade
Ounces Gold
Lower
estimate
6.71
1.48
0.27
0.68
0.23
9.37
Higher
estimate
7.41
1.63
0.30
0.75
0.26
10.35
Lower
estimate
1.49
1.62
1.57
1.21
2.88
1.53
Higher
estimate
1.65
1.79
1.74
1.33
3.18
1.69
Lower estimate Higher estimate
322,000
77,000
14,000
26,000
21,000
460,000
394,000
94,000
17,000
32,000
26,000
563,000
Cautionary Statement: The potential quantity (tonnage) and grade of the Exploration Target is conceptual in nature.
There has been insufficient exploration to estimate Mineral Resources and it is uncertain if further exploration will
result in the estimation of Mineral Resources.
The calculation was restricted to prospects for which there is good evidence of mineralisation orientation
and continuity. Most of these prospects are open along strike and at depth. A number of other isolated
gold intercepts within 10km of Bongou were excluded, so there is significant potential to expand the
Exploration Target further within range of PDI’s own drilling.
Additionally, PDI’s extensive ground holdings in Eastern Burkina Faso hold other significant prospects for
which Exploration Targets could be calculated (e.g. Tambiri, Solna, Bira and Fouli)
Data and parameters used in calculating this Exploration Target were as follows:
Data:
o Gold intercepts from 291 reverse circulation holes, 4 air core holes and 5 diamond drill holes1
were used in the calculation.
o The holes were mostly drilled on lines spaced from 50m to 100m apart, with a spacing along the
lines ranging from 10m to 50m.
Parameters:
o 0.5 g/t gold cut-off grade;
o Minimum downhole intercept width of 2m and a minimum grade times width intercept of 2g*m;
o Minimum internal waste of 3m except for a few holes where it was clear that the holes had
drilled almost down-dip and where the inclusion of larger down-hole intervals of internal waste
made geological sense;
o Maximum of 100m strike extent from drill holes (where the continuity of the mineralisation is
supported by mapping and/or the location of artisanal workings and/or anomalous auger results);
o Maximum of 70m vertical extent below surface;
o Dry bulk density estimates as follows:
Laterite: 2.2
Saprolite: 1.8
Weathered rock between base of saprock and base of complete oxidation (BOCO): 2.3
1 These drilling results were reported to the ASX in the following Quarterly Reports: June Quarter 2011, March Quarter 2012, June
Quarter 2012, March Quarter 2014 and June Quarter 2015. The drill results reported in these Quarterly Reports up to the June
Quarterly of 2012 were prepared and first disclosed under the JORC Code 2004; they have not been updated since to comply with
the JORC Code 2012 on the basis that the information has not materially changed since it was last reported.
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
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REVIEW OF OPERATIONS
Fresh mafic volcanics: 2.8
Fresh felsic to intermediate rocks including granite and granodiorite: 2.7
o The calculation was carried out using a cross sectional method with volumes projected half way
to the next hole (on the section) or half way to the next section to a maximum distance of 100m
(along strike).
Additional Potential
Most of the zones of gold mineralisation included in the Exploration Target are open at depth and along-
strike. In addition, there are a series of other mineralised intercepts which have potential for resource
discovery either along strike or at depth.
Follow-up Drilling
Subject to funding availability, Predictive plans to follow up the Exploration Target calculation with drilling
programs on all the listed prospects in order to make Mineral Resource Estimates. A total drilling budget of
20,000m, consisting of both RC and diamond drilling, has been calculated to complete this task, and is
planned for completion over the next one to two years.
VICTORIAN GOLD PROJECT
Cape Clear EL5434
Background
PDI has one project remaining in Australia, the Cape Clear Project west of Ballarat in Victoria (Figure 11).
Exploration there is targeted at discovery of Stawell-style and/or Ballarat-style gold mineralisation on the
margins of a concealed Cambrian basalt ridge located on the west side of the major north-south striking
Avoca Fault. The 5 million ounce Stawell gold deposit is located in a comparable geological position on the
western side of a basalt ridge, which is also west of a major fault (the Coongee Fault).
PDI announced the signing of a joint venture agreement with Cape Clear Minerals Pty Ltd (CCM) in regards
to the project on 22nd September 2014. CCM has now earned a 75% interest in the joint venture.
Past exploration by Leviathan Resources Limited revealed a gold mineralised zone on the eastern side of
the basalt ridge at the British Banner prospect (Figure 12). This included drill hole PFD036 (Figures 12 and
13) which reportedly contained visible gold in several places and intersected:
0.4m at 6.98g/t Au from 313.1m
0.6m at 22.80g/t Au from 334.0m
1.8m at 2.39g/t Au from 347.8.0m
3.0m at 3.15g/t Au from 392.2m including 0.4m at 19.5g/t Au.
0.4m at 4.99g/t Au from 397.2m
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
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REVIEW OF OPERATIONS
Figure 11: Cape Clear Project, Victoria - locality plan
Drilling program
CCM completed a diamond drilling program on Cape Clear, totalling 7 holes and 2,147m, in the December
2015 and March 2016 Quarters (see Figure 12 for drill hole locations).
Encouraging results, including some high gold grades over narrow widths, were obtained from the British
Banner Prospect (Figures 12 and 13). Highlights of that drilling included the following:
CCD001:
o 0.7m at 2.07g/t Au from 232.2m
o 3.8m at 6.74g/t Au from 265.7m including 1.3m at 17.50g/t Au
o 4.5m at 2.45g/t Au from 326.5m including 0.7m at 10.35g/t Au
CCD004:
o 2.1m at 3.18g/t Au from 206.8m including 0.6m at 5.22g/t Au
o 1.1m at 4.08g/t Au from 266.5m
CCD005:
o 1.2m at 2.45g/t Au from 160.5m
o 0.8m at 3.72g/t Au from 167.4m
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
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REVIEW OF OPERATIONS
Figure 12: Drill hole locality plan on map of interpreted basement geology below younger (Tertiary) basalt cover (see
Figure 13 for cross sectional view).
Figure 13: Cross section through the British Banner Prospect and diamond drill holes CCD001 and CCD005
The drilling to date indicates that there is a broad zone of gold-anomalous quartz veining, with traces of
visible gold, in the vicinity of the contact position between sandstones and shales east of the basalt contact
and west of the major Avoca Fault. CCM’s drilling has demonstrated that this zone extends for at least
400m along strike and is open to the north and south.
CORPORATE
Capital raisings during the year totalled $1.3 million via a rights issue in the December 2015 Quarter. The
Company’s overhead costs were again reduced in 2015-16, reflecting the ongoing difficult capital raising
environment during the year.
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
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REVIEW OF OPERATIONS
Two of PDI’s Non-Executive Directors, Mr Phil Henty and Mr Tim Markwell, retired from the Board during
the December 2015 Quarter. The Company thanks both of them for their many valuable contributions. Mr
David Kelly was appointed as a Non-Executive Director of PDI’s Board early in the March 2016 Quarter.
Subsequent to 30th June, 2016, the Company raised $3 million in funds in three components:
$1m from clients and affiliates of the Sprott Group;
A placement of $1.2m to large shareholders and several other sophisticated investors; and
A Share Purchase Plan which raised $0.8m.
OUTLOOK
Predictive’s current strategy is to operate through a project generator business model, i.e.:
generate high quality exploration ground in West Africa with the Company’s highly effective project
generation methods,
conduct early stage exploration up to initial the drilling stage in order to generate substantial value
for shareholders,
maintain a high level of exploration activity on its drilling stage and more advanced projects
through project-level funding – either via joint ventures or direct cash investments into private
companies which hold the Company’s ground.
The Toro and Cape Clear Joint Ventures are operating well and already generating significant newsflow. The
Company’s focus in the second half of 2016 is to obtain project-level funding on the Bonsiega Project in
Burkina Faso and the Bobosso Project in Cote D’Ivoire.
Assuming that the Company is successful in obtaining well qualified joint venture partners on Bonsiega and
Bobosso, Predictive shareholders can expect substantial progress on all of the Company’s projects in West
Africa with drilling results expected from three or four projects in Cote D’Ivoire and from the Bonsiega
district in Burkina Faso.
Predictive’s geologists are also actively investigating new opportunities in West Africa with a high
expectation of identifying more early stage projects for the Company to explore.
Competent Person’s Statement
The exploration results and Exploration Target reported herein, insofar as they relate to mineralisation, are based on information
compiled by Mr Paul Roberts (Fellow of the Australian Institute of Geoscientists). Mr Roberts is a full-time employee of the company
and has sufficient experience relevant to the style of mineralisation and type of deposits being considered to qualify as a Competent
Person as defined by the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore
Reserves. Mr Roberts consents to the inclusion in the report of the matters based on his information in the form and context in
which it appears.
The input data, including the drill hole dataset, topography and geology interpretation used in the Mineral Resource estimate for
the Bongou deposit is based on information and supporting documentation compiled by Mr Paul Roberts. Mr Roberts is a full-time
employee of Predictive Discovery Ltd and a Fellow of the Australasian Institute of Geoscientists. Mr Roberts 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 Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves
(2012 Edition). Mr Roberts consents to the inclusion of the drill hole data, topography and geological interpretation and the
supporting information in the form and context in which it appears in this report.
The Mineral Resource estimation and classification of Mineral Resources and Exploration Targets for the Bongou deposit is based
on, and fairly represents, information and supporting documentation compiled by Mr Richard Gaze. Mr Gaze is a full-time employee
of Golder Associates Pty Ltd and a Member and Chartered Professional of the Australasian Institute of Mining and Metallurgy. Mr
Gaze 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 Australasian Code for Reporting of Exploration Results,
Mineral Resources and Ore Reserves (2012 Edition). Mr Gaze consents to the inclusion of the estimates, classification and the
supporting information in the form and context in which it appears in this report.
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
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PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
DIRECTORS’ REPORT
Predictive Discovery Limited (“the Company” or “Predictive”) is a public company incorporated and domiciled in
Australia and listed on the Australian Securities Exchange.
The directors of the Company present their report on the group, which comprises Predictive Discovery Limited and its
controlled entities, for the year ended 30 June 2016.
The names of the directors in office at any time during, or since the end of the year are:
NAMES
Mr Phillip Jackson
Mr Paul Roberts
Mr Philip Henty
Mr Timothy Markwell
Mr David Kelly
POSITION
Non-Executive Chairman
Managing Director
Non-Executive Director (resigned 30 November 2015)
Non-Executive Director (resigned 17 December 2015)
Non-Executive Director (appointed 22 January 2016)
The Directors have been in office since the start of the financial year to the date of this report unless otherwise stated.
COMPANY SECRETARY
Eric Moore
Eric (Ric) Moore was appointed as Company Secretary on 7 April 2015. He has held senior managerial positions in a
number of resource companies during the past 20 years and was Company Secretary of a publicly listed company
between 1996 and 2005. Ric is also Company Secretary of Aurora Minerals Limited and Peninsula Mines Limited.
PRINCIPAL ACTIVITIES
During the financial year, the principal activity of the group was mineral exploration with the objective of identifying
and developing economic reserves in West Africa and Australia.
OPERATING RESULTS FOR THE PERIOD
The consolidated loss of the group for the financial year after providing for income tax amounted to $7,864,047 (2015:
$7,060,889). This was largely from the costs of administering the group to 30 June 2016, impairment of exploration
and exploration costs.
REVIEW OF OPERATIONS
In the year to June 2016, substantial exploration operations including three drilling programs were undertaken by
joint venture partners in Cote D’Ivoire and Victoria. In addition, the Company farmed in on the Bobosso Project in NE
Cote D’Ivoire and was engaged in discussions with possible joint venture partners in Burkina Faso. $1.3 million was
raised in a fully subscribed Rights issue in November-December 2015.
Predictive’s joint venture with Toro Gold Limited (Toro JV) in Cote D’Ivoire carried out a large exploration program
involving diamond and RC drilling, extensive geochemical sampling programs and geological mapping. This work
obtained highly encouraging results on the Boundiali, Kokoumbo and Ferkessedougou exploration permits including:
(1) Boundiali - a 6km long gold geochemical anomaly under which first pass RC drilling has obtained excellent drill
intersections including 20m at 10.5g/t Au and 28m at 4.0g/t Au with abundant visible gold panned from drill chips, (2)
Kokoumbo – two large gold-in-soil anomalies beneath one of which diamond drilling intersected a new style of quartz
diorite-hosted gold mineralisation with a best intercept of 7.5m at 16g/t Au, and (3) Ferkessedougou (South) – a 4km
long gold-in-soil geochemical anomaly which requires follow-up drilling. The Toro JV also farmed into a ground
package held by GIV Minerals SARL, an Ivoirian company, and thereby approximately doubled the area covered by the
JV to 3,133km2. Toro earned a 51% interest in Predictive’s Cote D’Ivoire subsidiary, Predictive Discovery Cote D’Ivoire
SARL, during the financial year by exploration expenditure of US$1 million and is in the process of earning 14% more
equity by spending an additional US$2.5 million.
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
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PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
DIRECTORS’ REPORT
Also in Cote D’Ivoire, the Company entered into a JV with XMI SARL, an Ivoirian company, over two permits and one
permit application in NE Cote D’Ivoire, covering 1,200km2. This project covers a large known gold mineralised system
drilled previously by Equigold and Lihir Gold. An initial program of data assessment, historic drill core and RC chip re-
logging, regional target generation and collection of near-surface metallurgical samples was carried out in the first six
months to June 2016.
In Burkina Faso, Predictive published an Exploration Target estimate covering drilled prospects within a 10km radius of
the Company’s Bongou gold discovery. In addition, the Company undertook field visits and discussions with possible
joint venture partners, in accordance with the Company’s announced joint venture strategy.
In Victoria, the Company’s joint venture partner, Cape Clear Minerals Pty Ltd (CCM), undertook a diamond drilling
program which encountered narrow high grade gold mineralisation including 1.3m at 17.5g/t Au.
As in previous years, administration costs were reduced in Burkina Faso and Australia, reflecting the ongoing difficult
capital raising environment during the year.
DIVIDENDS PAID OR RECOMMENDED
No dividends were paid or declared since the start of the financial year. No recommendation for payment of
dividends has been made.
FINANCIAL POSITION
The net assets of the group have decreased by $6,581,400 from 30 June 2015 to 30 June 2016. This net movement is
largely due to the following factors:
$1.2m net capital raising;
Expenditure on exploring and evaluating the assets in Burkina Faso and Cote D’Ivoire; and
Impairment of exploration costs carried forward.
SIGNIFICANT CHANGES IN STATE OF AFFAIRS
No significant changes in the group’s state of affairs occurred during the financial year.
EVENTS SUBSEQUENT TO BALANCE DATE
On 22 August 2016 Predictive Discovery Limited announced plans to raise up to $4million in three components, being:
1. A minimum of $1m and up to $2m being raised from clients and affiliates of the Sprott Group;
2. A placement of $1.2m to large shareholders and several other sophisticated investors; and
3. A Share Purchase Plan to raise up to $0.8m.
Portions of the first two components are subject to shareholder approval at a meeting to be held on 5 October 2016,
while the Share Purchase Plan is expected to close on 27 September 2016. Subsequent to balance date, 45,000,000
shares were issued prior to the date of this report for consideration of $450,000 before costs as part of this capital
raising.
Other than the above, no matters or circumstances have arisen for the year which significantly affected or could
significantly affect the operations of the group, the results of those operations, or the state of affairs of the group in
future financial years.
FUTURE DEVELOPMENTS
Likely developments in the operations of the group and the expected results of those operations in future financial
years have not been included in this report, as the inclusion of such information is likely to result in unreasonable
prejudice to the group.
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
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PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
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DIRECTORS’ REPORT
ENVIRONMENTAL ISSUES
The group’s operations are subject to significant environmental regulations under both Commonwealth and State
legislation. The Board believes that the group has adequate systems in place for the management of its
environmental regulations and is not aware of a breach of those environmental requirements as they apply to the
group.
INFORMATION ON DIRECTORS
Mr Phillip Jackson
Non-Executive Chairman
Qualification
Experience
BJuris, LLB, MBA, FAICD
Phillip Jackson, the Chairman and a Director of the Company, is a barrister
and solicitor with over 25 years legal and international corporate
experience, especially in the areas of commercial and contract law, mining
law and corporate structuring. He has worked extensively in the Middle
East, Asia and the United States of America. In Australia, he was formerly
a managing legal counsel for a major international mining company, and in
private practice specialised in small to medium resource companies.
Phillip was managing region legal counsel: Asia-Pacific for a leading oil
services company for 13 years. He is now General Counsel for a major
international oil and gas company. Phillip has been Chairman of Aurora
since it listed in June 2004 and of listed subsidiary Peninsula Mines Limited
(“Peninsula”), and is a non-executive Chairman of Predictive Discovery
Limited. Phillip is also a non-executive director of listed company Scotgold
Resources Limited.
Interest in Shares and Options
Nil
Directorships held in other listed entities
during the three years prior to the
current year
Aurora Minerals Limited
Peninsula Mines Limited
Scotgold Resources Limited
Mr Paul Roberts
Qualifications
Experience
Managing Director
BSc, MSc, FAIG, MGSA
Mr Roberts has a long and successful history in mineral exploration
management and mine geology both in Australia and overseas. He was
responsible for discovery of the Henty gold deposit and major extensions
to the St Dizier tin deposit both in Tasmania, as well as resource
evaluations of the Kuridala copper gold deposit in North Queensland, the
Bongara zinc deposit in Peru and a number of gold deposits in the Cue and
Meekatharra districts in Western Australia.
Interest in Shares and Options
Shareholding: 14,331,790 Optionholding: 3,000,000
Directorships held in other listed entities
during the three years prior to the
current year
None
Mr Philip Henty
Qualifications
Experience
Non-Executive Director (resigned 30 November 2015)
BA Acc, Dip SIA, F Fin
Mr Henty has extensive experience in the Australian securities markets.
He has worked for nearly 30 years in stockbroking and investments
markets. His experience covers the equities, derivatives and fixed interest
markets and most aspects of the securities industry from dealing and
advice through to management, capital raising, investment management
and private investment.
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
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PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
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DIRECTORS’ REPORT
Interest in Shares and Options
Shareholding: 20,712,583 Optionholding: 1,000,000
Directorships held in other listed entities
during the three years prior to the
current year
None
Mr Timothy Markwell
Non-Executive Director (resigned 17 December 2015)
Qualifications
Experience
BSc (Hons), GradDipAppFin, MAusIMM
Mr Markwell is a geologist and has worked for 20 years in the resources
and finance industries. He is currently African Lion 3 Limited’s manager
based in Melbourne. Previously Mr Markwell worked for LinQ Resources
Fund as an investment manager and as a resource analyst for Perth broker
DJ Carmichael. He has also worked as a geologist for BHP-Billiton, Golder
Associates, Anaconda Nickel, Great Central Mines and Reynolds.
Interest in Shares and Options
Shareholding: Nil Optionholding: Nil
Directorships held in other listed entities
during the three years prior to the
current year
Aurora Minerals Ltd
Celamin Holdings NL
Mr David Kelly
Qualifications
Experience
Non-Executive Director (appointed 22 January 2016)
(B.Sc. (Hons.) - Major in Geology
Mr Kelly is a highly experienced executive and director with almost 30
year’s involvement in the resources sector. Mr Kelly brings a wealth of
experience to the Company in the areas of geology and also in the areas of
strategic analysis, project evaluation and corporate advice.
Interest in Shares and Options
Nil
Directorships held in other listed entities
during the three years prior to the
current year
Renaissance Minerals Limited
MEETINGS OF DIRECTORS
During the financial year, 16 meetings / circular resolutions of directors (including committees of directors) were held.
Attendances by each director at meetings during the year were as follows:
Directors' Meetings
Circular Resolutions
Director
Number eligible to
attend
Mr Phillip Jackson
Mr Paul Roberts
Mr Philip Henty
Mr Timothy Markwell
Mr David Kelly
4
4
1
2
2
Number attended Number eligible to
Number attended
4
4
1
2
2
attend
12
12
5
6
4
12
12
5
6
4
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
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PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
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DIRECTORS’ REPORT
INDEMNIFYING OFFICERS OR AUDITORS
The group has paid premiums to insure directors against liabilities for costs and expenses incurred by them in
defending legal proceedings arising from their conduct while acting in the capacity of director of the group, other than
conduct involving a wilful breach of duty in relation to the group. The terms and conditions of the insurance are
confidential and cannot be disclosed.
OPTIONS
At the date of this report, the unissued ordinary shares of Predictive Discovery Limited under option, including those
options issued during the year and since 30 June 2016 to the date of this report are as follows:
Grant Date
27 March 2013
Date of Expiry
31 March 2017
Exercise Price
$0.022
TOTAL
Number under Option
8,000,000
8,000,000
During the year ended 30 June 2016 no ordinary shares of Predictive Discovery Limited were issued on the exercise of
options granted.
PROCEEDINGS ON BEHALF OF THE COMPANY
No person has applied for leave of Court to bring proceeding 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 proceeding during the year.
NON AUDIT SERVICES
The Board of Directors in accordance with the advice from the audit committee is satisfied that no provision of non-
audit services was provided by the auditors during the year.
AUDITOR’S INDEPENDENCE DECLARATION
The auditors’ independence declaration for the year ended 30 June 2016 has been received and can be found on page
61 of the financial report.
REMUNERATION REPORT (AUDITED)
REMUNERATION POLICY
It is the policy of the Company that, except in special circumstances, non-executive directors normally be
remunerated by way of fixed fees, should not receive a bonus or options and should not be provided with retirement
benefits other than statutory superannuation.
The Board, within the limit pre-approved by shareholders, determines fees payable to individual non-executive
directors. The remuneration level of any executive director or other senior executive is determined by the Board after
taking into consideration levels that apply to similar positions in comparable companies in Australia and taking
account of the individual’s possible participation in any equity based remuneration scheme. The Board may use
industry wide data gathered by independent remuneration experts annually as its point of reference. Options or
shares issued to any director pursuant to any equity based remuneration scheme require approval by shareholders
prior to their issue. Options or shares granted to senior executives who are not directors are issued by resolution of
the Board.
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DIRECTORS’ REPORT
REMUNERATION REPORT (AUDITED) (continued)
It is the policy of the Company that persons to whom options have been issued should not enter into any transaction
in any associated product which is designed to limit the economic risk of participating in unvested entitlements under
an equity based remuneration scheme.
There are no schemes for retirement benefits, other than the payment of the statutory superannuation contribution
for non-executive and executive directors.
All executives receive a base salary (which is based on factors such as qualifications, expertise, experience etc.),
superannuation and fringe benefits and are eligible for the grant of options under the Employee Option Plan.
The Board policy is to remunerate non-executive directors at market rates for comparable companies for the time,
commitment and responsibilities.
The fees payable to individual non-executive directors must be determined by the Board within the aggregate sum of
$500,000 per annum provided for under clause 21.1 of the constitution. That aggregate sum can only be increased
with the prior approval of the shareholders of the Company at a general meeting. A non-executive director is entitled
to a refund of approved expenditure and may also receive payments for consultancy work contracted for and
performed separately on the Company’s behalf.
The Company’s policy for determining the nature and amount of emoluments of Board members and senior
executives of the Company is as follows:
The remuneration structure for executive officers, including executive directors, is based on a number of factors,
including length of service, particular experience of the individual concerned, and overall performance of the
Company. The contracts for service between the Company, Directors and executives are on a continuing basis the
terms of which are not expected to change in the immediate future.
PERFORMANCE-BASED REMUNERATION
Performance based remuneration for key management personnel is limited to granting of options.
RELATIONSHIP BETWEEN REMUNERATION POLICY AND COMPANY PERFORMANCE
The remuneration policy has been tailored to increase goal congruence between shareholders, directors and
executives. The issue of options in past years to the majority of directors and executives is to encourage the
alignment of personal and shareholder interests. The company believes this policy will be effective in increasing
shareholder wealth.
PERFORMANCE CONDITIONS LINKED TO REMUNERATION
The group’s remuneration of key management personnel does not include any performance conditions.
EMPLOYMENT DETAILS OF MEMBERS OF KEY MANAGEMENT PERSONNEL AND OTHER EXECUTIVES
The following table provides employment details of persons who were, during the financial year, members of key
management personnel of the Group, and to the extent different, among the five Group executives or company
executives receiving the highest remuneration. The table also illustrates the proportion of remuneration that was
performance and non-performance-based and the proportion of remuneration received in the form of options.
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
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DIRECTORS’ REPORT
REMUNERATION REPORT (AUDITED) (continued)
Key Management Personnel
Position held during the
year ended 30 June 2016
Mr Phillip Jackson
Mr Paul Roberts
Mr David Kelly
Mr Philip Henty
Mr Tim Markwell
Mr Eric Moore
Non-Executive Chairman
Managing Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Company Secretary
Non-salary
cash-based
incentives
%
-
-
-
-
-
-
Options/
Rights
%
-
-
-
-
-
-
Fixed
Salary/Fees
%
100
100
100
100
100
-
Total
%
100
100
100
100
100
-
The employment terms and conditions of key management personnel and group executives are formalised upon each
Director's appointment. All non-executive directors are remunerated on a monthly basis with no fixed term or
termination benefits.
Paul Roberts, Managing Director, has entered into a contract of employment that requires 3 months’ notice of
voluntary termination of employment that entitles Mr Roberts to $31,200 as a termination benefit.
REMUNERATION DETAILS FOR THE PERIOD ENDED 30 JUNE 2016
The following table of benefits and payment details, in respect to the financial year, the components of remuneration
for each member of the key management personnel of the group and, to the extent different, the five group
executives and five company executives receiving the highest remuneration:
Table of Benefits and Payments for the Period Ended 30 June 2016
Key Management Personnel
Mr Philip Jackson(1)
Mr Paul Roberts
Mr David Kelly(2)
Mr Philip Harman (3)
Mr Philip Henty(4)
Mr Tim Markwell(5)
Mr Ian Hobson(6)
Mr Eric Moore(7)
Total Key Management
Personnel
Salary,
fees and
leave
$
27,500
26,041
126,739
164,384
10,127
-
-
12,500
5,327
30,725
6,436
32,812
-
72,550
-
-
176,129
339,012
2016
2015
2016
2015
2016
2015
2016
2015
2016
2015
2016
2015
2016
2015
2016
2015
2016
2015
Pension
and super-
annuation
$
Other
$
Shares/
Units
$
Options/
Rights
$
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
12,040
15,616
962
-
-
-
506
2,087
-
-
-
-
-
-
13,508
17,703
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Total
$
27,500
26,041
138,779
180,000
11,089
-
-
12,500
5,833
32,812
6,436
32,812
-
72,550
-
-
189,637
356,715
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
27
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
DIRECTORS’ REPORT
REMUNERATION REPORT (AUDITED) (continued)
(1) Appointed 4 December 2014
(2) Appointed 22 January 2016
(3) Resigned 25 November 2014
(4) Resigned 30 November 2015
(5) Resigned 17 December 2015
(6) Resigned 7 April 2015
(7) Appointed 7 April 2015. Mr Moore received no remuneration from the Company. Parent Aurora Minerals Limited provides company
secretarial, accounting and bookkeeping services to the Company under an Administration Services Agreement at the rate of $79,200 per
annum.
KEY MANAGEMENT PERSONNEL OPTIONS AND RIGHTS HOLDINGS
The number of options over ordinary shares held by each key management person of the group during the financial
year is as follows:
Balance at
beginning
of period
Granted as
remunerat-
ion during
the period
Expired
during the
period
Other changes
during the
period
Balance at
end of
period
Vested
during
the
period
Vested and
exercisable
Vested and
unexercis-
able
30 June 2016
Mr Philip Jackson
Mr Paul Roberts
Mr David Kelly(1)
Mr Philip Henty
Mr Tim Markwell(3)
Mr Eric Moore
-
4,700,000
-
1,600,000
-
-
6,300,000
-
-
- (1,700,000)
-
-
(600,000)
-
-
-
-
-
- (2,300,000) (1,000,000)
-
-
- 3,000,000
-
-
(1,000,000)(2)
-
-
-
-
-
3,000,000
-
-
- 3,000,000
-
-
-
-
-
-
-
-
- 3,000,000
-
-
-
-
-
-
-
(1) Mr Kelly was appointed a director of the Company on 22 January 2016
(2) Mr Henty resigned as a director of the Company on 30 November 2015
(3) Mr Markwell resigned as a director of the Company on 17 December 2015
30 June 2015
Mr Phillip Jackson
Mr Phillip Harman
Mr Paul Roberts
Mr Philip Henty
Mr Tim Markwell
Mr Eric Moore3
Mr Ian Hobson
Balance at
beginning
of period
-
2,095,469
4,825,000
2,826,563
-
-
1,000,000
10,747,032
Granted as
remunerat-
ion during
the period
Exercised
during the
period
Other
changes
during the
period
Balance at
end of
period
Vested
during
the
period
Vested and
exercisable
Vested and
unexercis-
able
-
-
(125,000)
- (1,226,563)
-
-
-
-
-
-
- 1,351,563
- (2,095,469)1
-
-
-
-
(1,000,000)2
(3,095,469)
-
4,700,000
1,600,000
-
-
-
6,300,000
-
-
- 4,700,000
- 1,600,000
-
-
-
-
-
-
- 6,300,000
-
-
-
-
-
-
-
(1) Mr Harman resigned as a director of the Company on 25 November 2014
(2) Mr Hobson resigned as secretary of the Company on 7 April 2015
(3) Mr Moore was appointed as secretary of the Company on 7 April 2015
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
28
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
DIRECTORS’ REPORT
REMUNERATION REPORT (AUDITED) (continued)
KEY MANAGEMENT PERSONNEL SHAREHOLDINGS
The number of ordinary shares in Predictive Discovery Limited held by each key management person of the group
during the financial year is as follows:
Balance at
beginning of
period
Granted as
remuneration
during the
period
Issued on
exercise of
options during
the period
Purchased
during the
period
Other changes
during the
period
Balance at end of
period
30 June 2016
Mr Phillip Jackson
Mr Paul Roberts
Mr David Kelly
Mr Philip Henty
Mr Tim Markwell
Mr Eric Moore
-
7,165,895
-
20,712,583
-
-
27,878,478
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
7,165,895
-
-
-
-
7,165,895
-
-
-
(20,712,583)
-
-
(20,712,583)
-
14,331,790
-
-
-
-
14,331,790
Balance at
beginning of
period
Granted as
remuneration
during the
period
Issued on
exercise of
options during
the period
Purchased
during the
period
Other changes
during the
period
Balance at end of
period
30 June 2015
Mr Phillip Harman
Mr Phillip Jackson
Mr Paul Roberts
Mr Philip Henty
Mr Tim Markwell
Mr Eric Moore
Mr Ian Hobson
5,969,311
-
5,165,895
17,212,583
-
-
60,000
28,407,789
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
3,581,587
-
2,000,000
3,500,000
-
-
-
9,081,587
(9,550,898)
-
-
-
-
-
(60,000)
(9,610,898)
-
-
7,165,895
20,712,583
-
-
-
27,878,478
SECURITIES RECEIVED THAT ARE NOT PERFORMANCE-BASED
No members of key management personnel received securities during the period which were not dependent upon the
performance of the group’s share price as part of their remuneration package.
CASH BONUSES, PERFORMANCE-RELATED BONUSES AND SHARE-BASED PAYMENTS
Options were granted as remuneration during the year to key management personnel and other executives as set out
in notes 16 and 22.
END OF THE REMUNERATION REPORT
Signed in accordance with a resolution of the Board of Directors:
Paul Roberts
Managing Director
22 September 2016
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
29
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2016
Finance income
Other income
Share based payments
Administrative payments
Foreign exchange gain/(expenses)
Impairment of exploration
Exploration expenditure pre-right to tenure
Loss before income tax
Income tax expense
Consolidated
Note
2016
$
2015
$
9,030
119,486
-
(725,970)
(20,325)
(7,197,867)
(48,401)
9,267
257,036
-
(1,055,013)
48,217
(6,320,272)
(124)
(7,864,047)
(7,060,889)
2
-
-
Loss from continuing operations
(7,864,047)
(7,060,889)
Other comprehensive income
Other comprehensive income
62,270
3,170
Total comprehensive loss for the year
(7,801,777)
(7,057,719)
Profit attributable to:
Members of the parent entity
(7,801,777)
(7,057,719)
(7,801,777)
(7,057,719)
Basic loss per share (cents per share)
Diluted loss per share (cents per share)
12
12
(0.773)
(0.773)
(1.281)
(1.281)
The accompanying notes form part of these financial statements
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
30
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2016
Current Assets
Cash and cash equivalents
Trade and other receivables
Other current assets
Total current assets
Non-Current Assets
Property, plant and equipment
Exploration expenditure
Total non-current assets
Total assets
Current Liabilities
Trade and other payables
Provisions
Total current liabilities
Total liabilities
Net Assets
Equity
Issued capital
Reserves
Accumulated losses
Total Equity
The accompanying notes form part of these financial statements
Consolidated
Note
2016
$
2015
$
3
4
5
6
7
9
625,917
181,266
-
807,183
717,648
188,141
-
905,789
113,759
3,675,061
3,788,820
180,703
10,338,343
10,519,046
4,596,003
11,424,835
79,280
16,095
95,375
95,375
322,522
20,285
342,807
342,807
4,500,628
11,082,028
10
11
25,401,246
2,023,686
(22,924,304)
24,180,869
1,961,416
(15,060,257)
4,500,628
11,082,028
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
31
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2016
CONSOLIDATED
At 1 July 2014
Loss for the year
Other comprehensive income
Total comprehensive loss for the year
Transactions with owners in their capacity as owners:
Share based payments
Issue of share capital
Transaction costs
At 30 June 2015
At 1 July 2015
Loss for the year
Other comprehensive income
Total comprehensive loss for the year
Transactions with owners in their capacity as owners:
Share based payments
Issue of share capital
Transaction costs
At 30 June 2016
Issued Capital
Accumulated Losses
Foreign Currency
Translation Reserve
Share Based
Payments
Reserve
Total
$
$
$
$
$
22,539,830
-
-
-
-
1,857,784
(216,745)
24,180,869
24,180,869
-
-
-
-
1,351,169
(130,792)
25,401,246
(7,999,368)
(7,060,889)
-
(7,060,889)
-
-
-
(15,060,257)
(15,060,257)
(7,864,047)
-
(7,864,047)
-
-
-
(22,924,304)
1,449,315
-
3,170
3,170
-
-
-
1,452,485
1,452,485
-
62,270
62,270
-
-
-
1,514,755
508,931
-
-
-
-
-
-
508,931
508,931
-
-
-
-
-
-
508,931
16,498,708
(7,060,889)
3,170
(7,057,719)
-
1,857,784
(216,745)
11,082,028
11,082,028
(7,864,047)
62,270
(7,801,777)
-
1,351,169
(130,792)
4,500,628
The accompanying notes form part of these financial statements
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
32
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2016
Cash flows from operating activities
Receipts from customers
GST receipts/(payments)
Payments to suppliers and employees
Note
Consolidated
2016
$
119,486
93
(737,536)
2015
$
257,036
(2,572)
(1,187,668)
Net cash provided by (used in) operating activities
21
(617,957)
(933,204)
Cash flows from investing activities
Interest received
Proceeds from refunds of tenement acquisitions
Proceeds from sales of property, plant and equipment
Purchase of property, plant and equipment
Payments for exploration expenditure
9,030
-
4,642
-
(702,469)
9,267
18,985
-
(5,606)
(1,005,780)
Net cash provided by (used in) investing activities
(688,797)
(983,134)
Cash flows from financing activities
Proceeds from issue of shares
Payment for share issue costs
1,301,169
(85,791)
1,857,784
(216,747)
Net cash inflow from financing activities
1,215,378
1,641,037
Foreign exchange differences
Net cash provided by (used in) other activities
(355)
(355)
42,124
42,124
Net increase (decrease) in cash held
(91,376)
(275,301)
Cash and cash equivalents at beginning of financial period
717,648
Cash and cash equivalents at end of the financial period
3
625,917
950,825
717,648
The accompanying notes form part of these financial statements
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
33
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2016
NOTES TO THE FINANCIAL STATEMENTS
This financial report includes the consolidated financial statements and notes of Predictive Discovery Limited and
controlled entities (the “group”).
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Predictive Discovery Limited is a for-profit company limited by shares, incorporated and domiciled in Australia.
The financial report is a general purpose financial statement that has been prepared in accordance with Australian
Accounting Standards, Australian Accounting Interpretations, other authoritative pronouncements of the Australian
Accounting Standards Board and the Corporations Act 2001.
Australian Accounting Standards set out accounting policies that the AASB has concluded would result in a financial
report containing relevant and reliable information about transactions, events and conditions. Compliance with
Australian Accounting Standards ensures that the financial statements and notes also comply with International
Financial Reporting Standards. Material accounting policies adopted in the preparation of this financial report are
presented below and have been consistently applied unless otherwise stated.
The financial report has been prepared on an accruals basis and is based on historical costs, modified, where
applicable, by the measurement at fair value of selected financial assets and financial liabilities.
These financial statements are presented in Australian dollars, rounded to the nearest dollar.
(a)
Principles of consolidation
The consolidated financial statements incorporate the assets, liabilities and results of entities controlled by Predictive
Discovery Limited at the end of the reporting period. A controlled entity is any entity over which Predictive Discovery
Limited has the power to govern the financial and operating policies so as to obtain benefits from the entity's activities.
Control will generally exist when the parent owns, directly or indirectly through subsidiaries, more than half of the
voting power of an entity. In assessing the power to govern, the existence and effect of holdings of actual and potential
voting rights are also considered.
Where controlled entities have entered or left the group during the year, the financial performance of those entities
are included only for the period of the year that they were controlled. A list of controlled entities is contained in Note
18 to the financial statements.
As at reporting date, the assets and liabilities of all controlled entities have been incorporated into the consolidated
financial statements as well as their results for the year then ended. Where controlled entities have entered (left) the
group during the year, their operating results have been included (excluded) from the date control was obtained
(ceased).
In preparing the consolidated financial statements, all inter-group balances and transactions between entities in the
group have been eliminated on consolidation. Accounting policies of subsidiaries have been changed where necessary
to ensure consistency with those adopted by the parent entity.
Non-controlling interests, being the equity in a subsidiary not attributable, directly or indirectly, to a parent, are shown
separately within the Equity section of the consolidated statement of financial position and consolidated statement of
comprehensive income. The non-controlling interests in the net assets comprise their interests at the date of the
original business combination and their share of changes in equity since that date.
Subsidiaries are accounted for in the parent entity at cost.
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
34
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2016
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(a)
Principles of consolidation (continued)
Business Combinations
Business combinations occur where an acquirer obtains control over one or more businesses and results in the
consolidation of its assets and liabilities.
A business combination is accounted for by applying the acquisition method, unless it is a combination involving
entities or businesses under common control. The acquisition method requires that for each business combination
one of the combining entities must be identified as the acquirer (i.e. parent entity). The business combination will be
accounted for as at the acquisition date, which is the date that control over the acquiree is obtained by the parent
entity.
At this date, the parent shall recognise, in the consolidated accounts, and subject to certain limited exceptions, the fair
value of the identifiable assets acquired and liabilities assumed. In addition, contingent liabilities of the acquiree will
be recognised where a present obligation has been incurred and its fair value can be reliably measured.
The acquisition may result in the recognition of goodwill or a gain from a bargain purchase. The method adopted for
the measurement of goodwill will impact on the measurement of any non-controlling interest to be recognised in the
acquiree where less than 100% ownership interest is held in the acquiree.
The acquisition date fair value of the consideration transferred for a business combination plus the acquisition date fair
value of any previously held equity interest shall form the cost of the investment in the separate financial statements.
Consideration may comprise the sum of the assets transferred by the acquirer, liabilities incurred by the acquirer to
the former owners of the acquiree and the equity interests issued by the acquirer.
Fair value uplifts in the value of pre-existing equity holdings are taken to the statement of comprehensive income.
Where changes in the value of such equity holdings had previously been recognised in other comprehensive income,
such amounts are recycled to profit or loss.
Included in the measurement of consideration transferred is any asset or liability resulting from a contingent
consideration arrangement. Any obligation incurred relating to contingent consideration is classified as either a
financial liability or equity instrument, depending upon the nature of the arrangement. Rights to refunds of
consideration previously paid are recognised as a receivable. Subsequent to initial recognition, contingent
consideration classified as equity is not remeasured and its subsequent settlement is accounted for within equity.
Contingent consideration classified as an asset or a liability is remeasured each reporting period to fair value through
the statement of comprehensive income unless the change in value can be identified as existing at acquisition date.
All transaction costs incurred in relation to the business combination are expensed to the statement of comprehensive
income.
(b)
Revenue and Other Income
Revenue is measured at the fair value of the consideration received or receivable after taking into account any trade
discounts and volume rebates allowed. Any consideration deferred is treated as the provision of finance and is
discounted at a rate of interest that is generally accepted in the market for similar arrangements. The difference
between the amount initially recognised and the amount ultimately received is interest revenue.
Interest revenue is recognised using the effective interest rate method. The effective interest rate method uses the
effective interest rate which is the rate that exactly discounts the estimated future cash receipts over the expected life
of the financial assets.
All revenue is stated net of the amount of goods and services tax (GST).
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
35
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2016
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(c)
Borrowing Costs
Borrowing costs directly attributable to the acquisition, construction or production of assets that necessarily take a
substantial period of time to prepare for their intended use or sale, are added to the cost of those assets, until such
time as the assets are substantially ready for their intended use or sale.
All other borrowing costs are recognised in income in the period in which they are incurred.
(d)
Income Tax
The income tax expense (revenue) for the year comprises current income tax expense (income) and deferred tax
expense (income).
Current income tax expense charged to the profit or loss is the tax payable on taxable income calculated using
applicable income tax rates enacted, or substantially enacted, as at the end of the reporting period. Current tax
liabilities (assets) are therefore measured at the amounts expected to be paid to (recovered from) the relevant
taxation authority.
Deferred income tax expense reflects movements in deferred tax asset and deferred tax liability balances during the
year as well as unused tax losses. Current and deferred tax expense (income) is charged or credited directly to equity
instead of the profit or loss when the tax relates to items that are credited or charged directly to equity.
Deferred tax assets and liabilities are ascertained based on temporary differences arising between the tax bases of
assets and liabilities and their carrying amounts in the financial statements. Deferred tax assets also result where
amounts have been fully expensed but future tax deductions are available. No deferred income tax will be recognised
from the initial recognition of an asset or liability, excluding a business combination, where there is no effect on
accounting or taxable profit or loss.
Deferred tax assets and liabilities are calculated at the tax rates that are expected to apply to the period when the
asset is realised or the liability is settled, based on tax rates enacted or substantively enacted at the end of the
reporting period. Their measurement also reflects the manner in which management expects to recover or settle the
carrying amount of the related asset or liability.
Deferred tax assets relating to temporary differences and unused tax losses are recognised only to the extent that it is
probable that future taxable profit will be available against which the benefits of the deferred tax asset can be utilised.
Where temporary differences exist in relation to investments in subsidiaries, branches, associates, and joint ventures,
deferred tax assets and liabilities are not recognised where the timing of the reversal of the temporary difference can
be controlled and it is not probable that the reversal will occur in the foreseeable future.
Current assets and liabilities are offset where a legally enforceable right of set-off exists and it is intended that net
settlement or simultaneous realisation and settlement of the respective asset and liability will occur. Deferred tax
assets and liabilities are offset where a legally enforceable right of set-off exists, the deferred tax assets and liabilities
relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable
entities where it is intended that net settlement or simultaneous realisation and settlement of the respective asset and
liability will occur in future periods in which significant amounts of deferred tax assets or liabilities are expected to be
recovered or settled.
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
36
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2016
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(e)
Employee Benefits
Provision is made for the company's liability for employee benefits arising from services rendered by employees to the
end of the reporting period. Employee benefits that are expected to be settled within one year have been measured
at the amounts expected to be paid when the liability is settled. Employee benefits payable later than one year have
been measured at present value of the estimated future cash outflows to be made for those benefits. In determining
the liability, consideration is given to employee wage increases and the probability that the employee may satisfy
vesting requirements. Those cashflows are discounted using market yields on corporate bonds with terms to maturity
that match the expected timing of cashflows.
Liabilities recognised in respect of employee benefits which are not expected to be settled within 12 months are
measured at the present value of the estimated future cash outflows to be made by The Group in respect of services
provided by employees up to reporting date.
(f)
Provisions
Provisions are recognised when The Group has a legal or constructive obligation, as a result of past events, for which it
is probable that an outflow of economic benefits will result and that outflow can be reliably measured.
The liability for long service leave is recognised in current and non-current liabilities, depending on the unconditional
right to defer settlement of the liability for at least 12 months after the reporting date.
(g)
Foreign Currency Transactions and Balances
The functional currency of each of the group's entities is measured using the currency of the primary economic
environment in which that entity operates. The consolidated financial statements are presented in Australian dollars
which is the parent entity's functional and presentation currency. All other companies within The Group have
Australian dollars as their functional currency.
Foreign currency transactions are translated into functional currency using the exchange rates prevailing at the date of
the transaction. Foreign currency monetary items are translated at the year-end exchange rate. Non-monetary items
measured at historical cost continue to be carried at the exchange rate at the date of the transaction. Non-monetary
items measured at fair value are reported at the exchange rate at the date when fair values were determined.
Exchange differences arising on the translation of monetary items are recognised in the consolidated statement of
comprehensive income, except where deferred in equity as a qualifying cash flow or net investment hedge.
Exchange differences arising on the translation of non-monetary items are recognised directly in equity to the extent
that the gain or loss is directly recognised in equity, otherwise the exchange difference is recognised in the
consolidated statement of comprehensive income.
The financial results and position of foreign operations whose functional currency is different from the group's
presentation currency are translated as follows:
•
•
•
assets and liabilities are translated at year-end exchange rates prevailing at that reporting date;
income and expenses are translated at average exchange rates for the period; and
retained earnings are translated at the exchange rates prevailing at the date of the transaction.
Exchange differences arising on translation of foreign operations are transferred directly to the group's foreign
currency translation reserve in the consolidated statement of financial position. These differences are recognised in
the consolidated statement of comprehensive income in the period in which the operation is disposed.
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
37
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2016
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(h)
Cash and Cash Equivalents
Cash and cash equivalents include cash on hand, deposits held at call with banks, other short term highly liquid
investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within
short term borrowings in current liabilities in the statement of financial position.
(i)
Financial Instruments
Initial recognition and measurement
Financial assets and financial liabilities are recognised when the entity becomes a party to the contractual provisions to
the instrument. For financial assets, this is the equivalent to the date that the group commits itself to either the
purchase or sale of the asset (i.e. trade date accounting is adopted). Financial instruments are initially measured at fair
value plus transactions costs, except where the instrument is classified 'at fair value through profit or loss', in which
case transaction costs are expensed to profit or loss immediately.
Classification and subsequent measurement
Financial instruments are subsequently measured at either of fair value, amortised cost using the effective interest rate
method, or cost. Fair value represents the amount for which an asset could be exchanged or a liability settled, between
knowledgeable, willing parties. Where available, quoted prices in an active market are used to determine fair value. In
other circumstances, valuation techniques are adopted.
Amortised cost is calculated as:
(a)
(b)
(c)
the amount at which the financial asset or financial liability is measured at initial recognition;
less principal repayments;
plus or minus the cumulative amortisation of the difference, if any, between the amount initially recognised and
the maturity amount calculated using the effective interest method; and
less any reduction for impairment.
(d)
The effective interest method is used to allocate interest income or interest expense over the relevant period and is
equivalent to the rate that exactly discounts estimated future cash payments or receipts (including fees, transaction
costs and other premiums or discounts) through the expected life (or when this cannot be reliably predicted, the
contractual term) of the financial instrument to the net carrying amount of the financial asset or financial liability.
Revisions to expected future net cash flows will necessitate an adjustment to the carrying value with a consequential
recognition of an income or expense in profit or loss.
The group does not designate any interests in subsidiaries, associates or joint venture entities as being subject to the
requirements of accounting standards specifically applicable to financial instruments.
Financial assets at fair value through profit or loss
(i)
Financial assets are classified at ‘fair value through profit or loss’ when they are either held for trading for the purpose
of short term profit taking, derivatives not held for hedging purposes, or when they are designated as such to avoid an
accounting mismatch or to enable performance evaluation where a group of financial assets is managed by key
management personnel on a fair value basis in accordance with a documented risk management or investment
strategy. Such assets are subsequently measured at fair value with changes in carrying value being included in profit or
loss.
Loans and receivables
(ii)
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in
an active market and are subsequently measured at amortised cost.
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
38
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2016
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(i)
Financial Instruments (continued)
Loans and receivables are included in current assets, except for those which are not expected to mature within 12
months after the end of the reporting period. (All other loans and receivables are classified as non-current assets).
(iii) Held-to-maturity investments
Held-to-maturity investments are non-derivative financial assets that have fixed maturities and fixed or determinable
payments, and it is the group's intention to hold these investments to maturity. They are subsequently measured at
amortised cost.
Held-to-maturity investments are included in non-current assets, except for those which are expected to mature within
12 months are the end of the reporting period. (All other investments are classified as current assets).
If during the period the group sold or reclassified more than an insignificant amount of the held to maturity
investments before maturity, the entire held-to-maturity investments category would be tainted and reclassified as
available for sale.
Available for sale financial assets
(iv)
Available for sale financial assets are non-derivative financial assets that are either not suitable to be classified into
other categories of financial assets due to their nature, or they are designated as such by management. They comprise
investments in the equity of other entities where there is neither a fixed maturity nor fixed or determinable payments.
Available for sale financial assets are included in non-current assets, except for those which are expected to mature
within 12 months after the end of the reporting period. (All other financial assets are classified as current assets).
Financial liabilities
(v)
Non-derivative financial liabilities (excluding financial guarantees) are subsequently measured at amortised cost.
Derecognition
Financial assets are derecognised where the contractual rights to receipt of cash flows expires or the asset is
transferred to another party whereby the entity no longer has any significant continuing involvement in the risks and
benefits associated with the asset. Financial liabilities are derecognised where the related obligations are either
discharged, cancelled or expired. The difference between the carrying value of the financial liability extinguished or
transferred to another party and the fair value of consideration paid, including the transfer of non-cash assets or
liabilities assumed is recognised in profit or loss.
(j)
Property, Plant and Equipment
Each class of property, plant and equipment is carried at cost or fair value as indicated, less, where applicable, any
accumulated depreciation and impairment losses.
Plant and Equipment
Plant and equipment are measured on the cost basis.
Depreciation
The depreciable amount of all fixed assets is depreciated on a straight line basis over the asset's useful life to the group
commencing from the time the asset is held ready for use.
Leasehold improvements are depreciated over the shorter of either the unexpired period of the lease or the estimated
useful lives of the improvements.
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
39
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2016
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(j)
Property, Plant and Equipment (continued)
The estimated useful lives used for each class of depreciable assets are:
Class of Fixed Asset
Plant and Equipment
Useful Life
2 - 20 years
The assets' residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting
period.
An asset's carrying amount is written down immediately to its recoverable amount if the asset's carrying amount is
greater than its estimated recoverable amount.
Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains and
losses are included in the consolidated statement of comprehensive income.
Property, plant and equipment is derecognised and removed from the consolidated statement of financial position on
disposal or when no future economic benefits are expected. Gains and losses from derecognition are measured as the
difference between the net disposal proceeds, if any, and the carrying amount and are recognised in profit or loss.
Subsequent costs are included in the property, plant and equipment's carrying value or recognised as a separate asset
when it is probable that future economic benefits associated with the item will be realised and the cost of the item can
be measured reliably. All other repairs and maintenance are recognised in profit or loss.
Where required by accounting standards comparative figures have been adjusted to conform with changes in
presentation for the current financial year.
(k)
Exploration and Development Expenditure
Costs Carried Forward
Costs arising from exploration and evaluation activities are carried forward where the rights to tenure for the area of
interest are current and such costs are expected to be recouped through successful development, or by sale, or where
exploration and evaluation activities have not, at reporting date, reached a stage to allow a reasonable assessment
regarding the existence of economically recoverable reserves.
Costs carried forward in respect of an area of interest that is abandoned are written off in the period in which the
decision to abandon is made.
Contributions received from third parties in exchange for participating interests in exploration and evaluation
tenements (e.g. as part of farm out arrangements) are netted off against the costs carried forward in respect of those
tenements in which the third party acquires a participating interest.
(l)
Impairment of Assets
At each reporting date, the group assesses whether there is any indication that an asset may be impaired. The
assessment will include considering external sources of information including, dividends received from subsidiaries,
associates or jointly controlled entities deemed to be out of pre-acquisition profits. If such an indication exists, an
impairment test is carried out on the asset by comparing the recoverable amount of the asset, being the higher of the
asset's fair value less costs to sell and value in use to the asset's carrying value. Any excess of the asset's carrying value
over its recoverable amount is expensed to the consolidated statement of comprehensive income.
Impairment testing is performed annually for goodwill and intangible assets with indefinite lives.
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
40
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2016
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(l)
Impairment of Assets (continued)
Where an impairment loss on a revalued asset is identified, this is debited against the revaluation surplus in respect of
the same class of asset to the extent that the impairment loss does not exceed the amount in the revaluation surplus
for that same class of asset.
Non-financial assets, other than inventories, deferred tax assets, assets from employee benefits, investment properties
and deferred acquisition costs, are assessed for any indication of impairment at the end of each reporting period. Any
indication of impairment requires formal testing of impairment by comparing the carrying amount of the asset to an
estimate of the recoverable amount of the asset. An impairment loss is calculated as the amount by which the carrying
amount of the asset exceeds the recoverable amount of the asset.
Intangible assets with an indefinite useful life and intangible assets not yet available for use are tested for impairment
annually regardless of whether there is any indication of impairment.
The recoverable amount is the greater of the asset's fair value less costs to sell and its value in use. The asset's value in
use is calculated as the estimated future cash flows discounted to their present value using a pre-tax rate that reflects
current market assessments of the time value of money and the risks associated with the asset. Assets that cannot be
tested individually for impairment are grouped together into the smallest group of assets that generates cash inflows
(the asset's cash generating unit).
Impairment losses are recognised in profit or loss. Impairment losses are allocated first, to reduce the carrying amount
of any goodwill allocated to cash generating units, and then to other assets of the group on a pro rata basis.
Assets other than goodwill are assessed at the end of each reporting period to determine whether previously
recognised impairment losses may no longer exist or may have decreased. Impairment losses recognised in prior
periods for assets other than goodwill are reversed up to the carrying amounts that would have been determined had
no impairment loss been recognised in prior periods.
(m)
Trade and Other Payables
Trade and other payables represent the liability outstanding at the end of the reporting period for goods and services
received by the group during the reporting period which remain unpaid. The balance is recognised as a current liability
with the amounts normally paid within 30 days of recognition of the liability.
(n)
Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is
not recoverable from the Tax Office. In these circumstances the GST is recognised as part of the cost of acquisition of
the asset or as part of an item of the expense. Receivables and payables in the consolidated statement of financial
position are shown inclusive of GST.
(o)
Leases
Leases of fixed assets where substantially all the risks and benefits incidental to the ownership of the asset but not the
legal ownership that are transferred to entities in the group are classified as finance leases.
Finance leases are capitalised by recording an asset and a liability at the lower of the amounts equal to the fair value of
the leased property or the present value of the minimum lease payments, including any guaranteed residual values.
Lease payments are allocated between the reduction of the lease liability and the lease interest expense for the period.
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
41
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2016
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(p)
Earnings Per Share
Basic loss per share is calculated as net loss attributable to members of the group divided by the weighted average
number of ordinary shares. Diluted loss per share is calculated by adjusting the net loss attributable to members of
the group and the number of shares outstanding for the effects of all dilutive potential ordinary shares, which include
shares options.
(q)
Contributed Equity
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options
are shown as a deduction, net of tax, from the proceeds.
(r)
Share-based Payment Transactions
Employees of the group receive remuneration in the form of share based payment transactions, whereby employees
render services in exchange for equity instruments ("equity settled transactions"). When the goods or services
acquired in a share based payment transaction do not qualify for recognition as assets, they are recognised as
expenses.
The cost of equity settled transactions and the corresponding increase in equity is measured at the fair value of the
goods or services acquired. Where the fair value of the goods or services received cannot be reliably estimated, the
fair value is determined indirectly by the fair value of the equity instruments using the Black Scholes option valuation
technique.
Equity-settled transactions that vest after employees complete a specified period of service are recognised as services
are received during the vesting period with a corresponding increase in equity.
(s)
Critical Accounting Estimates and Judgements
The directors evaluate estimates and judgments incorporated into the financial statements based on historical
knowledge and best available current information. Estimates assume a reasonable expectation of future events and
are based on current trends and economic data, obtained both externally and within The Group.
Key estimates – Impairment
The group assesses impairment at the end of each reporting period by evaluating conditions specific to the group that
may be indicative of impairment triggers. Recoverable amounts of relevant assets are reassessed using fair value less
cost to sell or value-in-use calculations which incorporate various key assumptions.
Key judgements – Exploration and Evaluation Expenditure
The group capitalises expenditure relating to exploration and evaluation where it is considered likely to be recoverable
or where the activities have not reached a stage which permits a reasonable assessment of the existence of reserves.
$3,675,601 has been capitalised as at 30 June 2016 (see note 6). While there are certain areas of interest from which
no reserves have been extracted, the directors are of the continued belief that such expenditure should not be written
off since feasibility studies in such areas have not yet concluded and there are no facts of circumstances that suggest
the carrying amounts of the exploration and evaluation assets recognised exceed their recoverable amount.
In assessing the recoverability of the carrying amounts, the Directors have determined that as with similar companies,
future capital raisings will be required in order to continue the exploration and development of the company's mining
tenements (some subject to an option payment) to achieve a position where they can prove exploration reserves.
Should there be no funding available, exploration of the areas of interest may be put on hold. The recoverability of
the exploration asset is dependent upon the continued exploration of each area of interest.
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
42
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2016
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(s)
Critical Accounting Estimates and Judgements (continued)
Key Judgements – Share-based payment transactions
The group measures the cost of equity settled transactions with employees by reference to the fair value of the equity
instruments at the date at which they are granted. The fair value is determined using the Black Scholes method. The
related assumptions are detailed in note 22. 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.
Key Judgements - Going Concern
For the year ended 30 June 2016 the Group made a loss of $7,801,777 (2015: loss $7,057,719). Notwithstanding this
the financial report has been prepared using the going concern basis. The Directors have determined that as with
similar companies, future capital raisings will be required in order to continue the exploration and development of the
company's mining tenements (some subject to an option payment) and meet operational expenditure at current
levels to achieve a position where they can prove exploration reserves. The ability of the company to continue as a
going concern is dependent upon the company raising additional capital sufficient to meet the company's exploration
commitments and operational commitments. Should there be no funding available, exploration of the areas of
interest may be put on hold. The recoverability of the exploration asset is dependent upon the continued exploration
of each area of interest.
The Directors have prepared a cash flow forecast for the foreseeable future reflecting this expectation and their effect
upon the company. The achievement of the forecast is dependent upon the future capital raising, the outcome of
which is uncertain.
Key Judgements - Recoverability of Intercompany Loan
Within Non-current assets of the parent entity (see note 20) there is a loan due from the 100% subsidiaries of
$18,214,918 which is considered fully recoverable. The recoverability of this loan is dependent upon the successful
development or sale of exploration assets in Burkina Faso.
Adoption of New and Revised Accounting Standards
(t)
In the current year, the group has adopted all of the new and revised Standards and Interpretations issued by the
AASB that are relevant to its operations and effective for the current annual reporting period. The adoption of these
new and revised Standards and Interpretations has not resulted in a significant or material change to the group’s
accounting policies.
New accounting standards issued but not yet effective
Accounting Standards and Interpretations issued by the AASB that are not yet mandatorily applicable to the Group,
together with an assessment of the potential impact of such pronouncements on the Group when adopted in future
periods, are discussed below:
Financial Instruments (effective from 1 January 2018)
AASB 9
AASB 9 will replace AASB 139: Financial Instruments: Recognition and Measurement. The key changes that may affect
the Group on initial application of AASB 9 and associated amending Standards include:
simplifying the general classifications of financial assets into those carried at amortised cost and those carried
at fair value;
permitting entities to irrevocably elect on initial recognition to present gains and losses on an equity
instrument that is not held for trading in other comprehensive income (OCI);
simplifying the requirements for embedded derivatives, including removing the requirements to separate and
fair value embedded derivatives for financial assets carried at amortised cost;
requiring an entity that chooses to measure a financial liability at fair value to present the portion of the
change in its fair value due to changes in the entity’s own credit risk in OCI, except when it would create an
‘accounting mismatch’;
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
43
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2016
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(t) Adoption of New and Revised Accounting Standards (continued)
introducing a new model for hedge accounting that permits greater flexibility in the ability to hedge risk,
particularly with respect to non-financial items; and
requiring impairment of financial assets carried at amortised cost based on an expected loss approach.
Although the directors anticipate that the adoption of AASB 9 may have an impact on the Group’s financial
instruments, including hedging activity, it is impracticable at this stage to provide a reasonable estimate of such
impact.
AASB 15 Revenue from Contracts with Customers (effective from 1 January 2018)
AASB 15 will provide (except in relation to some specific exceptions, such as lease contracts and insurance contracts) a
single source of accounting requirements for all contracts with customers, thereby replacing all current accounting
pronouncements on revenue.
These Standards provide a revised principle for recognising and measuring revenue. Under AASB 15, revenue is
recognised in a manner that depicts the transfer of promised goods or services to customers in an amount that
reflects the consideration to which the provider of the goods or services expects to be entitled. The give effect to this
principle, AASB 15 requires the adoption of the following 5-step model:
identify the contract(s) with a customer;
identify the performance obligations under the contract(s);
determine the transaction price;
allocate the transaction price to the performance obligations under the contract(s); and
recognise revenue when (or as) the entity satisfies the performance obligations.
AASB 15 also provides additional guidance to assist entities in applying the revised principle to licences of intellectual
property, warranties, rights of return, principal/agent considerations and options for additional goods and services.
This Standard will require retrospective restatement, as well as enhanced disclosures regarding revenue.
Although the directors anticipate that the adoption of AASB 15 may have an impact on the group’s financial
statements, it is impracticable at this stage to provide a reasonable estimate of such impact.
AASB 16 Leases (effective from 1 January 2019)
Under IFRS 16 there is no longer a distinction between finance and operating leases. Lessees will now bring to
account a right-to-use asset and lease liability onto their balance sheets for all leases. Effectively this means the vast
majority of operating leases as defined by the current AASB 117 Leases which currently do not impact the balance
sheet will be required to be capitalised on the balance sheet once IFRS 16 is adopted.
Although the directors anticipate that the adoption of AASB 16 may have an impact on the group’s financial
statements, it is impracticable at this stage to provide a reasonable estimate of such impact.
AASB 2016-5 Amendments to Australian Accounting Standards – Classification and Measurement of Share-based
Payment Transactions (effective from 1 January 2018)
This Standard amends AASB 2 Share-based Payment to address:
(a) the accounting for the effects of vesting and non-vesting conditions on the measurement of cash-settled share
based payments;
(b) the classification of share-based payment transactions with a net settlement feature for withholding tax
obligations; and
(c) the accounting for a modification to the terms and conditions of a share-based payment that changes the
classification of the transaction from cash-settled to equity-settled.
Although the directors anticipate that the adoption of AASB 2016-5 may have an impact on the group’s financial
statements, it is impracticable at this stage to provide a reasonable estimate of such impact.
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
44
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2016
Consolidated
2016
$
2015
$
NOTE 2: INCOME TAX
(a)
Income tax recognised in profit or loss
Tax expense/(revenue) comprises:
Current tax expense/(revenue)
Under/(over) provision in prior year
Deferred tax expense/(revenue) relating to the origination and reversal of
temporary difference
Tax losses not recognised
Income tax expense/(revenue)
(255,447)
-
(1,721,068)
1,976,515
-
The prima facie income tax expense on pre-tax accounting profit from
operations reconciles to the income tax in the financial statements as
follows:
Profit/(loss) from operations
Income tax expense/(revenue) calculated at 30% (2015: 30%)
Under / (over) provision in prior year
Tax effect of employee options
Tax effect of FX loss
Tax effect of capital raising costs not recognised
Tax effect on other items
Tax losses not recognised
(7,864,047)
(2,359,214)
-
-
(9,118)
(64,259)
456,076
1,976,515
-
(723,094)
17,736
(1,510,484)
2,215,842
-
(7,057,715)
(2,117,315)
17,736
-
(15,417)
(101,037)
191
2,215,842
-
Income tax rate
The tax rate used in the above reconciliation is the corporate tax rate of 30% payable by the Australian corporate
entities on taxable profits under the Australian tax law. There has been no change in the corporate tax rate when
compared with the previous year.
NOTE 3: CASH AND CASH EQUIVALENTS
Cash at bank
NOTE 4: TRADE AND OTHER RECEIVABLES
Other receivables
2016
$
2015
$
625,917
625,917
717,648
717,648
181,266
181,266
188,141
188,141
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
45
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2016
NOTE 5: PLANT AND EQUIPMENT
Plant and Equipment
Accumulated depreciation
Consolidated
2016
$
2015
$
478,337
(364,578)
113,759
545,222
(364,519)
180,703
A reconciliation of the carrying amounts of each class of plant and equipment between the beginning of the current
financial year is set out below:
Balance at 30 June 2016
Balance at the beginning of year
Disposals (carrying value)
Depreciation expense
Movement in exchange rate
Balance at 30 June 2016
Balance at 30 June 2015
Balance at the beginning of year
Reclassification of assets to exploration
Additions
Depreciation expense
Movement in exchange rate
Balance at 30 June 2015
NOTE 6: EXPLORATION, EVALUATION AND DEVELOPMENT ASSETS
Exploration and evaluation expenditure
2016
Balance at beginning of the year
Expenditure incurred
Impairment
Balance at the end of the year
2015
Balance at beginning of the year
Expenditure incurred
Impairment
Balance at end of the year
Plant and
Equipment
$
180,703
-
(74,225)
7,281
113,759
303,885
(27,297)
5,598
(79,077)
(22,406)
180,703
Total
$
180,703
-
(74,225)
7,281
113,759
303,885
(27,297)
5,598
(79,077)
(22,406)
180,703
Consolidated
2016
$
2015
$
3,675,061
3,675,061
10,338,343
10,338,343
Exploration and
Evaluation
$
10,338,343
534,585
(7,197,867)
3,675,061
15,639,370
1,019,370
(6,320,397)
10,338,343
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
46
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2016
NOTE 6: EXPLORATION, EVALUATION AND DEVELOPMENT ASSETS (continued)
The recoverability of the carrying amount of the exploration and evaluation assets is dependent on successful
development and commercial exploitation, or alternatively, sale of the respective areas of interest. The board has
assessed the exploration and evaluation assets for impairment, using AASB 6 paragraph 20 as a guide. As a result of
this process 13 tenements were impaired during the period.
The budget for future exploration and evaluation expenditure is split by geographical area and not by area of interest
as the allocation of resources will depend upon findings. However, it is acknowledged that the budget allows for
spending on all areas of interest without exclusion. It is anticipated that all expenditure required by agreement or
permit will be met.
In assessing the recoverability of the carrying amounts, reference is made to Note 1 (S) - Key Judgements - Exploration
and Evaluation Expenditure and Going Concern. The Directors have determined that as with similar companies, future
capital raisings will be required in order to continue the exploration and development of the company's mining
tenements (some subject to an option payment) to achieve a position where they can prove exploration reserves.
Should there be no funding available, exploration of the areas of interest may be put on hold. The recoverability of
the exploration asset is dependent upon the continued exploration of each area of interest.
NOTE 7: CURRENT TRADE AND OTHER PAYABLES
Accruals and other creditors
NOTE 8: TAX ASSETS AND LIABILITIES
(a) Assets
Current
Income tax refundable
Non-current
Deferred tax asset comprises:
Employee entitlements
Accruals and payables
Cancellation of licence
Tax losses
Amount not recognised
(b) Liabilities
Current
Income tax liabilities
Less: PAYG instalments paid
Income tax payable
Non-current
Deferred tax liability comprises:
Exploration expenditure
Amount not recognised
Net DTA/DTL
Consolidated
2016
$
2015
$
79,280
79,280
322,522
322,522
-
-
-
-
4,829
6,450
36,000
5,904,876
(5,952,155)
-
-
-
-
-
-
-
6,086
7,500
54,000
5,825,356
(5,892,942)
-
-
-
-
(1,080,770)
1,080,770
-
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
47
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2016
NOTE 8: TAX ASSETS AND LIABILITES (continued)
(c) Reconciliation
(i) Gross Movements
The overall movement in the deferred tax balance is as follows:
Opening balance
Under/(over) provision in prior year
Credited/(charged) to the income statement
Amount not recognised
Closing balance
(ii) Deferred tax assets
The movement in deferred tax assets for each temporary difference during the
year is as follows:
Employee Entitlements
Opening balance
Credited/(charged) to the income statement
Amount not recognised
Closing balance
Accruals and payables
Opening balance
Credited/(charged) to the income statement
Amount not recognised
Closing balance
Tax Losses
Opening balance
Under/(over) provision in prior year
Credited/(charged) to the income statement
Amount not recognised
Closing balance
Cancellation of Licence
Opening balance/previous amounts not recognised
Credited/(charged) to the income statement
Amount not recognised
Closing balance
Exploration Expenditure
Opening balance
Credited/(charged) to the income statement
Amount not recognised
Closing balance
Consolidated
2016
$
2015
$
4,812,172
(175,927)
1,976,514
(6,612,759)
-
2,596,330
(17,736)
2,233,578
(4,812,172)
-
6,086
(1,257)
(4,829)
-
7,500
(1,050)
(6,450)
-
5,825,356
(175,927)
255,447
(5,904,876)
-
54,000
(18,000)
(36,000)
-
-
660,604
(660,604)
-
5,853
233
(6,086)
-
9,000
(1,500)
(7,500)
-
5,119,999
(17,736)
723,093
(5,825,356)
-
72,000
(18,000)
(54,000)
-
-
-
-
-
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
48
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2016
NOTE 8: TAX ASSETS AND LIABILITES (continued)
(iii) Deferred tax liability
Exploration Expenditure
Opening balance
Under/(over) provision in prior year
Credited/(charged) to the income statement
Amount not recognised
Closing balance
NOTE 9: PROVISIONS
CURRENT
Employee entitlements
NOTE 10: ISSUED CAPITAL
1,326,168,686 (30 June 2015: 650,584,343) Ordinary Shares
Share issue costs written off against issued capital
At 1 July 2014
Issue of shares in placement
Issue of shares in rights issue
Options cancelled/expired
At 30 June 2015
At 1 July 2015
Issue of shares in rights issue
Issue of shares for underwriting services
Issue of shares for other services
Options cancelled/expired
At 30 June 2016
OPTIONS
Shares
No.
387,865,214
18,750,000
243,969,129
-
650,584,343
650,584,343
650,584,343
22,500,000
2,500,000
-
1,326,168,686
Consolidated
2016
$
2015
$
1,080,770
-
(1,080,770)
-
-
2,610,522
-
(1,529,752)
(1,080,770)
-
16,095
16,095
20,285
20,285
27,215,993
(1,814,247)
25,401,746
25,864,824
(1,683,955)
24,180,869
Listed
Options
No.
Unlisted Options
No.
25,631,075
-
-
(9,131,075)
16,500,000
16,500,000
-
-
-
(8,500,000)
8,000,000
-
-
-
-
-
-
-
-
-
-
For information relating to Predictive Discovery Limited employee option plan, including details of options issued,
exercised and lapsed during the financial year and the options outstanding at year end, refer to Note 22.
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
49
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2016
NOTE 11: RESERVES
FOREIGN CURRENCY TRANSLATION RESERVE
Exchange differences arising on translation of the foreign controlled entity are recognised in other comprehensive
income foreign currency translation reserve. The cumulative amount is reclassified to profit or loss when the net
investment is disposed of.
OPTION RESERVE
The option reserve records items recognised as expenses on valuation of employee share options.
Consolidated
2016
$
2015
$
NOTE 12: EARNINGS PER SHARE
Reconciliation of loss
Loss used in calculating earnings per share – basic and diluted
Net loss for the reporting period
(7,864,047)
(7,864,047)
(7,060,889)
(7,060,889)
Weighted average number of ordinary shares outstanding during the
year used in the calculation of basic and diluted earnings per share
1,017,432,114
551,201,748
NOTE 13: CAPITAL AND LEASING COMMITMENTS
(A) LEASE COMMITMENTS
Payable – minimum lease payments:
-not later than 12 months
-between 12 months and 5 years
(B) OPTIONS FEE COMMITMENTS
Payable – minimum lease payments:
-not later than 12 months
-between 12 months and 5 years
-more than 5 years
(C) CAPITAL EXPENDITURE COMMITMENTS
Payable:
-not later than 12 months
-not later than 12 months and 5 years
-more than 5 years
Consolidated
2016
$
2015
$
42,536
170,145
212,681
40,318
463,654
-
503,972
40,054
164,624
204,678
398,412
166,549
55,516
620,477
2,573,417
6,596,864
-
9,170,281
2,852,334
7,695,339
-
10,547,673
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
50
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2016
NOTE 14: FINANCIAL RISK MANAGEMENT
The group's financial instruments consist mainly of deposits with banks, receivables and payables.
The totals for each category of financial instruments, measured in accordance with AASB 139 as detailed in the
accounting policies to these financial statements, are as follows:
Financial Assets
Cash and cash equivalents
Trade and other receivables
Total Financial Assets
Financial Liabilities
Trade and other payables
Total Financial Liabilities
FINANCIAL RISK MANAGEMENT POLICIES
Consolidated
Note
3
4
7
2016
$
625,917
181,266
807,183
79,280
79,280
2015
$
717,648
188,141
905,789
322,522
322,522
Exposure to key financial risks is managed in accordance with the group’s risk management policy with the objective to
ensure that the financial risks inherent in exploration activities are identified and then managed or kept as low as
reasonably practicable.
The main financial risks that arise in the normal course of business are market risk (including currency risk, interest rate
risk and price risk), credit risk and liquidity risk. Different methods are used to measure and manage these risk
exposures. Liquidity risk is monitored through the ongoing review of available cash and future commitments for
exploration expenditure.
Exposure to liquidity risk is limited by anticipating liquidity shortages and ensures capital can be raise in advance of
shortages. Interest rate risk is managed by limiting the amount of interest bearing loans entered into by The Group. It
is the Board's policy that no speculative trading in financial instruments be undertaken so as to limit expose to price
risk.
Primary responsibility for identification and control of financial risks rests with the Company Secretary, under the
authority of the Board. The Board is apprised of these risks from time to time and agrees any policies that may be
undertaken to manage any of the risks identified.
Details of the significant accounting policies and methods adopted, including criteria for recognition, the basis of
measurement and the basis on which income and expenses are recognised, in respect of each financial instrument are
disclosed in Note 1 to the financial statements. The carrying values less the impairment allowance for receivables and
payables are assumed to approximate fair values due to their short term nature. Cash and cash equivalents are
subject to variable interest rates.
SPECIFIC FINANCIAL RISK EXPOSURES AND MANAGEMENT
(A)
CREDIT RISK
Exposure to credit risk relating to financial assets arises from the potential non-performance by counter parties of
contract obligations that could lead to a financial loss to the group.
The group trades only with recognised, creditworthy third parties.
The group has no customers and consequently no significant exposure to bad debts or other credit risks.
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
51
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2016
NOTE 14: FINANCIAL RISK MANAGEMENT (continued)
With respect to credit risk arising from financial assets, which comprise cash and cash equivalents and receivables, the
exposure to credit risk arises from default of the counter party, with a maximum exposure equal to the carrying
amount of these instruments. At balance date cash and deposits were held with Australia and New Zealand Banking
Group Limited.
(B)
LIQUIDITY RISK
Liquidity risk arises from the possibility that the group might encounter difficulty in settling its debts or otherwise
meeting its obligations related to financial liabilities.
Prudent liquidity risk management implies maintaining sufficient cash reserves to meet the ongoing operational
requirements of the business. It is the group’s policy to maintain sufficient funds in cash and cash equivalents.
Furthermore, the group monitors its ongoing exploration cash requirements and raises equity funding as and when
appropriate to meet such planned requirements. The group has no undrawn financing facilities. Trade and other
payables, the only financial liability of the group, are due within 6 months.
The tables below reflect an undiscounted contractual maturity analysis for financial liabilities.
Cash flows realised from financial assets reflect management's expectation as to the timing of realisation. Actual
timing may therefore differ from that disclosed. The timing of cash flows presented in the table to settle financial
liabilities reflects the earliest contractual settlement dates and does not reflect management's expectations that
banking facilities will be rolled forward.
Financial liability and financial asset maturity analysis
Within 1 Year
1 to 5 Years
Total Contractual Cash Flow
2016
$
2015
$
2016
$
2015
$
2016
$
2015
$
Financial liabilities due for
payment
Trade and other payables
Total contractual outflows
Financial assets - cash flows
realisable
Trade and other receivables
Total anticipated inflows
79,280
79,280
322,522
322,522
181,266
181,266
188,141
188,141
-
-
-
-
-
-
-
-
79,280
79,280
322,522
322,522
181,266
181,266
188,141
188,141
The financial assets and liabilities noted above are interest free.
(C) MARKET RISK
Interest rate risk
i.
The group’s cash flow interest rate risk primarily arises from cash at bank and deposits subject to market bank rates.
At balance date, the group does not have any borrowings. The group does not enter into hedges. An increase/
(decrease) in interest rates by 1% during the whole of the respective periods would have led to an increase/(decrease)
in both equity and losses of less than $10,000. 1% was thought to be appropriate because it represents four 0.25 basis
point rate rises/falls, which is appropriate in the recent economic climate. The majority of cash held in a cash
management account earns interest income at a rate of 0.1% p.a.
Foreign exchange risk
ii.
Exposure to foreign exchange risk may result in the fair value or future cash flows of a financial instrument fluctuating
due to movement in foreign exchange rates of currencies in which the group holds foreign currency which are other
than the AUD functional currency of the group.
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
52
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2016
NOTE 15: OPERATING SEGMENTS
Identification of Reportable Segments
The group has identified its operating segments based on the internal reports that are reviewed and used by the
Board of Directors (chief operating decision makers) in assessing performance and determining the allocation of
resources.
The accounting policies applied for internal purposes are consistent with those applied in the preparation of these
financial statements.
The following is an analysis of the Group’s revenue and results from operations by reportable segment.
2016
Revenue
Interest income
Other income
Expenses
Administration expenses
FX Expense
Exploration expenditure written off
Impairment of Exploration(i)
Loss before tax
Current assets
Exploration expenditure(i)
Plant and Equipment
Current liabilities
Net assets
2015
Revenue
Interest income
Other income
Expenses
Administration expenses
FX Expense
Exploration expenditure written off
Impairment of Exploration
Loss before tax
Current assets
Exploration expenditure
Plant and Equipment
Current liabilities
Net assets
Corporate
$
9,030
119,486
(391,063)
30,393
(48,401)
(1,053,069)
(1,333,624)
576,222
114,274
-
(53,736)
636,760
Corporate
$
9,267
257,036
(528,433)
50,332
-
-
(211,798)
714,374
1,030,674
-
(159,019)
1,586,029
Gold
Aust
$
Gold
Burkina Faso Cote D’Ivoire
$
$
Total
$
-
-
-
-
-
-
-
-
4,906
-
-
4,906
Gold
Aust
$
-
-
-
-
9,030
119,486
(294,358)
(45,490)
-
(6,142,889)
(6,482,737)
194,261
3,521,812
113,759
(33,056)
3,796,776
Gold
(40,549)
(5,228)
-
(1,909)
(47,686)
36,700
34,069
-
(8,583)
62,186
(725,970)
(20,325)
(48,401)
(7,197,867)
(7,864,047)
807,183
3,675,061
113,759
(95,375)
4,500,628
Burkina Faso Cote D’Ivoire
$
$
Total
$
-
-
-
-
-
(124)
(950)
(1,074)
-
-
-
-
-
(466,419)
(1,861)
-
(5,919,342)
(6,387,622)
170,866
9,271,697
180,703
(181,914)
9,441,352
(60,161)
(254)
-
(399,980)
(460,395)
20,548
35,972
-
(1,873)
54,647
9,267
257,036
(1,055,013)
48,217
(124)
(6,320,272)
(7,060,889)
905,788
10,338,343
180,703
(342,806)
11,082,028
(i)
The exploration incurred on behalf of Corporate relates to Burkina Faso and Cote D’Ivoire, which were subsequently
impaired during the year.
The group operates in three principal geographical areas – Australia (country of domicile), Burkina Faso and Cote
D’Ivoire.
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
53
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2016
NOTE 16: INTERESTS OF KEY MANAGEMENT PERSONNEL
Refer to the Remuneration Report contained in the Directors' Report for details of the remuneration paid or payable
to each member of the group's key management personnel for the year ended 30 June 2016.
The totals of remuneration paid to key management personnel of the company and the group during the year are as
follows:
Short-term benefits
Post-employments benefits
OTHER KEY MANAGEMENT PERSONNEL TRANSACTIONS
Consolidated
2016
$
176,129
13,508
189,637
2015
$
339,012
17,703
356,715
There have been no other transactions involving equity instruments other than those described in the tables above.
For details of other transactions with key management personnel, refer to Note 20: Related Party Transactions.
NOTE 17: REMUNERATION OF AUDITORS
Remuneration of the auditor of the parent entity for:
-Audit services
-Other services
NOTE 18: CONTROLLED ENTITIES
Parent Entity:
Predictive Discovery Limited
Subsidiaries of legal parent entity:
Predictive Discovery SARL
Predictive Discovery Niger SARL
Predictive Discovery Cote D’Ivoire SARL
Birrimian Pty Ltd
Predictive Discovery Cote D’Ivoire Pty Ltd
Country of
Incorporation
Australia
Burkina Faso
Niger
Cote D’Ivoire
British Virgin Islands
Australia
(i)
Percentage of voting power is in proportion to ownership
Acquisitions of controlled entities
There were no acquisitions during the year.
Consolidated
2016
$
39,000
6,600
45,600
2015
$
37,000
6,600
43,600
Percentage Owned(i)
2016
-
100%
100%
100%
100%
100%
2015
-
100%
100%
100%
100%
100%
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
54
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2016
NOTE 19: CONTINGENT LIABILITIES
There are no material contingent liabilities or contingent assets of the group at balance date.
NOTE 20: RELATED PARTY TRANSACTIONS
Transactions between related parties are on normal commercial terms and conditions no more favourable than those
available to other parties unless otherwise stated.
Transactions with related parties:
Intercompany Loans
Predictive Discovery Limited has made loans to its subsidiaries in the amount of $18,214,918 (2015: $16,829,444).
The loan is interest free and payable on demand.
Directors’ Remuneration
For information relating to related party transactions with key management personnel during the financial year, refer
to Note 16.
Other Related Party Transactions
There were no other related party transactions during the year. In the previous period Churchill Services Pty Ltd, an
entity associated with Ian Hobson, was paid $72,550 for company secretarial services.
NOTE 21: STATEMENT OF CASH FLOWS
Reconciliation of loss after income tax to net cash flow from operating
activities
Operating loss after income tax
(7,864,047)
(7,060,889)
Consolidated
2016
$
2015
$
Non-operating items in loss:
Exploration expenditure
Interest income
Non-cash flows in loss:
Share based payments
Depreciation
Foreign exchange (gains)/losses
Write off of exploration expenditure
Movement in assets and liabilities:
(Increase)/decrease in receivables
Increase/(decrease) in payables
Increase/(decrease) in provisions
Net cash outflow from operating activities
48,401
(9,030)
-
1,222
20,325
7,197,867
(498)
(8,007)
(4,190)
(617,957)
124
(9,267)
-
-
(48,217)
6,320,272
(4,936)
(131,067)
776
(933,204)
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
55
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2016
NOTE 22: SHARE BASED PAYMENTS
During the period ending 30 June 2016, the group entered into the following share-based payments:
1. The issue of 22,500,000 shares in the company as consideration to the Lead Underwriter of the renounceable
rights issue that closed on 3 December 2015, for a value of $45,000;
2. The issue of 2,500,000 shares in the company as consideration for investor relations services for a period of
12 months.
The group did not enter into any share-based payments during the period ending 30 June 2015.
At 30 June 2016 the group has the following share-based payment options on issue to employees:
Exercise
price
Grant Date Expiry Date
20 Aug 2010 20 Aug 2015 $0.250
27 Mar 2014 31 Mar 2017 $0.022
Start of the
year
6,000,000
8,000,000
14,000,000
Granted
during the
year
Exercised
during the
year
-
-
-
-
-
-
Expired
during the
year
(6,000,000)
Balance at
the end of
the year
-
- 8,000,000
(6,000,000) 8,000,000
Vested and
exercisable
at the end of
the year
-
8,000,000
8,000,000
At 30 June 2016 the group has the following share-based payment options on issue in lieu of capital raising fees:
Grant Date
5 Dec 2012
Expiry Date
30 Oct 2015
Exercise
price
$0.15
Start of the
year
2,000,000
2,000,000
Granted
during the
year
Exercised
during the
year
Expired
during the
year
-
-
- (2,000,000)
- (2,000,000)
Balance at
the end of
the year
-
-
Vested and
exercisable
at the end of
the year
-
-
The weighted average exercise price of options as at 30 June 2016 was $0.022 (30 June 2015: $0.13). The weighted
average remaining contractual life of options outstanding at year end was 0.75 (30 June 2015: 0.94).
During the year ending 30 June 2016 no options were granted.
During the year ending 30 June 2015 no options were granted.
NOTE 23: EVENTS AFTER THE END OF THE REPORTING PERIOD
On 22 August 2016 Predictive Discovery Limited announced plans to raise up to $4million in three components, being:
1. A minimum of $1m and up to $2m being raised from clients and affiliates of the Sprott Group;
2. A placement of $1.2m to large shareholders and several other sophisticated investors; and
3. A Share Purchase Plan to raise up to $0.8m.
Portions of the first two components are subject to shareholder approval at a meeting to be held on 5 October 2016,
while the Share Purchase Plan is expected to close on 27 September 2016. Subsequent to balance date, 45,000,000
shares were issued prior to the date of this report for consideration of $450,000 before costs as part of this capital
raising.
Other than the above, no matters or circumstances have arisen for the year which significantly affected or could
significantly affect the operations of the group, the results of those operations, or the state of affairs of the group in
future financial years.
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
56
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 171 877
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2016
NOTE 24: PARENT ENTITY DISCLOSURES
Assets
Current assets
Non-current assets
Total assets
Liabilities
Current liabilities
Total liabilities
Equity
Issued capital
Reserves
Accumulated losses
Total equity
CONTINGENT LIABILITIES
Nil
CONTRACTUAL COMMITMENTS
2016
$
576,222
19,492,459
20,068,681
53,736
53,736
25,401,246
2,495,954
(7,882,255)
20,014,945
2015
$
714,374
19,039,583
19,753,957
159,019
159,019
24,180,868
1,942,818
(6,528,748)
19,594,938
The parent entity has commitments as at 30 June 2016 that are disclosed in Note 13.
RECOVERABILITY OF INTERCOMPANY LOAN
Within Non-current assets is a loan due from the 100% subsidiaries of $18,214,918 which is considered fully
recoverable. The recoverability of this loan is dependent upon the successful development or sale of exploration
assets in Burkina Faso.
NOTE 25: COMPANY DETAILS
The registered office of the company is:
The principal place of business of the company is:
Predictive Discovery Limited
Suite 2, Level 2
20 Kings Park Road
WEST PERTH WA 6005
Predictive Discovery Limited
Level 2, 33 Ord Street
WEST PERTH WA 6005
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
57
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 871 877
DIRECTOR’S DECLARATION
FOR THE YEAR ENDED 30 JUNE 2016
DIRECTORS’ DECLARATION
The directors of the company declare that:
1.
The financial statements and notes, as set out on pages 30 to 57, are in accordance with the
Corporations Act 2001 and:
(a) comply with Accounting Standards; and
(b)
give a true and fair view of the financial position as at 30 June 2016 and of the performance for
the year ended on that date of the consolidated group;
2.
The Chief Executive Officer and Chief Financial Officer have each declared that:
(a)
(b)
the financial records of the company for the financial year have been properly maintained in
accordance with section 286 of the Corporations Act 2001;
the financial statements and notes for the financial year comply with the Accounting Standards;
and
(c)
the financial statements and notes for the financial year give a true and fair view.
Note 1 confirms that the financial statements also comply with International Financial Reporting
Standards as issued by the International Accounting Standards Board.
3.
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.
This declaration is made in accordance with a resolution of the Board of Directors.
Paul Roberts
Managing Director
22 September 2016
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
58
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF PREDICTIVE DISCOVERY LIMITED & CONTROLLED ENTITIES
Report on the Financial Report
We have audited the accompanying financial report of Predictive Discovery Limited & controlled entities,
which comprises the consolidated statement of financial position as at 30 June 2016, the consolidated
statement of profit or loss and other comprehensive income, the consolidated statement of changes in equity
and the consolidated statement of cash flows for the year then ended, notes comprising a summary of
significant accounting policies and other explanatory information and the directors’ declaration of the
consolidated entity comprising the company and the entities it controlled at the year’s end or from time to
time during the financial year.
Directors’ Responsibility for the Financial Report
The directors of the company are responsible for the preparation of the financial report that gives a true and
fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such
internal control as the directors determine is necessary to enable the preparation of the financial report that
is free from material misstatement, whether due to fraud or error. In Note 1, the directors also state, in
accordance with Accounting Standard AASB 101: Presentation of Financial Statements, that the financial
statements comply with International Financial Reporting Standards (IFRS).
Auditor’s Responsibility
Our responsibility is to express an opinion on the financial report based on our audit. We conducted our audit
in accordance with Australian Auditing Standards. Those standards require that we comply with relevant
ethical requirements relating to audit engagements and plan and perform the audit to obtain reasonable
assurance whether the financial report is free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
financial report. The procedures selected depend on the auditor’s judgment, including the assessment of the
risks of material misstatement of the financial report, whether due to fraud or error. In making those risk
assessments, the auditor considers internal control relevant to the company’s preparation of the financial
report in order to design audit procedures that are appropriate in the circumstances, but not for the purpose
An audit also includes evaluating
of expressing an opinion on the effectiveness of the entity’s internal control.
the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the
directors, as well as evaluating the overall presentation of the financial report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
audit opinion.
Independence
In conducting our audit, we have complied with the independence requirements of the Corporations Act
2001. We confirm that the independence declaration required by the Corporations Act 2001, which has been
given to the directors of Predictive Discovery Limited & controlled entities, would be in the same terms if
provided to the directors as at the date of this auditor’s report.
Auditor’s Opinion
In our opinion:
a.
b.
the financial report of Predictive Discovery Limited & controlled entities is in accordance with the
Corporations Act 2001, including:
i.
ii.
giving a true and fair view of the consolidated entity’s financial position as at 30 June 2016 and
of its performance for the year ended on that date; and
complying with Australian Accounting Standards and the Corporations Regulations 2001; and
the financial report also complies with International Financial Reporting Standards as disclosed in Note
1.
Emphasis of Matter – Material Uncertainty Regarding Continuation as a Going Concern
Without modifying our opinion, we draw to Note 1 (s) “Key Judgement – Going Concern” which indicates the
company incurred a loss for the year ended 30 June 2016 of $7,801,777 and that the company’s ability to
continue the exploration and development of its mining tenements and meet operational expenditure at
current levels is dependent upon future capital raising. These conditions, along with other matters as set
forth in Note 1 (s), indicate the existence of a material uncertainty that may cast significant doubt about the
company’s ability to continue as a going concern and therefore, the company may be unable to realise its
assets and discharge its liabilities in the normal course of business.
Emphasis of Matter ‐ Inherent Uncertainty regarding Recoverability of Capitalised Exploration and Evaluation
Assets
Without modifying the opinion expressed above, attention is drawn to the following matter. As a result of the
matter described in Note 1(s) and Note 6 to the financial statements, there is uncertainty as to whether the
company will be able to recover the carrying value of exploration expenditure for the amount recorded in the
financial report. The ultimate recovery of the carrying value of exploration expenditure, and future
exploration expenditure, is dependent upon the successful development and commercial exploitation or,
alternatively, sale of the interest in the tenements.
Report on the Remuneration Report
We have audited the remuneration report included in pages 7 to 11 of the directors’ report for the year
ended 30 June 2016. The directors of the company are responsible for the preparation and presentation of
the remuneration report in accordance with s 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.
Auditor’s Opinion
In our opinion the remuneration report of Predictive Discovery Limited & controlled entities for the year
ended 30 June 2016 complies with s 300A of the Corporations Act 2001.
MOORE STEPHENS AUDIT (VIC)
ABN 16 847 721 257
ANDREW JOHNSON
Partner
Audit & Assurance Services
Melbourne, Victoria
22 September 2016
AUDITOR’S INDEPENDENCE DECLARATION
UNDER S 307C OF THE CORPORATIONS ACT 2001
TO THE DIRECTORS OF PREDICTIVE DISCOVERY LIMITED & CONTROLLED ENTITIES
I declare that, to the best of my knowledge and belief, during the year ended 30 June 2016, there have been:
i.
ii.
no contraventions of the auditor independence requirements as set out in the Corporations Act 2001
in relation to the audit; and
no contraventions of any applicable code of professional conduct in relation to the audit.
MOORE STEPHENS AUDIT (VIC)
ABN 16 847 721 257
ANDREW JOHNSON
Partner
Audit & Assurance Services
Melbourne, Victoria
22 September 2016
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 871 877
SHAREHOLDER INFORMATION
The shareholder information set out below was applicable at 24 October 2016
1. Number and Distribution of Equity Securities
The number and class of all securities on issue:
ASX Code
PDI
PDIAK
Number
1,631,113,686
8,000,000
Description
Fully Paid Ordinary Shares Quoted
Unlisted Options expiring 31 March 2017
Distribution of equity securities
Size of Holding
1-1,000
1,001-5,000
5,001-10,000
10,001-100,000
100,001 and over
Total
Number of Holders
27
24
37
669
779
1,536
Unmarketable Parcels
300
The number of holders
Ordinary shares fully paid (ASX Code: PDI):
1,536
Shares Held
4,613
85,093
331,548
40,934,684
1,589,757,748
1,631,113,686
Shares
6,919,152
2. Substantial Shareholders
Substantial shareholders as defined by Section 671B of Australian Corporations Law are:
Name
Aurora Minerals Limited
Equity Trustees Limited (Lowell Resources Fund)
Merrill Lynch (Australia) Pty Limited
Number of Shares
646,536,859
178,026,190
103,265,000
%
39.64
10.91
6.33
3. Voting Rights
Subject to any rights or restrictions for the time being attached to any class or classes of shares, at a general
meeting every shareholder or class of shareholder present in person or by proxy, attorney or representative has
one vote on a show of hands and, on a poll, one vote for each fully paid share which that member holds or
represents.
PREDICITIVE DISCOVERY LIMITED ANNUAL REPORT
62
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 871 877
SHAREHOLDER INFORMATION (Continued)
4. Twenty Largest Shareholders as at 24 October 2016
The twenty largest fully paid shareholders hold 68.29% of the issued capital and are tabled below:
Shareholder
Aurora Minerals Limited
Bond Street Custodians Limited (GRIPIC PH 240 A/C)
1.
2. Equity Trustees Limited (Lowell Resources Fund)
3. Merrill Lynch (Australia) Nominees Pty Limited
4. Dyspo Pty Limited
5. Aggregated Capital Pty Ltd
6.
7. Mr Michael Robert Hodgetts
8. Bond Street Custodians Limited (Apicon D05711 A/C)
9. Croftbank Pty Ltd (Watts Family Super Fund)
10. Finance Associates Pty Ltd (Super Fund A/C)
11. Technica Pty Ltd
12. Mr Rhett Anthony John Morson
13. Silver Whiting Pty Ltd
14. Dr Thomas Holland Whiting
15. Dypso Pty Ltd
16. Gecko Resources Pty Ltd
17. Toltec Holdings Pty Ltd
18. Mr Mark Andrew Tkocz
19. Dr Thomas Holland Whiting
20. ABN Amro Clearing Sydney Nominees Pty Ltd
Total Issued Shares
5. Corporate Governance Statement
No. of Shares
646,536,859
178,026,190
103,265,000
26,547,747
21,000,000
18,885,798
16,340,000
14,831,790
10,412,760
10,000,000
9,353,620
9,000,000
7,000,004
7,000,000
6,250,000
6,200,000
6,000,000
6,000,000
6,000,000
5,300,599
%
39.64
10.91
6.33
1.63
1.29
1.16
1.00
0.91
0.64
0.61
0.57
0.55
0.43
0.43
0.38
0.38
0.37
0.37
0.37
0.32
1,113,950,367
1,631,113,686
68.29
100.00
The 2016 Corporate Governance statement of Predictive Discovery Limited is available on the Company’s website
at
http://www.predictivediscovery.com/corporate/corporate-governance
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT
63
PREDICTIVE DISCOVERY LIMITED AND CONTROLLED ENTITIES
ACN 127 871 877
MINERAL TENEMENT INFORMATION (as at 24 October 2016)
Name
Number
Location
Area
(sq. km)
PDI equity
Fouli
Arrêté 2014-294/MCE/SG/DGMGC
Burkina Faso
186.2
100%
Tantiabongou
Arrêté 2013-168/MCE/SG/DGMGC
Burkina Faso
93.9
100%
Sirba
Arrêté 2014-296/MCE/SG/DGMGC
Burkina Faso
136.9
100%
Madyabari
Arrêté 2014-295/MCE/SG/DGMGC
Burkina Faso
171.9
100%
Tyekanyebi
Arrêté 2015-229/MCE/SG/DGMGC
Burkina Faso
Tamfoagou
Arrêté 2015-281/MCE/SG/DGMGC
Burkina Faso
140
238
100%
100%
Tangagari
Arrêté 2013-37/MCE/SG/DGMGC
Burkina Faso
127.5
Earning 95%; current equity 0% (until
final cash payment is made)
Bangaba
Arrete 2015-109/MCE/SG/DGMGC
Burkina Faso
128
Earning 95%; current equity 84%
Kogodou South
2015-226/MCE/SG/DGMGC
Burkina Faso
44.6
Earning 100%; current equity 0% (until
final cash payment is made)
Bira
Basieri
2013-33/MCE/SG/DGMGC
Burkina Faso
21
100%
2013-16/MCE/SG/DGMGC
Burkina Faso
73.5
100%
Kokoumbo
Mining exploration permit No. 307
Cote D'Ivoire
Ferkessedougou
Mining exploration permit No. 310
Cote D'Ivoire
joint venture
Predictive-Toro
(also
known as Predictive Discovery Cote
D’Ivoire SARL
- Predictive 49%)
earning 90% in JV with Ivoir Negoce
(local Cote D’Ivoire company)
49% (Toro Gold Ltd 51%)
300 (after
25% area
reduction)
290 (after
25% area
reduction)
Boundiali
Mining exploration permit No. 414
Cote D'Ivoire
Kounahiri
Mining exploration permit No. 317
Cote D'Ivoire
399
347
49% (Toro Gold Ltd 51%)
49% (Toro Gold Ltd 51%)
Beriaboukro
Mining exploration permit
Cote D'Ivoire
400
Ferkessedougou
North
Mining exploration permit
Cote D'Ivoire
400
joint
Predictive-Toro
venture
(Predictive Discovery Cote D’Ivoire
SARL - Predictive 49%) earning 85% in
JV with Gold Ivoire Minerals SARL
(local Cote D’Ivoire company)
Predictive-Toro
venture
(Predictive Discovery Cote D’Ivoire
SARL - Predictive 49%) earning 85% in
JV with Gold Ivoire Minerals SARL
(local Cote D’Ivoire company)
joint
Wendene
Mining exploration permit 779
Cote D'Ivoire
400
Bassawa
Mining exploration permit 570
Cote D'Ivoire
400
Approximately 35%. Predictive may
earn up to 85%.
Approximately 35%. Predictive may
earn up to 85%.
Cape Clear
EL 5434
Victoria,
Australia
120
25% (Cape Clear Minerals Pty Ltd hold
75%)
PREDICTIVE DISCOVERY LIMITED ANNUAL REPORT 64
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PREDICTIVE DISCOVERY LIMITED
ABN 11 127 871 877
Level 2
33 Ord Street
WEST PERTH WA 6005
Telephone: +61 8 9216 1000
Facsimile: +61 8 9481 0411
Website: www.predictivediscovery.com.au