ANNUAL REPORT 2019
ABN 38 115 857 988
CORPORATE DIRECTORY
Directors
Ian Macpherson
Executive Chairman
Richard Carcenac
Chief Executive Officer & Executive Director
Paul Graham-Clarke
Non-Executive Director
Athol Emerton
Non-Executive Director
Company
Secretary
Jessamyn Lyons
Principal
Registered
Office
Level 2, 33 Colin Street
West Perth
Western Australia 6005
Po Box 534
West Perth
Western Australia 6872
Telephone: (08) 9214 7500
Facsimile: (08) 9214 7575
Email: info@rbrgroup.com.au
Website: www.rbrgroup.com.au
Auditor
Butler Settineri (Audit) Pty Limited
Unit 16, 1st Floor
100 Railway Road
Subiaco
Western Australia 6008
Share
Registry
Security Transfer Australia
770 Canning Highway
Applecross
Western Australia 6153
Telephone: 1300 992 916
Email: registrar@securitytransfer.com.au
Stock
Exchange
The Company’s shares are quoted
on the Australian Stock Exchange.
The Home Exchange is Perth.
ASX Code
RBR - ordinary shares
CONTENTS
Chairman's Letter
Letter from the CEO
Directors’ Report
1
3
9
Auditor’s Independence Declaration
21
Statement of Comprehensive Income
22
Statement of Financial Position
Statement of Changes in Equity
Statement of Cash Flows
Notes to Financial Statements
Directors’ Declaration
Independent Auditor’s Report
ASX Additional Information
23
24
25
26
49
50
55
CHAIRMAN’S LETTER
Dear Shareholder
Welcome to the 2019 Annual Report for your Company.
The past financial year has been a pivotal period for RBR, marked by several key achievements and
milestones as well as some frustration stemming from events not always proceeding at the pace we
would have liked.
Significant progress was made on many fronts during the year. However, the nature of this activity
means that much of it took place “below the waterline” and hence there is an understandable appetite
among shareholders to see us begin securing the contracts which we are now set up to fulfil.
With this in mind, I can assure you that your Board and Management team are fully committed to
ensuring RBR achieves its goal of becoming a key supplier of labour and training services to the
LNG construction industry and is moving as quickly as the circumstances allow.
The financial year culminated in Anadarko Petroleum and its project partners making a positive Final
Investment Decision (FID) in June 2019, thereby committing to construction of the Area 1 LNG
Project. This milestone followed a host of pre-FID early works, including the construction of a village
for residents who were relocated from the Afungi project site, various roadworks, camp
accommodation and an airfield.
The contracts awarded to date have been predominantly, pre-FID awards. The contractors appear
to have been afforded considerable flexibility in the way in which the scopes of work were delivered,
including the recruitment, training and deployment of local workers. In the future, on the project
construction site for post-FID contracts, the rigorous minimum standards in terms of internationally
recognised skills and local recruitment requirements will be more consistently applied, in line with
RBR’s services.
Since the Anadarko FID, the project’s Engineering, Procurement and Construction (EPC) contractor
consortium, the CCS JV, has been formally appointed, and is now beginning to award construction-
related contracts. Amongst the first of these contracts is the construction of a 9,500-bed
accommodation camp for construction workers. Work on this contract is expected to commence in
the October 2019 quarter, around the same time as work commences on the temporary beach
landing facilities.
Your Board believes that this progress is firm evidence that further significant delays in project
development are highly unlikely, further reinforced by the fact that first gas deliveries from the project
are committed for 2024, with a construction timetable of roughly 60 months. The prevailing sense of
urgency is also supported by the ongoing discussions between RBR representatives and the
contractors working on these sites. Moreover, RBR is confident of securing work with these
contractors.
RBR is focusing its efforts on the larger, labour-intensive activities both within and outside of the
project site (outside activities primarily being those related to the development of the Palma
townsite). The rationale for this distinction is due to the fact that project-related contracts will be
subject to very well-defined, rigorous performance conditions, lengthy payment terms, project-
specific employment conditions, and so on, while potential clients undertaking work unrelated to the
LNG projects will have complete flexibility within the bounds of the law. RBR’s service offerings to
these two “groups” will be tailored to their specific requirements. Indeed, RBR is one of a select few
organisations which is able to address a broad spectrum of clientele with bespoke services and is
therefore very well-positioned.
As part of RBR’s strategy, we have invested significant time and money in establishing our brand
and profile in Mozambique.
1
CHAIRMAN’S LETTER (Continued)
We are the preferred supplier of training services to several of the larger corporate groups within
Mozambique. We have entered into a number of strategic relationships to enhance and expand our
service offerings and expanded our geographic footprint beyond the capital, Maputo, with an
operating base now in Palma, the regional city in closest proximity to the Project, with further
representation in the coastal city of Beira via our recently announced alliance with ROTC. This is in
addition to having developed a mobile training capability for deployment to any location, as required.
While laying the foundations to secure these contracts, we have been prudent in our expenditure,
which in turn has enabled us to limit the amount of money we have raised from investors. As part of
this prudent financial management, our successful convertible note issue in January 2019 and the
more recent September placement were executed above ruling market prices. While operating on a
relatively small capital base, we have attracted support from high net-worth individuals and corporate
parties who clearly see the enormous potential of your Company.
With the Anadarko Project (Area 1) formally underway, the Exxon-led MRV (Area 4) project FID
imminent and the acceleration of construction activities in and around Palma, we believe demand
for RBR’s services will increase substantially over the coming 12 months. Anadarko’s recent
acquisition by Occidental Petroleum, and the implications thereof on the project timeline, has been
explained in the “Review of Operations and Activities” section of the Annual Report.
Finally, I would like to thank our staff, alliance partners and shareholders for their support over the
past year.
I look forward to reporting to you as we seek to secure the contracts which we believe will generate
strong returns on the investment we have made in establishing RBR as a leading supplier of labour
and training services in Mozambique.
Ian Macpherson
2
LETTER FROM THE CEO
Dear Shareholder,
As Chief Executive of your Company, I am pleased to report to you on the strong progress we have
made over the past year as we seek to capitalise on the opportunities which are expected to stem
from the emerging LNG industry in Mozambique.
Our focus in the past financial year has been on building on the capabilities which will enable us to
deliver our vision – “To be the leading provider of local and expatriate staffing solutions to the
Mozambique LNG construction boom. We will recruit, train and supply skilled, fit-for-work
staff to our clients every day”.
Setting the Scene
Mozambique is rapidly shaping up as a major LNG producer based on the discovery of vast
quantities of high-quality gas in the Rovuma Basin off the northern Cabo Delgado province.
Resources are already estimated to exceed 150 Tcf and further drilling under the 5th Licensing Round
will commence in 2020.
The country is geographically well-placed to supply, in parallel, both the fast-growing Asian markets
in India and China, as well as Europe, which is facing declining indigenous production. Standard
Bank considers Mozambique can become to China for LNG what Australia is for minerals and New
Zealand is for food. Furthermore, Mozambique production will be price competitive with US LNG
exports and is well-placed for regional bunkering/SSLNG.
According to Standard Bank, the Mozambique LNG “as it stands” project timetable indicates a total
project pipeline valued at US$128 billion scheduled for Final Investment Decision (FID) by 2025.
This pipeline includes floating LNG (FLNG), onshore production and various domestic gas (Domgas)
projects.
Above: Overview of Potential developments Fuelled by LNG and Domgas
Source: Standard Bank
3
LETTER FROM THE CEO (Continued)
A summary of the projects is below:
FLNG:
o The Coral FLNG (3.4 Mtpa), secured FID in June 2017, with first gas scheduled for
June 2022. Construction is already underway. Capital cost c.US$9 billion;
On-shore:
o Mozambique LNG (12.9 Mtpa), secured FID in June 2019 and is expected to be fully
commissioned in 2024. Capex c.US$23 billion;
o Area 4 Rovuma LNG (15.2 Mtpa):
This will be the largest project in Africa’s history, capex c.US$30 billion;
FID expected 2H 2019 and fully commissioned in 2025;
o Future unitised trains (15.2 Mtpa). FID possible in 2023/4;
o Prosperidade LNG (12.9 or 15.2 Mtpa). FID possible in 2023/4;
Domgas Projects:
o Various projects are envisioned, including gas to liquids (GTL – c.US$5.5 billion),
fertiliser production, independent power projects (IPPs), small scale LNG (SSLNG),
LNG bunkering, methanol to olefins (MTO). Total estimated capex of these projects
exceeds US$12 billion.
Above: Development Overview of the Rovuma Basin
Source: Mitsui & Co.
Mozambique will commission into production 28.1 Mtpa between 2023-2025 at the same site, similar
to Ras Laffan in Qatar. On this basis, Mozambique will be building on-shore LNG more intensively
than Qatar did. Standard Bank envisages the Afungi site will ultimately be able to host (with Mega-
Trains) over 90 Mtpa of LNG production plus a Domgas Industrial Park.
Mozambique has a 30-year Engineering, Procurement, Construction and Commissioning (EPCC)
term and requires, through a Decree Law, that all Plans of Development (PODs) must be submitted
by December 2023 – essentially, this is a use it or lose it requirement on all project Sponsors.
Assuming the Sponsors submit their ambitious PODs accordingly, the big question is whether the
country will have the capacity in terms of infrastructure and skills to match this market obligation.
4
LETTER FROM THE CEO (Continued)
Below are a few numbers to further illustrate the enormity of the Mozambique LNG projects (source:
Standard Bank):
US$65 billion of FIDs expected in 2019, in a country with a GDP of US$14 billion (and 100%
external debt to GDP);
To date, the most expensive object ever built in the world cost US$54 billion (the Gorgon
LNG project in Australia);
From 2019, the Afungi LNG site in Mozambique will be the world’s most expensive real estate
since time began, and will be a building site for the next decade at least;
The overall US$128 billion investment is scheduled to take place in a province with a GDP
of only US$0.55 billion;
Mozambique’s GDP is likely to increase (roughly) at 8-10% p.a. real over the next 30 years;
The LNG investments will position Mozambique as the world’s 4th or 5th biggest producer;
Building the four on-shore LNG trains in parallel will need 2 million eggs per month to feed
the workers, requiring nearly 60,000 chickens laying 1.2 eggs per day;
The construction activities will require tens of thousands of workers on site each day at peak
and create several hundred thousand employment opportunities nationally.
The Mozambique Government is busy finalising a local content law which will stipulate, amongst
other matters, the minimum requirements for procurement from local suppliers, as well as local
employment terms (including recruitment and training). Mozambique produces very little in terms of
industrial goods, with the bulk of local content expenditure likely to be labour-related (training and
workers’ wages) and logistics.
RBR is perfectly positioned to play a key role in training and providing this local labour.
RBR’s Competitive Position
Since establishing operations in Mozambique, RBR believes it has put in place all the elements
required to achieve its vision “To be the leading provider of local and expatriate staffing
solutions to the Mozambique LNG construction boom. We will recruit, train and supply
skilled, fit-for-work staff to our clients every day”.
Executing this vision requires RBR to possess the following capabilities:
The ability to identify potential recruits who are willing and able to work in the targeted sectors.
Recruitment efforts must also be prioritised based on proximity to the workplace, i.e.
opportunities must be offered to local communities ahead of people living in other provinces
or distant locations. RBR has arguably the largest consolidated database in Mozambique
from which to source potential workers;
A way to ensure the local employees have the skills required for the job. Mozambique’s local
qualifications are not yet recognised by the developers of the LNG projects as being of a
standard equivalent to “mainstream” international qualifications. However, workers will not
be granted access to site without an internationally recognised qualification. RBR’s training
entity Futuro Skills is able to assess the competency of individuals, in certain key skills,
against the UK’s Engineering Construction Industry Training Board (ECITB) and, if deemed
competent, award a recognised international qualification. Futuro Skills is well-placed to
provide training in the skills which will be in high demand by the project developers;
The technology to record and maintain the qualifications and competencies of workers in its
database, which enables employers to inspect a candidate’s training and competency
assessment records at any time. To this end, RBR developed the innovative FuturoCARDTM
portable training record;
5
LETTER FROM THE CEO (Continued)
The licence and ability to supply skilled staff to clients, whether through a recruitment and
placement service, through a labour hire arrangement, or through the Company’s
comprehensive internship programme;
The capacity to supply the abovementioned skilled staff in the required numbers and with the
desired range of skills/experience. This will require a significant number of skilled expatriates
to be employed, at least until the capabilities of the local workforce reasonably matches the
expatriate workforce. Futuro People, with its labour broking licence and visa/immigration
capabilities, is equipped to provide this service. However, RBR does not have an extensive
database of suitable skilled expatriates of its own, so an alliance has been put in place with
a leading international recruitment organisation to service this need;
All the above needs to take place at multiple locations, with on-the-ground support for the
workforce. RBR’s network of offices and association with leading Mozambican logistics
company, LBH Mozambique, provides a strong geographic footprint from which to grow its
services.
STATUS
MOZAMBIQUE CAPABILITY
Recruitment & Labour Broking Licence
Few issued, and long lead time to acquire
Database of Skilled Labour
Arguably the most comprehensive in Mozambique
Skills Training & Assessment
Already the premier provider – wide scope
ECITB Accreditation
First company to receive accreditation
Intellectual Property
Innovative FuturoCARDTM training record
Adequate Facilities
Hubs in north and south, mobile facilities and
alliances to access further sites
Visas & Immigration
Have in-house capability
In-country network
Staff across 3 offices/locations
Established relationships with key industry
participants
Above: RBR is systematically acquiring all the capabilities essential to success in
Mozambique
Above: Futuro Skills Students
6
LETTER FROM THE CEO (Continued)
THE WAY FORWARD
The strong progress made by RBR during the past financial year has left it well-placed to supply the
major LNG projects planned for Mozambique. The Company has strengthened its team and
significantly improved its facilities and technology. Please refer to the Review of Operations and
Activities section in this Annual Report.
RBR’s capabilities in Mozambique give the Company a significant point of difference. Other labour
providers focus on recruiting “work-ready” candidates but do not have RBR’s capacity to develop
their own workforce with internationally recognised qualifications.
While maintaining a focus on Mozambique, the Company will continue to target other emerging
markets with similarly strict local content laws and lower levels of education, primarily in Africa. The
recent recovery in commodity prices should help to drive resource development activity – and
therefore demand for RBR’s services – in markets of this kind.
The Company also maintains its JV exploration assets which are completely funded by the JV
partners, offering opportunistic upside at no cost to shareholders.
The key risks to RBR remain unchanged, and are:
Recruiting and retaining staff of a calibre required to deliver its vision as the business grows;
Growing RBR’s capacity at the required pace and extending its network of facilities in
Mozambique to meet future demand;
Securing future business, including the timing and value of these contracts. The LNG Project
schedules are out of RBR’s control.
In closing, the LNG-driven opportunities in Mozambique are truly once-in-a-generation. Those
companies which recognised the opportunity and took the bold step to invest into the country, in a
considered and timely manner over the past few years, stand to share in the benefits. Progress has
been slower than anticipated, testing the patience and resolve of investors. But it is all starting to
happen right now, and RBR is the only ASX-listed company with exposure to what is shaping up as
the world’s biggest project play.
Thank you very much for your support.
Richard Carcenac
7
FINANCIAL REPORT
For the year ended
30 June 2019
8
DIRECTORS’ REPORT
The Directors present their report on RBR Group Limited (“RBR”) and the entities it controlled at the end of and during the
year ended 30 June 2019.
DIRECTORS
The names and details of the Directors of RBR during the financial year and until the date of this report are:
Ian Macpherson – B.Comm., CA
Executive Chairman
Appointed 18 October 2010
Mr Macpherson is a Chartered Accountant with over forty years experience in the provision of financial and corporate
advisory services. Mr Macpherson was formerly a partner at Arthur Anderson & Co managing a specialist practice providing
corporate and financial advice to the mining and mineral exploration industry.
In 1990, Mr Macpherson established Ord Partners (later to become Ord Nexia) and has specialised in the area of corporate
advice with particular emphasis on capital structuring, equity and debt raising, corporate affairs and Stock Exchange
compliance for public companies in the mining and industrial areas. He has further been involved in numerous asset
acquisitions and disposal engagements. Ord Nexia merged with MGI Perth in October 2010 and Mr Macpherson continued
in a consulting role with the merged group until November 2011.
He has acted in the role of Director and Company Secretary for a number of entities and is currently a Non-Executive
Director of Red 5 Limited (15 April 2014 to present).
Former Directorships: Non-Executive (Deputy) Chairman of Avita Medical Ltd (5 March 2008 to 16 January 2016).
Mr Macpherson is a Member of the Institute of Chartered Accountants in Australia, the Australian Institute of Company
Directors and past member of the Executive Council of the Association of Mining Exploration Companies (WA) Inc.
Richard Carcenac – B.Sc. Eng. (Civil), MBA
Chief Executive Officer and Executive Director
Appointed 16 June 2015
Mr Carcenac is a civil engineer with an MBA who has over 20 years experience working for international mining houses
including Anglo American and BHP Billiton in a variety of roles in Australia, South Africa, Switzerland and The Netherlands.
The majority of his career was spent in marketing and operations, and included board appointments at Ingwe Collieries
Ltd (the South African coal subsidiary of BHP Billiton Ltd) and the Richards Bay Coal Terminal Company Ltd. Mr
Carcenac’s most recent position was as General Manager of BHP Billiton Worsley Alumina’s Boddington Bauxite Mine in
Western Australia.
Athol Emerton – Fellow of Chartered Institute of Shipbrokers, London
Non-Executive Director
Appointed 19 August 2019
Mr Emerton 30 years in commerce in Southern Africa, including Mozambique and has chaired the South African Shipping
Association (SAASOA) training committee for 7 years, including the scoping panel that developed the TETA shipping
qualification & headed the establishment of an industry wide shipping learnership programme.
He is a self-motivated leader in the maritime and transport logistics industries, with a particular interest in building
business capacity and opportunities through entrepreneurial thought, and a passion for skills development and upliftment
of indigenous populations. Mr Emerton’s wealth of experience and unique skills set has been gained through working
with many of the large, well known, international resource and shipping companies around the world, and he is considered
a specialist in developing landside, marine and transport solutions in inhospitable (due to political, economic or
geographical reasons) regions or ports.
Mr Emerton is the Managing Partner of the African operations of global logistics company LBH. After establishing the
LBH operations in South Africa and Mozambique 35 years ago, Mr Emerton has grown the business into one of the
premier logistics and ships agency enterprises in the region.
9
DIRECTORS’ REPORT (Continued)
Paul Graham-Clarke – B.Sc. (Tokyo)
Non-Executive Director
Appointed 16 December 2015
Mr Graham-Clarke has 37 years of foreign exchange and commodity experience in the United Kingdom working for public
listed companies, a UK Hedge fund and a private UK commodity company in an executive capacity. He has significant
experience in company strategic turnarounds, leading large and small management teams, and the restructuring of
business divisions. He was formerly Managing Director of Foreign Exchange at ICAP (part of ICAP's Global Broking
business, which is now the conglomerate TPIcap) and Managing Director of London Commodity Brokers.
Mr Graham-Clarke was born in South Africa and educated both there and in Japan where he received his Bachelor of
Science degree. Predominantly UK-based in the latter part of his career, he maintains a significant business network
and access into the UK financial markets.
COMPANY SECRETARY
Jessamyn Lyons – B.Comm., AGIA, ICSA
Appointed 2 August 2019
Ms Lyons is a Chartered Secretary with 15 years experience working in the stockbroking and banking industries. She is
an Associate of the Governance Institute of Australia and she holds a Bachelor of Commerce from the University of Western
Australia with majors in Investment Finance, Corporate Finance and Marketing.
Ms Lyons is also a Director of Everest Corporate and Company Secretary of Southern Hemisphere Mining Limited, Ardiden
Limited, ACH Minerals Pty Ltd and Andes Resources Limited. Over the past 15 years she has held various positions with
Macquarie Bank, UBS Investment Bank (London) and more recently Patersons Securities.
Patrick Soh, B.Bus., CPA (Resigned as Company Secretary on 2 August 2019).
PRINCIPAL ACTIVITIES
The principal activities of the Consolidated Entity during the financial year focused on Mozambique. The group operates
via subsidiaries PacMoz, Lda (“PacMoz”), Futuro Skills Mozambique, Lda (“Futuro Skills”) and Futuro Business Services,
Lda in the provision of labour, training and professional services in Mozambique. The Australian business maintains its
mineral exploration and development assets, primarily in Western Australia (refer to the review of operations and activities
below), and owns a Registered Training Organisation.
DIVIDENDS
No dividend has been paid since the end of the previous financial year and no dividend is recommended for the current
year.
REVIEW OF OPERATIONS AND ACTIVITIES
RBR continued to prepare for the first contracts to be issued in relation to the planned LNG projects in Mozambique. While
the primary source of revenue over the reporting period was from the delivery of training and assessment services and
corporate payroll services, the Company plans to capitalise on this huge future LNG opportunity by providing a
comprehensive, integrated solution to the challenge of employing suitably skilled local workers. In this regard, RBR’s
commercial services span the identification and recruitment of prospective workers against specific priorities and criteria,
medically screening them for fitness to work, assessing their existing skills (recognition of prior learning) against accepted
standards, training them both on and off the job until they are deemed fully competent, and managing their employment
and placement with client companies At the same time, RBR will continue to expand our client base and secure repeat
work with existing clients.
As part of our preparations for the LNG construction boom in Mozambique, RBR’s key focus during this reporting period
was on:
Enhancing our capacity in-country. This included improving our IT systems, purchasing equipment, expanding our
trainer pool, securing international accreditation (UK’s ECITB) for key training scope, filling key leadership positions
and, critically, opening a training centre in Palma in August 2019, close to the LNG construction site;
Furthermore, Futuro Skills developed containerised mobile training and assessment units which can be readily
transported to any location within the country in order to provide basic ECITB-accredited training and assessment
services;
Analysing and interpreting the database of over 250,000 prospective workers so that recruitment efforts will be efficient
and focussed.
10
DIRECTORS’ REPORT (Continued)
The Key Event during the Reporting Period
The standout news event in the reporting period was the 19 June 2019 announcement by Anadarko Petroleum and its
joint venture partners that they had made a Final Investment Decision (FID) in favour of their US$20 billion Mozambique
LNG Project (“Moz LNG”), which is the largest single LNG project approved in Africa. This consortium has also appointed
its Engineering, Procurement and Construction (EPC) Contractor, the CCS JV, the key participants in which are Saipem
(with a 75% share) and McDermott (with a 25% share).
This was the second LNG project in Mozambique to receive a positive FID (Eni’s floating LNG being the first) and a larger
onshore LNG project led by Eni and Exxon Mobil is understood to be proceeding towards its FID in the coming months.
These two onshore LNG projects have a combined estimated capital cost of US$50 billion. LNG projects of this scale
typically take about five years to construct and are expected to have a peak construction workforce of up to 50,000. There
is both a legal requirement and corporate commitment by the investors in both projects to maximise employment
opportunities for Mozambicans, requiring significant investment in training.
Furthermore, on 8 August 2019, Anadarko Petroleum Corporation (“Anadarko”) confirmed the successful completion of
the acquisition of Anadarko by Occidental Petroleum Corporation (“Occidental”), with Anadarko’s Mozambican entity
AMA1 continuing to exist as a wholly owned subsidiary of Occidental.
A few days prior, on 3 August 2019, Occidental entered into a definitive Purchase and Sale Agreement with Total S.A.
(“Total”), pursuant to which Total will acquire all of Anadarko’s Algeria, Ghana, Mozambique and South Africa assets,
including all of Anadarko’s shareholding in AMA1. The transaction is expected to close promptly following receipt of all
requisite approvals. Occidental and Total are committed to AMA1’s operations in Mozambique and are confident that the
Transaction will have no adverse impact on AMA1’s business in Mozambique, including in relation to both the direction
and schedule of the project.
The Significance of this FID for Near-term Activities
The main construction-related activities which will commence within the coming six months include:
major earthworks (clearing, grubbing, infill and stabilisation)
camp accommodation with at least 10,000 beds and associated facilities
a reverse osmosis plant to provide a safe source of water
a temporary beach landing for the receival of material, plant and equipment
temporary facilities such as fencing, site offices, warehouses, laydown areas, waste facilities, fuel depot and temporary
power
concrete batch plant with aggregate receival and storage.
RBR is in regular contact with the companies bidding for, or already holding, these contracts, many of which are awaiting
Notice to Proceed.
Actions Taken by RBR
With the FID in place, RBR took significant steps during the June 2019 quarter to ensure we are fully prepared to bid for
the supply of our services under these large contracts, as soon as they are awarded to the various contractors.
As part of our preparations under our strategy to assess, train and provide workers to the LNG projects, RBR has opened
a training centre in the Mozambican city of Palma, which is located close to the LNG construction sites. The facility is run
by RBR’s training subsidiary, Futuro Skills Mozambique, Lda (FSM).
Palma was chosen as the Company’s northern hub because of its close proximity to the LNG construction sites, whereas
the province’s capital city, Pemba, is situated more than 400km from the site by road.
The Catalisa Youth Training Program, which is an initiative of the Anadarko-led Mozambique LNG Project (Moz LNG),
recently trained 100 young Palma residents in various basic life skills which will better prepare them for the job market.
This program aims to train about 1000 candidates during the construction of Moz LNG, representing only a small proportion
of the Mozambicans expected to secure employment on the LNG projects and related industries.
FSM and Catalisa are working together to create an integrated personal development pathway for the Catalisa graduates.
FSM is enrolling Catalisa graduates in our Mozambique Construction Green Card training program which will, upon
successful completion, earn them an internationally-recognised level one qualification that meets the health and safety
needs of multiple industries, including oil and gas, mining and construction.
The holders of the Mozambique Construction Green Card will then become eligible to enrol into Futuro Skills’
internationally-recognised ECITB technical training programs as well as a suite of other FSM vocational training programs
that will significantly raise their employment potential in semi-skilled and skilled roles.
11
DIRECTORS’ REPORT (Continued)
The first cohort of Catalisa graduates completed their training on 12 August 2019 and each week another group of students
will be trained as they become available from the Catalisa program.
RBR has already received expressions of interest from contractors operating in the area which are seeking to hire the
graduates as they become available, and placement interviews are underway.
Other Contracts
FSM secured Mozambique’s first accreditation from the UK’s Engineering Construction Industry Training Board (ECITB)
to assess, train and issue ECITB qualifications in health and safety, as well as five key technical disciplines: rigging,
scaffolding, non-critical welding, pipe-fitting, and steel erecting. These ECITB qualifications, or their international
equivalent, will be required for any worker to gain access to the LNG project site.
In recognition of securing ECITB accreditation in the December quarter of 2018 and FSM’s participation in the December
2018 launch event for the Anadarko Area 1 LNG project and Government of Mozambique Skills Fair initiative, FSM was
awarded a contract by the CCS JV to “Perform a series of Skills Roadshows around Mozambique for the Mozambique
LNG Project”. During the June 2019 quarter the scope of the Skills Fair project was significantly expanded by Anadarko,
which indicated the expected numbers of Mozambican participants had grown from about 700 to over 2,500 and put out
to tender. While the current Skills Fair contract with the CCS JV remains valid, Anadarko may elect to award the entire
expanded scope to a single Party under a contract which supersedes the CCS JV contract. The tender result and contract
are yet to be confirmed but RBR remains confident.
In January 2019, South32’s Mozal aluminium business appointed FSM as its sole provider of a range of training and
assessment services to all its contractors, as required for entry to site. The contract continues to operate on a month-by-
month basis, with variable revenues up to about $20k per month (driven by contractor volumes), potentially growing if
other programs are added to the scope of works.
FSM delivered two months of skills development in the June quarter, on behalf of Sasol to the stakeholder communities
around its Inhassoro petroleum operations, delivering over $100k of revenues.
FSM secured further training work from the NGO Swisscontact, which is funding the training of employees of small
construction businesses in the Maputo region.
Corporate and Financial Position
As at 30 June 2019 the Consolidated Entity had cash reserves of $412,821 (2018: $341,920). The net loss for the year
was $1,513,571 (2018: $1,423,434) including a non-cash impairment charge of $nil (2018: $150,000).
Risk Management
The Board is responsible for the oversight of the Consolidated Entity’s risk management and control framework.
Responsibility for control and risk management is delegated to the appropriate level of management with the Chief
Executive Officer having ultimate responsibility to the Board for the risk management and control framework.
Areas of significant business risk to the Consolidated Entity are presented to the Board by the Chief Executive Officer each
year.
Arrangements put in place by the Board to monitor risk management include monthly reporting to the Board in respect of
operations and the financial position of the Consolidated Entity.
EARNINGS/LOSS PER SHARE
Basic loss per share
Diluted loss per share
SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS
2019
Cents
(0.21)
(0.21)
2018
Cents
(0.24)
(0.24)
In the opinion of the Directors there were no other significant changes in the state of affairs of the Consolidated Entity that
occurred during the financial year under review.
12
DIRECTORS’ REPORT (Continued)
OPTIONS OVER UNISSUED CAPITAL
Unlisted Options and Performance Rights
During the financial year the following options were issued.
4,500,000 options with an exercise price of $0.018 and expiring 31 July 2019 were issued to Directors as a free issue
as part of a placement approved by shareholders on the 6 November 2018 and completed on the 6 December 2018.
3,500,000 options with an exercise price of $0.018 and expiring 31 July 2019 were issued as part of a share based
payment to a supplier on the 6 December 2018.
2,500,000 Performance Rights were issued to Ken Foote on the 22 January 2019 under Employee Securities Incentive
Plan and subject to internal management performance criteria.
Since 30 June 2019 and up until the date of this report there have been no further options issued to Directors or Staff.
For a reconciliation of the number of options on issue refer to note 15(c).
No person entitled to exercise any option has or had, by virtue of the option, a right to participate in any share issue of any
other body corporate.
CORPORATE STRUCTURE
RBR Group Limited (ACN 115 857 988) is a Company limited by shares that was incorporated on 19 August 2005 and is
domiciled in Australia.
EVENTS SUBSEQUENT TO THE REPORTING DATE
There has not arisen since the end of the financial year any item, transaction or event of a material and unusual nature
likely, in the opinion of the Directors of the Consolidated Entity to affect substantially the operations of the Consolidated
Entity, the results of those operations or the state of affairs of the Consolidated Entity in subsequent financial years except
for the following:
29,321,429 unlisted options with an exercise price $0.018 expired on 31 July 2019.
On 2 August 2019, the Company announced a change of Company Secretary appointing Ms Jessamyn Lyons.
On 14 August 2019, the Company announced that it had started training workers for jobs on the Mozambique LNG
projects.
On 19 August 2019, the Company announced the appointment of global logistics specialist Mr Athol Emerton as Non-
Executive Director.
LIKELY DEVELOPMENTS AND EXPECTED RESULTS OF OPERATIONS
RBR is developing and growing the business units described in the “Review of Operations and Activities” (page 10) and
developing the client base and revenues.
EXPLORATION / ENVIRONMENTAL REGULATION AND PERFORMANCE
Exploration interests are maintained and fully funded via Newmont Joint Venture as detailed in Note 28.
The Consolidated Entity holds various exploration licences to regulate its exploration activities in Australia. These licences
include conditions and regulations with respect to the rehabilitation of areas disturbed during the course of its exploration
activities. So far as the Directors are aware there has been no known breach of the Consolidated Entity’s licence conditions
and all exploration activities comply with relevant environmental regulations.
13
DIRECTORS’ REPORT (Continued)
INFORMATION ON DIRECTORS
As at the date of this report the Directors’ interests in shares and unlisted options of the Consolidated Entity are as follows:
Directors
Ian Macpherson
Executive Chairman
Appointed 18 October 2010
Richard Carcenac
Chief Executive Officer and Executive
Director
Appointed 16 June 2015
Paul Graham-Clarke
Non-Executive Director
Appointed 16 December 2015
Athol Emerton
Non-Executive Director
Appointed 19 August 2019
DIRECTORS’ MEETINGS
Ordinary Shares
Performance Rights Unlisted Options
51,000,000
-
33,441,210
15,000,000
19,435,564
91,948,871
-
-
-
-
-
-
The number of meetings of the Consolidated Entity’s Directors held in the period each Director held office during the
financial year and the numbers of meetings attended by each Director were:
Director
Board of Directors’ Meetings
I Macpherson
R Carcenac
P Graham-Clarke
Meetings Attended
3
3
3
Meetings held while
a director
3
3
3
14
DIRECTORS’ REPORT (Continued)
REMUNERATION REPORT
the ASX Corporate Governance Council’s Corporate Governance Principles and
Recommendation 8.1 of
Recommendations (2nd edition) states that the Board should establish a Remuneration Committee. The Board has formed
the view that given the number of Directors on the Board, this function could be performed just as effectively with full Board
participation. Accordingly, it was resolved that there would be no separate Board sub-committee for remuneration
purposes.
This report details the amount and nature of remuneration of each Director of the Consolidated Entity and executive officers
of the Consolidated Entity during the year.
Overview of Remuneration Policy
The Board of Directors is responsible for determining and reviewing compensation arrangements for the Directors and the
executive team. The broad remuneration policy is to ensure that remuneration properly reflects the relevant person’s
duties and responsibilities, and that the remuneration is competitive in attracting, retaining and motivating people of the
highest quality. The Board believes that the best way to achieve this objective is to provide the Managing Director (or
equivalent) and the Executive Team with a remuneration package consisting of a fixed and variable component that
together reflects the person’s responsibilities, duties and personal performance. An equity based remuneration
arrangement for the Board and the Executive Team is in place. The remuneration policy is to provide a fixed remuneration
component and a specific equity related component, with performance conditions. The Board believes that this
remuneration policy is appropriate given the stage of development of the Consolidated Entity and the activities which it
undertakes and is appropriate in aligning Director and executive objectives with shareholder and business objectives.
The remuneration policy in regard to setting the terms and conditions for the Chief Executive Officer has been developed
by the Board taking into account market conditions and comparable salary levels for companies of a similar size and
operating in similar sectors.
Directors receive a superannuation guarantee contribution required by the government, which is currently 9.5% per annum
and do not receive any other retirement benefits. Some individuals, however, can choose to sacrifice part or all of their
salary to increase payments towards superannuation.
All remuneration paid to Directors is valued at cost to the Consolidated Entity and expensed. Options are valued using
either the Black-Scholes methodology or the Binomial model. In accordance with current accounting policy the value of
these options is expensed over the relevant vesting period.
Non-Executive Directors
The Board policy is to remunerate Non-Executive Directors at market rates for comparable companies for time,
commitment and responsibilities. The Board determines payments to the Non-Executive Directors and reviews their
remuneration annually, based on market practice, duties and accountability. Independent external advice is sought when
required. The maximum aggregate amount of fees that can be paid to Non-Executive Directors is subject to approval by
shareholders at a General Meeting. The annual aggregate amount of remuneration paid to Non-Executive Directors was
approved by shareholders on 7 November 2006 and is not to exceed $200,000 per annum. Actual remuneration paid to
the Consolidated Entity’s Non-Executive Directors is disclosed below notwithstanding the approved maximum of $200,000
and the policy of fair remuneration, Non-Executive Directors have accepted significantly reduced remuneration fees in light
of the restricted working capital position of the company as it builds its business units. Remuneration fees for Non-
Executive Directors are not linked to the performance of the Consolidated Entity. However, to align Directors’ interests
with shareholder interests, the Directors are encouraged to hold shares in the Consolidated Entity.
Senior Executives and Management
The Consolidated Entity aims to reward executives with a level of remuneration commensurate with their position and
responsibilities within the Consolidated Entity so as to:
Reward executives of the Consolidated Entity and individual performance against targets set by reference to
appropriate benchmarks;
Reward executives in line with the strategic goals and performance of the Consolidated Entity; and
Ensure that total remuneration is competitive by market standards.
Structure
Remuneration consists of the following key elements:
Fixed remuneration; and
Issuance of performance rights.
15
DIRECTORS’ REPORT (Continued)
Fixed Remuneration
Fixed remuneration consists of base remuneration (which is calculated on a total cost basis including any employee
benefits e.g. motor vehicles) as well as employer contributions to superannuation funds.
The level of fixed remuneration is set so as to provide a base level of remuneration which is both appropriate to the position
and is competitive in the market.
Remuneration packages for the staff who report directly to the Managing Director (or equivalent) are based on the
recommendation of the Managing Director (or equivalent), subject to the approval of the Board in the annual budget setting
process.
Service Agreement
Mr Richard Carcenac was appointed Chief Executive Officer and an Executive Director on 16 June 2015. A summary of
his employment contract is as follows:
•
•
•
Term of agreement – Ongoing, subject to termination and notice periods;
Base Salary, $250,000 including superannuation;
The following performance rights were issued on 27 November 2015;
• 7,500,000 Class 2 performance rights subject to meeting specific performance criteria achieved within 24
months;
• 7,500,000 Class 3 performance rights subject to meeting specific performance criteria achieved within 24
months; and
•
Termination of employment by either party requires 3 month’s written notice.
Contracted key management personnel are engaged on standard commercial terms.
Details of the nature and amount of each element of the remuneration of each Director and Executive Officer of RBR Group
Limited paid/accrued during the year are as follows:
2018/2019
Directors
I Macpherson – Executive Chairman
R Carcenac – Chief Executive Officer
P Graham-Clarke – Non-Executive
Executives
Ken Foote – General Manager, Training (i)
P Soh – Company Secretary, CFO (ii)
Short-term Benefits
Post
Employment
Equity
Compensation
Base
Salary/Fees
$
Motor
Vehicle/Bonus
$
Superannuation
Contributions
$
Performance
Rights (v)
$
Total
$
76,606
228,311
20,000
117,000
47,500
-
-
-
-
3,478
21,690
-
-
28,217
-
80,084
278,218
20,000
-
9,278
-
126,278
47,500
2017/2018
Directors
I Macpherson – Executive Chairman
R Carcenac – Chief Executive Officer
I Buchhorn – Non-Executive (iii)
D Fyfe – Non-Executive Director (iv)
P Graham-Clarke – Non-Executive
Executives
Ken Foote – General Manager, Training (i)
P Soh – Company Secretary, CFO (ii)
Notes:
(i) Mr Foote was identified as a KMP for the year ending 30 June 2019.
(ii) Mr Soh resigned as Company Secretary on 2 August 2019 and continues as CFO.
(iii) Mr Buchhorn resigned as Non-Executive Director on 19 April 2018
(iv) Mr Fyfe was appointed Non-Executive Director on 18 December 2017 and resigned on 13 June 2018
(v) Amounts represent value of performance rights expensed for the period.
76,606
228,311
18,750
5,000
20,000
3,478
21,690
-
475
-
91,000
57,235
-
-
-
-
-
-
-
-
87,375
-
-
-
-
80,084
337,376
18,750
5,475
20,000
91,000
57,235
Other than the Directors and Executive Officers disclosed above there were no other Executive Officers who received
emoluments during the financial year ended 30 June 2019.
16
DIRECTORS’ REPORT (Continued)
Loans
During the 2019 financial year, the transactions with Directors, included an entity related to Ian Macpherson, which loaned
the Company $55,000 on normal commercial terms (unsecured, interest rate of 5%). The loans have been repaid from
the proceeds of shares issued. There were no other loan transactions with Directors or Executives in the current year.
Movement in Shares
The aggregate numbers of shares of the Company held directly, indirectly or beneficially by Directors and Executive
Officers of the Consolidated Entity or their personally-related entity are as follows:
Opening
Purchases
Disposals
30 June
Purchases
Closing
-
-
-
-
-
-
9,699,999
3,000,000
-
3,000,000
-
-
49,000,000
33,441,210
-
19,435,564
-
-
39,300,001
30,441,210
-
16,435,564
-
-
2,000,000
-
91,948,871
-
-
-
2018/2019
Mr I Macpherson (i) & (ii)
Mr R Carcenac (ii)
Mr Athol Emerton (iii)
Mr P Graham-Clarke (ii)
Mr K Foote
Mr P Soh
2017/2018
Mr I Macpherson
Mr R Carcenac
Mr I Buchhorn (iv)
Mr D Fyfe
Mr P Graham-Clarke
Mr P Soh
Notes:
(i) Purchase includes during FY2019 include on-market purchases of 6,699,999 and purchases post 30 June 2019 are on-market.
(ii) Purchase includes 3,000,000 shares from placement in December 2018.
(iii) Post 30 June purchase represents holding on appointment as Director on the 19 August 2019.
(iv) Deemed disposal when left the Board or Company.
-
-
- (18,574,724)
-
-
-
5,747,600
-
-
39,300,001
30,441,210
-
-
16,435,564
-
33,800,000
17,691,210
18,574,724
-
10,687,964
-
5,500,001
12,750,000
51,000,000
33,441,210
91,948,871
19,435,564
-
-
-
-
-
-
-
-
Movement in Options
The aggregate numbers of options of the Company held directly, indirectly or beneficially by Directors and Executive
Officers of the Consolidated Entity or their personally-related entity are as follows:
Opening
Placement
options (i)
30 June
Expired 31
July 2019
Closing
2018/2019
Mr I Macpherson
Mr R Carcenac
Mr Athol Emerton
Mr P Graham-Clarke
Mr K Foote
Mr P Soh
Notes:
(i) Options were a free issue on a 1 option for every 2 shares basis as apart of a placement participated by Directors and approved by
shareholders at a general meeting on the 6 November 2018. Options had an exercise price of $0.018 expiring on the 31 July 2019.
1,500,000
1,500,000
-
1,500,000
-
-
1,500,000
1,500,000
-
1,500,000
-
-
1,500,000
1,500,000
-
1,500,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
There were no amounts payable on the issue of the options, and there are no performance conditions attached. All options
previously issued are now fully vested and are exercisable at any time. When exercisable, each option is convertible into
one ordinary share of RBR Group Limited.
17
DIRECTORS’ REPORT (Continued)
Movement in Convertible Notes
The aggregate numbers of Convertible Notes of the Company held directly, indirectly or beneficially by Directors and
Executive Officers of the Consolidated Entity or their personally-related entity are as follows:
Opening
Issues (i)
On
appointment
Closing
2018/2019
Mr I Macpherson
Mr R Carcenac
Mr Athol Emerton (ii)
Mr P Graham-Clarke
Mr K Foote
Mr P Soh
Notes:
(i)
(ii) Mr Emerton’s holding on appointment as Director on the 19 August 2019.
-
-
-
-
-
-
80,000
22,500
-
-
-
-
-
-
80,000
-
-
-
80,000
22,500
80,000
-
-
-
Issue of Convertible Notes to Directors was by shareholders at a general meeting on the 6 November 2018.
Performance Rights
The terms and conditions of each grant of options affecting remuneration in this or future reporting periods are as follows:
Granted
Number
Date of Grant
Terms & Conditions for each Grant
Date of
Vesting
Option
Value ($)
Exercise
Price ($)
Expiry Date
7,500,000 27 Nov 2017 Refer (i) below
7,500,000 29 Nov 2018 Refer (ii) below
Performance Rights
R Carcenac Class 2 (i)
R Carcenac Class 3 (ii)
Staff Performance Rights
Ken Foote Class 1 (iii)
Ken Foote Class 2 (iii)
Notes:
(i) Rights subject to performance criteria prior to 26 November 2018; the Company’s market capitalisation averaging over a period of 30
consecutive trading days a daily average of not less than $8,000,000; and consolidated gross income of the Company and its revenue
exceeding $2,000,000; and Mr Carcenac completing 24 months of continuous employment with the Company.
1,250,000 22 Jan 2019 Refer (iii) below
1,250,000 22 Jan 2019 Refer (iii) below
N/A 31 Dec 2018
N/A 31 Dec 2019
N/A 26 Nov 2019
N/A 29 Nov 2020
0.00720
0.00048
0.00350
0.00689
(ii) Rights subject to performance criteria prior to 29 November 2020; the Company’s market capitalisation averaging over a period of 30
consecutive trading days a daily average of not less than $10,000,000; and Mr Carcenac completing 12 months of continuous
employment with the Company following date of issue.
(iii) Staff Performance Rights subject to internal management KPI criteria prior to expiry date.
As at the date of this report no Performance Rights had vested.
Movement in Performance Rights
The aggregate numbers of Performance Rights of the Company held directly, indirectly or beneficially by Directors and
Executive Officers of the Consolidated Entity or their personally-related entity are as follows:
2018/2019
Mr I Macpherson
Mr R Carcenac
Mr Athol Emerton (ii)
Mr P Graham-Clarke
Mr K Foote
Mr P Soh
Opening
Granted
Closing
-
7,500,000
-
-
-
-
-
7,500,000
-
-
2,500,000
-
-
15,000,000
-
-
2,500,000
-
18
DIRECTORS’ REPORT (Continued)
INDEMNIFYING OFFICERS AND AUDITOR
During the year the Company paid an insurance premium to insure certain officers of the Consolidated Entity. The officers
of the Consolidated Entity covered by the insurance policy include the Directors named in this report.
The Directors and Officers Liability insurance provides cover against all costs and expenses that may be incurred in
defending civil or criminal proceedings that fall within the scope of the indemnity and that may be brought against the
officers in their capacity as officers of the Consolidated Entity. The insurance policy does not contain details of the premium
paid in respect of individual officers of the Consolidated Entity. Disclosure of the nature of the liability cover and the amount
of the premium is subject to a confidentiality clause under the insurance policy.
The Consolidated Entity has not provided any insurance for an auditor of the Consolidated Entity.
AUDITORS’ INDEPENDENCE DECLARATION
Section 370C of the Corporations Act 2001 requires the Consolidated Entity’s auditors Butler Settineri (Audit) Pty Ltd, to
provide the Directors of the Consolidated Entity with an Independence Declaration in relation to the audit of the financial
report. This Independence Declaration is attached and forms part of this Directors’ Report.
NON-AUDIT SERVICES
A company related to Butler Settineri (Audit) Pty Limited provided non-audit services on taxation during the period. The
Directors are satisfied that the provision of non-audit services is compatible with the general standard of independence for
auditors imposed by the Corporations Act 2001. The Directors are satisfied that the provision of non-audit services by the
auditor, as set out below, did not compromise the auditor independence requirements of the Corporations Act 2001.
Taxation Services
PROCEEDINGS ON BEHALF OF THE CONSOLIDATED ENTITY
2019
$
2018
$
2,550
2,920
No person has applied for leave of Court to bring proceedings on behalf of the Consolidated Entity or intervene in any
proceedings to which the Consolidated Entity is a party for the purpose of taking responsibility on behalf of the Consolidated
Entity for all or any part of those proceedings. The Consolidated Entity was not party to any such proceedings during the
year.
19
DIRECTORS’ DECLARATION
CORPORATE GOVERNANCE
In recognising the need for the highest standards of corporate behaviour and accountability, the Directors of the
Consolidated Entity support and have adhered to the principles of corporate governance. The Consolidated Entity’s
corporate governance practices have been disclosed in Appendix 4G in accordance with ASX listing rule 4.7.3 at the same
time as the annual report is lodged with the ASX. Further information about the Company’s corporate governance practices
is set out on the Company’s web site at www.rbrgroup.com.au. In accordance with the recommendations of the ASX,
information published on the web site includes codes of conduct and other policies and procedures relating to the Board
and its responsibilities.
DATED at Perth this 30th day of August 2019
Signed in accordance with a resolution of the Directors
Ian Macpherson
Executive Chairman
Competent Persons Statement
The information in this report that relates to Exploration is based on information compiled by Andrew Ford who is a Member of the
Australasian Institute of Mining and Metallurgy. Andrew Ford is a consultant to RBR Group Limited and has sufficient experience that is
relevant to the style of mineralisation and type of deposit under consideration, and to the exploration activity that is being undertaking to
qualify as a Competent Person as defined in the 2012 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral
Resources and Ore Reserves”. Andrew Ford has consented to the inclusion in this report of the matters based on his information in the
form and context that it appears.
20
AUDITOR’S INDEPENDENCE DECLARATION
21
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the year ended 30 June 2019
Notes
2
3
3
3
3
5
Revenue
Cost of sales
Gross profit
Employee expenses
Directors’ fees
Insurance expenses
Consultants fees
Corporate expenses
Depreciation
Property expenses
Share-based payments expense
Exploration costs refund
Exploration written off
Goodwill impairment
Interest expense
Capital raising costs
Other expenses
Loss before income tax
Income tax
Net loss for the year
Other comprehensive income that may be recycled to
profit or loss
Foreign currency translation adjustments
Total other comprehensive loss
Total comprehensive loss
Loss is attributable to:
Equity holders of RBR Group Ltd
Non-controlling interests
Total comprehensive loss is attributable to:
Equity holders of RBR Group Ltd
Non-controlling interests
2019
$
531,588
(71,347)
460,241
(662,759)
(60,092)
(20,102)
(267,161)
(68,345)
(17,523)
(175,244)
(46,993)
-
(21,659)
-
(87,312)
(16,537)
(530,313)
(1,513,799)
228
(1,513,571)
(5,130)
(5,130)
(1,518,701)
(1,498,298)
(15,273)
(1,513,571)
(1,503,122)
(15,579)
(1,518,701)
Earnings per share
Basic earnings/(loss) per share (cents per share)
Diluted earnings/(loss) per share (cents per share)
21
21
(0.21) cents
(0.21) cents
2018
$
485,180
(155,703)
329,477
(544,329)
(79,317)
(7,617)
(196,191)
(100,624)
(19,024)
(141,195)
(62,765)
3,493
-
(150,000)
-
-
(454,795)
(1,422,887)
(577)
(1,423,464)
(13,829)
(13,829)
(1,437,293)
(1,413,820)
(9,644)
(1,423,464)
(1,427,796)
(9,497)
(1,437,293)
(0.24) cents
(0.24) cents
The above Consolidated Statement of Comprehensive Income should be read in conjunction with the Consolidated Entity
accompanying notes.
22
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 30 June 2019
ASSETS
CURRENT ASSETS
Cash and cash equivalents
Trade receivables
Other assets
TOTAL CURRENT ASSETS
NON-CURRENT ASSETS
Plant and equipment and motor vehicles
Intangibles
Capitalised mineral exploration expenditure
TOTAL NON-CURRENT ASSETS
TOTAL ASSETS
LIABILITIES
CURRENT LIABILITIES
Trade and other payables
Provisions
Convertible Note Liability
TOTAL CURRENT LIABILITIES
TOTAL LIABILITIES
NET ASSETS
EQUITY
Contributed equity
Reserves
Accumulated losses
Equity attributable to equity holders in the Company
Non-controlling interests
TOTAL EQUITY
Notes
22(a)
6
7
8
10
11
12
13
14
15(a)
16
2019
$
412,821
167,741
40,774
621,336
45,979
149,898
17,843
213,720
835,056
229,335
35,300
1,304,513
1,569,148
1,569,148
(734,092)
19,478,110
716,650
(20,906,828)
(712,068)
(22,024)
(734,092)
2018
$
341,920
205,464
15,932
563,316
34,257
149,898
39,147
223,302
786,618
207,434
40,082
-
247,516
247,516
539,102
19,279,596
674,481
(19,408,530)
545,547
(6,445)
539,102
The above Consolidated Statement of Financial Position should be read in conjunction with the Consolidated Entity’s
accompanying notes.
23
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 30 June 2019
l
a
t
o
T
-
n
o
N
g
n
i
l
l
o
r
t
n
o
c
t
s
e
r
e
t
n
i
f
o
s
r
e
n
w
O
t
n
e
r
a
p
e
h
t
l
d
e
t
a
u
m
u
c
c
A
n
o
i
t
a
l
s
n
a
r
T
s
e
s
s
o
l
e
v
r
e
s
e
R
n
g
i
e
r
o
F
y
c
n
e
r
r
u
C
e
r
a
h
S
n
o
i
t
p
O
e
v
r
e
s
e
R
d
e
t
u
b
i
r
t
n
o
C
y
t
i
u
q
E
s
e
t
o
N
3
9
4
,
0
7
8
0
1
6
9
2
,
3
8
8
,
0
4
8
,
)
9
7
6
8
5
0
,
8
1
(
)
7
9
0
,
7
4
(
3
7
1
,
2
1
8
6
8
4
,
4
3
1
,
8
1
7
1
0
2
E
N
U
J
0
3
T
A
E
C
N
A
L
A
B
2
0
1
,
9
3
5
)
5
4
4
,
6
(
7
4
5
,
5
4
5
,
)
0
3
5
8
0
4
,
9
1
(
)
2
3
4
,
5
9
(
3
1
9
,
9
6
7
6
9
5
,
9
7
2
,
9
1
8
1
0
2
E
N
U
J
0
3
T
A
E
C
N
A
L
A
B
)
4
6
4
,
3
2
4
,
1
(
)
4
4
6
,
9
(
)
0
2
8
,
3
1
4
,
1
(
)
0
2
8
,
3
1
4
,
1
(
-
)
9
2
8
,
3
1
(
7
4
1
)
6
7
9
,
3
1
(
-
)
6
7
9
,
3
1
(
)
3
9
2
,
7
3
4
,
1
(
)
7
9
4
,
9
(
)
6
9
7
,
7
2
4
,
1
(
)
0
2
8
,
3
1
4
,
1
(
)
6
7
9
,
3
1
(
-
-
-
5
6
7
2
6
,
-
-
-
-
-
-
-
5
6
7
,
2
6
7
3
1
3
4
0
,
,
1
2
5
0
,
3
5
8
0
,
0
4
0
1
,
-
-
-
-
-
-
-
-
-
-
-
)
0
1
6
9
2
(
,
0
1
6
,
9
2
9
6
9
,
3
6
)
9
5
3
,
4
3
(
-
-
-
-
-
-
-
e
m
o
c
n
i
i
e
v
s
n
e
h
e
r
p
m
o
c
r
e
h
O
t
r
a
e
y
e
h
t
r
o
f
s
s
o
L
e
m
o
c
n
i
i
e
v
s
n
e
h
e
r
p
m
o
c
l
t
a
o
T
5
8
0
,
0
4
0
,
1
)
b
(
5
1
r
a
e
y
e
h
t
g
n
i
r
u
d
d
e
u
s
s
i
s
e
r
a
h
S
n
o
i
t
a
n
b
m
o
c
i
s
s
e
n
s
u
b
i
n
o
g
n
i
t
a
n
m
i
i
l
e
t
s
e
r
e
t
n
i
g
n
i
l
l
o
r
t
n
o
c
-
n
o
N
:
s
r
e
n
w
o
s
a
y
t
i
c
a
p
a
c
r
i
e
h
t
n
i
s
r
e
n
w
o
h
t
i
w
s
n
o
i
t
c
a
s
n
a
r
T
)
0
0
0
,
0
7
(
0
0
0
,
0
7
y
t
i
u
q
e
o
t
s
e
r
a
h
s
d
e
u
s
s
n
u
i
r
e
f
s
n
a
r
T
5
6
7
,
2
6
-
)
5
7
3
,
7
8
(
5
7
3
,
7
8
0
5
3
,
2
5
)
0
5
3
,
2
5
(
d
e
u
s
s
i
s
t
h
g
i
r
e
c
n
a
m
r
o
f
r
e
P
d
e
t
s
e
v
s
t
h
g
i
r
e
c
n
a
m
r
o
f
r
e
P
s
t
h
g
i
r
e
c
n
a
m
r
o
f
r
e
p
r
e
k
o
r
B
24
)
1
7
5
,
3
1
5
,
1
(
)
3
7
2
5
1
(
,
)
8
9
2
,
8
9
4
,
1
(
)
8
9
2
,
8
9
4
,
1
(
-
-
4
1
5
,
8
9
1
3
9
9
6
4
,
-
-
-
-
4
1
5
,
8
9
1
3
9
9
,
6
4
-
-
-
)
0
3
1
,
5
(
)
6
0
3
(
)
4
2
8
,
4
(
-
)
1
0
7
,
8
1
5
,
1
(
)
9
7
5
5
1
(
,
)
2
2
1
,
3
0
5
,
1
(
)
8
9
2
,
8
9
4
,
1
(
-
-
-
)
4
2
8
,
4
(
)
4
2
8
,
4
(
-
-
-
-
-
3
9
9
,
6
4
-
-
-
e
m
o
c
n
i
i
e
v
s
n
e
h
e
r
p
m
o
c
r
e
h
O
t
r
a
e
y
e
h
t
r
o
f
s
s
o
L
e
m
o
c
n
i
i
e
v
s
n
e
h
e
r
p
m
o
c
l
t
a
o
T
4
1
5
,
8
9
1
)
b
(
5
1
r
a
e
y
e
h
t
g
n
i
r
u
d
d
e
u
s
s
i
s
e
r
a
h
S
:
s
r
e
n
w
o
s
a
y
t
i
c
a
p
a
c
r
i
e
h
t
n
i
s
r
e
n
w
o
h
t
i
w
s
n
o
i
t
c
a
s
n
a
r
T
-
-
y
t
i
u
q
e
o
t
s
e
r
a
h
s
d
e
u
s
s
n
u
i
r
e
f
s
n
a
r
T
s
n
o
i
t
p
o
d
n
a
s
t
h
g
i
r
e
c
n
a
m
r
o
f
r
e
P
r
a
e
y
e
h
t
g
n
i
r
u
d
)
2
9
0
,
4
3
7
(
)
4
2
0
2
2
(
,
)
8
6
0
,
2
1
7
(
,
)
8
2
8
6
0
9
,
0
2
(
)
6
5
2
,
0
0
1
(
6
0
9
,
6
1
8
0
1
1
,
8
7
4
,
9
1
9
1
0
2
E
N
U
J
0
3
T
A
E
C
N
A
L
A
B
i
t
.
s
e
o
n
g
n
y
n
a
p
m
o
c
c
a
s
’
y
t
i
t
n
E
d
e
t
a
d
i
l
o
s
n
o
C
e
h
t
h
t
i
w
n
o
i
t
c
n
u
n
o
c
n
j
i
d
a
e
r
l
e
b
d
u
o
h
s
y
t
i
u
q
e
n
i
s
e
g
n
a
h
c
f
o
t
n
e
m
e
t
a
t
s
d
e
t
a
d
i
l
o
s
n
o
C
e
v
o
b
a
e
h
T
CONSOLIDATED STATEMENT OF CASH FLOWS
For the year ended 30 June 2019
Notes
2019
$
2018
$
Cash flows from operating activities
Receipts from customers
Interest received
Convertible note interest paid
Payments to suppliers and employees (inclusive of goods
and services tax)
Net cash used in operating activities
22(b)
540,320
1,846
(73,519)
601,409
1,542
-
(1,862,774)
(1,394,127)
(1,628,335)
(1,025,384)
Cash flows from investing activities
Payments for exploration and evaluation
Receipt on sale of tenement
Payments for investments in subsidiaries
Payments for plant and equipment
Net cash used in investing activities
Cash flows from financing activities
Proceeds from loan
Repayment of loan
Proceeds from the issue of shares (net of fees)
Proceeds from convertible notes
Capital raising costs
Net cash provided by financing activities
Net decrease in cash held
Cash at the beginning of the financial year
Exchange rate movements
Cash at the end of the financial year
22(a)
(354)
-
-
(29,121)
(29,475)
96,715
(89,239)
198,514
1,304,513
(16,537)
1,493,966
70,364
341,920
537
412,821
2,655
-
(4,578)
(10,209)
(12,132)
-
-
1,040,085
-
-
1,040,085
2,569
339,084
267
341,920
The above Consolidated Statement of Cash Flows should be read in conjunction with the Consolidated Entity’s
accompanying notes.
25
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2019
1.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The principal accounting policies adopted in preparing the financial report of the Company, RBR Group Limited and
its controlled entities (“RBR” or “Consolidated Entity”), are stated to assist in a general understanding of the financial
report. These policies have been consistently applied to all the years presented, unless otherwise indicated.
RBR Group Limited is a Company limited by shares incorporated and domiciled in Australia whose shares are
publicly traded on the official list of the Australian Securities Exchange. The financial statements are presented in
Australian dollars which is the Consolidated Entity’s functional currency.
(a)
Basis of Preparation
This general purpose financial report has been prepared in accordance with Australian Accounting
Standards (including Australian Interpretations) adopted by the Australian Accounting Standards Board and
the Corporations Act 2001.
RBR Group Limited is a for-profit entity for the purpose of preparing the financial statements.
The financial report has been prepared on the basis of historical costs and does not take into account
changing money values or, except where stated, current valuations of non-current assets.
The financial report was authorised for issue by the Directors.
Going Concern
The Consolidated Entity incurred a loss for the year of $1,513,571 (2018: $1,423,464) including a non-cash
impairment charge of $nil (2018: $150,000).
At 30 June 2019 the Consolidated Entity had cash assets of $412,821 (2018: $341,920) and working capital
of $356,701 (2018: $315,800). During the financial year the Company raised $1,503,027 before costs from
issue of shares and convertible notes.
Although the above is indicative of a material uncertainty, the Company maintains the ongoing support of its
major shareholders and capital markets advisers in ensuring continuing access to equity funds. The
Company completed a capital raise in December 2018 and January 2019 that included the issue of
1,304,513 convertible notes. In March 2019 7,528,573 options at $0.018 were exercised and converted to
ordinary shares. The Company is confident that it will be able to access additional funds through the equity
markets during the year to allow for operating activities to continue, if required. Based on this information,
the Directors consider it appropriate that the financial statements be prepared on a going concern basis.
(b)
Use of Estimates and Judgements
The preparation of financial statements requires management to make judgements, estimates and
assumptions that affect the application of accounting policies and reported amounts of assets and liabilities,
income and expenses. Actual results may differ from these estimates. Estimates and underlying
assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the
period in which the estimate is revised and in any future periods affected. None of the balances reported
have been derived from estimates.
(c)
Basis of Consolidation
Controlled Entity
The consolidated financial statements comprise the financial statements of RBR Group Limited and its
subsidiaries as at 30 June each year.
The financial statements of the subsidiaries are prepared for the same reporting period as the parent
company, using consistent accounting policies.
In preparing the consolidated financial statements, all intercompany balances and transactions, income and
expenses and profit and losses resulting from intra-group transactions have been eliminated in full. The
subsidiaries are fully consolidated from the date on which control is transferred to the consolidated entity
and ceases to be consolidated from the date on which control is transferred out of the consolidated entity.
The acquisition of the subsidiaries has been accounted for using the purchase method of accounting. The
purchase method of accounting involves allocating the cost of the business combination to the fair value of
the assets acquired and the liabilities and contingent liabilities assumed at the date of acquisition.
26
NOTES TO THE FINANCIAL STATEMENTS (Continued)
For the year ended 30 June 2019
Accordingly, the consolidated financial statements include the results of the subsidiaries for the period from
their acquisition.
Joint Ventures
Joint ventures are those entities over whose activities the consolidated entity has joint control, established
by contractual agreement.
In the consolidated entity’s financial statements, investments in joint ventures are carried at cost. Details of
these interests are shown in Note 28.
(d)
Income Tax
The income tax expense or revenue for the period is the tax payable on the current period’s taxable income
based on the income tax rate adjusted by changes in deferred tax assets and liabilities attributable to
temporary differences between the tax bases of assets and liabilities and their carrying amounts in the
financial statements, and to unused tax losses.
Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to apply
when the assets are recovered or liabilities are settled, based on those tax rates which are enacted. The
relevant tax rates are applied to the cumulative amounts of deductible and taxable temporary differences to
measure the deferred tax asset or liability. An exception is made for certain temporary differences arising
from the initial recognition of an asset or a liability. No deferred asset or liability is recognised in relation to
those temporary differences if they arose in a transaction, other than a business combination, that at the
time of the transaction did not affect either accounting profit or taxable profit or loss.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is
probable that future taxable amounts will be available to utilise those temporary differences and losses.
Current and future tax balances attributable to amounts recognised directly in equity are also recognised
directly in equity.
(e)
Foreign Currency Translation
The financial statements are presented in Australian dollars, which is RBR Group Limited’s functional and
presentation currency.
Foreign currency transactions
Foreign currency transactions are translated into Australian dollars using the exchange rates prevailing at
the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such
transactions and from the translation at financial year-end exchange rates of monetary assets and liabilities
denominated in foreign currencies are recognised in profit or loss.
Foreign operations
The assets and liabilities of foreign operations are translated into Australian dollars using the exchange rates
at the reporting date. The revenues and expenses of foreign operations are translated into Australian dollars
using the average exchange rates, which approximate the rates at the dates of the transactions, for the
period. All resulting foreign exchange differences are recognised in other comprehensive income through
the foreign currency reserve in equity.
The foreign currency reserve is recognised in profit or loss when the foreign operation or net investment is
disposed of.
(f)
Revenue Recognition
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Consolidated
Entity and the revenue can be reliably measured. The following specific recognition criteria must also be met
before revenue is recognised.
Revenue from rendering of services
Rendering of services revenue from training, payroll and business service fees is recognised by reference
to the stage of completion of the contracts. Stage of completion is measured by reference to delivery of
service.
27
NOTES TO THE FINANCIAL STATEMENTS (Continued)
For the year ended 30 June 2019
Interest income
Interest revenue is recognised on a time proportionate basis that takes into account the effective yield on
the financial asset.
(g)
Cash and Cash Equivalents
Cash and short-term deposits in the statement of financial position comprise cash at bank and in hand and
short-term deposits with an original maturity of three months or less.
For the purposes of the Consolidated Statement of Cash Flows, cash and cash equivalents consist of cash
and cash equivalents as defined above, which are readily convertible to cash on hand and which are used
in the cash management function on a day-to-day basis.
(h)
Employee Entitlements
Liabilities for wages and salaries, annual leave and other current employee entitlements expected to be
settled within 12 months of the reporting date are recognised in other payables in respect of employees’
services up to the reporting date and are measured at the amounts expected to be paid when the liabilities
are settled. Liabilities for non-accumulating sick leave are recognised when the leave is taken and measured
at the rates paid or payable.
Contributions to employee superannuation plans are charged as an expense as the contributions are paid
or become payable.
(i)
Plant and Equipment and Motor Vehicles
Each class of plant and equipment and motor vehicles is carried at cost or fair value less, where applicable,
any accumulated depreciation and impairment losses.
Plant and equipment and motor vehicles
Plant and equipment and motor vehicles are stated at cost less accumulated depreciation and any
impairment in value.
The carrying values of plant and equipment and motor vehicles are reviewed for impairment when events or
changes in circumstances indicate the carrying value may not be recoverable.
For an asset that does not generate largely independent cash flows, the recoverable amount is determined
for the cash-generating unit to which the asset belongs.
If any such indication exists where the carrying values exceed the estimated recoverable amount, the assets
or cash generating units are written down to their recoverable amount.
Depreciation
Depreciable non-current assets are depreciated over their expected economic life using either the straight
line or the diminishing value method. Profits and losses on disposal of non-current assets are taken into
account in determining the operating loss for the year. The depreciation rate used for each class of assets
is as follows:
Plant & equipment
20 - 33%
(j)
Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of goods and services tax (“GST”), except
where the amount of GST incurred is not recoverable from the Australian Taxation Office (“ATO”). 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 are stated with the amount of GST included. GST incurred is claimed from the
ATO when a valid tax invoice is provided. The net amount of GST recoverable from, or payable to, the
ATO is included as a current asset or liability in the balance sheet.
Cash flows are included in the statement of cash flows on a gross basis. The GST components of cash
flows arising from investing and financing activities which are recoverable from, or payable to, the ATO are
classified as operating cash flows.
28
NOTES TO THE FINANCIAL STATEMENTS (Continued)
For the year ended 30 June 2019
(k)
Payables
These amounts represent liabilities for goods and services provided to the Consolidated Entity prior to the
end of the financial year and which are unpaid. The amounts are unsecured and are usually paid within 30
days of recognition.
(l)
Contributed Equity
Issued capital is recognised as the fair value of the consideration received by the Company.
Any transaction costs arising on the issue of ordinary shares are recognised directly in equity as a reduction
of the share proceeds received.
(m) Exploration and Evaluation Expenditure
Mineral exploration and evaluation expenditure incurred is accumulated in respect of each identifiable area
of interest and is subject to impairment testing. These costs are carried forward only if they relate to an area
of interest for which rights of tenure are current, can be successfully developed or have not reached a stage
which permits assessment of recoverability.
A regular review is undertaken of each area of interest to determine the appropriateness of continuing to
carry forward costs in relation to that area of interest.
(n)
Earnings per Share
Basic earnings per share (“EPS”) are calculated based upon the net profit/(loss) attributable to equity holders
of the parent divided by the weighted average number of shares. Diluted EPS are calculated as the net
profit/(loss) attributable to equity holders of the parent divided by the weighted average number of shares
and dilutive potential shares.
(o)
Leases
Leases are classified at their inception as either operating or finance leases based on the economic
substance of the agreement so as to reflect the risks and benefits incidental to ownership.
The minimum lease payments of operating leases, where the lessor effectively retains substantially all of the
risks and benefits of ownership of the leased item, are recognised as an expense on a straight-line basis
over the term of the lease.
(p)
Borrowings
Loans and borrowings are initially recognised at the fair value of the consideration received, net of
transaction costs. They are subsequently measured at amortised cost using the effective interest method.
The component of the convertible notes that exhibits characteristics of a liability is recognised as a liability
in the statement of financial position, net of transaction costs. On the issue of the convertible notes the fair
value of the liability component is determined using a market rate for an equivalent non-convertible bond
and this amount is carried as a non-current liability on the amortised cost basis until extinguished on
conversion or redemption. The increase in the liability due to the passage of time is recognised as a finance
cost. The remainder of the proceeds are allocated to the conversion option that is recognised and included
in shareholders equity as a convertible note reserve, net of transaction costs. The carrying amount of the
conversion option is not remeasured in the subsequent years. The corresponding interest on convertible
notes is expensed to profit or loss.
(q)
Share-based payment transactions
The Company provides benefits to employees (including Directors and Consultants) of the Consolidated
Entity in the form of share-based payment transactions, whereby employees render services in exchange
for shares or rights over shares (“Equity–settled transactions”).
There is currently one plan in place to provide these benefits being an Employee Share Option Plan (“ESOP”)
which provides benefits to Directors, Consultants and Senior Executives.
The cost of these equity-settled transactions is measured by reference to fair value at the date at which they
are granted. The fair value is determined by an external valuer using the either the Black-Scholes or
Binomial model.
29
NOTES TO THE FINANCIAL STATEMENTS (Continued)
For the year ended 30 June 2019
In valuing equity-settled transactions, other than conditions linked to the price of the shares of RBR Group
Limited (“market conditions”), management reviews the likelihood of achieving performance criteria.
The cost of equity settled securities is recognised, together with a corresponding increase in equity, over the
period in which the performance conditions are fulfilled, ending on the date on which the relevant employees
become fully entitled to the award (“vesting date”).
Where the Consolidated Entity acquires some form of interest in an exploration tenement or an exploration
area of interest and the consideration comprises share-based payment transactions, the fair value of the
equity instruments granted is measured at grant date. The cost of equity securities is recognised within
capitalised mineral exploration and evaluation expenditure, together with a corresponding increase in equity.
(r)
Comparative Figures
When required by Accounting Standards, comparative figures have been adjusted to conform to changes in
presentation for the current financial year.
(s)
Financial risk management
The Board of Directors has overall responsibility for the establishment and oversight of the risk management
framework, to identify and analyse the risks faced by the Consolidated Entity. These risks include credit
risk, liquidity risk and market risk from the use of financial instruments. The Consolidated Entity has only
limited use of financial instruments through its cash holdings being invested in short term interest bearing
securities. The primary goal of this strategy is to maximise returns while minimising risk through the use of
accredited Banks with a minimum credit rating of A1 from Standard & Poors. The Consolidated Entity has
no debt, and working capital is maintained at its highest level possible and regularly reviewed by the full
board.
(t)
Changes in accounting policies and disclosures
In the current year, the Consolidated Entity has adopted all new and revised Standards and Interpretations
that have been issued and are effective for the accounting periods beginning on or after 1 January 2018.
The adoption of the new and revised Standards and Interpretations has not resulted in any changes to the
Group’s accounting policies.
(u)
Standards issued but not yet effective
Australian Accounting Standards and Interpretations that have recently been issued or amended but are not
yet mandatory, have not been early adopted by the Consolidated Entity for the annual reporting period ended
30 June 2019. The Consolidated Entity's assessment of the impact of these new or amended Accounting
Standards and Interpretations, most relevant to the Consolidated Entity, are set out below.
AASB 16: Leases (applicable to annual reporting periods beginning on or after 1 January 2019).
When effective, this Standard will replace the current accounting requirements applicable to leases in AASB
117: Leases and related Interpretations. AASB 16 introduces a single lessee accounting model that
eliminates the requirement for leases to be classified as operating or finance leases.
The main changes introduced by the new Standard include:
-
recognition of a right-to-use asset and liability for all leases (excluding short-term leases with less than
12 months of tenure and leases relating to low-value assets);
- depreciation of right-to-use assets in line with AASB 116: Property, Plant and Equipment in profit or loss
and unwinding of the liability in principal and interest components;
- variable lease payments that depend on an index or a rate are included in the initial measurement of the
lease liability using the index or rate at the commencement date;
- by applying a practical expedient, a lessee is permitted to elect not to separate non-lease components
and instead account for all components as a lease; and
- additional disclosure requirements.
The transitional provisions of AASB 16 allow a lessee to either retrospectively apply the Standard to
comparatives in line with AASB 108 or recognise the cumulative effect of retrospective application as an
adjustment to opening equity on the date of initial application.
The Directors anticipate that the adoption of AASB 16 will impact the Group's financial statements and
estimate that the impact to be similar to the operating lease commitments of $80,282, detailed in note 19.
30
NOTES TO THE FINANCIAL STATEMENTS (Continued)
For the year ended 30 June 2019
2.
OTHER INCOME
Revenue
Revenue from training services (i)
Revenue from payroll services (ii)
Revenue from business services (iii)
Interest
2019
$
2018
$
314,539
111,847
103,356
1,846
166,287
111,619
207,274
1,569
531,588
485,180
Notes:
(i) RBR delivers training services to clients and recognises revenue based on completion of training by students. Pricing is
based on each training program and student enrolment for the program. A program is considered delivered following a final
report on training sent to the client.
(ii) Payroll and HR services are based on a percentage of the total payroll and billed following completion of the payroll service.
(iii) RBR delivers a range of business services to clients and recognises revenue on successful delivery of those services.
There is a schedule of fixed prices for services.
3.
EXPENSES
Contributions to employees superannuation plans
Depreciation - plant and equipment
Exploration Written off
Share based payment expense
Provision for employee entitlements
Other Expenses
Travel and accommodation
IT and communications
Legal and public relations
Other
4.
AUDITORS’ REMUNERATION
Butler Settineri (Audit) Pty Limited (Including component auditors
Perfect Partners - Mozambique)
Audit and review of the financial statements
Taxation Services – company related to Butler Settineri (Audit) Pty Ltd
2019
$
2018
$
33,296
17,523
21,659
46,993
(4,093)
63,899
39,912
96,843
329,659
530,313
38,851
19,024
(3,493)
62,765
(7,976)
105,464
26,614
81,250
241,467
454,795
2019
$
2018
$
31,578
2,550
34,128
37,881
2,920
40,801
31
NOTES TO THE FINANCIAL STATEMENTS (Continued)
For the year ended 30 June 2019
5.
INCOME TAX
(a)
Income tax expense
No income tax is payable by the Consolidated Entity as it has incurred losses for income tax purposes for the year,
therefore current tax, deferred tax and tax expense is $Nil (2018: $Nil).
2019
$
Numerical reconciliation of income tax expense to prima facie tax payable
(b)
2018
$
Loss from continuing operations before income tax expense
(1,513,800)
(1,422,887)
Prima facie tax benefit at the Australian tax rate of 30% (2017: 30%)
(454,140)
(426,866)
Tax effect of amounts which are not deductible (taxable) in calculating
taxable income:
Non-deductible expenses
Overseas projects income and expenses
Other allowable expenditure
Deferred tax asset not brought to account
Income tax expense
(b)
Tax losses
20,596
81,507
(1,193)
62,753
72,152
(290)
353,458
292,470
228
219
Unused tax losses for which no deferred tax asset has been recognised
17,756,759
16,582,746
Potential tax benefit at 30%
5,329,727
4,974,823
(c)
Unrecognised deferred tax assets
Unrecognised deferred tax assets
Provisions
Carry forward tax losses
15,621
17,295
5,329,727
4,974,823
5,345,348
4,992,118
No deferred tax asset has been recognised for the above balance as at 30 June 2019 as it is not considered
probable that future taxable profits will be available against which it can be utilised.
Unrecognised deferred tax liabilities
Capitalised mineral exploration and evaluation expenditure
5,353
11,744
(d)
Franking credits balance
The Consolidated Entity has no franking credits as at 30 June 2019 available for use in future years (2018: $Nil).
6.
TRADE RECEIVABLES
Current
Trade receivables
Other receivables
2019
$
152,190
15,551
167,741
2018
$
199,654
5,810
205,464
Trade receivables represent outstanding amounts owed by customers in Mozambique. Other receivables include
GST and other value added tax receipts.
32
NOTES TO THE FINANCIAL STATEMENTS (Continued)
For the year ended 30 June 2019
7.
OTHER ASSETS
Current
Prepayments
8.
PLANT AND EQUIPMENT AND MOTOR VEHICLES
Plant and office equipment
At cost
Accumulated depreciation
2019
$
2018
$
40,774
15,932
2019
$
2018
$
190,126
162,808
(144,147)
(128,551)
45,979
34,257
Reconciliation
Reconciliation of the carrying amounts for each class of plant and equipment and motor vehicles are set out
below:
Plant and office equipment
Carrying amount at beginning of the year
Additions
Depreciation
Foreign currency differences
Carrying amount at the end of the year
2019
$
2018
$
34,257
29,121
41,484
10,209
(17,523)
(19,024)
124
45,979
1,588
34,257
33
NOTES TO THE FINANCIAL STATEMENTS (Continued)
For the year ended 30 June 2019
9.
INVESTMENTS
Particulars in relation to the Controlled Entity
RBR Group Limited is the parent entity.
Name of Controlled Entity
Country of
incorporation
Class of
Shares
Equity Holding
Freelance Support Pty Ltd (i)
Australia
Ordinary
PacMoz, Lda
Mozambique
Ordinary
Futuro Skills Mozambique, Lda (ii)
Mozambique
Ordinary
Futuro Business Services, Lda (iii)
Mozambique
Ordinary
Rubicon Resources & Mining, Lda (iv)
Mozambique
Ordinary
Morson Mozambique, Lda (iv)
Mozambique
Ordinary
2019
100%
100%
100%
100%
59.4%
59.4%
Futuro Skills Guinee SARL (v)
Notes:
(i) RBR purchased 100% of the issued capital of Freelance Support Pty Ltd on 11 January 2016.
(ii) RBR Incorporated Futuro Skills Mozambique, Lda on 9 July 2015.
(iii) RBR Incorporated Futuro Business Services, Lda on 24 May 2017.
(iv) Parent entity owner PacMoz, Lda. These entities are dormant.
(v) RBR Incorporated Futuro Skills Guinee SARL on 21 February 2018.
Ordinary
Guinea
60%
2018
100%
100%
100%
100%
59.4%
59.4%
60%
10.
INTANGIBLES
Cost brought forward
Goodwill impairment of PacMoz Lda
2019
$
149,898
2018
$
299,898
-
(150,000)
149,898
149,898
The carrying value of the goodwill for PacMoz was subject to impairment testing in accordance with the accounting
standards. A valuation was undertaken using a discounted cashflow model based on current cashflows plus
expected revenues and a discount rate of 12% and the Board agreed to maintain the current carrying value. The
carrying value of the intangible is expected to be indefinite and will be evaluated on a six-month basis in the future.
The Directors reviewed the carrying value of Freelance Support Pty Ltd and formed a view that the carrying value
is recoverable.
34
NOTES TO THE FINANCIAL STATEMENTS (Continued)
For the year ended 30 June 2019
11.
CAPITALISED MINERAL EXPLORATION EXPENDITURE
In the exploration phase
Non-Current
Balance at the beginning of the year
Expenditure incurred during the year (at cost)
Refund of exploration costs
Exploration expenditure written off
Balance at the end of the year
2019
$
2018
$
39,147
355
-
(21,659)
17,843
38,309
(2,655)
3,493
-
39,147
The recoupment of costs carried forward is dependent on the successful development and/or commercial
exploitation or alternatively sale of the respective areas of interest. The Company assessed the value of its
exploration assets and impaired tenements that had expired.
12.
TRADE AND OTHER PAYABLES
Current (Unsecured)
Trade creditors
Other creditors and accruals
Loan
2019
$
134,866
2018
$
122,018
94,469
85,416
-
-
229,335
207,434
Included within trade and other creditors and accruals is an amount of $nil (2018: nil) relating to exploration
expenditure.
13.
PROVISIONS
Current
Africa Tax Provisions
Employee entitlements
2019
$
(1,460)
36,760
35,300
2018
$
3,259
36,823
40,082
PacMoz tax provisions relate to deferred taxes in Mozambique and employee entitlements are a calculation of
leave owing to employees.
35
NOTES TO THE FINANCIAL STATEMENTS (Continued)
For the year ended 30 June 2019
14.
CONVERTIBLE NOTES
On 22 January 2019, the Company completed the issue of 1,304,513 Convertible Notes at a face value of $1 as
part of its preparations to capitalise on the US$50 billion LNG construction boom about to get underway in
Mozambique.
The key terms of the Convertible Notes are as follows.
Type of Instrument: Convertible notes which are convertible into Ordinary Fully Paid Shares and attaching
Options; the Notes will not be quoted on any securities exchange or financial market.
Face Value: Each Note shall have a face value of $1.00 (Face Value); the aggregate Face Value of all Notes is
$1,304,513.
Maturity Date: The Notes will mature on the date that is 24 months after the Issue Date.
Interest: The Notes shall bear interest at the rate of 12% per annum, accrued monthly and calculated monthly;
interest on the Notes shall be paid quarterly in cash by the Company to the Noteholder.
Conversion at election of Noteholder: The Noteholder may at any time after the date that is 6 months after the
Issue Date and prior to the Maturity Date and the Company issuing a Redemption, elect to convert all the Notes
into Shares by providing the Company with notice of the conversion in a form acceptable to the Company acting
reasonably. On receipt of a Conversion Notice, the Company must issue Shares to the Noteholder based on a price
per Share equal to the lower of $0.015 and the issue price of any equity capital raising completed by the Company
within the two months prior to receipt of the Conversion Notice, but in any event not less than $0.01; issue Options
to the Noteholder for nil or nominal consideration on the basis that the Noteholder is entitled to 1 Option of every 5
Shares issued to the Noteholder on conversion of the Notes and immediately pay to the Noteholder any outstanding
Interest that is due and payable.
Repayment at election of Company: The Company may, at any time prior to the Maturity Date and the Noteholder
providing a Conversion Notice elect to redeem all the Notes by providing written notice to the Noteholders. Within
2 business days of issuing a Redemption Notice, the Company must pay to each Noteholder the Face Value of the
Notes in cash; issue Options to each Noteholder for nil or nominal consideration and pay each Noteholder in cash
an amount equal to 12 months Interest on the Principal Amount less any amount of Interest already paid by the
Company to the relevant Noteholder as at the date of the Redemption Notice.
If the Company issues a Redemption Notice, it must redeem all of the Notes.
The number of Options issued will be the same number of Options that would have been issued to the Noteholder
had the Noteholder given a Conversion Notice to the Company dated the same date as the Redemption Notice
Repayment at Maturity Date: If at the Maturity Date the Notes have not been converted by the Noteholder or
repaid by the Company, the Company must redeem all the Notes by paying to the Noteholder (within 2 business
days of the Maturity Date) the Face Value of the Notes in cash plus any outstanding Interest that is due and payable.
Option Exercise Price and Expiry Date: Each Option will be unquoted and have an exercise price equal to the
volume weighted average price per Share of Shares traded on ASX during the 20 trading day period ending on the
date that an Exercise Notice is given in respect of the Option and will expire at 5.00pm (WST) on the date that is
two (2) years after their issue (Expiry Date). Any Option not exercised before the Expiry Date will automatically
lapse on the Expiry Date. Each Option entitles the holder to subscribe for one fully paid ordinary share in the capital
of the Company upon exercise of the Option.
36
NOTES TO THE FINANCIAL STATEMENTS (Continued)
For the year ended 30 June 2019
15.
CONTRIBUTED EQUITY
(a)
Ordinary Shares
2019
$
2018
$
716,264,651 (2018: 699,736,078) fully paid ordinary shares
19,478,110
19,279,596
(b)
Share Movements during the Year
Beginning of the financial year
699,736,078
19,279,596
510,913,294
18,134,486
2019
2018
Number of
Shares
$
Number of
Shares
$
New share issues during the year
Director placement (i)
Conversion of options (ii)
Placements during the year (iii)
Broker options (iv)
Unissued shares (v)
Shares issued to staff (vi)
Less costs of share issues
9,000,000
63,000
7,528,573
135,514
-
-
-
-
-
-
-
-
-
-
-
-
-
167,322,784
1,092,014
-
(52,350)
14,000,000
7,500,000
70,000
87,375
-
(51,929)
716,264,651
19,478,110
699,736,078
19,279,596
Notes:
(i) As approved at the general meeting on 6 November 2018, shares were issued to directors as part of a placement.
(ii) Exercise of $0.018 options.
(iii) In September 2017, 53,622,784 shares valued at $268,114 before costs, were issued as the 2nd tranche of a placement
approved by shareholders on 8 August 2017. In December 2017 and January 2018 a placement of 70,000,000 shares was
made raising $490,000 before costs. In June 2018 a placement for 57,700,000 shares was made to raise $403,900 before
costs.
(iv) As part of the December placement 15,000,000 broker options with an exercise price of $0.025 expiring on 30 June 2020,
were issued as part of the capital raising cost.
(v) Included in the September 2017 placement were 14,000,000 unissued shares for a value of $70,000.
(vi) Vesting of 7,500,000 tranche 1 performance rights was made to Mr Carcenac on 16 March 2018.
(c)
Unlisted Options
The following table details movement of options during the year.
Beginning of the financial year
1 Jul 2018
Number of
Options
43,850,002
Exercise
Price $0.018
Expiring
31 July 2019
28,850,002
Exercise
Price $0.025
Expiring
30 June 2020
15,000,000
Director placement (i)
6 Dec 2018
4,500,000
4,500,000
Vendor options as part of a share-
based payment (ii)
Converted to shares (iii)
Converted to shares (iii)
6 Dec 2018
3,500,000
3,500,000
7 Mar 2019
(2,457,144)
(2,457,144)
27 Jul 2019
(5,071,429)
(5,071,429)
-
-
-
-
Notes:
(i) As approved at the general meeting on the 6 November 2018, options were issued to directors as part of a placement.
(ii) Options issued as part of a share based payment to a supplier
(iii) Exercise of $0.018 options.
30 Jun 2019
44,321,429
29,321,429
15,000,000
As at the date of this report the only remaining options were the 15,000,000 broker options with an exercise price
of $0.025 expiring on 30 June 2020. There were no other options issued to staff under the RBR Share Option Plan
(refer Note 17).
37
NOTES TO THE FINANCIAL STATEMENTS (Continued)
For the year ended 30 June 2019
2019
Unquoted placement options (1
option for 2 shares)
Issue date
Expiry date
Number of
options
Exercise
Price
Weighted
average
value cents
6 Dec 2018
31 Jul 2019
4,500,000
$0.018
N/A
Unquoted vendor options
6 Dec 2018
31 Jul 2019
3,500,000
$0.018
0.312
2018
Unquoted Placement Options (3
options for 4 shares)
Unquoted Placement Options (3
options for 4 shares)
15 Dec 2017
30 Jun 2018
45,000,000
$0.018
22 Jan 2018
30 Jun 2018
7,500,000
$0.018
Unquoted broker options
15 Dec 2017
30 Jun 2020
15,000,000
Unquoted placement options (1
option for 2 shares)
25 Jun 2018
31 Jul 2019
28,850,002
$0.025
$0.018
N/A
N/A
0.349
N/A
The assessed fair values of the 15,000,000 Broker and 3,500,000 Vendor Options were determined on a Black-
Scholes model, taking into account the exercise price, term of option, the share price at grant date and expected
price volatility of the underlying share, expected yield and the risk-free interest rate for the term of the option. The
inputs to the model used were:
Grant Date
7 December 2017
6 December 2018
Expiry Date
30 June 2020
31 July 2019
Exercise
Price (Cents)
2.50
1.80
Volatility
Percentage (%)
130
130
Risk-free
rate (%)
1.93
1.93
Value (Cents)
for one Option
0.349
0.312
(d)
Performance Shares
An independent valuation was completed on performance rights granted during the year. Market based vesting
conditions were valued using a hybrid share option pricing model that simulates the share price of the Company as
at the test date using a Monte-Carlo model. For non-market based vesting conditions no discount was made to the
underlying valuation model.
Grant date
Expiry date
Number of
performance
rights
Weighted
average
value cents
2019
R Carcenac Class 3
29 Nov 2018
29 Nov 2020
7,500,000
0.689
Rights subject to performance criteria prior to 29 November 2020; the Company’s market capitalisation
averaging over a period of 30 consecutive trading days a daily average of not less than $10,000,000; and Mr
Carcenac completing 12 months of continuous employment with the Company following date of issue.
At the Annual General Meeting held on 28 November 2018, shareholders approved the issue of Performance
Rights of Mr Carcenac.
Staff Performance Rights Class 1
22 Jan 2019
31 Dec 2018
1,250,000
Staff Performance Rights Class 2
22 Jan 2019
31 Dec 2019
1,250,000
0.720
0.048
Staff Performance Rights subject to internal management KPI criteria prior to expiry date. In determining the
value of the Performance Rights, Management assigned a likelihood of achieving performance criteria and
applied the value of shares on grant date of $0.012.
38
NOTES TO THE FINANCIAL STATEMENTS (Continued)
For the year ended 30 June 2019
Grant date
Expiry date
Number of
performance
rights
Weighted
average
value cents
2016
R Carcenac Class 2
27 Nov 2015
27 Nov 2019
7,500,000
0.350
Rights subject to performance criteria prior to 26 November 2019; the Company’s market capitalisation
averaging over a period of 30 consecutive trading days a daily average of not less than $8,000,000; and
consolidated gross income of the Company and its revenue exceeding $2,000,000; and Mr Carcenac
completing 24 months of continuous employment with the Company.
At the Annual General Meeting held on 28 November 2017, shareholders approved the variation to the
Performance Rights of Mr Carcenac, amending the expiry date of each tranche by one year. Mr Carcenac’s
Class 2 Performance Rights expiry date changed from 27 November 2018 to 27 November 2019. An
independent valuation was completed following changes to the expiry dates.
(e)
Terms and Conditions of Contributed Equity
Ordinary Shares
The Company is a public company limited by shares. The Company was incorporated in Perth, Western Australia.
The Company’s shares are limited whereby the liability of its members is limited to the amount (if any) unpaid on
the shares respectively held by them.
Ordinary shares have the right to receive dividends as declared and, in the event of the winding up of the Company,
to participate in the proceeds from the sale of all surplus assets in proportion to the number of shares held.
Ordinary shares which have no par value, entitle their holder to one vote, either in person or by proxy, at a meeting
of the Company.
The Company’s objectives when managing capital are to safeguard their ability to continue as a going concern, so
that they may continue to provide returns for shareholders and benefits for other stakeholders.
(f)
Capital Risk Management
Due to the nature of the Consolidated Entity’s activities, the Consolidated Entity does not have ready access to
credit facilities, with the primary source of funding being equity raisings. Therefore, the focus of the Consolidated
Entity’s capital risk management is the current working capital position against the requirements to meet the costs
of development of the group’s business units and corporate overheads. The Consolidated Entity’s strategy is to
ensure appropriate liquidity is maintained to meet anticipated operating requirements, with a view to initiating
appropriate capital raisings as required. The working capital position of the Consolidated Entity is as follows:
Cash and cash equivalents
Trade and other receivables
Other assets
Trade and other payables
Provisions
Working capital position
2019
$
412,821
167,741
40,774
2018
$
341,920
205,464
15,932
(229,335)
(207,434)
(35,300)
356,701
(40,082)
315,800
39
NOTES TO THE FINANCIAL STATEMENTS (Continued)
For the year ended 30 June 2019
16.
RESERVES
Reserves
Share Option Reserve
Foreign Currency Translation Reserve
Total Reserves
As represented by:
Share Option Reserve
Balance at the beginning of the year
Unissued (issued) shares
Performance rights expensed in current year
Performance rights vested
Broker options issued
Balance at the end of the year
2019
$
2018
$
816,906
(100,256)
716,650
769,913
(95,432)
674,481
2019
$
2018
$
769,913
-
46,993
-
-
816,906
812,173
(70,000)
62,765
(87,375)
52,350
769,913
The share option reserve comprises any equity settled share based payment transactions.
Foreign Currency Translation Reserve
Balance at the beginning of the year
Loss on translation of foreign subsidiaries
Balance at the end of the year
2019
$
2018
$
(95,432)
(4,824)
(100,256)
(47,097)
(48,335)
(95,432)
The foreign currency translation reserve is used to record currency differences arising from the translation of
financial statements of foreign operations.
40
NOTES TO THE FINANCIAL STATEMENTS (Continued)
For the year ended 30 June 2019
17. OPTION PLAN
The establishment of the RBR Group Limited Employee Securities Incentive Plan (“the Plan”) was approved by
special resolution at a General Meeting of Shareholders of the Consolidated Entity held on 28 November 2017. All
eligible Directors, Executive Officers, Employees and Consultants of RBR Group Limited who have been
continuously employed by the Consolidated Entity are eligible to participate in the Plan.
The Plan allows the Consolidated Entity to issue free securities to eligible persons. Listing Rule 7.2, exception 9(b)
provides an exception to Listing Rule 7.1 such that issues of Equity Securities under an employee incentive scheme
are exempt for a period of 3 years from the date on which shareholders approve the issue of Equity Securities under
the scheme as an exception to Listing Rule 7.1.
18.
RELATED PARTIES
Full remuneration details for Directors and Executives are included in the Directors report where the information
has been audited as indicated.
19.
EXPENDITURE COMMITMENTS
(a)
Exploration
The Consolidated Entity has certain obligations to perform minimum exploration work on mineral leases held. These
obligations may vary over time, depending on the Consolidated Entity’s exploration programs and priorities. As at
balance date, total exploration expenditure commitments on tenements held by the Consolidated Entity have not
been provided for in the financial statements and those which cover the following twelve-month period amount to
$84,000 (2018: $70,000). These obligations are also subject to variations by farm-out arrangements or sale of the
relevant tenements.
(b)
Operating Lease Commitments
The Consolidated Entity has entered into commercial leases for office premises in Mozambique and Australia. The
Mozambique lease has a three-year term commencing March 2016. The Australian lease has a term until
December 2019.
Within one year
After one year but not more than five years
2019
$
80,282
-
2018
$
77,751
27,039
80,282
104,790
(c)
Capital Commitments
The Consolidated Entity had no capital commitments at 30 June 2019 (2018: $Nil).
41
NOTES TO THE FINANCIAL STATEMENTS (Continued)
For the year ended 30 June 2019
20.
SEGMENT INFORMATION
The Consolidated Entity has operated the business in two distinct regions, Asia-Pacific and Africa since the
purchase of PacMoz in March 2015. The operating segments are recognised according to geographical location,
with each segment representing a strategic business unit. As the chief operating decision makers, the Directors
and Executive Management team monitor the operating results of business units separately, for the purposes of
making decisions about resource allocation and performance assessment.
Year ended 30/6/2019
Revenue
Asia-Pacific
$
1,804
Africa
$
485,866
Total
$
487,670
Operating Profit (Loss) before tax
(1,242,108)
(271,691)
(1,513,799)
Income Tax
Net Profit (Loss) after tax
Segment Assets
Segment Liabilities
Year ended 30/6/2018
Revenue
-
228
228
(1,242,108)
(271,463)
(1,513,571)
531,358
1,483,320
303,698
835,056
85,828
1,569,148
Asia-Pacific
$
121,804
Africa
$
363,376
Total
$
485,180
Operating Profit (Loss) before tax
(1,032,479)
(390,407)
(1,422,887)
Income Tax
Net Profit (Loss) after tax
Segment Assets
Segment Liabilities
21.
EARNINGS/ (LOSS) PER SHARE
(359)
(218)
(577)
(1,032,838)
(390,626)
(1,423,464)
452,090
121,994
334,528
125,522
786,618
247,516
The following reflects the loss and share data used in the calculations of basic and diluted earnings/(loss) per share:
Earnings/(loss) used in calculating basic and diluted earnings/ (loss) per
share
(1,498,298)
(1,413,820)
2019
$
2018
$
Weighted average number of ordinary shares used in calculating basic
earnings/(loss) per share:
Effect of dilutive securities-share options
706,909,660
593,960,476
-
-
Adjusted weighted average number of ordinary shares used in calculating
diluted earnings/(loss) per share
706,909,660
593,960,476
Basic and diluted loss per share (cents per share)
(0.21)
(0.24)
Non-dilutive securities
As at balance date, 44,321,429 unlisted options (30 June 2018: 43,850,002) which represent potential ordinary
shares were not dilutive as they would decrease the loss per share.
42
NOTES TO THE FINANCIAL STATEMENTS (Continued)
For the year ended 30 June 2019
22.
NOTES TO THE STATEMENT OF CASH FLOWS
(a)
Cash and Cash Equivalents
Cash at the end of the financial year as shown in the statement of cash flows is reconciled to the related items in
the balance sheet as follows:
Cash on hand
Cash at bank
Deposits at call
2019
$
2018
$
432
395,785
16,605
412,821
264
325,051
16,605
341,920
(b) Reconciliation of the loss from ordinary activities after income tax to the net cash flows used in
operating activities
Loss from ordinary activities after income tax
Non-cash items:
Depreciation
Exploration written-off
Share-based payments expense
Goodwill impairment
Exchange movement
Change in operating assets and liabilities:
Decrease (Increase) in prepayments
Decrease (Increase) in receivables
Increase (Decrease) in trade creditors and accruals
Increase in employee provisions
2019
$
2018
$
(1,513,571)
(1,423,464)
17,523
21,659
46,993
-
(4,824)
(24,842)
37,722
21,901
(4,782)
19,024
(3,493)
62,765
150,000
(8,599)
5,783
111,261
66,114
(4,775)
Net cash outflows used in operating activities
(1,394,127)
(1,025,384)
(c)
Stand-By Credit Facilities
As at 30 June 2019 the Consolidated Entity has a business credit card facility available totaling $20,000 of which
$10,400 (2018: $82) was utilised.
43
NOTES TO THE FINANCIAL STATEMENTS (Continued)
For the year ended 30 June 2019
23. FINANCIAL INSTRUMENTS
The Consolidated Entity's activities expose it to a variety of financial risks and market risks. The Consolidated
Entity's overall risk management program focuses on the unpredictability of financial markets and seeks to minimise
potential adverse effects on the financial performance of the Consolidated Entity.
(a)
Interest Rate Risk
The Consolidated Entity’s exposure to interest rate risk, which is the risk that a financial instrument’s value will
fluctuate as a result of changes in market, interest rates and the effective weighted average interest rates on those
financial assets, is as follows:
Note Weighted
Average
Effective
Interest
%
Funds
Available at a
Floating
Interest Rate
$
Fixed
Interest Rate
$
Assets/
(Liabilities)
Non-Interest
Bearing
$
Total
$
2019
Financial assets
Cash and cash equivalents
22(a)
0.3%
395,785
16,605
432
412,821
2018
Financial assets
Cash and cash equivalents
22(a)
0.6%
325,051
16,605
264
341,920
(b)
Foreign currency exchange risk
The Consolidated Entity undertakes certain transactions denominated in foreign currencies, hence exposures to
exchange rate fluctuations arise. The carrying amount of the Consolidated Entity’s foreign currency denominated
monetary assets and monetary liabilities at the reporting date is as follows:
Assets – Mozambique Metical
Liabilities – Mozambique Metical
Assets – Guinean Franc
Liabilities – Guinean Franc
Foreign currency sensitivity analysis
2019
$
198,862
2018
$
229,065
81,238
157,432
4,836
4,591
6,296
-
The Consolidated Entity is exposed to Mozambique Metical (MZN) and Guinea Franc (GNF) currency fluctuations.
The following table details the Consolidated Entity’s sensitivity to a 10% increase and decrease in the Australian
Dollar (AUD) against the relevant currencies. 10% is the sensitivity rate used when reporting foreign currency risk
internally to key management personnel and represents management’s assessment of the possible change in
foreign exchange rates. The sensitivity analysis includes only outstanding foreign currency denominated monetary
items and adjusts their translation at the period end for a 10% change in foreign currency rates.
The sensitivity analysis includes cash balances held in MZN/GNF and trade creditors and other payables held in
MZN/GNF. A positive number indicates an increase in profit and other equity where the AUD weakens against the
relevant currency. For a strengthening Australian Dollar against the relevant currency there would be an equal and
opposite impact on the profit and other equity and the balances would be negative.
AUD strengthens against MZN
AUD weakens against MZN
44
2019
$
Profit /(Loss)
2018
$
Profit /(Loss)
(11,762)
11,762
(7,984)
7,984
NOTES TO THE FINANCIAL STATEMENTS (Continued)
For the year ended 30 June 2019
AUD strengthens against GNF
AUD weakens against GNF
(c)
Credit Risk
2019
$
2018
$
(250)
250
(630)
630
The maximum exposure to credit risk, excluding the value of any collateral or other security, at balance date, is the
carrying amount, net of any provisions for doubtful debts, as disclosed in the balance sheet and in the notes to the
financial statements.
The Consolidated Entity does not have any material credit risk exposure to any single debtor or group of debtors,
under financial instruments entered into by it. As at the end of the year the Consolidated Entity had trade receivables
of $152,190 (2018: $199,654) as detailed in Note 6. Included in the trade receivables of $152,190 at 30 June 2019,
$140,092 were due in less than 6 months, $5,269 were due between 6-12 months and $6,829 were due between
1-5 years. The Company has assessed the exposure to credit losses as low and has not made any provision for
credit losses and will continue to review long outstanding receivables.
(d)
Liquidity Risk
The liquidity position of the Consolidated Entity is managed to ensure sufficient liquid funds are available to meet
financial obligations as they fall due. The contractual maturities of the financial liabilities referred to in Note 12 at
the reporting date are less than 12 months.
(e)
Net Fair Values
For assets and other liabilities, the net fair value approximates their carrying value. No financial assets and financial
liabilities are readily traded on organised markets in standardised form. The Consolidated Entity has no financial
assets where the carrying amount exceeds net fair values at balance date.
The aggregate net fair values and carrying amounts of financial assets and financial liabilities are disclosed in the
statement of financial position and in the notes to the financial statements.
24.
EMPLOYEE ENTITLEMENTS AND SUPERANNUATION COMMITMENTS
Employee Entitlements
The aggregate employee entitlement liability is disclosed in Note 13.
Directors, Officers, Employees and Other Permitted Persons Option Plan
Details of the Consolidated Entity’s Directors, Officers, Employees and Other Permitted Persons Option Plan are
disclosed in Note 17.
Superannuation Commitments
The Consolidated Entity contributes to individual employee accumulation superannuation plans at the statutory rate
of the employees’ wages and salaries, in accordance with statutory requirements, to provide benefits to employees
on retirement, death or disability.
Accordingly, no actuarial assessments of the plans are required.
Funds are available for the purposes of the plans to satisfy all benefits that would have been vested under the plans
in the event of:
termination of the plans;
voluntary termination by all employees of their employment; and
compulsory termination by the employer of the employment of each employee.
During the year employer contributions (including salary sacrifice amounts) to superannuation plans totaled $33,296
(2018: $38,851).
45
NOTES TO THE FINANCIAL STATEMENTS (Continued)
For the year ended 30 June 2019
25.
CONTINGENT LIABILITIES
There were no material contingent liabilities not provided for in the financial statements of the Consolidated Entity
as at 30 June 2019 other than:
Native Title and Aboriginal Heritage
Native title claims have been made with respect to areas which include tenements in which the Consolidated Entity
has an interest. The Consolidated Entity is unable to determine the prospects for success or otherwise of the claims
and, in any event, whether or not and to what extent the claims may significantly affect the Consolidated Entity or
its projects. Agreement is being or has been reached with various native title claimants in relation to Aboriginal
Heritage issues regarding certain areas in which the Consolidated Entity has an interest.
PacMoz Minority Acquisition
During the previous year, the Company acquired the 40% minority stake in PacMoz from the PacMoz Director and
General Manager Ms Hanlie Lloyd. The purchase consideration for the acquisition included a contingent liability for
the issue of 5,000,000 shares subject to Ms Lloyd successfully completing the re-organisation of the entity including
agreed specific conditions over the subsequent twelve month period. As at the date of this report no shares had
been issued to Ms Lloyd.
26.
EVENTS SUBSEQUENT TO THE REPORTING DATE
There has not arisen since the end of the financial year any item, transaction or event of a material and unusual
nature likely, in the opinion of the Directors of the Consolidated Entity to affect substantially the operations of the
Consolidated Entity, the results of those operations or the state of affairs of the Consolidated Entity in subsequent
financial years except for the following:
29,321,429 unlisted options with an exercise price $0.018 expired on 31 July 2019.
On 2 August 2019, the Company announced a change of Company Secretary appointing Ms Jessamyn Lyons.
On 14 August 2019, the Company announced that it had started training workers for jobs on the Mozambique
LNG projects.
On 19 August 2019, the Company announced the appointment of global logistics specialist Mr Athol Emerton
as Non-Executive Director.
46
NOTES TO THE FINANCIAL STATEMENTS (Continued)
For the year ended 30 June 2019
27.
PARENT COMPANY
(a)
Financial Position
As at 30 June 2019
Assets
Total current assets
Total non-current assets
Total Assets
Liabilities
Total current liabilities
Total Liabilities
Net Assets
Equity
Contributed equity
Reserves
Accumulated losses
Total Equity
Loss for the year
Other comprehensive income
2019
$
2018
$
1,251,881
493,688
1,745,569
1,473,320
1,473,320
272,249
756,275
503,350
1,259,625
111,994
111,994
1,147,631
19,478,467
19,279,952
816,906
769,913
(20,023,124)
(18,902,234)
272,249
1,147,631
(1,120,890)
(926,966)
-
-
Total comprehensive loss for the year
(1,120,890)
(926,966)
(b)
Guarantees entered into
RBR Group Limited has not entered into a deed of cross guarantee with its wholly-owned subsidiary.
(c)
Contingent liabilities
RBR Group Limited had no contingent liabilities at 30 June 2019 (2018: Nil).
(d)
Capital commitments
RBR Group Limited’s capital commitments are disclosed in Note 19.
47
NOTES TO THE FINANCIAL STATEMENTS (Continued)
For the year ended 30 June 2019
28.
INTERESTS IN JOINT VENTURES
RBR has the following Joint Venture Interest:
Peters Dam Joint Venture (Silver Lake Resources Limited (“Silver Lake”) 69%, RBR diluting)
The Peters Dam Joint Venture comprises approximately 6km2 of RBR tenements in the southern Yindarlgooda
project. Silver Lake has earned an initial 51% by spending $1.5 million. Silver Lake manages the joint venture and
is currently sole funding it with RBR being diluted. RBR can elect to contribute to the exploration program at six
monthly intervals (one-off right) to maintain its interest.
Yindarlgooda Farm-in Agreement (Newmont Exploration Pty Ltd (“Newmont”) 0%, RBR 100%)
The Yindarlgooda Project covers a 28km strike length of gold prospective stratigraphy between the Mt Monger-
Bulong (15km north) and Gindalbie (4km south) gold mining centres, and is just 600m from the Penny’s Find Gold
Project currently in development. The project also contains several historic gold workings. To date Newmont has
conducted a detailed geophysical interpretation, soil sampling and aircore drilling over the project.
The Term Sheet sets out the basic terms of the FJV Agreement as follows:
• Newmont has contributed expenditure of $75,000 and has elected to earn a 51% interest upon additional
Expenditure of $925,000 by 31 October 2019, the second anniversary of the FJV Agreement (“Phase 1 Earn-
in”).
• On and from the date Newmont has completed the Phase 1 Earn-In (“JV Commencement Date”), Newmont and
RBR will be associated in a joint venture for the exploration and evaluation and, if warranted, development and
exploitation of the Joint Venture Assets and all minerals within the Joint Venture Assets to which the Joint
Venture Assets extend.
• Newmont can then elect to commit to spending an additional $1.0 million over a further two years to earn 75%
equity in the project (Phase 2 Earn-in).
• Once Newmont has met the Phase 2 Earn In - RBR has the election to contribute to the Tenement expenditure
at its respective interest, or dilute using an industry standard dilution formula.
48
DIRECTORS’ DECLARATION
In the opinion of the Directors of RBR Group Limited (“the Consolidated Entity”):
(a)
the financial statements and notes, set out on pages 22 to 48, are in accordance with the Corporations Act 2001,
including:
(i)
(ii)
complying with Accounting Standards in Australia and the Corporations Regulations 2001 and other
mandatory professional reporting requirements; and
giving a true and fair view of the financial position of the Consolidated Entity as at 30 June 2019 and of its
performance, as represented by the results of its operations, for the financial year ended on that date.
(b)
there are reasonable grounds to believe that RBR Group Limited will be able to pay its debts as and when they
become due and payable.
The Directors have been given the declarations required by section 295A of the Corporations Act 2001 from the Managing
Director and the Company Secretary for the financial year ended 30 June 2019.
This declaration is made in accordance with a resolution of the Directors.
Signed at Perth this 30th day of August 2019.
Ian Macpherson
Executive Chairman
49
INDEPENDENT AUDITOR’S REPORT
50
INDEPENDENT AUDITOR’S REPORT (Continued)
51
INDEPENDENT AUDITOR’S REPORT (Continued)
52
INDEPENDENT AUDITOR’S REPORT (Continued)
53
INDEPENDENT AUDITOR’S REPORT (Continued)
54
ASX ADDITIONAL INFORMATION
Pursuant to the Listing Requirements of the Australian Stock Exchange Limited, the shareholder information set out below
was applicable as at 10 September 2019.
A. Voting Rights
In accordance with the Company’s Constitution, voting rights in respect of ordinary shares are on a show of hands whereby
each member present in person or by proxy shall have one vote and upon a poll each share shall have one vote.
B. Distribution of Equity Securities
Analysis of numbers of shareholders by size of holding:
Distribution
1 – 1000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 – and over
Totals
The number of equity security holders holding less than a marketable
parcel (based on a 1.4 cents price) of securities are:
C. Twenty Largest Shareholders
The names of the twenty largest holders of quoted shares are listed below:
Shareholder Name
Athol Emerton
Gurravembi Investments Pty Ltd
Fats Pty Ltd (Macib Super Fund A/C)
Fats Pty Ltd (Macib Family A/C)
Perth Capital Pty Ltd
Linvana Thomson
BT Portfolio Services Ltd (Warrell Holdings Super Fund A/C)
Richard A E Carcenac (Carcenac Family A/C)
Paul Graham-Clarke
Richard A E Carcenac (Carcenac Super Fund A/C)
Ragged Holdings Pty Ltd (Jon Young Family Fund)
Ashley Robert Brown
Harold Cripps Holdings Pty Ltd
Nicholas Barr
Gattenside Pty Ltd
Paul Horsfall
Citicorp Nominees Pty Ltd
Frank Violi
HSBC Custody Nominees (Australia) Ltd
Tom Hume Pty Ltd
Number of
Holders
Number of
Shares
110
64
44
326
362
906
344
22,753
147,457
329,203
16,033,021
699,732,217
716,264,651
3,382,992
Issued Ordinary Shares
Number of
Holders
88,473,872
28,000,000
27,787,315
20,683,334
20,000,000
18,847,314
18,436,192
15,810,000
13,553,156
13,350,000
13,000,000
12,000,000
11,500,000
11,183,370
10,610,416
9,625,184
9,574,803
8,000,000
7,489,037
7,366,311
365,290,304
Percentage of
Ordinary Shares
12.35%
3.91%
3.88%
2.89%
2.79%
2.63%
2.57%
2.21%
1.89%
1.86%
1.81%
1.68%
1.61%
1.56%
1.48%
1.34%
1.34%
1.12%
1.05%
1.03%
51.00%
55
ASX ADDITIONAL INFORMATION (Continued)
D. Substantial Shareholders
An extract of the Company’s Register of Substantial Shareholders (who holds 5% or more of the issued capital) is set out
below:
Shareholder Name
A Emerton & Associates
I Macpherson & Associates
E. Unquoted Options
Shareholder Name
Performance Rights
R Carcenac Class 2 1
R Carcenac Class 3 2
Staff Performance Rights Class 1 3
Staff Performance Rights Class 2 4
Options
Options exercisable at $0.025 each on or before 30 June 2020
Issued Ordinary Shares
Number of
Holders
85,842,268
38,800,001
Percentage of
Ordinary Shares
13.5%
6.9%
Number of
Holders
Number of
Securities
1
1
1
1
5
7,500,000
7,500,000
1,250,000
1,250,000
15,000,000
Notes:
(1) Rights subject to performance criteria prior to 27 November 2019; the Company’s market capitalisation averaging
over a period of 30 consecutive trading days a daily average of not less than $8,000,000; consolidated gross income
of the Company and its revenue exceeding $2,000,000; and Mr Carcenac completing 24 months of continuous
employment with the Company.
(2) Rights subject to performance criteria prior to 29 November 2020; the Company’s market capitalisation averaging
over a period of 30 consecutive trading days a daily average of not less than $10,000,000; and Mr Carcenac
completing 12 months of continuous employment with the Company following date of issue.
(3) Staff Performance Rights subject to internal management KPI criteria prior to expiry date. In determining the value
of the Performance Rights, Management assigned a likelihood of achieving performance criteria and applied the
value of shares on grant date of $0.012.
56
THIS PAGE HAS BEEN LEFT BLANK INTENTIONALLY
Level 2, 33 Colin Street, West Perth, Western Australia, 6005
Po Box 534, West Perth, Western Australia, 6872
Telephone: +61 8 9214 7500
Facsimile: +61 8 9214 7575
www.rbrgroup.com.au