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1
Renascor Resources Limited annual report 2020 financial statements
Renascor Resources is an emerging
critical minerals company with assets in
South Australia. It’s key projects include the
Siviour Graphite and Battery Anode Material
Project and the Carnding Gold Project.
-28°
S O U TT HH
A U S T R AA LL I A
-30°
Challenger
Prominent Hill
Olympic Dam
Marree
Carnding
Carrapateena
-32°
Olary
Eastern Eyre
Arno Bay
Siviour
Port Adelaide
Proposed battery anode
material operation
136°
138°
140°
Renascor project
-34°
RNU: Siviour Graphic Project
Major project
Railway / major roads
0
200 km
134°
Competent Persons Statement
Exploration Results
The information in this document that relates to exploration activities and exploration results is based on information compiled and reviewed
by Mr G.W. McConachy who is a Fellow of the Australasian Institute of Mining and Metallurgy. Mr McConachy is a director of the Company. Mr
McConachy has sufficient experience relevant to the style of mineralisation and type of deposits being considered to qualify as a Competent
Person as defined by the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the
JORC Code, 2012 Edition). Mr McConachy consents to the inclusion in the report of the matters based on the reviewed information in the form and
context in which it appears.
Mineral Resource
The information in this document that relates to Mineral Resources is based upon information compiled by
Mrs Christine Standing who is a Member of the Australasian Institute of Mining and Metallurgy and a Member of the Australian Institute of
Geoscientists. Mrs Standing is an employee of Optiro Pty Ltd and has sufficient experience relevant to the style of mineralisation, the type of
deposit under consideration and to the activity undertaken to qualify as a Competent Person as defined in the 2012 edition of the Australasian
Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves.
Ore Reserve
The information in this document that relates to Ore Reserves is based on information complied and reviewed by Mr Ben Brown, who is a Member
of the Australasian Institute of Mining and Metallurgy. Mr Brown is an employee of Optima Consulting and Contracting Pty Ltd and a consultant to
the Company. Mr Brown has sufficient experience relevant to the type of deposit under consideration to qualify as a Competent Person as defined
by the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the JORC Code, 2012
Edition).
This report may contain forward-looking statements. Any forward-looking statements reflect management’s current beliefs based on information
currently available to management and are based on what management believes to be reasonable assumptions. It should be noted that a number of
factors could cause actual results, or expectations to differ materially from the results expressed or implied in the forward-looking statements.
2
Contents
Chairman’s letter
Directors’ Report
Auditor’s Independence Declaration
Financial Statements
Directors’ Declaration
Independent Auditor’s Report
Shareholder’s information
4
6
19
21
57
58
61
Corporate directory
inside back cover
‘Siviour: a world-class graphite project’
3
3
Renascor has responded to these challenges by
maintaining the steady advancement of our flagship
Siviour Graphite and Battery Anode Material Project,
while concurrently creating additional opportunities
to build on our shareholder’s investments through
the development of near-term discovery prospects
in minerals with favourable commodity price
outlooks.
At Siviour, we have achieved several breakthroughs
that confirm the project as among the leading
graphite developments globally, with strong
prospects to benefit for the growing lithium-ion
battery market and advance into a profitable long-
term producer of high quality graphite products.
From the Chairman
Dear Shareholder,
I am very pleased to present
Renascor’s annual report
for the twelve-month period
ending 30 June 2020.
The past year has presented
an unprecedented set of
challenges, with COVID-19
having wide-ranging
impacts on nearly all
aspects of society. For
ASX-listed exploration and
development companies
like Renascor, this has
required both prudence
and flexibility in light of
changes in operational and
market norms.
4
Key achievements have included:
• Siviour Definitive Feasibility Study (DFS). The
Siviour DFS confirms Siviour’s potential as a long-
life graphite concentrate project with amongst the
lowest operating costs of any graphite development
globally. Whilst graphite as a mineral occurrence
is relatively common, the Siviour DFS establishes
Siviour as particularly unique as a low cost source
of high quality graphite located in Australia, amongst
the most favourable mining jurisdictions in the
world.
• Siviour Mineral Ore Reserve. Work undertook during
the year resulted in an updated Mineral Reserve
estimate for Siviour that confirms it as the second
largest Proven Reserve of graphite in the world and
the largest Ore Reserve of graphite outside of Africa.
• Eco-Friendly Battery Anode Material. Using a
purification technology that avoids the use of
potentially harmful hydrofluoric acid, Renascor
has successfully produced battery-grade anode
material from Siviour graphite. The use of
this more ecologically-friendly method firmly
establishes Renascor’s commitment to responsible
environmental management of resources.
• Battery Anode Material Study. Following the DFS,
Renascor completed a study assessing an integrated
battery anode material operation to produce Purified
Spherical Graphite for lithium-ion battery anodes. By
leveraging off the comparatively low cost of Siviour
graphite concentrates and co-locating a downstream
anode material manufacturing operation in South
Australia, the study confirms the globally competitive
nature of the project.
The steady progress Renascor achieved at Siviour
during the past year puts Renascor in an excellent
position to take the project through development
and create the first vertically integrated battery
anode material operation outside of China.
Significantly, the focus on the production of
Purified Spherical Graphite aligns the project with
potential offtake partners in the growing lithium-ion
battery market.
In addition to our progress at Siviour, Renascor
also advanced earlier-stage exploration prospects,
including our Carnding Gold Project in South
Australia’s Central Gawler Craton. Carnding, which
we acquired in 2012, is part of a pipeline of highly
prospective early-stage exploration projects.
At Carnding, we identified multiple prospects for
near-surface, high-grade gold. As the gold price has
risen considerably, the Central Gawler region has
seen an increasing focus on gold, and Renascor
is pleased to offer shareholders the potential to
benefit from this renewed interest through
near-term discovery opportunities in projects
like Carnding.
We are particularly grateful of the support
offered by shareholders during the year,
notwithstanding difficult market conditions and
subdued equity prices.
With the work undertaken last year, together with
work programs for the current year including a
focus on the development of Siviour, as well as gold
exploration, we believe there is strong potential for
a re-rating of Renascor by the equity markets.
On behalf of the Board and my fellow shareholders,
I thank our Managing Director David Christensen
and the entire Renascor team for their dedicated
work during an exciting year. I also offer my
sincere thanks to you, our shareholders, for your
continued support.
Yours sincerely,
Dick Keevers, Chairman
5
Renascor Resources Limited annual report 2020 financial statements Directors’ Report
Business objectives
Siviour Graphite Project
Renascor Resources is an Australian-based company
focused on the development of economically viable
minerals. Renascor has an extensive tenement
portfolio, holding interests in key mineral provinces of
South Australia. Its projects include the Siviour graphite
project near Arno Bay, South Australia. The principal
activity of the Group during the financial year was
mineral exploration, development and evaluation.
Corporate Governance Statement
The board of directors of the Company (“Board”)
is responsible for the corporate governance of
the Company. The board guides and monitors the
business affairs of the Company on behalf of its
shareholders by whom they are elected and to whom
they are accountable. The Company believes that good
corporate governance enhances investor confidence
and adds value to stakeholders. The Board continually
monitors and reviews its policies, procedures and
charters with a view to ensure its compliance with
the ASX Corporate Governance Council’s “Corporate
Governance Principles and Recommendations, 3rd
Edition” to the extent considered appropriate for the
size of the Company and its scale of its operations.
The Company’s Corporate Governance Statement is
available on the Company’s website.
www.renascor.com.au/corporate-governance
The directors present their report, together with
the financial statements, on the consolidated entity
(referred to hereafter as the ‘Group’) consisting of
Renascor Resources Limited (referred to hereafter
as the ‘Company’ or ‘parent entity’) and the entities it
controlled at the end of, or during, the year ended 30
June 2020.
Dividends
There were no dividends paid, recommended or
declared during the current or previous financial year.
Review of operations
Company overview
Renascor Resources Limited (Renascor) is an ASX-listed,
Australian-based company focused on the development
of economically viable deposits containing graphite,
gold, copper and other minerals.
Renascor’s activities during the past financial year were
primarily directed at developing the Siviour Graphite
and Battery Anode Material Project (Siviour).
Significant activities undertaken on the Siviour Project
during the year included:
• The completion of the Siviour Definitive Feasibility
Study (DFS) in November. The DFS positively
confirmed Siviour’s potential as a low cost, long-
life graphite project that can achieve consistently
attractive profit margins.
• Advancement of an integrated battery anode
material operation in South Australia to produce
Purified Spherical Graphite (PSG) for lithium-ion
batteries.
• In December 2019 the company entered into a
joint development agreement with battery anode
company Sicona Battery Technologies (Sicona) to
jointly develop battery anode material.
Other projects
In addition to its activities at the Siviour Graphite
Project, Renascor has maintained a strong exploration
portfolio, identifying and maintaining a strong pipeline
of targets for development of gold, copper, nickel,
cobalt and other mineral assets. To limit non-essential
exposure, Renascor has also relinquished tenements
considered less prospective.
Corporate and financial
For the year ended 30 June 2020 the loss for the Group
after providing for income tax amounted to $1,072,575
(2019: $1,321,558). This included an impairment
write down of capitalised exploration and evaluation
expenditure of $274,109 (2019: $387,751).
To support the Group’s exploration activities and
developing the Siviour Graphite Project, the Company
raised $1,796,468 (after capital raising costs) via
placements to professional and sophisticated investors
and a Share Purchase Plan (“SPP”) during the year.
On 12 August 2019 the Company announced the results
of purification tests using a more eco-friendly caustic
roasting technique that successfully produced battery-
grade spherical graphite from Siviour. The caustic
roasting method offers environmental advantages over
the traditional hydrofluoric purification technique.
On 11 November 2019 the Company announced the
completion of the DFS. The Siviour DFS confirmed
Siviour’s potential as a low cost, long-life graphite
project that can achieve consistently attractive profit
margins.
6
Directors’ Report 30 June 2020
On 18 December 2019 the Company announced that
it had entered into a non-binding memorandum of
understanding (MOU) with Sicona to jointly develop
battery anode material. Under the terms of the
MOU, the Company and Sicona will collaborate in the
development of the next-generation anode material by
combining Renascor’s expertise in the production of
purified spherical graphite and Sicona’s expertise in the
development of silicon-based anodes.
On 3 March 2020 the company received a Letter of
Support from the Australian government Export Finance
Agency (EFA), the official Export Credit Agency (ECA) of
the Australian Government. The EFA has conducted a
preliminary review of the Siviour Project, and subject to
further due diligence it will consider providing finance.
ECA cover typically supports favourable debt financing
terms, including competitive margin and increased
loan tenor.
On 24 June 2020 the company announced that that it
has engaged a European investment bank, ABG Sundal
Collier to manage the proposed debt financing for the
integrated Siviour Graphite and Battery Anode Material
Project.
Significant changes in the state of affairs
During the financial year Renascor took steps to
manage the impact of COVID-19, focusing on the health
of its staff and the communities in which the Company
works, while seeking to preserve shareholder funds
and limit the financial impact on Renascor and its
stakeholders. Work programs were designed to permit
them to continue with minor disruptions due to travel
restrictions and shipping delays. Where practicable,
laboratory and desktop activities were accelerated to
ensure delays would be minimised when more normal
operations can be undertaken.
There were no other significant changes in the state of
affairs of the Group during the financial year.
Matters subsequent to the end of the
financial year
On 1 July 2020 the company announced the results of
a study assessing an integrated battery anode material
operation in South Australia to produce PSG for
lithium-ion battery anodes. The study confirms that the
integration of a PSG processing operation with Siviour
creates significant added value and aligns the company
with end-users of PSG seeking supply chain security
through the world’s first integrated, in-country mine
and battery anode material operation outside of China.
On 14 July 2020 the company announced the results
of independent purification tests that confirmed
that Siviour is able to produce PSG through a more
environmentally-friendly caustic roast purification
method.
On 21 July 2020 an updated Mineral Ore Reserve
estimate was announced confirming Siviour as the
largest reported total Ore Reserve outside of Africa,
and the second largest reported Proven Reserve of
graphite in the world. This estimate provides additional
confidence in the size and quality of the Siviour
deposit as a consistent source of high-quality graphite
supporting a mine life of over 40 years.
On 4 August 2020 the Company announced high-grade,
shallow gold drill intercepts at the Carnding Project in
South Australia’s Central Gawler Craton. The results
include over 16 g/t Au at the Soyuz prospect.
On 10 August 2020 the Company announced an
expansion to the Carding Project, with the approval
of an exploration licence application over an area
immediately north of the Soyuz propsect.
On 12 August 2020 independent qualification tests
undertaken by a German graphite specialist confirmed
that Siviour PSG meets product specifications required
for integration of PSG into lithium-ion battery anodes.
On 28 August 2020 Renascor confirmed multiple
untested, shallow gold targets along-strike from
the company’s Soyuz (Carnding) prospect in South
Australia’s Gawler Craton.
On 18 September 2020 the company announced that
it has received firm commitments from professional
and sophisticated investors to raise approximately $3.6
million (before expenses) at 1.1cents per share with one
attaching option for every two shares issued. The funds
raised will be used to advance the Siviour Project and
Carnding Gold Project.
No other matter or circumstance has arisen since
30 June 2020 that has significantly affected, or may
significantly affect the Group’s operations, the results
of those operations, or the Group’s state of affairs in
future financial years.
Likely developments and expected results of
operations
The Company will continue activities in the exploration,
evaluation, development and acquisition of viable
projects with the objective of establishing a significant
production business.
Environmental regulation and performance
The directors have put in place strategies and
procedures to ensure that the Group manages its
compliance with environmental regulations. The
directors are not aware of any breaches of any
applicable environmental regulations.
7
Renascor Resources Limited annual report 2020 financial statements Information on directors
David Christensen
Managing Director
Richard (Dick) Keevers
Non-Executive Chairman
Experience and expertise:
Experience and expertise:
David Christensen is an experienced mining executive,
with recent successful experience managing
exploration, mining and marketing operations. Prior to
founding the Company, David served as Chief Executive
Officer of Adelaide-based companies, Heathgate
Resources Pty Ltd and Quasar Resource Pty Ltd. While
at Heathgate and Quasar, his responsibilities included
overseeing Australian operations, including the
Beverley uranium mine, as well as the expansion into
new projects with the discovery and development of the
Four Mile deposit and numerous joint ventures. David’s
experience also includes serving as President of Nuclear
Fuels Corporation, a trading and marketing company,
where he managed a multi-million dollar uranium
portfolio and was responsible for developing sales
strategy, executing trades and swaps and negotiating all
contracts. David commenced his career as an attorney
in California and London offices of international law
firm Latham & Watkins, where he advised on corporate
finance and mergers and acquisitions. David was
educated at Cornell University (BA, Economics and
Classical Civilizations), the University of California, Los
Angeles (JD) and the Universitá di Bologna (Fulbright
Fellow).
Other current directorships: None
Former directorships (last 3 years): None
Interests in shares: 23,064,637
Interests in rights: 12,000,000
Dick Keevers’ experience includes advancing multiple
producing mines from discovery phase through
development, including the Telfer gold and copper
mine, the Phosphate Hill phosphate mine and the Baal
Gammon copper mine. Dick also was a substantial
shareholder of and served as an executive director for
Pembroke Josephson Wright Limited, an Australian
share brokerage firm. Dick has served on boards of
several ASX-listed resource and industrial companies,
and he is currently a non-executive director of Santana
Minerals Limited. Prior to joining the Renascor board,
Dick served as chairman of unlisted Eyre Peninsula
Minerals Proprietary Limited (EPM).
Other current directorships: Santana Minerals Limited
Former directorships (last 3 years): None
Interests in shares: 47,265,810
Stephen Bizzell
Non-Executive Director
Experience and expertise:
Stephen Bizzell is Chairman of boutique corporate
advisory and funds management group Bizzell Capital
Partners. He has over 25 years corporate finance
and public company management experience in the
resources sector in Australia and Canada. Stephen
was previously an Executive Director of Arrow Energy
from 1999 until its acquisition in 2010 by Royal Dutch
Shell and PetroChina for $3.5 billion. Stephen was
instrumental in Arrow’s corporate and commercial
success and its growth from a junior explorer to a
large integrated energy company. Stephen spent his
early career in the corporate finance division of Ernst
& Young and the tax division of Cooper & Lybrand and
qualified as a Chartered Accountant. He is also a former
director of Queensland Treasury Corporation.
Other current directorships: Laneway Resources Limited,
Armour Energy Limited, and Strike Energy Limited
Former directorships (last 3 years): Stanmore Coal Limited
(2009 to 2020), UIL Energy Limited (2014 to 2018)
Interests in shares: 38,122,982
8
Directors’ Report 30 June 2020
Geoffrey McConachy
Non-Executive Director
Experience and expertise:
Geoffrey McConachy is an accomplished geologist
with over thirty years of Australian and international
experience in the mining industry assessing a wide
range of commodities. Prior to joining the Company,
Geoffrey worked for Heathgate Resources Pty Ltd
and Quasar Resources Pty Ltd, where his roles
included Managing Director, Exploration. While at
Heathgate and Quasar, Geoffrey led the exploration
and development team in the discovery, definition
and evaluation of four uranium deposits including the
Four Mile deposit, for which he was co-honoured with
the Prospector of the Year award from the Australian
Association of Mining & Exploration Companies. His
experience includes instrumental roles in the discovery
of the Fosterville gold deposit in Victoria and the Potosi
base metal deposit in New South Wales. Geoffrey is
a fellow of the Australasian Institute of Mining and
Metallurgy and a former Director of the Uranium
Information Centre.
Other current directorships: None
Former directorships (last 3 years): None
Interests in shares: 9,704,244
Other current directorships quoted above are
current directorships for listed entities only and
excludes directorships of all other types of entities,
unless otherwise stated.
Former directorships (last 3 years)’ quoted above
are directorships held in the last 3 years for listed
entities only and excludes directorships of all other
types of entities, unless otherwise stated.
Company secretary
Pierre van der Merwe is an accountant of more than
30 years’ experience with extensive knowledge in the
provision of corporate secretarial and accounting
services to ASX listed companies. He also has
experience as CFO and was a Partner from 2004 to 2016
in HLB Mann Judd, an Australasian and International
accountancy and business advisory group. During this
time, he headed the Corporate Team in Adelaide which
provides corporate secretarial and accounting services
to a host of ASX listed companies in various industries,
specialising in exploration and mining entities.
Pierre was company secretary of the following ASX
listed companies, amongst others:
• Bondi Mining Ltd (ASX ‘BOM’) which changed it’s
name to World Titanium Resources Ltd
• Papyrus Australia Ltd (ASX ‘PPY’)
• Terramin Australia Ltd (ASX ‘TZN’) during its
transition from exploration to mining at its
Strathalbyn site
He spent part of 2016 and 2017 assisting an unlisted
public company, 1414 Degrees Ltd, as company
secretary with its preparation for IPO on the ASX (Listed
10 September 2018 at market capitalisation of $46m –
ASX ‘14D’).
Meetings of directors
The number of meetings of the Company’s Board of
Directors (‘the Board’) held during the year ended 30
June 2020, and the number of meetings attended by
each director were:
Full Board
Audit & Risk
Committee
Attended Held
Attended Held
Richard Keevers
David Christensen
Geoffrey McConachy
Stephen Bizzell
5
5
5
5
5
5
5
5
2
2
2
2
2
2
2
2
Held: represents the number of meetings held during the time
the director held office.
9
Renascor Resources Limited annual report 2020 financial statements
Remuneration report (audited)
The remuneration report details the key management
personnel remuneration arrangements for the
Group, in accordance with the requirements of the
Corporations Act 2001 and its Regulations.
The Board is responsible for managing:
Their objective is to ensure that remuneration policies
and structures are fair and competitive and aligned with
the long-term interests of the Group.
Key management personnel are those persons having
authority and responsibility for planning, directing
and controlling the activities of the entity, directly or
indirectly, including all directors.
The remuneration report is set out under the following
main headings:
• Principles used to determine the nature and amount
of remuneration
• Details of remuneration
• Service agreements
• Share-based compensation
• Additional information
• Additional disclosures relating to key management
personnel
Principles used to determine the nature and
amount of remuneration
The objective of the Group’s executive reward
framework is to ensure reward for performance is
competitive and appropriate for the results delivered.
The framework aligns executive reward with the
achievement of strategic objectives and the creation of
value for shareholders, and it is considered to conform
to the market best practice for the delivery of reward.
The Board of Directors (‘the Board’) ensures that
executive reward satisfies the following key criteria for
good reward governance practices:
• competitiveness and reasonableness
• acceptability to shareholders
• performance linkage / alignment of executive
compensation
• transparency
The Board carried out the functions of the Nomination
and Remuneration Committee and is responsible for
determining and reviewing remuneration arrangements
for its directors and executives. The performance of
the Group depends on the quality of its directors and
executives. The remuneration philosophy is to attract,
motivate and retain high performance and high quality
personnel.
• non-executive director fees;
• executive remuneration (directors and other
executives); and
• the over-arching executive remuneration framework
and incentive plan policies.
10
Relationship between remuneration and Group
performance:
During the financial year, the Group has generated
losses as its principal activity was developing the Siviour
Graphite Project and exploration for graphite, copper,
gold and other minerals within South Australia. As
the Group is still in the development, exploration and
evaluation stage, the link between remuneration, Group
performance and shareholder wealth is sometimes
tenuous. Share prices are subject to the influence of
metals prices, market sentiment towards the sector and
the global economy and as such increases or decreases
may occur quite independent of executive performance
or remuneration.
In accordance with best practice corporate governance,
the structure of non-executive director and executive
director remuneration is separate.
Non-executive directors remuneration
Fees and payments to non-executive directors reflect
the demands and responsibilities of their role. Non-
executive directors’ fees and payments are reviewed
periodically by the Board. The chairman’s fees are
determined independently to the fees of other non-
executive directors based on comparative roles in the
external market. The chairman is not present at any
discussions relating to the determination of his own
remuneration. Non-executive directors do not receive
any performance-based pay.
ASX listing rules require the aggregate non-executive
directors’ remuneration be determined periodically by
a general meeting. The most recent determination was
at the Annual General Meeting held on 5 August 2010,
where the shareholders approved a maximum annual
aggregate remuneration of $350,000.
Retirement allowances for non-executive
directors
In line with guidance from the ASX Corporate
Governance Council on non-executive director’s
remuneration, no retirement allowances are
provided for non-executive directors. Superannuation
contributions required under the Australian
superannuation guarantee legislation continue to be
made as required and are deducted from the directors’
overall fee entitlements.
Directors’ Report 30 June 2020
Executive remuneration
The objective of the Group’s executive reward
framework is to ensure reward for performance is
competitive and appropriate for the results delivered.
The framework aligns executive reward with
achievement of strategic objectives and the creation
of value for shareholders, and conforms to market
practice for delivery of reward. The Board ensures that
executive reward satisfies the following key criteria for
good reward governance practices:
• acceptability to shareholders;
• performance linkage/alignment of executive
compensation;
• transparency; and
• capital management.
The Group has structured an executive remuneration
framework that is market competitive and
complementary to the reward strategy of the
organisation.
Alignment to shareholders’ interests:
• has economic profit as a core component of plan
design;
• focuses on sustained growth in shareholder wealth;
• delivering constant return on assets as well as
focusing the executive on key non-financial drivers of
value; and
• attracts and retains high calibre executives.
Alignment to program participants’ interests:
• rewards capability and experience;
• reflects competitive reward for contribution to
growth in shareholder wealth;
• provides a clear structure for earning rewards;
• provides recognition for contribution; and
• competitiveness and reasonableness.
The framework provides a mix of fixed and long-
term incentives.
The Board carried out the functions of the
Remuneration and Nominations Committees
and is responsible for reviewing and negotiating
compensation arrangements of senior executives. It
assesses the appropriateness of the nature and amount
of remuneration of such officers on a periodic basis by
relevant employment market conditions with the overall
objective of ensuring maximum stakeholder benefit
from the retention of a high quality board and executive
team. The board manages remuneration and incentive
policies and practices and remuneration packages and
other terms of employment for executive directors,
other senior executives and non-executive directors.
The Board ensures that executive reward satisfies
the following key criteria for good reward governance
practices:
• base pay and benefits, including superannuation;
• short-term performance incentives through a cash
bonus may be determined by the Board; and
• long-term incentives through the issue of share
options and performance rights.
The combination of these comprises the executive’s
total remuneration.
Base pay and benefits
Base pay and benefits are structured as a total
employment cost package which may be delivered as
a combination of cash and prescribed non-financial
benefits, at the executive’s discretion and subject to
board approval.
Executives are offered a competitive base pay that
comprises the fixed component of pay and rewards
to ensure base pay is set to reflect the market for a
comparable role. Base pay for executives is reviewed
periodically to ensure the executive’s pay is competitive
with the market.
There is no guaranteed base pay increase included in
any of the executives’ contracts.
Consolidated entity performance and link to
remuneration
Remuneration for certain individuals is directly linked
to the performance of the Group. A portion of any cash
bonus and incentive payments are at the discretion of
the Nomination and Remuneration Committee. Refer to
the “additional information” section below for details of
the earnings and total shareholders return for the last
five years.
The Nomination and Remuneration Committee is of the
opinion that the results can be attributed in part to the
adoption of performance based compensation and is
satisfied that this improvement will continue to increase
shareholder wealth if maintained over the coming
years.
Voting and comments made at the Company’s 20
November 2019 Annual General Meeting (‘AGM’)
At the 20 November 2019 AGM, 99.2% of the votes
received supported the adoption of the remuneration
report for the year ended 30 June 2019. The Company
did not receive any specific feedback at the AGM
regarding its remuneration practices.
11
Renascor Resources Limited annual report 2020 financial statements Remuneration report (audited)
Details of remuneration
Amounts of remuneration
Details of the remuneration of key management personnel of the Group are set out in the following tables.
Short-term benefits
Post-employment
benefits
Long-term
benefits
Share-based payment
Cash salary
and fees
$
34,000
46,576
34,000
2020
Non-Executive Directors:
Stephen Bizzell*
Richard Keevers*
Geoffrey McConachy*
Executive Directors:
Non-
monetary Superannuation
$
$
Long service Performance NEDSP &
Rights director’s
$ shares $
leave
$
Total
$
-
-
-
-
4,945
-
-
-
-
-
-
-
4,000
38,000
5,479
57,000
4,000 38,000
David Christensen**
269,760
9,706
21,003
6,840
70,259
3,840 381,408
Other Key Management Personnel:
Pierre van der Merwe***
123,345
-
-
-
-
- 123,345
507,681
9,706
25,948
6,840
70,259
17,319 637,753
*
**
From 1 April 2020 the Non- Executive directors agreed to a temporary 20% reduction in their directors fees to support the Company
through the economic uncertainty caused by the COVID-19 pandemic.
Short term benefits paid to Mr Christensen includes $24,000 in annual leave entitlements paid during the year. Mr Christensen also
accrued $6,840 in unpaid long service leave entitlements during the year.
*** From 1 April 2020 Mr van der Merwe agreed to a temporary 17% reduction in his Company Secretarial and CFO fees to support the
Company through the economic uncertainty caused by the COVID-19 pandemic.
The NEDSP plan approved by shareholders in the November 2014 AGM was reinstated. Commencing on 1 April
2020, 50% of the non-executive director fees have been paid, with 50% of the fees ($2,000 per month in the case
of the Chairman and $1,333 per month in the case of other non-executive directors) withheld by the Company
pursuant to the NEDSP. At 30 June 2020, NEDSP shares for the period 1 April 2020 to 30 June 2020 had not
been issued.
Commencing 1 May 2020, 10% of Mr Christensen’s fees ($2,080 per month) were withheld by the Company to be
paid via the issue of share capital subject to shareholder approval. At 30 June 2020, the shares for the period
1 May 2020 to 30 June 2020 had not been issued.
12
Directors’ Report 30 June 2020
Short-term benefits
Post-employment
benefits
Long-term
benefits
Share-based payment
2019
Non-Executive Directors:
Chris Anderson
Stephen Bizzell
Richard Keevers
Cash salary
and fees
$
19,058
40,000
54,795
Geoffrey McConachy*
202,022
Executive Directors:
Non-
monetary Superannuation
$
$
Long service Performance NEDSP &
Rights director’s
$ shares $
leave
$
Total
$
-
-
-
-
-
-
5,205
-
-
-
11,190
47,841
-
-
-
-
-
-
-
19,058
40,000
60,000
- 261,053
David Christensen**
273,600
9,663
20,531
6,840
177,675
- 488,309
Other Key Management Personnel:
Pierre van der Merwe
118,009
-
-
-
-
- 118,009
707,484
9,663
36,926
54,681
177,675
- 986,429
*
**
Mr McConachy became a non-executive director on the 5th of January 2019. Short term benefits paid to Mr McConachy includes
$42,310 in annual leave entitlements paid during the year.
Short term benefits paid to Mr Christensen includes $24,000 in annual leave entitlements paid during the year. Mr Christensen also
accrued $6,840 in unpaid long service leave entitlements during the year.
The proportion of remuneration linked to performance and the fixed proportion are as follows:
Name
Non-Executive Directors:
Chris Anderson
Stephen Bizzell
Richard Keevers
Geoffrey McConachy
Executive Directors:
David Christensen*
Fixed remuneration
At risk - STI
At risk - LTI
2020
2019
2020
2019
2020
2019
-
100%
100%
100%
100%
100%
100%
100%
81%
63%
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
19%
37%
*
During the year ended 30 June 2019 shareholders granted approval for the issue of performance rights to Mr David Christensen.
Further information pertaining to the Performance Rights can be found in Note 30. “Share Based Payments”. The total value of
performance-related bonuses paid to key management personnel and executives during the year was $70,259 (2019: $177,675).
Key management personnel and executives were not paid cash bonuses during the years ended 30 June 2020
and 2019.
13
Renascor Resources Limited annual report 2020 financial statements
Remuneration report (audited)
Service agreements
Share-based compensation
Remuneration and other terms of employment for
key management personnel are formalised in service
agreements.
Details of these agreements are as follows:
David Christensen, Managing Director
Term of agreement: Indefinite term, subject to six-
month’s notice or a termination payment of six months.
Details: Per annum rate of $249,600, exclusive of
superannuation. In addition, David is also entitled to
private health insurance.
Pierre van der Merwe,
Chief Financial Officer and Company Secretary
Term of agreement: The agreement may be terminated
by either party on one months’ notice.
Details: Services are provided at a rate of $10,000 per
month plus GST plus expenses. However, at 1 April
2020 it was agreed that during the COVID-19 pandemic
the fee for services provided would be temporarily
reduced to $8,333 per month for an indefinite period
of time.
Key management personnel have no entitlement to
termination payments in the event of removal for
misconduct.
Issue of shares
During the period 1 April to 30 June 2020, 50% of non-
executive director fees totaling $13,479 were withheld
by the Company pursuant to the Non-Executive Director
Share Plan (“NEDSP”) (2019: Nil). As at 30 June 2020 the
shares pertaining to the the period 1 April 2020 to 30
June 2020 had not been issued.
During the period 1 April to 30 June 2020 executive
director fees totaling $3,840 were withheld by the
Company to be issued as shares at a later date when
shareholder approval is obtained (2019: Nil). As at 30
June 2020 the shares pertaining to the the period 1 April
2020 to 30 June 2020 had not been issued.
Options
There were no options over ordinary shares issued
to directors and other key management personnel
as part of compensation that were outstanding as at
30 June 2020.
14
Directors’ Report 30 June 2020
Performance rights
The terms and conditions of each grant of performance rights over ordinary shares affecting remuneration of
directors and other key management personnel in this financial year or future reporting years are as follows:
Grant date
Expiry date
Share price hurdle for vesting
Fair value per right at grant date
Tranche A
3 September 2018
Vested during the year
Tranche B
3 September 2018
3 September 2022
Tranche C
3 September 2018
3 September 2022
$0.00
$0.00
$0.06
$0.020
$0.020
$0.008
Performance rights granted carry no dividend or voting rights.
Details of performance rights over ordinary shares granted, vested and lapsed for directors and other key
management personnel as part of compensation during the year ended 30 June 2020 are set out below:
Name
Grant date
Number
of rights
granted
Number
of rights
vested
$
Value of
rights
granted
$
Value of
rights expensed in
the period
$
Number
of rights
lapsed
Value of
rights
lapsed
David Christensen 3 September 2018
-
6,000,000
-
70,259
-
-
Further information regarding the Performance Rights can be found in Note 30 “Share Based Payments”.
Additional information
Refer to the sections below for details of the earnings and total shareholders return for the last five years:
The earnings of the Group for the five years to 30 June 2020 are summarised below:
2020
$
2019
$
2018
$
2017
$
2016
$
(Loss) for the year attributable to owners ($)
(1,072,575)
(1,321,558)
(3,434,543)
(1,085,492)
(890,079)
Increase/(decrease) in share price (%)
(52%)
5%
25%
(25%)
-
The factors that are considered to affect total shareholders return (‘TSR’) are summarised below:
Share price at financial year end (cents)
Basic earnings per share (cents per share)
2020
1.0
(0.1)
2019
2018
2017
2.1
(0.1)
2.0
(0.5)
1.6
(0.2)
2016
2.0
(0.4)
15
Renascor Resources Limited annual report 2020 financial statements
Remuneration report (audited)
Additional disclosures relating to key management personnel
Shareholding
The number of shares in the Company held during the financial year by each director and other members of key
management personnel of the Group, including their personally related parties, is set out below:
Ordinary shares
Stephen Bizzell
David Christensen
Richard Keevers
Geoffrey McConachy
Option holding
Balance at
the start of
the year
Performance
rights vested
& exercised
Additions
Other
Balance at
the end of
the year
28,122,982
-
10,000,000
16,064,637
6,000,000
1,000,000
46,265,810
9,249,699
-
-
1,000,000
454,545
-
-
-
-
38,122,982
23,064,637
47,265,810
9,704,244
99,703,128
6,000,000
12,454,545
- 118,157,673
The number of options over ordinary shares in the Company held during the financial year by each director and
other members of key management personnel of the Group, including their personally related parties, is set out
below:
Options over ordinary shares
Stephen Bizzell
David Christensen
Richard Keevers
Geoffrey McConachy
Balance at
the start of
the year
6,250,000
150,000
7,834,399
235,294
14,469,693
Acquired
Exercised
Lapsed
Balance at
the end of
the year
-
-
-
-
-
-
-
-
-
-
(6,250,000)
(150,000)
(7,834,399)
(235,294)
(14,469,693)
-
-
-
-
-
Performance rights holding
The number of performance rights over ordinary shares in the Company held during the financial year by each
director and other members of key management personnel of the Group, including their personally related parties,
is set out below:
Performance rights over ordinary shares
David Christensen
Balance at
the start of
the year
Granted
Vested &
exercised
Expired/
forfeited/
other
Balance at
the end of
the year
18,000,000
18,000,000
-
-
(6,000,000)
(6,000,000)
-
-
12,000,000
12,000,000
16
Directors’ Report 30 June 2020
Other transactions with key management
personnel and their related parties
Mr G W McConachy and Mr C Anderson are directors
of Euro Exploration Services Pty Ltd (Euro). Euro has
provided the company with exploration services,
geochemical sampling services as well as the provision
of geological personnel services during the year. The
services provided are based on normal commercial
terms and conditions. During the financial year the
Company incurred costs of $24,376 (2019: $203,768)
from Euro. An amount of $2,677 (2019: $7,384) was
owing to Euro at 30 June 2020.
Mr G W McConachy provided the company with
exploration consulting services during the year. The
services provided are based on normal commercial
terms and conditions. During the financial year the
Company incurred costs of $4,287 (2019: $Nil) from GW
McConachy & Co Pty Ltd. No amount was owing to GW
McConachy & Co Pty Ltd at 30 June 2020 (2019: $Nil).
Mr C Anderson (resigned as a director 12 October 2018)
is a director of Pondray Pty Ltd trading as CG Anderson
& Associates (CGAA). CGAA has provided geophysical
services to the company. During the financial year the
Company incurred no expenses (2019: $7,700) from
CGAA. No amount was owing to CGAA at 30 June 2020
(2019: $Nil).
Mr S Bizzell is a director of Bizzell Capital Partners Pty
Ltd (BCP). BCP has provided corporate advisory and
underwriting services to the company in relation to
its capital raising. The services provided are based on
normal commercial terms and conditions. During the
financial year the Company did not incur any non-
director’s fees costs from BCP (2019: $Nil). An amount
of $5,867 of director’s fees was owing to BCP at 30 June
2020 (2019: $3,667).
Mr D Christensen had incurred expenses throughout
year on behalf of the company. At 30 June 2020 a
reimbursement to Mr Christensen of $5,509 was
outstanding (2019: $Nil).
This concludes the remuneration report, which
has been audited.
Shares under option
There were no unissued ordinary shares of Renascor
Resources Limited under option outstanding at the date
of this report.
Shares under performance rights
Unissued ordinary shares of Renascor Resources
Limited under performance rights at the date of this
report are as follows:
Grant date
Expiry date
Exercise
price
Number
under rights
03/09/2018
03/09/2022
$0.00
12,000,000
No person entitled to exercise the performance rights
had or has any right by virtue of the performance right
to participate in any share issue of the Company or of
any other body corporate.
Shares issued on the exercise of options
There were no ordinary shares of Renascor Resources
Limited issued on the exercise of options during the
year ended 30 June 2020 and up to the date of this
report.
Shares issued on the exercise of performance
rights
The following ordinary shares of Renascor Resources
Limited were issued during the year ended 30 June
2020 and up to the date of this report on the exercise of
performance rights granted:
Date performance rights granted
Exercise
Number of
price shares issued
08/11/2019
$0.00
6,000,000
Indemnity and insurance of officers
The Company has indemnified the directors and
executives of the Company for costs incurred, in their
capacity as a director or executive, for which they may
be held personally liable, except where there is a lack of
good faith.
During the financial year, the Company paid a premium
in respect of a contract to insure the directors and
executives of the Company against a liability to the
extent permitted by the Corporations Act 2001. The
contract of insurance prohibits disclosure of the nature
of the liability and the amount of the premium.
17
Renascor Resources Limited annual report 2020 financial statements
Directors’ Report 30 June 2020
Indemnity and insurance of auditor
The Company has not, during or since the end of the
financial year, indemnified or agreed to indemnify the
auditor of the Company or any related entity against a
liability incurred by the auditor.
During the financial year, the Company has not paid a
premium in respect of a contract to insure the auditor
of the Company or any related entity.
Officers of the Company who are former partners
of BDO Audit (SA) Pty Ltd
There are no officers of the Company who are former
partners of BDO Audit (SA) Pty Ltd.
Auditor’s independence declaration
A copy of the auditor’s independence declaration as
required under section 307C of the Corporations Act
2001 is set out immediately after this directors’ report.
Proceedings on behalf of the Company
No person has applied to the Court under section
237 of the Corporations Act 2001 for leave to bring
proceedings on behalf of the Company, or to intervene
in any proceedings to which the Company is a party for
the purpose of taking responsibility on behalf of the
Company for all or part of those proceedings.
Auditor
BDO Audit (SA) Pty Ltd continues in office in accordance
with section 327 of the Corporations Act 2001.
This report is made in accordance with a resolution
of directors, pursuant to section 298(2)(a) of the
Corporations Act 2001.
On behalf of the directors
David Christensen, Director
29 September 2020
Non-audit services
Details of the amounts paid or payable to the auditor
for non-audit services provided during the financial year
by the auditor are outlined in note 21 to the financial
statements.
The directors are satisfied that the provision of non-
audit services during the financial year, by the auditor
(or by another person or firm on the auditor’s behalf), is
compatible with the general standard of independence
for auditors imposed by the Corporations Act 2001.
The directors are of the opinion that the services as
disclosed in note 21 to the financial statements do
not compromise the external auditor’s independence
requirements of the Corporations Act 2001 for the
following reasons:
• all non-audit services have been reviewed and
approved to ensure that they do not impact the
integrity and objectivity of the auditor; and
• none of the services undermine the general
principles relating to auditor independence as set
out in APES 110 Code of Ethics for Professional
Accountants issued by the Accounting Professional
and Ethical Standards Board, including reviewing
or auditing the auditor’s own work, acting in a
management or decision-making capacity for the
Company, acting as advocate for the Company or
jointly sharing economic risks and rewards.
18
Auditor’s independence declaration
Tel: +61 8 7324 6000
Fax: +61 8 7324 6111
www.bdo.com.au
Level 7, BDO Centre
420 King William Street
Adelaide SA 5000
GPO Box 2018, Adelaide SA 5001
AUSTRALIA
DECLARATION OF INDEPENDENCE
BY ANDREW TICKLE
TO THE DIRECTORS OF RENASCOR RESOURCES LIMITED
As lead auditor of Renascor Resources for the year ended 30 June 2020, I declare that, to the best of
my knowledge and belief, there have been:
1. No contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit; and
2. No contraventions of any applicable code of professional conduct in relation to the audit.
This declaration is in respect of Renascor Resources Limited and the entities it controlled during the
period.
Andrew Tickle
Director
BDO Audit (SA) Pty Ltd
Adelaide, 29 September 2020
BDO Audit (SA) Pty Ltd ABN 33 161 379 086 is a member of a national association of independent entities which are all members of BDO (Australia) Ltd
ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit (SA) Pty Ltd and BDO (Australia) Ltd are members of BDO International
Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme
approved under Professional Standards Legislation.
19
Renascor Resources Limited annual report 2020 financial statements
Financial statements
Statement of profit or loss and
other comprehensive income
Statement of financial position
Statement of changes in equity
Statement of cash flows
Notes to the financial statements
Directors’ declaration
Independent auditor’s report to the members
of Renascor Resources Limited
Shareholder information
22
23
24
25
26
57
58
63
20
Statement of financial position for the year ended 30 June 2020
General information
The financial statements cover Renascor Resources Limited
as a Group consisting of Renascor Resources Limited
and the entities it controlled at the end of, or during, the
year. The financial statements are presented in Australian
dollars, which is Renascor Resources Limited’s functional
and presentation currency.
Renascor Resources Limited is a listed public company
limited by shares, incorporated and domiciled in Australia.
Its registered office and principal place of business is:
36 North Terrace
Kent Town SA 5067
Phone: + 61 8 8363 6989
Email: info@renascor.com.au
Website: www.renascor.com.au
A description of the nature of the Group’s operations and
its principal activities are included in the directors’ report,
which is not part of the financial statements.
The financial statements were authorised for issue, in
accordance with a resolution of directors, on 29 September
2020. The directors have the power to amend and reissue
the financial statements.
21
Renascor Resources Limited annual report 2020 financial statements Statement of profit or loss and other
comprehensive income
Revenue
Interest revenue
Boosting cashflow payment
Total revenue
Expenses
Administration and consulting
Depreciation and amortisation expense
Employee benefits expense
Office accommodation
Impairment of exploration expenditure
Legal fees
Other expenses
Total expenses
Loss before income tax expense
Income tax expense
Loss after income tax expense for the year
Other comprehensive income for the year, net of tax
Total comprehensive income for the year
Basic earnings per share
Diluted earnings per share
Consolidated
2020
$
2019
$
Note
19,598
94,818
100,000
-
119,598
94,818
4
5
(362,327)
(287,837)
(2,065)
(2,236)
(364,391)
(435,483)
(30,388)
(30,596)
(274,109)
(387,751)
(6,384)
(26,996)
6
(152,509)
(245,477)
(1,192,173)
(1,416,376)
(1,072,575)
(1,321,558)
-
-
(1,072,575)
(1,321,558)
-
-
(1,072,575)
(1,321,558)
Cents
Cents
(0.1)
(0.1)
(0.1)
(0.1)
7
17
29
29
22
Statement of financial position for the year ended 30 June 2020
Statement of financial position
Assets
Current assets
Cash and cash equivalents
Other receivables
Prepayments
Total current assets
Non-current assets
Other receivables
Property, plant and equipment
Exploration and evaluation
Development asset
Total non-current assets
Total assets
Liabilities
Current liabilities
Trade and other payables
Provisions
Total current liabilities
Total liabilities
Net assets
Equity
Issued capital
Reserves
Accumulated losses
Total equity
The above statement of financial position should be read in conjunction
with the accompanying notes
Note
8
9
9
10
11
12
Consolidated
2020
$
2019
$
1,855,784
2,877,843
206,675
32,598
13,566
28,655
2,076,025
2,939,096
30,000
20,000
3,679
4,662
2,850,654
15,034,092
13,534,752
-
16,419,085
15,058,754
18,495,110
17,997,850
13
14
231,476
516,450
100,677
112,595
332,153
629,045
332,153
629,045
18,162,957
17,368,805
15
16
17
34,114,480
32,210,012
(1,277,856)
407,903
(14,673,667)
(15,249,110)
18,162,957
17,368,805
23
Renascor Resources Limited annual report 2020 financial statements
Statement of changes in equity
Contributed
equity
Share-based
Business
Payments Combination
Reserve
Reserve
Accumulated
losses
Total equity
Consolidated
$
$
$
$
$
Balance at 1 July 2018
28,752,262
1,648,018
(1,417,790)
(13,927,552)
15,054,938
Loss after income tax expense for the year
Other comprehensive income for the year,
net of tax
Total comprehensive income for the year
-
-
-
Transactions with owners in their
capacity as owners:
Contributions of equity, net of transaction
costs (note 15)
3,457,750
-
-
-
-
Share-based payments (note 30)
-
177,675
-
-
-
-
-
(1,321,558)
(1,321,558)
-
-
(1,321,558)
(1,321,558)
-
-
3,457,750
177,675
Balance at 30 June 2019
32,210,012
1,825,693
(1,417,790)
(15,249,110)
17,368,805
Consolidated
$
$
$
$
$
Balance at 1 July 2019
32,210,012
1,825,693
(1,417,790)
(15,249,110)
17,368,805
Loss after income tax expense for the year
Other comprehensive income for the year,
net of tax
Total comprehensive income for the year
Lapse of options (note 30)
-
-
-
-
-
-
-
(1,579,734)
Performance rights vested (note 30)
108,000
(108,000)
Transfer of historical performance rights
-
(68,284)
Transactions with owners in their
capacity as owners:
Contributions of equity, net of transaction
costs (note 15)
1,796,468
-
Share-based payments (note 30)
-
70,259
-
-
-
-
-
-
-
-
(1,072,575)
(1,072,575)
-
-
(1,072,575)
(1,072,575)
1,579,734
-
68,284
-
-
-
-
-
1,796,468
70,259
Balance at 30 June 2020
34,114,480
139,934
(1,417,790)
(14,673,667)
18,162,957
The above statement of changes in equity should be read in conjunction
with the accompanying notes
24
Statement of financial position for the year ended 30 June 2020
Statement of cash flows
Cash flows from operating activities
Payments to suppliers and employees (inclusive of GST)
(1,248,298)
(1,452,201)
Consolidated
2020
$
2019
$
Note
Receipts from Goods & Services Tax paid
Interest received
Research & Development tax concession
Other revenue
Net cash used in operating activities
Cash flows from investing activities
Payments for property, plant and equipment
Payments for exploration and evaluation
Payments for development assets
Net cash used in investing activities
Cash flows from financing activities
Proceeds from issue of shares
Share issue transaction costs
Net cash from financing activities
Net decrease in cash and cash equivalents
Cash and cash equivalents at the beginning of the financial year
197,313
498,735
19,598
94,818
-
212,358
8,724
-
28
(1,022,663)
(646,290)
(1,925)
(2,145)
(437,427)
(4,662,552)
(1,356,512)
-
(1,795,864)
(4,664,697)
15
1,883,000
(86,532)
1,796,468
-
-
-
(1,022,059)
(5,310,987)
2,877,843
8,188,830
Cash and cash equivalents at the end of the financial year
8
1,855,784
2,877,843
The above statement of cash flows should be read in conjunction with the
accompanying notes
25
Renascor Resources Limited annual report 2020 financial statements
Notes to the financial statements 30 June 2020
1. Significant accounting policies
Basis of preparation
These general purpose financial statements have
been prepared in accordance with Australian
Accounting Standards and Interpretations
issued by the Australian Accounting Standards
Board (‘AASB’) and the Corporations Act 2001,
as appropriate for for-profit oriented entities.
These financial statements also comply with
International Financial Reporting Standards as
issued by the International Accounting Standards
Board (‘IASB’).
Historical cost convention
The financial statements have been prepared
under the historical cost convention, except for,
where applicable, the revaluation of available-for-
sale financial assets, financial assets and liabilities
at fair value through profit or loss, and equipment
and derivative financial instruments.
Critical accounting estimates
The preparation of the financial statements
requires the use of certain critical accounting
estimates. It also requires management
to exercise its judgement in the process of
applying the Group’s accounting policies. The
areas involving a higher degree of judgement
or complexity, or areas where assumptions
and estimates are significant to the financial
statements, are disclosed in note 2.
The principal accounting policies adopted in the
preparation of the financial statements are set
out either in the respective notes or below. These
policies have been consistently applied to all the
years presented, unless otherwise stated.
New or amended Accounting Standards and
Interpretations adopted
The Group has adopted all of the new
or amended Accounting Standards and
Interpretations issued by the Australian
Accounting Standards Board (‘AASB’) that are
mandatory for the current reporting period.
The following Accounting Standards and
Interpretations are most relevant to the Group:
AASB 16 Leases
The Group has adopted AASB 16 from 1 July 2019.
The standard replaces AASB 117 ‘Leases’ and for
lessees eliminates the classifications of operating
leases and finance leases. The company has
elected not to recognise a right-of-use asset and
corresponding lease liability for short-term leases
with terms of 12 months or less and leases of low-
value assets. Lease payments on these assets are
expensed to profit or loss as incurred.
The application of this new standard has
had no material impact on the disclosures or
amounts recognised in the consolidated financial
statements.
New Accounting Standards and
Interpretations not yet mandatory or early
adopted
Australian Accounting Standards and
Interpretations that have recently been issued
or amended but are not yet mandatory, have
not been early adopted by the Group for the
annual reporting period ended 30 June 2020. The
Group has not yet assessed the impact of these
new or amended Accounting Standards and
Interpretations.
26
Notes to the financial statements for the year ended 30 June 2020
1. Significant accounting policies continued
Going concern
The Directors believe it is appropriate to prepare
the consolidated financial report on a going
concern basis, which contemplates realisation of
assets and settlement of liabilities in the normal
course of business. As disclosed in the financial
report, the group has incurred a loss after tax
for the year of $1,072,575 (2019: $1,321,558)
and net operating cash outflow of $1,022,663
(2019: $646,290). At 30 June 2020, the Group had
net current assets of $1,743,872 (30 June 2019:
$2,310,051).
The consolidated entity’s ability to continue as a
going concern is contingent on raising additional
capital and/or the successful exploration and
subsequent exploitation of its areas of interest
through sale or development. The matters set
out above indicate the existence of a material
uncertainty that may cast significant doubt about
the entity’s ability to continue as a going concern
and therefore the entity may be unable to realise
its assets and discharge its liabilities in the normal
course of business. The financial statements
do not include any adjustments that may be
necessary if the consolidated entity is unable to
continue as a going concern.
Parent entity information
In accordance with the Corporations Act 2001,
these financial statements present the results of
the Group only. Supplementary information about
the parent entity is disclosed in note 25.
Principles of consolidation
The consolidated financial statements incorporate
the assets and liabilities of all subsidiaries of
Renascor Resources Limited (‘Company’ or ‘parent
entity’) as at 30 June 2020 and the results of all
subsidiaries for the year then ended. Renascor
Resources Limited and its subsidiaries together
are referred to in these financial statements as
the ‘Group’.
Subsidiaries are all those entities over which the
Group has control. The Group controls an entity
when the Group is exposed to, or has rights to,
variable returns from its involvement with the
entity and has the ability to affect those returns
through its power to direct the activities of the
entity. Subsidiaries are fully consolidated from the
date on which control is transferred to the Group.
They are de-consolidated from the date that
control ceases.
Intercompany transactions, balances and
unrealised gains on transactions between
entities in the Group are eliminated. Unrealised
losses are also eliminated unless the transaction
provides evidence of the impairment of the asset
transferred. Accounting policies of subsidiaries
have been changed where necessary to ensure
consistency with the policies adopted by the
Group.
The acquisition of subsidiaries is accounted for
using the acquisition method of accounting. A
change in ownership interest, without the loss of
control, is accounted for as an equity transaction,
where the difference between the consideration
transferred and the book value of the share of the
non-controlling interest acquired is recognised
directly in equity attributable to the parent.
Where the Group loses control over a subsidiary,
it derecognises the assets including goodwill,
liabilities and non-controlling interest in the
subsidiary together with any cumulative
translation differences recognised in equity.
The Group recognises the fair value of the
consideration received and the fair value of any
investment retained together with any gain or loss
in profit or loss.
27
Renascor Resources Limited annual report 2020 financial statements
1. Significant accounting policies continued
Revenue recognition
Income tax
The Group recognises revenue as follows:
Revenue from contracts with customers
Revenue is recognised at an amount that reflects
the consideration to which the Group is expected
to be entitled in exchange for transferring goods
or services to a customer. For each contract with a
customer, the Group: identifies the contract with a
customer; identifies the performance obligations
in the contract; determines the transaction price
which takes into account estimates of variable
consideration and the time value of money;
allocates the transaction price to the separate
performance obligations on the basis of the
relative stand-alone selling price of each distinct
good or service to be delivered; and recognises
revenue when or as each performance obligation
is satisfied in a manner that depicts the transfer to
the customer of the goods or services promised.
Variable consideration within the transaction
price, if any, reflects concessions provided to
the customer such as discounts, rebates and
refunds, any potential bonuses receivable from
the customer and any other contingent events.
Such estimates are determined using either the
‘expected value’ or ‘most likely amount’ method.
The measurement of variable consideration
is subject to a constraining principle whereby
revenue will only be recognised to the extent that
it is highly probable that a significant reversal in
the amount of cumulative revenue recognised will
not occur. The measurement constraint continues
until the uncertainty associated with the variable
consideration is subsequently resolved. Amounts
received that are subject to the constraining
principle are recognised as a refund liability.
Interest
Interest revenue is recognised as interest accrues
using the effective interest method. This is a
method of calculating the amortised cost of a
financial asset and allocating the interest income
over the relevant period using the effective
interest rate, which is the rate that exactly
discounts estimated future cash receipts through
the expected life of the financial asset to the net
carrying amount of the financial asset.
Other revenue
Other revenue is recognised when it is received or
when the right to receive payment is established.
The income tax expense or benefit for the period
is the tax payable on that period’s taxable income
based on the applicable income tax rate for each
jurisdiction, adjusted by the changes in deferred
tax assets and liabilities attributable to temporary
differences, unused tax losses and the adjustment
recognised for prior periods, where applicable.
Deferred tax assets and liabilities are recognised
for temporary differences at the tax rates
expected to be applied when the assets are
recovered or liabilities are settled, based on
those tax rates that are enacted or substantively
enacted, except for:
• When the deferred income tax asset or liability
arises from the initial recognition of goodwill or
an asset or liability in a transaction that is not a
business combination and that, at the time of
the transaction, affects neither the accounting
nor taxable profits; or
• When the taxable temporary difference is
associated with interests in subsidiaries,
associates or joint ventures, and the timing
of the reversal can be controlled and it is
probable that the temporary difference will not
reverse in the foreseeable future.
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.
The carrying amount of recognised and
unrecognised deferred tax assets are reviewed
at each reporting date. Deferred tax assets
recognised are reduced to the extent that it is no
longer probable that future taxable profits will be
available for the carrying amount to be recovered.
Previously unrecognised deferred tax assets
are recognised to the extent that it is probable
that there are future taxable profits available to
recover the asset.
Deferred tax assets and liabilities are offset only
where there is a legally enforceable right to offset
current tax assets against current tax liabilities
and deferred tax assets against deferred tax
liabilities; and they relate to the same taxable
authority on either the same taxable entity or
different taxable entities which intend to settle
simultaneously.
28
Notes to the financial statements for the year ended 30 June 2020
1. Significant accounting policies continued
Renascor Resources Limited (the ‘head entity’)
and its wholly-owned Australian subsidiaries
have formed an income tax consolidated group
under the tax consolidation regime. The head
entity and each subsidiary in the tax consolidated
group continue to account for their own current
and deferred tax amounts. The tax consolidated
group has applied the ‘separate taxpayer within
group’ approach in determining the appropriate
amount of taxes to allocate to members of the tax
consolidated group.
In addition to its own current and deferred tax
amounts, the head entity also recognises the
current tax liabilities (or assets) and the deferred
tax assets arising from unused tax losses and
unused tax credits assumed from each subsidiary
in the tax consolidated group.
Assets or liabilities arising under tax funding
agreements with the tax consolidated entities
are recognised as amounts receivable from or
payable to other entities in the tax consolidated
group. The tax funding arrangement ensures that
the intercompany charge equals the current tax
liability or benefit of each tax consolidated group
member, resulting in neither a contribution by the
head entity to the subsidiaries nor a distribution
by the subsidiaries to the head entity.
R & D Tax Incentives
R&D tax incentives are considered more akin
to government grants because they are not
conditional upon earning taxable income and
the group accounts for any R&D Tax incentives
received as government grants under AASB 120
Accounting for Government Grants and Disclosure
of Government Assistance.
Current and non-current classification
Assets and liabilities are presented in the
statement of financial position based on current
and non-current classification.
An asset is classified as current when: it is either
expected to be realised or intended to be sold or
consumed in the Group’s normal operating cycle;
it is held primarily for the purpose of trading;
it is expected to be realised within 12 months
after the reporting period; or the asset is cash
or cash equivalent unless restricted from being
exchanged or used to settle a liability for at least
12 months after the reporting period. All other
assets are classified as non-current.
A liability is classified as current when: it is
either expected to be settled in the Group’s
normal operating cycle; it is held primarily for the
purpose of trading; it is due to be settled within
12 months after the reporting period; or there
is no unconditional right to defer the settlement
of the liability for at least 12 months after the
reporting period. All other liabilities are classified
as non-current.
Deferred tax assets and liabilities are always
classified as non-current.
Impairment of non-financial assets
Non-financial assets are reviewed for impairment
whenever events or changes in circumstances
indicate that the carrying amount may not be
recoverable. An impairment loss is recognised for
the amount by which the asset’s carrying amount
exceeds its recoverable amount.
Recoverable amount is the higher of an asset’s fair
value less costs of disposal and value-in-use. The
value-in-use is the present value of the estimated
future cash flows relating to the asset using a
pre-tax discount rate specific to the asset or cash-
generating unit to which the asset belongs. Assets
that do not have independent cash flows are
grouped together to form a cash-generating unit.
Goods and Services Tax (‘GST’) and other
similar taxes
Revenues, expenses and assets are recognised
net of the amount of associated GST, unless the
GST incurred is not recoverable from the tax
authority. In this case it is recognised as part of
the cost of the acquisition of the asset or as part
of the expense.
Receivables and payables are stated inclusive of
the amount of GST receivable or payable. The net
amount of GST recoverable from, or payable to,
the tax authority is included in other receivables
or other payables in the statement of financial
position.
Cash flows are presented on a gross basis.
The GST components of cash flows arising
from investing or financing activities which are
recoverable from, or payable to the tax authority,
are presented as operating cash flows.
Commitments and contingencies are disclosed
net of the amount of GST recoverable from, or
payable to, the tax authority.
29
Renascor Resources Limited annual report 2020 financial statements
1. Significant accounting policies continued
Provisions
Share-based payment transactions
Provisions for legal claims are recognised when:
the Group has a present legal or constructive
obligation as a result of past events; it is more
likely than not that an outflow of resources will be
required to settle the obligation; and the amount
has been reliably estimated. Provisions are not
recognised for future operating losses.
Where there are a number of similar obligations,
the likelihood that an outflow will be required
in settlement is determined by considering the
class of obligations as a whole. A provision is
recognised even if the likelihood of an outflow
with respect to any one item included in the same
class of obligations may be small.
The Group has obligations to restore and
rehabilitate certain areas where drilling has
occurred on exploration tenements. These
obligations are currently being met as the drilling
is completed and as such no provision has been
recognised.
2.
Critical accounting judgements, estimates
and assumptions
The preparation of the financial statements
requires management to make judgements,
estimates and assumptions that affect the
reported amounts in the financial statements.
Management continually evaluates its judgements
and estimates in relation to assets, liabilities,
contingent liabilities, revenue and expenses.
Management bases its judgements, estimates
and assumptions on historical experience and
on other various factors, including expectations
of future events, management believes to
be reasonable under the circumstances. The
resulting accounting judgements and estimates
will seldom equal the related actual results. The
judgements, estimates and assumptions that have
a significant risk of causing a material adjustment
to the carrying amounts of assets and liabilities
(refer to the respective notes) within the next
financial year are discussed below.
The Group measures the cost of equity-settled
transactions with employees by reference to
the fair value of the equity instruments at the
date at which they are granted. The fair value
is determined by using either the Binomial or
Black-Scholes model taking into account the
terms and conditions upon which the instruments
were granted. The accounting estimates and
assumptions relating to equity-settled share-
based payments would have no impact on the
carrying amounts of assets and liabilities within
the next annual reporting period but may impact
profit or loss and equity. Details of share based
payment transactions are presented in Note 30.
Exploration and evaluation costs
Exploration and evaluation costs have been
capitalised on the basis that the Group will
commence commercial production in the future,
from which time the costs will be amortised
in proportion to the depletion of the mineral
resources. Key judgements are applied in
considering costs to be capitalised which includes
determining expenditures directly related to these
activities and allocating overheads between those
that are expensed and capitalised. In addition,
costs are only capitalised that are expected
to be recovered either through successful
development or sale of the relevant mining
interest. Factors that could impact the future
commercial production at the mine include the
level of reserves and resources, future technology
changes, which could impact the cost of mining,
future legal changes and changes in commodity
prices. To the extent that capitalised costs are
determined not to be recoverable in the future,
they will be written off in the period in which
this determination is made. Details of capitalised
exploration and evaluation costs are presented in
Note 11.
Development assets
Critical estimates and judgments are disclosed in
Note 12.
30
Notes to the financial statements for the year ended 30 June 2020
3. Operating segments
The Group has identified its operating segments
based on the internal reports that reviewed and
used by the Managing Director (Chief Operating
Decision Maker ‘CODM’) and the board of
directors in assessing performance determining
the allocation of resources. The Group is
managed primarily on a geographic basis, that
is, the location of the respective areas of interest
(tenements) in Australia. Operating segments are
determined on the basis of financial information
reported to the board which is at the consolidated
level. The Group does not have any products or
services it derives revenue from.
Accordingly, management currently identifies the
Group as having only one reportable segment,
being the development of the Siviour Graphite
Project and the exploration for graphite, copper,
gold, uranium and other minerals in Australia.
There have been no changes in the operating
segments during the year. Accordingly, all
significant operating decisions are based upon
analysis of the Group as one segment. The
financial results from this segment are equivalent
to the financial statements of the Group as a
whole.
Accounting policy for operating segments
Operating segments are presented using the
‘management approach’, where the information
presented is on the same basis as the internal
reports provided to the CODM. The CODM
is responsible for the allocation of resources
to operating segments and assessing their
performance.
4. Employee benefits expense
Employee benefits expense
Employee share-based payment expense
Defined contribution superannuation expense
Consolidated
2020
$
2019
$
260,966
216,007
70,259
177,675
33,166
41,801
364,391
435,483
Employee share-based payment expense comprises of Performance Rights granted to Mr David Christensen.
Further information pertaining to the Performance Rights can be found in Note 30 “Share Based Payments”.
Not included in the totals above is the employee benefits expenditure that has been capitalised as part of
Exploration and evaluation assets (note 11) and Development assets (note 12). The total amount of employee
benefits expenditure capitalised in the year ended 30 June 2020 is $229,460 (2019: $352,266). The total
amount remunerated to employees during the year is $593,851 (2019: $787,749).
31
Renascor Resources Limited annual report 2020 financial statements
5. Office accommodation
Operating lease expense
Short term lease expense
6. Other expenses
Business development & marketing
Investor and public relations
Travel
Other expenses
7.
Income tax expense
Numerical reconciliation of income tax expense and tax at the statutory rate
Loss before income tax expense
Tax at the statutory tax rate of 27.5%
Tax effect amounts which are not deductible/(taxable) in calculating taxable income:
Share-based payments
Boosting Cashflow Payment
Current year temporary differences not recognised
Income tax expense
Consolidated
2020
$
2019
$
-
30,596
30,388
-
30,388
30,596
Consolidated
2020
$
2019
$
17,942
108,853
36,766
66,998
17,794
48,392
80,007
21,234
152,509
245,477
Consolidated
2020
$
2019
$
(1,072,575)
(1,321,558)
(294,958)
(363,428)
19,321
61,236
(27,500)
-
(303,137)
(302,192)
303,137
302,192
-
-
The Group has tax losses arising in Australia of $22,840,659 (2019: $19,996,118) that may be available and
may be offset against future taxable profits. In addition, these tax losses can only be utilised in the future if
the continuity of ownership test is passed, or if failing that, the same business test is passed.
The Group had nil franking credits in its franking account at 30 June 2020 (2019: Nil).
No deferred tax liability has been recognised for expenditure pertaining to exploration and evaluation. The
amount of $4,547,640 is fully offset by the company’s deferred tax assets (2019: $3,195,869).
No deferred tax asset has been recognised because it is not likely future assessable income is derived of a
nature and of an amount sufficient to enable the benefit to be realised.
32
Notes to the financial statements for the year ended 30 June 2020
8. Cash and cash equivalents
Current assets
Cash on hand
Cash at bank
Consolidated
2020
$
2019
$
100
100
1,855,684
2,877,743
1,855,784
2,877,843
Cash at bank accounts are interest bearing attracting normal market interest rates.
As funds are held with AA/AA1 to A/A1 credit rated financial institutions (as per S&P/Moody’s ratings) there is
minimal counterparty credit risk of funds held.
Accounting policy for cash and cash equivalents
Cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short-
term, highly liquid investments with original maturities of three months or less that are readily convertible to
known amounts of cash and which are subject to an insignificant risk of changes in value.
The carrying amount for cash and cash equivalents equals the fair value.
9. Other receivables
Current assets
GST refundable
Sundry receivables
Research and development tax concession
Non-current assets
Other receivables
Consolidated
2020
$
2019
$
5,207
23,874
50,000
8,724
151,468
-
206,675
32,598
30,000
20,000
236,675
52,598
33
Renascor Resources Limited annual report 2020 financial statements
9. Other receivables continued
Allowance for expected credit losses
The Group has recognised a loss of $Nil (2019: $Nil) in profit or loss in respect of the expected credit losses
for the year ended 2020.
The ageing of the receivables and allowance for expected credit losses provided for above are as follows:
Expected credit loss rate
Carrying amount
Allowance for expected credit losses
Consolidated
Not overdue
2020
%
-
2019
%
2020
$
2019
$
-
206,675
32,598
2020
$
-
2019
$
-
Accounting policy for trade and other receivables
Trade receivables are initially recognised at fair value and subsequently measured at amortised cost using
the effective interest method, less any allowance for expected credit losses. Trade receivables are generally
due for settlement within 30 days.
The Group has applied the simplified approach to measuring expected credit losses, which uses a lifetime
expected loss allowance. To measure the expected credit losses, trade receivables have been grouped based
on days overdue.
Other receivables are recognised at amortised cost, less any allowance for expected credit losses.
10. Property, plant and equipment
Non-current assets
Computer equipment
Less: Accumulated depreciation
Office equipment
Less: Accumulated depreciation
Consolidated
2020
$
2019
$
24,385
41,570
(20,921)
(37,248)
3,464
3,407
4,322
4,444
(3,192)
(4,104)
215
3,679
340
4,662
34
Notes to the financial statements for the year ended 30 June 2020
10. Property, plant and equipment continued
Reconciliations
Reconciliations of the written down values at the beginning and end of the current and previous financial
year are set out below:
Consolidated
Balance at 1 July 2018
Additions
Depreciation expense
Balance at 30 June 2019
Additions
Write off of assets
Depreciation expense
Balance at 30 June 2020
Computer equipment
$
Office equipment
$
4,287
2,146
(2,111)
4,322
1,923
(841)
(1,940)
3,464
464
-
(124)
340
-
-
(125)
215
Total
$
4,751
2,146
(2,235)
4,662
1,923
(841)
(2,065)
3,679
Accounting policy for property, plant and equipment
Plant and equipment is stated at historical cost less accumulated depreciation and impairment. Historical
cost includes expenditure that is directly attributable to the acquisition of the items.
The cost of an item of plant and equipment also includes the initial estimate of the costs of dismantling and
removing the item and restoring the site on which it is located.
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as
appropriate, only when it is probable that future economic benefits associated with the item will flow to the
Group and the cost of the item can be measured reliably. The carrying amount of any component accounted
for as a separate asset is derecognised when replaced. All other repairs and maintenance are charged to
profit or loss during the reporting period in which they are incurred.
Depreciation is calculated on a straight-line basis to write off the net cost of each item of property, plant and
equipment (excluding land) over their expected useful lives as follows:
Plant and equipment
3-10 years
The residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each
reporting date.
An item of property, plant and equipment is derecognised upon disposal or when there is no future
economic benefit to the Group. Gains and losses between the carrying amount and the disposal proceeds are
taken to profit or loss.
35
Renascor Resources Limited annual report 2020 financial statements
11. Exploration and evaluation
Reconciliations
Reconciliations of the written down values at the beginning and end of the current and previous financial
year are set out below:
Consolidated
Balance at 1 July 2018
Expenditure during the year
Other tenements
$
Siviour Project
$
Total
$
3,216,535
237,660
4,153,389
7,369,924
4,424,893
4,662,553
Acquisition of Ausmin Development Pty Ltd
-
3,412,750
3,412,750
Impairment of assets
(387,751)
-
(387,751)
R & D tax refund offset against capitalised
exploration and evaluation #
Balance at 30 June 2019
Expenditure during the year
-
(23,384)
(23,384)
3,066,444
11,967,648
15,034,092
58,319
1,074,089
1,132,408
Payment for option to purchase land
-
225,000
225,000
Impairment of assets
(274,109)
-
(274,109)
Reclassification to development asset in November 2019
-
(13,266,737)
(13,266,737)
Balance at 30 June 2020
2,850,654
-
2,850,654
Accounting policy for exploration and evaluation assets
Exploration and evaluation expenditure in relation to separate areas of interest for which rights of tenure
are current is carried forward as an asset in the statement of financial position where it is expected that the
expenditure will be recovered through the successful development and exploitation of an area of interest,
or by its sale, or exploration activities are continuing in an area and activities have not reached a stage which
permits a reasonable estimate of the existence or otherwise of economically recoverable reserves. Where a
project or an area of interest has been abandoned, the expenditure incurred thereon is written off in the year
in which the decision is made.
Exploration and evaluation expenditure comprises of net direct costs and includes an appropriate portion
of related salaries & wages expenditure associated with each area of interest. During the financial year the
Group has allocated $229,460 of internal personnel costs (2019: $352,266) which form part of the exploration
expenditure for the year.
# Note: Refundable tax incentives (Research and development tax concession) are accounted for as government grants under
AASB 120 Accounting for Government Grants and Disclosure of Government Assistance and offset against capitalised exploration
and evaluation expenditure.
36
Notes to the financial statements for the year ended 30 June 2020
12. Development asset
Non-current assets
Siviour project - at cost
Reconciliations
Consolidated
2020
$
2019
$
13,534,752
-
Reconciliations of the written down values at the beginning and end of the current and previous financial
year are set out below:
Consolidated
Balance at 1 July 2018
Balance at 30 June 2019
Reclassification from exploration and evaluation
asset in November 2019 (see note 11)
Expenditure after reclassification
Research and Development Tax Incentive #
Balance at 30 June 2020
Siviour Project
$
-
-
Total
$
-
-
13,266,737
13,266,737
419,483
419,483
(151,468)
(151,468)
13,534,752
13,534,752
In November 2019 the Company received the results from the Definitive Feasibility Study (DFS) for its Siviour
Graphite Project. The DFS confirms Siviour’s potential as a low cost, long life graphite project. The asset has
been reclassified as a development asset to appropriately reflect the likelihood of future development.
# Note: Refundable tax incentives (Research and development tax concession) are accounted for as government grants
under AASB 120 Accounting for Government Grants and Disclosure of Government Assistance and offset against capitalised
development asset.
37
Renascor Resources Limited annual report 2020 financial statements
12. Development asset continued
Assessing impairment on reclassification
The development asset had been assessed for impairment on reclassification from exploration and
evaluation expenditure. In determining the recoverable amount of the asset, estimates were made regarding
the present value of future cashflows. These estimates require significant management judgments and
assumptions and are subject to risk and uncertainty that may be beyond the control of the Group. The
recoverable amount estimate is most sensitive to assumptions regarding the long-term forecasts of
production capacity, graphite prices and discount rates.
The Company has considered market conditions and changes to these estimates and is satisfied that there is
no impairment to the carrying value of the development asset.
The main estimates and assumptions used are as follows:
• Production: the model is based on staged development with average production of 80ktpa during the first
4 years, before expansion to 144ktpa in years 5 to 10.
• Graphite prices: prices are based on the latest internal forecasts taking into account expected demand and
supply, benchmarked with external sources of information.
• Discount rate: a discount rate 10% has been used for financial modelling.
Accounting policy for development asset
Expenditure is transferred from ‘Exploration and evaluation assets’ to ‘Development asset’ once the work
completed to date supports the future development of the property and such development receives
appropriate approvals.
After transfer of the exploration and evaluation assets, all subsequent expenditure on the construction,
installation or completion of infrastructure facilities is capitalised in ‘development asset’. Development
expenditure is net of proceeds from the sale of ore extracted during the development phase to the extent
that it is considered integral to the development of the asset.
Any costs incurred in the testing of assets to determine if they are functioning as intended, are capitalised,
net of any proceeds received from selling any product produced while testing. Where these proceeds exceed
the cost of testing, any excess is recognised in the statement of profit or loss and other comprehensive
income.
After production starts, all assets included in “Development asset’ are then transferred to ‘Producing mine’.
38
Notes to the financial statements for the year ended 30 June 2020
13. Trade and other payables
Current liabilities
Trade and other payables
Sundry creditor and accrued expenses
Consolidated
2020
$
2019
$
170,265
462,331
61,211
54,119
231,476
516,450
Accounting policy for trade and other payables
These amounts represent liabilities for goods and services provided to the Group prior to the end of the
financial year and which are unpaid. Due to their short-term nature they are measured at amortised cost and
are not discounted. The amounts are unsecured and are usually paid within 30 days of recognition.
14. Provisions
Current liabilities
Annual leave
Long service leave
Consolidated
2020
$
2019
$
25,262
45,376
75,415
67,219
100,677
112,595
Accounting policy for employee benefits
Short-term employee benefits
Liabilities for wages and salaries, including non-monetary benefits, annual leave and long service leave
expected to be settled wholly within 12 months of the reporting date are measured at the amounts expected
to be paid when the liabilities are settled.
Amounts not expected to be settled within the next 12 months
The current provision for employee benefits includes all unconditional entitlements where employees have
completed the required period of service and also those where employees are entitled to pro-rata payments
in certain circumstances. The entire amount is presented as current, since the Group does not have an
unconditional right to defer settlement. However, based on past experience, the Group does not expect all
employees to take the full amount of accrued leave or require payment within the next 12 months.
39
Renascor Resources Limited annual report 2020 financial statements
15. Issued capital
Consolidated
2020
Shares
2019
Shares
2020
$
2019
$
Ordinary shares - fully paid
1,330,606,165
1,153,424,340
34,114,480
32,210,012
Movements in ordinary share capital
Details
Balance
Date
Shares
Issue price
$
1 July 2018
961,327,113
28,752,262
Issue of Ordinary Shares as consideration
for marketing services provided
Issue of Ordinary Shares as
consideration for the acquisition of
Ausmin Development Pty Ltd
22 November 2018
2,500,000
$0.02
45,000
22 November 2018
189,597,227
$0.02
3,412,750
Balance
30 June 2019
1,153,424,340
32,210,012
Shares issued on vesting of performance rights 8 November 2019
6,000,000
$0.02
108,000
Conditional placement to professional &
sophisticated investors
Conditional placement to professional &
sophisticated investors
Issue of Ordinary Shares pursuant to
Share Purchase Plan
Issue of Ordinary Shares pursuant
to Share Purchase Plan
Less: Transaction costs arising on
share issues, net of tax
12 December 2019
110,454,528
$0.01
1,215,000
19 December 2019
2,818,200
$0.01
31,000
13 January 2020
45,454,552
$0.01
500,000
6 May 2020
12,454,545
$0.01
137,000
-
$0.00
(86,532)
Balance
30 June 2020
1,330,606,165
34,114,480
Ordinary shares
Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the
Company in proportion to the number of and amounts paid on the shares held. The fully paid ordinary
shares have no par value and the Company does not have a limited amount of authorised capital.
On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon
a poll each share shall have one vote.
Share buy-back
There is no current on-market share buy-back.
40
Notes to the financial statements for the year ended 30 June 2020
15.
Issued capital continued
Capital risk management
The Group’s objectives when managing capital is to safeguard its ability to continue as a going concern, so
that it can provide returns for shareholders and benefits for other stakeholders and to maintain an optimum
capital structure to reduce the cost of capital.
Capital is regarded as total equity, as recognised in the statement of financial position, plus net debt. Net
debt is calculated as total borrowings less cash and cash equivalents.
In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to
shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.
The Group would look to raise capital when an opportunity to invest in a business or company was seen as
value adding relative to the current Company’s share price at the time of the investment. The Group is not
actively pursuing additional investments in the short term as it continues to integrate and grow its existing
businesses in order to maximise synergies.
The Group is subject to certain financing arrangements covenants and meeting these is given priority in all
capital risk management decisions. There have been no events of default on the financing arrangements
during the financial year.
The capital risk management policy remains unchanged from the 30 June 2019 Annual Report.
Accounting policy for issued capital
Ordinary shares are classified as equity.
Incremental costs directly attributable to the issue of new shares or options are shown in equity as a
deduction, net of tax, from the proceeds.
16.
Reserves
Options reserve
Performance rights reserve
Business combination reserve
Consolidated
2020
$
2019
$
-
1,579,734
139,934
245,959
(1,417,790)
(1,417,790)
(1,277,856)
407,903
Share-based payments reserve
The reserve is used to recognise the value of equity benefits provided to employees and directors as part of
their remuneration, and other parties as part of their compensation for services.
Business combination
The reserve is used to recognise the difference between the value of consideration paid to acquire the non-
controlling interests and value of the non-controlling interest.
41
Renascor Resources Limited annual report 2020 financial statements
16. Reserves continued
Movements in reserves
Movements in each class of reserve during the current and previous financial year are set out below:
Consolidated
Options
reserve
Performance
rights reserve
$
Business
combination reserve
$
Total
$
Balance at 1 July 2018
1,579,734
68,284
(1,417,790)
230,228
Performance rights expensed over
vesting period
Balance at 30 June 2019
Performance rights expensed over
vesting period
Performance rights vested
Performance rights lapsed
-
1,579,734
-
-
-
177,675
245,959
70,259
(108,000)
(68,284)
Options lapsed
(1,579,734)
-
-
177,675
(1,417,790)
407,903
-
-
-
-
70,259
(108,000)
(68,284)
(1,579,734)
Balance at 30 June 2020
-
139,934
(1,417,790)
(1,277,856)
17. Accumulated losses
Accumulated losses at the beginning of the financial year
Loss after income tax expense for the year
Transfer from options reserve
Transfer from performance rights reserve
Consolidated
2020
$
2019
$
(15,249,110)
(13,927,552)
(1,072,575)
(1,321,558)
1,579,734
68,284
-
-
Accumulated losses at the end of the financial year
(14,673,667)
(15,249,110)
18. Dividends
There were no dividends paid, recommended or declared during the current or previous financial year.
42
Notes to the financial statements for the year ended 30 June 2020
19. Financial instruments
Financial risk management objectives
The Group’s activities expose it to a variety of financial risks: market risk (including price risk and interest
rate risk), credit risk and liquidity risk. The Group’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 Group. The board is responsible for managing the Group’s finance facilities. The Group
does not currently undertake hedging of any kind and is not directly exposed to currency risk.
The Group holds the following financial instruments:
Financial assets at amortised cost
Cash and cash equivalents
Other receivables
Total financial assets
Financial liabilities at amortised cost
Trade and other payables
Sundry creditors & accrued expenses
Total financial liabilities at amortised cost
Market risk
Price risk
The Group is not exposed to any significant price risk.
Consolidated
2020
$
2019
$
1,855,784
2,877,843
236,675
52,598
2,092,459
2,930,441
170,265
462,331
61,211
54,119
231,476
516,450
Interest rate risk
As at 30 June 2020 and 30 June 2019, the Group had no borrowings. As such the group is not exposed to any
significant interest rate risk.
At the reporting date, the Company is exposed to changes in market interest rates through its bank deposits,
which are subject to variable interest rates.
The following table illustrates the sensitivity of the net result for the year and equity to a reasonably possible
change in interest rates of +0.5% and -0.5% (2019: +0.5%/-0.5%), with effect from the beginning of the year.
These changes are considered to be reasonably possible based on observation of current market conditions.
The calculations are based on the cash and cash equivalents held at the beginning of each reporting period.
All other variables are held constant.
43
Renascor Resources Limited annual report 2020 financial statements
19.
Financial instruments continued
Basis points increase
Basis points decrease
Basis points Effect on profit
before tax
change
Effect on
equity
Basis points Effect on profit
before tax
change
Effect on
equity
50
14,389
14,389
(50)
(14,389)
(14,389)
50
40,944
40,944
(50)
(40,944)
(40,944)
Consolidated 2020
Cash and cash
equivalents
Consolidated 2019
Cash and cash
equivalents
Credit risk
Credit risk is managed on a Group basis. Credit risk arises from cash and cash equivalents and deposits with
banks and financial institutions. For banks and financial institutions, only independently rated parties with a
minimum rating of ‘A’ are accepted. The majority of cash and cash equivalents is held with a single financial
institution.
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial
loss to the Group. The Group does not hold any collateral to mitigate this risk.
The Group has adopted a lifetime expected loss allowance in estimating expected credit losses to trade
receivables through the use of a provisions matrix using fixed rates of credit loss provisioning. These
provisions are considered representative across all customers of the Group based on recent sales
experience, historical collection rates and forward-looking information that is available.
Generally, trade receivables are written off when there is no reasonable expectation of recovery. Indicators of
this include the failure of a debtor to engage in a repayment plan, no active enforcement activity and a failure
to make contractual payments for a period greater than 1 year.
The credit quality of financial assets that are neither past due nor impaired can be assessed by reference to
external credit ratings (if available) or to historical information about counterparty default rates:
Cash and cash equivalents
Minimum rating of A
Liquidity risk
Consolidated
2020
$
2019
$
1,855,784
2,877,843
Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the
availability of funding through an adequate amount of committed credit facilities to meet obligations when
due and close out market positions. At the end of each reporting period the Group held deposits at call of
$1,855,784 (2019: $2,877,843) that are expected to readily generate cash inflows for managing liquidity risk.
The Group has sufficient funds to finance its operations and exploration activities and to allow for reasonable
contingencies.
44
Notes to the financial statements for the year ended 30 June 2020
19.
Financial instruments continued
Remaining contractual maturities
The following tables detail the Group’s remaining contractual maturity for its financial instrument liabilities.
The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the
earliest date on which the financial liabilities are required to be paid. The tables include both interest and
principal cash flows disclosed as remaining contractual maturities and therefore these totals may differ from
their carrying amount in the statement of financial position.
Weighted
average
interest rate
%
1 year or less
$
Between 1
and 2 years
$
Remaining
Between 2
contractual
and 5 years Over 5 years maturities
$
$
$
Consolidated 2020
Non-derivatives
Non-interest bearing
Trade payables
Other payables
Total non-derivatives
-
-
170,265
61,211
231,476
Consolidated 2019
%
$
Non-derivatives
Non-interest bearing
Trade payables
Other payables
Total non-derivatives
-
-
462,331
54,119
516,450
-
-
-
$
-
-
-
-
-
-
$
-
-
-
-
-
-
$
-
-
-
170,265
61,211
231,476
$
462,331
54,119
516,450
The cash flows in the maturity analysis above are not expected to occur significantly earlier than contractually
disclosed above.
Fair value of financial instruments
Unless otherwise stated, the carrying amounts of financial instruments reflect their fair value.
45
Renascor Resources Limited annual report 2020 financial statements
20. Key management personnel disclosures
Compensation
The aggregate compensation made to directors and other members of key management personnel of the
Group is set out below:
Short-term employee benefits
Post-employment benefits
Long-term benefits
Performance rights
NEDSP & director’s shares
Consolidated
2020
$
2019
$
517,387
717,147
25,948
36,926
6,840
54,681
70,259
177,675
17,319
-
637,753
986,429
Details of the remuneration of each director of the Company and each of the other key management
personnel of the Group, including their personally related entities, are set out in the remuneration report.
Other transactions with key management personnel
Mr G W McConachy and Mr C Anderson are directors of Euro Exploration Services Pty Ltd (Euro). Euro has
provided the company with exploration services, geochemical sampling services as well as the provision of
geological personnel services during the year. The services provided are based on normal commercial terms
and conditions. During the financial year the Company incurred costs of $24,376 (2019: $203,768) from
Euro. An amount of $2,677 (2019: $7,384) was owing to Euro at 30 June 2020.
Mr G W McConachy provided the company with exploration consulting services during the year. The services
provided are based on normal commercial terms and conditions. During the financial year the Company
incurred costs of $4,287 (2019: $Nil) from GW MCConachy & Co Pty Ltd. No amount was owing to GW
MCConachy & Co Pty Ltd at 30 June 2020 (2019: $Nil).
Mr C Anderson (resigned as a director 12 October 2018) is a director of Pondray Pty Ltd trading as CG
Anderson & Associates (CGAA). CGAA has provided geophysical services to the company. During the financial
year the Company incurred no expenses (2019: $7,700) from CGAA. No amount was owing to CGAA at 30 June
2020 (2019: $Nil).
Mr S Bizzell is a director of Bizzell Capital Partners Pty Ltd (BCP). BCP has provided corporate advisory and
underwriting services to the company in relation to its capital raising. The services provided are based on
normal commercial terms and conditions. During the financial year the Company did not incur any non-
director’s fees costs from BCP (2019: $Nil). An amount of $5,867 of director’s fees was owing to BCP at 30 June
2020 (2019: $3,667).
Mr D Christensen had incurred expenses throughout year on behalf of the company. At 30 June 2020 a
reimbursement to Mr Christensen of $5,509 was outstanding (2019: $Nil).
46
Notes to the financial statements for the year ended 30 June 2020
21. Remuneration of auditors
During the financial year the following fees were paid or payable for services provided by
BDO Audit (SA) Pty Ltd, the auditor of the Company:
Audit services - BDO Audit (SA) Pty Ltd
Audit or review of the financial statements
Other services
Amounts paid/payable to a related practice of the auditor for
tax compliance for the entity or any entity in the Group
Amounts paid/payable to a related practice of the auditor for
advisory services for the entity or any entity in the Group
Consolidated
2020
$
2019
$
33,000
32,000
3,030
4,243
7,169
10,199
348
4,591
43,199
36,591
22. Contingent liabilities
Renascor has entered into an agreement with a service provider under which the service provider agreed
to contribute $1 million of services towards early project works on the basis that they may subsequently
be awarded the engineering procurement and construction contract for the Siviour project. Renascor
subsequently entered into contract with this service provider to provide services in relation the Siviour
Definitive Feasibility Study (DFS), with the parties agreeing that the $1 million early project works commitment
would apply toward the DFS. In performing work in the DFS, the service provider incurred costs exceeding the
$1 million contribution amount. Renascor may be liable to reimburse, in cash or equity, amounts due to this
service provider pursuant to the agreement relating to the DFS.
23. Commitments
In order to maintain current rights to tenure to exploration tenements, the Group is required to perform
minimum exploration work to meet the minimum expenditure requirements specified by various State
governments. These amounts are subject to renegotiation when application for a mining lease is made and
at other times. These amounts, which are not provided for in the financial report and are expected to be
capitalised as incurred but not recognised as liabilities, are as follows:
Consolidated
2020
$
2019
$
Exploration and mining lease commitments
Commitments in relation to exploration and mining leases held at the end of each
reporting period but not recognised as liabilities, payable:
Within one year
2,004,500
1,792,500
To keep tenements in good standing, work programs should meet certain minimum expenditure
requirements. If the minimum expenditure requirements are not met, the Company has the option to
negotiate new terms or relinquish the tenements. The Company also has the ability to meet expenditure
requirements by joint venture or farm-in agreements.
47
Renascor Resources Limited annual report 2020 financial statements
23. Commitments continued
Exploration and mining lease contingent liabilities
The Group has previously entered into Asset Sale Agreements with Hillment Pty Ltd to acquire tenement EL
4570 and a similar agreement with Hiltaba Gold Pty Ltd for EL4707. Under each agreement, the company
has granted a 1% royalty of the Net Smelter Return. The timing and amount of any financial effect relating
to these agreements are dependent on the successful exploration and subsequent exploitation of the
associated tenements.
Operating Lease Commitments
The office lease expired on 30 November 2013. The company continues to occupy the office with rent
payable monthly in advance on a month to month basis.
24. Related party transactions
Parent entity
Renascor Resources Limited is the parent entity.
Subsidiaries
Interests in subsidiaries are set out in note 26.
Key management personnel
Disclosures relating to key management personnel are set out in note 20 and the remuneration report
included in the directors’ report.
Transactions with related parties
There were no transactions with related parties during the current and previous financial year, aside from
those set out in note 24.
Receivable from and payable to related parties
There were no trade receivables from or trade payables to related parties at the current and previous
reporting date, aside from those set out in note 24.
Loans to/from related parties
There were no loans to or from related parties at the current and previous reporting date.
48
Notes to the financial statements for the year ended 30 June 2020
25. Parent entity information
Set out below is the supplementary information about the parent entity.
Statement of profit or loss and other comprehensive income
Loss after income tax
Total comprehensive income
Statement of financial position
Total current assets
Total assets
Total current liabilities
Total liabilities
Equity
Issued capital
Options reserve
Performance rights reserve
Accumulated losses
Total equity
Parent
2020
$
2019
$
(1,047,558)
(3,280,494)
(1,047,558)
(3,280,494)
Parent
2020
$
2019
$
2,075,925
2,938,998
18,495,114
17,997,850
332,157
629,045
332,157
629,045
34,114,480
32,210,012
-
1,579,734
139,934
245,959
(16,091,457)
(16,666,900)
18,162,957
17,368,805
Guarantees entered into by the parent entity in relation to the debts of its subsidiaries
The parent entity had no guarantees in relation to the debts of its subsidiaries as at 30 June 2020.
Contingent liabilities
In the year ended 30 June 2017 the Parent Entity had entered into Asset Sale Agreements with Hillment Pty
Ltd to acquire tenement EL4570 and a similar agreement with Hiltaba Gold Pty Ltd for EL4707. Under each
agreement, the company has granted a 1% royalty of the Net Smelter Return.
Capital commitments - Property, plant and equipment
The parent entity had no capital commitments for property, plant and equipment as at 30 June 2020.
Significant accounting policies
The accounting policies of the parent entity are consistent with those of the Group, as disclosed in note 1,
except for the following:
• Investments in subsidiaries are accounted for at cost, less any impairment, in the parent entity.
• Investments in associates are accounted for at cost, less any impairment, in the parent entity.
• Dividends received from subsidiaries are recognised as other income by the parent entity and its receipt
may be an indicator of an impairment of the investment.
49
Renascor Resources Limited annual report 2020 financial statements
26.
Interests in subsidiaries
The consolidated financial statements incorporate the assets, liabilities and results of the following
subsidiaries in accordance with the accounting policy described in note 1:
Name
Kulripa Uranium Pty Ltd
Astra Resources Pty Ltd
Sol Jar Property Pty Ltd
Principal place of business/
country of incorporation
Australia
Australia
Australia
Eyre Peninsula Minerals Pty Ltd
Australia
Ausmin Development Pty Ltd
Australia
27. Events after the reporting period
Ownership interest
2020
%
2019
%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
On 1 July 2020 the company announced the results of a study assessing an integrated battery anode material
operation in South Australia to produce Purified Spherical Graphite (“PSG”) for lithium-ion battery anodes.
The study confirms that the integration of a PSG processing operation with Siviour creates significant added
value and aligns the company with end-users of PSG seeking supply chain security through the world’s first
integrated, in-country mine and battery anode material operation outside of China.
On 14 July 2020 the company announced the results of independent purification tests that confirmed that
Siviour is able to produce PSG through the more environmentally-friendly caustic roast purification method.
On 21 July 2020 an updated Mineral Ore Reserve estimate was announced confirming Siviour as the largest
reported total Ore Reserve outside of Africa, and the second largest reported proven reserve of graphite
in the world. This estimate provides additional confidence in the size and quality of the Siviour deposit as a
consistent source of high-quality graphite supporting a mine life of over 40 years.
On 4 August 2020 the Company announced high-grade, shallow gold drill intercepts at the Carnding Project in
South Australia’s Central Gawler Craton. The results include over 16 g/t Au at the Soyuz prospect.
On 10 August 2020 the Company announced an expansion to the Carding Project, with the approval of an
exploration licence application over an area immediately north of the Soyuz prospect.
On 12 August 2020 independent qualification tests undertaken by a German graphite specialist confirmed
that Siviour PSG meets product specifications required for integration of PSG into lithium-ion battery anodes.
On 28 August 2020 an induced polarization survey confirmed multiple untested, shallow gold targets along-
strike from the company’s Soyuz (Carnding) prospect in South Australia’s Gawler Craton.
On 18 September 2020 the company announced that it has received firm commitments from professional
and sophisticated investors to raise approximately $3.6 million (before expenses) at 1.1cents per share with
one attaching option for every two shares issued. The funds raised will be used to advance the Siviour Project
and Carnding Gold Project.
No other matter or circumstance has arisen since 30 June 2020 that has significantly affected, or may
significantly affect the Group’s operations, the results of those operations, or the Group’s state of affairs in
future financial years.
50
Notes to the financial statements for the year ended 30 June 2020
28. Reconciliation of loss after income tax to net cash used in operating activities
Loss after income tax expense for the year
(1,072,575)
(1,321,558)
Consolidated
2020
$
2019
$
Adjustments for:
Depreciation and amortisation
Write off of non-current assets
Share-based payments
Write off exploration
Change in operating assets and liabilities:
Increase/(decrease) in provisions
Increase/(decrease) in trade and other payables
(Increase)/decrease in other receivables
(Increase)/decrease in other operating assets
Net cash used in operating activities
Non-cash financing and investing activities
Shares issued to vendors of Ausmin Development Pty Ltd for
no cash consideration in respect of the acquisition of
Ausmin Development Pty Ltd
2,065
2,236
841
-
70,259
222,675
291,157
387,751
(11,918)
(110,197)
(284,972)
(94,392)
(7,520)
284,856
(10,000)
(17,661)
(1,022,663)
(646,290)
2020
$
2019
$
-
(3,412,750)
51
Renascor Resources Limited annual report 2020 financial statements
29. Earnings per share
Loss after income tax
Basic earnings per share
Diluted earnings per share
Weighted average number of ordinary shares used in calculating
basic earnings per share
Weighted average number of ordinary shares used in calculating
diluted earnings per share
Consolidated
2020
$
2019
$
(1,072,575)
(1,321,558)
Cents
Cents
(0.1)
(0.1)
(0.1)
(0.1)
Number
Number
1,242,788,242
1,077,638,036
1,242,788,242
1,077,638,036
Options and performance rights are considered anti-dilutive as the Group is loss making. At 30 June 2020
there were no anti-dilutive options (2019: 129,761,096) and 12,000,000 performance rights (2019: 18,000,000).
Accounting policy for earnings per share
Basic earnings per share
Basic earnings per share is calculated by dividing the profit attributable to the owners of Renascor Resources
Limited, excluding any costs of servicing equity other than ordinary shares, by the weighted average number
of ordinary shares outstanding during the financial year, adjusted for bonus elements in ordinary shares
issued during the financial year.
Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to
take into account the after income tax effect of interest and other financing costs associated with dilutive
potential ordinary shares and the weighted average number of shares assumed to have been issued for no
consideration in relation to dilutive potential ordinary shares.
52
Notes to the financial statements for the year ended 30 June 2020
30. Share-based payments
Directors and executives share based payments
During the period 1 April to 30 June 2020, 50% of non-executive director fees totaling $13,479 were withheld
by the Company pursuant to the Non-Executive Director Share Plan (“NEDSP”) (2019: Nil). As at 30 June 2020
the shares pertaining to the the period 1 April 2020 to 30 June 2020 had not been issued.
During the period 1 April to 30 June 2020 executive director fees totaling $3,840 were withheld by the
Company to be issued as shares at a later date when shareholder approval is obtained (2019: Nil). As at 30
June 2020 the shares pertaining to the the period 1 April 2020 to 30 June 2020 had not been issued.
There are no options that have been granted to directors and senior management as part of their
remuneration (2019: Nil).
There was no amount of the equity settled share-based payment recognised in the current period in respect
of options granted to directors and executives (2019: $Nil).
During the year the amount of the equity settled share-based payment recognised in the current period in
respect of options granted to consultants was $Nil (2019: $Nil). These options were issued as consideration
for capital raising services provided.
Exploration and evaluation share based payments
The amount of the equity settled share-based payment recognised in the current period in respect of the
ordinary shares issued is $Nil (2019: $3,412,750). Amounts previously recognised have been included as
exploration and evaluation expenditure within the non-current assets in the statement of financial position.
There were no options granted during the year in respect of exploration and evaluation activities (2019: $Nil).
Share based payments to consultants
During the period the amount of the equity settled share-based payment recognised in the current period in
respect of shares issued to consultants was $Nil (2019: $45,000).
During the year there were no equity settled share-based payments recognised in the current period in
respect of options granted to consultants (2019: $Nil).
Set out below are summaries of the granted options:
2020
Grant date
Expiry date
Exercise
price
Balance at
the start of
the year
Granted
Exercised
05/12/2016
05/12/2019
$0.00
15,000,000
28/11/2017
31/10/2019
$0.00
25,000,000
40,000,000
2019
05/12/2016 05/12/2019
$0.05
15,000,000
28/11/2017 31/10/2019
$0.03
25,000,000
40,000,000
-
-
-
-
-
-
-
-
-
-
-
-
Expired
forfeited/
other
Balance
at the end
of the year
(15,000,000)
(25,000,000)
(40,000,000)
-
-
-
- 15,000,000
- 25,000,000
- 40,000,000
Weighted average exercise price
$0.04
$0.00
$0.00
$0.00
$0.04
53
Renascor Resources Limited annual report 2020 financial statements
30. Share-based payments continued
Grant date
Expiry date
05/12/2016
05/12/2019
28/11/2017
31/10/2019
2020
Number
2019
Number
-
-
-
15,000,000
114,761,096
129,761,096
The weighted average remaining contractual life of options outstanding at the end of the financial year was 0
years (2019: 0.3 years).
Performance rights granted to directors and senior management
At the Extraordinary General Meeting held on 3 September 2018 Shareholders of the Company granted
approval for the issue of performance rights to Mr David Christensen. Details of the performance rights are
in the Notice of Extra Ordinary General Meeting dated 1 August 2018. However the vesting conditions are
outlined below:
Tranche A Performance Rights. 6,000,000 Performance Rights will vest upon the completion of a positive
Definite Feasibility Study in respect of the production of graphite concentrates.
Tranche B Performance Rights. 6,000,000 Performance Rights will vest upon the commencement of
construction of a commercial graphite concentrate production facility
Tranche C Performance Rights. 6,000,000 Performance Rights will vest upon (i) the share price of Renascor
ordinary shares having achieved a closing price of in excess of $0.055 for five consecutive days after the issue
date of such Performance Rights, and (ii) the date that is two and one-half years after the issue date of such
Performance Rights.
The Performance Rights are expensed over the expected vesting period. The total value of Performance
Rights recognised in the current period is $70,259 (2019: $177,675).
The performance rights were valued as outlined below:
Tranche A
Tranche B
Tranche C
Total
Total value at
grant date
$
108,000
108,000
45,600
261,600
Expensed during
the year
$
-
52,710
17,549
70,259
The tranches were valued using the Black Scholes pricing model that takes into account the term of the
Performance Rights, the vesting and performance criteria (if applicable), the non-tradable nature of the rights
(if applicable), the share price at grant date, expected price volatility of the underlying share, the expected
dividend yield, the probability that the Performance Rights will issue and the risk free interest rate for the
term of the Performance Right.
The probability that the Tranche C rights will vest (38%) was determined using the Monte Carlo simulation.
This model takes into account the randomness of the share price movements and the volatility of the
underlying share.
54
Notes to the financial statements for the year ended 30 June 2020
30. Share-based payments continued
Set out below are summaries of performance rights granted to directors and senior management:
2020
Grant date
Expiry date
Exercise
price
Balance at
the start of
the year
Granted
Vested
Expired
forfeited/
other
Balance
at the end
of the year
22/11/2018
22/11/2022
$0.00
6,000,000
22/11/2018
22/11/2022
$0.00
6,000,000
22/11/2018
22/11/2022
$0.00
6,000,000
18,000,000
-
-
-
-
(6,000,000)
-
-
(6,000,000)
2019
22/11/2018
22/11/2022
$0.00
22/11/2018
22/11/2022
$0.00
22/11/2018
22/11/2022
$0.00
-
-
-
-
6,000,000
6,000,000
6,000,000
18,000,000
-
-
-
-
-
-
-
-
-
-
-
-
-
6,000,000
6,000,000
12,000,000
6,000,000
6,000,000
6,000,000
18,000,000
Set out below are the performance rights exercisable at the end of the financial year:
Grant date
Expiry date
22/11/2018
22/11/2022
22/11/2018
22/11/2022
22/11/2018
22/11/2022
2020
Number
2019
Number
-
6,000,000
6,000,000
6,000,000
6,000,000
6,000,000
12,000,000
18,000,000
The weighted average remaining contractual life of performance rights outstanding at the end of the financial
year was 2.4 years (2019: 3.4 years).
Fair value of performance rights granted:
The assessed fair value at grant date of performance rights is allotted equally over the period from grant date
to vesting date. The fair value was independently determined using a Black Scholes option pricing model.
that takes into account the exercise price, the term of the option, the vesting and performance criteria (if
applicable), the impact of dilution, the non-tradable nature of the option (if applicable), the share price at
grant date, expected price volatility of the underlying share, the expected dividend yield and the risk free
interest rate for the term of the option.
Historical volatility of a group of comparable companies has been the basis of determining expected share
price volatility, as it is assumed that this is indicative of future movements. No adjustment has been made
to the life of the option based on no past history regarding expected exercise or any variation of the expiry
date. Accordingly, the expected life of the options has been taken to the full period of time from grant date to
expiry date, which may fail to eventuate in the future.
The valuation model input also assumes no dividend yield on the Performance Shares.
55
Renascor Resources Limited annual report 2020 financial statements
Notes to the financial statements for the year ended 30 June 2020
30. Share-based payments continued
Accounting policy for share-based payments
Share-based compensation benefits are provided to directors, executives and consultants through the
granting of share options and performance rights.
Options and performance rights are granted for no cash consideration. When these share options and
performance rights are granted, the fair value of the options and performance rights issued are recognised
as an employee benefits expense with a corresponding increase in equity. The amount recognised as an
expense is adjusted to reflect the number of share options and performance rights for which the related
service and non-market performance conditions are expected to be met, such that the amount ultimately
recognised as an expense is based on the number of share options and performance rights that meet the
related service and non-market performance conditions at the vesting date.
The fair value of share options and performance rights are measured using an appropriate pricing model.
Measurement inputs include the share price on measurement date, exercise price of the instrument,
expected price volatility of the underlying share, the expected dividend yield and the risk-free interest rate for
the term of the option and performance rights. Service and non-market performance conditions attached to
the transactions are not taken into account in determining fair value.
Upon the exercise of options and performance rights, the balance of the share-based payments reserve
relating to those options and performance rights is transferred to share capital.
Market conditions are taken into consideration in determining fair value. Therefore any awards subject to
market conditions are considered to vest irrespective of whether or not that market condition has been met,
provided all other conditions are satisfied.
If equity-settled awards are modified, as a minimum an expense is recognised as if the modification has not
been made. An additional expense is recognised, over the remaining vesting period, for any modification that
increases the total fair value of the share-based compensation benefit as at the date of modification.
If the non-vesting condition is within the control of the Group or employee, the failure to satisfy the condition
is treated as a cancellation. If the condition is not within the control of the Group or employee and is not
satisfied during the vesting period, any remaining expense for the award is recognised over the remaining
vesting period, unless the award is forfeited.
If equity-settled awards are cancelled, it is treated as if it has vested on the date of cancellation, and any
remaining expense is recognised immediately. If a new replacement award is substituted for the cancelled
award, the cancelled and new award is treated as if they were a modification.
56
Directors’ declaration
In the directors’ opinion:
• the attached financial statements and notes comply with
the Corporations Act 2001, the Accounting Standards, the
Corporations Regulations 2001 and other mandatory professional
reporting requirements;
• the attached financial statements and notes comply with
International Financial Reporting Standards as issued by the
International Accounting Standards Board as described in note 1
to the financial statements;
• the attached financial statements and notes give a true and fair
view of the Group’s financial position as at 30 June 2020 and of its
performance for the financial year ended on that date; and
• there are reasonable grounds to believe that the Company will be
able to pay its debts as and when they become due and payable.
The directors have been given the declarations required by section
295A of the Corporations Act 2001.
Signed in accordance with a resolution of directors made pursuant
to section 295(5)(a) of the Corporations Act 2001.
On behalf of the directors
___________________________
David Christensen, Director
29 September 2020
57
Renascor Resources Limited annual report 2020 financial statements
Independent auditor’s report
to the members of Renascor Resources Limited
Tel: +61 8 7324 6000
Fax: +61 8 7324 6111
www.bdo.com.au
BDO Centre
Level 7, 420 King William Street
Adelaide SA 5000
GPO Box 2018 Adelaide SA 5001
Australia
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF RENASCOR RESOURCES LIMITED
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Renascor Resources Limited (the Company) and its subsidiaries
(the Group), which comprises the consolidated statement of financial position as at 30 June 2020, the
consolidated statement of profit or loss and other comprehensive income, the consolidated statement
of changes in equity and the consolidated statement of cash flows for the year then ended, and notes
to the financial report, including a summary of significant accounting policies and the directors’
declaration.
In our opinion the accompanying financial report of the Group, is in accordance with the Corporations
Act 2001, including:
(i)
(ii)
Giving a true and fair view of the Group’s financial position as at 30 June 2020 and of its
financial performance for the year ended on that date; and
Complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s responsibilities for the audit of the Financial
Report section of our report. We are independent of the Group in accordance with the Corporations
Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s
APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code)
that are relevant to our audit of the financial report in Australia. We have also fulfilled our other
ethical responsibilities in accordance with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been
given to the directors of the Company, would be in the same terms if given to the directors as at the
time of this auditor’s report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Material uncertainty related to going concern
We draw attention to Note 1 in the financial report which describes the events and/or conditions which
give rise to the existence of a material uncertainty that may cast significant doubt about the group’s
ability to continue as a going concern and therefore the group may be unable to realise its assets and
discharge its liabilities in the normal course of business. Our opinion is not modified in respect of this
matter.
BDO Audit (SA) Pty Ltd ABN 33 161 379 086 is a member of a national association of independent entities which are all members of BDO (Australia) Ltd
ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit (SA) Pty Ltd and BDO (Australia) Ltd are members of BDO International
Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme
approved under Professional Standards Legislation.
58
Independent auditor’s report to the members of Renascor Resources Limited
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the financial report of the current period. These matters were addressed in the context of
our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide
a separate opinion on these matters. In addition to the matter described in the Material uncertainty
related to going concern section, we have determined the matters described below to be the key audit
matters to be communicated in our report.
Impairment assessment on reclassification of Siviour development assets
Key audit matter
How the matter was addressed in our audit
As disclosed in Note 12, costs in relation to the Siviour
Our audit procedures, amongst others, included:
project were reclassified from exploration and evaluation
assets to development assets during the financial year as
technical feasibility and commercial viability were
demonstrable.
Evaluation of the accuracy of management’s
calculation of the net present value of the
Siviour Project over its expected life.
Carrying out a sensitivity analysis over key
Under AASB 6 Exploration for and Evaluation of Mineral
inputs used to calculate the net present value
Resources when an exploration and evaluation asset is
of the Siviour Project
reclassified in these circumstances, the asset shall be
Critically assessing the assumptions used
assessed for impairment
within the net present value calculation for
appropriateness.
The impairment assessment is a key audit matter due to the
size of the recorded asset, $13,266,737 at reclassification
and the degree of estimate and assumptions required to be
made by the Group, specifically concerning future
discounted cash flows. Note 12 discloses the assumptions
used by the Group in testing these assets for impairment
Other information
The directors are responsible for the other information. The other information comprises the
information in the Group’s annual report for the year ended 30 June 2020, but does not include the
financial report and the auditor’s report thereon.
Our opinion on the financial report does not cover the other information and we do not express any
form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
59
Renascor Resources Limited annual report 2020 financial statements
Independent auditor’s report to the members of Renascor Resources Limited
Responsibilities of the directors for the Financial Report
The directors of the Company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due to
fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the group to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the Group or to cease
operations, or has no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of this financial report.
A further description of our responsibilities for the audit of the financial report is located at the
Auditing and Assurance Standards Board website at:
https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf
This description forms part of our auditor’s report.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 10 to 17 of the directors’ report for the
year ended 30 June 2020.
In our opinion, the Remuneration Report of Renascor Resources Limited, for the year ended 30 June
2020, complies with section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the
Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility
is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with
Australian Auditing Standards.
BDO Audit (SA) Pty Ltd
Andrew Tickle
Director
Adelaide, 29 September 2020
60
Shareholder information
The shareholder information set out below was
applicable as at 14 September 2020.
Distribution of equitable securities
Analysis of number of equitable security holders by size
of holding:
Ordinary shares
1 to 1,000
1,001 to 5,000
5,001 to 10,000
10,001 to 100,000
100,001 and over
Holding less than a marketable parcel
Equity security holders
50
18
59
821
1,057
2,005
412
Twenty largest quoted equity security holders:
The names of the twenty largest security holders of quoted equity securities are listed below:
Kabininge Nominees Pty Ltd
Mr David Vigolo
Mr Richard Edward Keevers
Bnp Paribas Nominees Pty Ltd
Rookharp Capital Pty Ltd
Dr Leon Eugene Pretorius
Bizzell Capital Partners Pty Ltd
David Christensen
HSBC Custody Nominees (Australia) Limited
Mr Douglas Young
Mrs Tracey Ann Mezzino
JP Morgan Nominees Australia Pty Ltd
Pontifex Wines Pty Ltd
CPS Control Systems Pty Ltd
Maja Nominees Pty Ltd
Mr Gregory Michael Josephson & Mrs Mary Margaret Josephson
Rmvic Pty Ltd
Canceler Pty Ltd
Mr Malcolm John McClure
Mr Timothy John Nixon Binney & Mrs Dianne Pamela Binney
Ordinary shares
Number
held
% of total
shares issued
126,014,646
55,100,000
41,855,328
32,273,296
26,500,000
21,000,000
16,802,322
15,761,241
15,060,350
14,482,148
13,500,000
12,671,071
11,466,111
11,291,112
11,000,000
10,000,000
9,500,000
9,500,000
9,000,471
9,000,000
9.47
4.14
3.15
2.43
1.99
1.58
1.26
1.18
1.13
1.09
1.01
0.95
0.86
0.85
0.83
0.75
0.71
0.71
0.68
0.68
471,778,096
35.45
61
Renascor Resources Limited annual report 2020 financial statements
Shareholder information
Performance rights
over ordinary shares
Performance rights
over ordinary shares
% of total
Number held
12,000,000
issued
100.00
Ordinary shares
Number held
126,014,646
% of total
shares issued
9.47
David Christensen
Unquoted equity securities
There are no unquoted equity securities.
Substantial holders
Substantial holders in the Company are set out below:
Kabininge Nominees Pty Ltd
Voting rights
The voting rights attached to ordinary shares are set out below:
Ordinary shares
On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon
a poll each share shall have one vote.
Restricted Securities
No restricted securities were on issue at 14 September 2020.
There are no other classes of equity securities.
Interests in tenements at 31 August 2020
Description
Malbrom
Lipson Cove
Verran
Malbrom West
Dutton Bay
Willouran
Flat Hill (Callanna)
Witchelina
Outalpa
Cutana
Iron Baron
Old Wartaka
Carnding
Tarcoola
Siviour Project
62
Tenement number
Interest owned %
EL 6197
EL 6423
EL 6469
EL 5714
EL 6032
EL 6170
EL 5586
EL 6403
EL 6450
EL 6451
EL 5822
EL 6191
EL 5856
ELA 2020/00110
ML 6495
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
Corporate directory
Directors
Richard Keevers, Non-Executive Chairman
David Christensen, Managing Director
Geoffrey McConachy, Non-Executive Director
Stephen Bizzell, Non-Executive Director
Company secretary
Pierre van der Merwe
Registered office &
principal place of business
36 North Terrace
Kent Town SA 5069
Telephone : + 61 8 363 6989
Email: info@renascor.com.au
Website: www.renascor.com.au
Share register
Link Market Services Limited
ANZ Building
Level 15, 324 Queen Street
Brisbane QLD 4000
Phone: + 61 2 8280 7454
Fax: + 61 2 9287 0303
Auditor BDO Audit (SA) Pty Ltd
Stock exchange listing
Renascor Resources Limited shares are listed on the
Australian Securities Exchange (ASX code: RNU)
ASX code: RNU
www.renascor.com.au
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