Australia:
c/o Edwards Mac Scovell,
Level1, 8 St Georges Terrace
Perth, WA 6000
T +61 8 6205 3012
UK:
Battersea Studios
80 Silverthorne Road
London, SW8 3HE
T +44 20 3865 8430
STAR PHOENIX GROUP LTD
E admin@starphoenixgroup.com
www.starphoenixgroup.com
Star Phoenix Group Ltd
and Controlled Entities
Annual Report 2022
for the year ended
30 June 2022
ABN: 88 002 522 009
An electronic version of this report is available on the Company’s website www.starphoenixgroup.com
Star Phoenix Group Ltd
Annual report ended 30 June 2022
Contents
Directors’ Report .............................................................................................................................. 3
Operational Review ........................................................................................................................ 6
Remuneration Report (Audited) .................................................................................................. 10
Auditor’s Independence Declaration .......................................................................................... 2
Consolidated Statement of Profit or Loss and other Comprehensive Income as at 30 June
2022………………………………………………………………………………. ................................... 19
Consolidated Statement of Financial Position as at 30 June 2022 ......................................... 20
Consolidated Statement of Changes in Equity as at 30 June 2022 ........................................ 20
Consolidated Statement of Cash Flows as at 30 June 2022 .................................................... 23
Notes to Consolidated Financial Statements ............................................................................ 24
Directors’ Declaration ................................................................................................................... 58
Independent Audit Report to the Members .............................................................................. 59
Additional Information .................................................................................................................. 59
Corporate Directory .................................................................................................................... 641
Star Phoenix Group Ltd
Annual report ended 30 June 2022
Directors’ Report
The Directors of Star Phoenix Group Ltd (“SPG” or “the Company”) and the entities it controls (together,
the “Group”) present the financial report for the year ended 30 June 2022.
Directors
The names and details of the Company’s directors in office during the financial year and until the date
of this report are as follows. The directors were in office during the entire period unless otherwise stated.
Name
Position
Mr Lubing Liu
Executive Chairman (Appointed on 1 June 2022), Chief
Operating Officer
Dr Mu (Robin) Luo
Executive Director (Ceased to be Non-Executive
Director on 1 June 2022)
Mr Zhiwei Gu
Non-Executive Director (Ceased to be Executive
Chairman on 31 May 2022)
Mr Lubing Liu: Executive Chairman and Chief Operating Officer
Qualifications:
BSc
Interest in shares and options:
1,726,077 ordinary shares
Directorships held in other
listed entities during the past
three years
None
Mr Lubing Liu has 25 years of global experience in petroleum exploration, development,
production, joint venture operations and new ventures. Prior to joining the Company, Mr
Liu held various subsurface leader roles, including Chief Reservoir Engineer with Melbana
Energy Limited, Vice President of Exploration and Petroleum Technology with Sinopec
East Puffin Pty Ltd, and principal petroleum engineering leader roles with other
international exploration and production and energy service companies including
ConocoPhillips, CNOOC, Woodside, RPS and LR. Mr Liu is experienced in petroleum
engineering and has extensive IOR/EOR (waterflood inclusive) and gas cycling
experience having worked at the Xijiang24-3/30-2/24-1 oilfields, Liuhua 11-1 oilfield and
Penglai oilfield in China, the Chinguetti oilfield in Mauritania, Block 95 in Peru, Goodwyn
gas field, Thylacine & Geographe gas field and Longtom gas field in Australia. Mr Liu
Star Phoenix Group Ltd
Annual report ended 30 June 2022
holds a BSc in Petroleum Engineering from the Southwest Petroleum University, China. He
is a Member of the Society of Petroleum Engineers.
Mr Zhiwei Gu: Non - Executive Chairman
Qualifications:
LL.B, LL.M., MSc
Interest in shares and options:
5,489,793 ordinary shares
Directorships held in other
listed entities during the past
three years
None
Mr Gu is an experienced corporate lawyer, who has worked with numerous companies
seeking listings on various international stock markets, including the Toronto Stock
Exchange and the Hong Kong Stock Exchange. He is currently a partner of Dentons, one
of the largest global law firms. Mr Gu has participated in several venture capital and
private equity investment cases by various funds such as London Asia Fund, Warburg
Pincus, Korea Development Bank, China Venture Investment Co., and China Cinda
Dr Mu (Robin) Luo: Executive Director
Qualifications:
BSc, MSc, PhD
Interest in shares and options:
None
Directorships held in other
listed entities during the past
three years
None
Dr Luo is a senior oil and gas professional with over 35 years' experience working for leading
international E&P and oilfield services companies. He has worked on various giant
conventional and unconventional projects across all levels from research to operations.
He most recently worked as a principal development geophysicist to Inpex Corporation,
leading a multi-billion Ichthys LNG project in Australia. Prior to that, he was a post-doc in
Waseda University, Tokyo, and held principal roles with Sinopec Oil and Gas, PGS, Japan
Petroleum Exploration Company Limited, and Japan Oil, Gas and Metals National
Corporation. Dr Luo holds a PhD in Exploration Geophysics from the Curtin University,
Australia; MSc in Geophysics from the University of Queensland, Australia; and BSc in
Geophysics from the Petroleum University of China. He is a member of the Australian
Society of Exploration Geophysicists, the European Association of Geoscientists and
Engineers, and the Society of Exploration Geophysicists.
Star Phoenix Group Ltd
Annual report ended 30 June 2022
AMC. During his time with China National Gold Group Corp., Mr Gu was in charge of
mineral resources merger and acquisition activities. Mr Gu holds an LLB from Jilin
University in China, an LLM from Northeast University in China, and Master of Applied
Finance from Macquarie University in Australia. Mr Gu is a qualified lawyer and securities
practitioner in China.
Company Secretary
The following persons held the position of company secretary during the financial year:
•
Ms Evgenia Bezruchko (Resigned on 27 August 2021)
•
Mr Lubing Liu (Resigned on 1 June 2022)
•
Dr Mu (Robin) Luo (Appointed on 1 June 2022)
Results of operations
The Company’s loss for the year to 30 June 2022 was US$1,525,546 (FY2021: loss of US$6,268,902). Loss for
the year from continuing operations was US$1,299,369 (FY2021: US$1,863,582 loss) and Loss for the year
from discontinued operations was (US$226,177) (FY2021: loss of US$4,405,320).
Dividends
No dividend was paid or declared by the Company during the year and up to the date of this report.
Corporate structure
Star Phoenix Group Ltd is a company limited by shares, which is incorporated and domiciled in
Australia.
Ms Evgenia Bezruchko: Joint Company Secretary
Qualifications:
BSc, MSc, MBA
Directorships held in other
listed entities during the past
three years
None
Ms Evgenia Bezruchko has 10 years experience in corporate development and capital
markets in natural resources sector. Prior to joining SPG in 2012, Evgenia worked in
corporate broking and equity sales for an independent merchant bank Brandon Hill
Capital (formerly Fox-Davies Capital Limited), covering a wide range of listed and private
oil & gas and mining companies. Evgenia holds a BSc in Pharmacology from the
University of Bristol, an MSc in Finance from the University of Westminster and an MBA from
the American InterContinental University.
Star Phoenix Group Ltd
Annual report ended 30 June 2022
Nature of operations and principal activities
The principal activity of the Group during the financial year was oilfield services.
The Company's key focus remains on securing new opportunities to provide future growth and value for
the Company and its shareholders. Over the last year, the Company has considered, reviewed and
evaluated numerous projects and investment opportunities with a view of securing attractive targets.
The Company is pleased to report that it is currently in advanced discussions on a selected number of
investment and joint venture opportunities and is focusing its efforts to progress to the next stage. The
Board believes these new opportunities would offer shareholders exposure to significant plays in the
energy sector and looks forward to sharing the details of these potentially value enhancing opportunities
should they progress to binding deals.
Operational Review
LandOcean Energy Services Co Limited litigation
On 14 July 2021, the Company advised that its legal advisers Dentons UK and Middle East LLP have
now filed an arbitration request in the London Court of International Arbitration (the "Request"), which
officially marks commencement of arbitration proceedings against LandOcean Energy Services Co
Limited.
Pursuant to the Request, the Group is claiming various sums from LandOcean Energy Services Co Limited
currently estimated in excess of US$8.4 million. There are additional claims of US$1.8 million that fall outside
of the Request, and the Company is exploring options of bringing these claims separately in the courts
of Trinidad and Tobago. These sums are owed to the Group by LandOcean Energy Services Co Limited
pursuant to the sale and purchase agreement of Range Resources Trinidad Limited.
Oilfield services
Following the sale, in the prior year, of the upstream business (RRTL) which was by far the largest client of
RRDSL, and given the continued challenging industry conditions, the Company completed an
organizational restructure of RRDSL in order to substantially reduce overheads and the ongoing costs of
the Group.
The Company has also been actively marketing the rigs and equipment. As a result, the Company sold
four production rigs for a total sum of US$0.06 million. The Company continues the sale process of the
remaining two production workover and five drilling rigs.
The Company is also considering its options with regards to its interests in Indonesia.
Management changes
On 27 August 2021, the company announced that the Directors made a decision to implement changes
to the management team. As a result, a mutual agreement was reached for Mr Theo Eleftheriades, the
Chief
Financial
Officer
and
Ms Evgenia
Bezruchko,
the Group
Corporate
Development
Manager and Joint Company Secretary to cease their employment in their current roles. The Board of
Directors have approved the non-Board appointment of Mr Harry Liu as Chief Financial Officer. All of the
management changes came into effect on 1 September 2021.
Star Phoenix Group Ltd
Annual report ended 30 June 2022
On 31 August 2021, the company announced that Mr Lubing Liu will continue his role as company
secretary.
On 31 May 2022, the board elected and appointed Mr Lubing Liu as Executive Chairman from 1 June
2022. The board appointed Dr Mu (Robin) Luo as Company Secretary and Executive Director from 1 June
2022. The Board approved Mr Zhiwei (Kerry) Gu’s appointment as Executive Chairman will cease on 31
May 2022. Mr Gu will remain as a Non-Executive Director effective from 1 June 2022.
Director’s Salaries and payments
On 07 September 2021, the company announced that the Board of Directors has approved delaying all
directors' salaries and payments from 1 September 2021 subject to further review at the beginning of 2022
in accordance with the cash position of the Company at that particular time.
This has been taken as a cash conservation measure to preserve the Company's cash reserves whilst it
seeks the collection of the monies owed to it by LandOcean Energy Services Co Limited, as updated in
the Company's announcement of 14 July 2021.
Significant changes in the state of affairs
There have been no significant changes in the state of affairs of the Group during the financial year,
other than as set out in this report.
A special general meeting
A special general Meeting was held on 10 December 2021 after the Company received a request from
Beijing Sibo Investment Management LP, which holds approximately 17.3% of the votes that may be
cast at a general meeting of the Company. The general meeting was held to consider the following
resolutions:
1. Election of Director - Mr. Qu Guangsheng;
2. Election of Director - Mr. Deng Lian Jun;
3. Election of Director - Mr. Yang Chon Yi;
The Company called, arranged and held the Meeting to consider all the resolutions proposed pursuant
to these requests and in accordance with the provisions of section 249D of the Corporations Act.
Following the Extraordinary General Meeting, none of the resolutions was duly passed.
Likely developments and expected results of operations
The Company continues its search of new attractive acquisition opportunities to provide future growth
and value for the Company and its shareholders. The Company is also seeking to complete the sale of
its rigs and equipment in Trinidad to provide additional cashflow and strengthen the Company’s
financial position.
Star Phoenix Group Ltd
Annual report ended 30 June 2022
Update on RRDSL Claim
RRDSL, through its attorney (Robin B. Ramoutar & Co), has submitted a claim at an amount of
approximately TT$1.1 million (£132,000) against 360 Oil and Gas Limited (the "Defendant") in the Supreme
Court of Trinidad and Tobago (the "Claim") in respect of unpaid service fees from the Defendant. A Court
date will be scheduled in due course.
Events after the reporting date
RRDSL Claim
On 28 July 2022, the company announced that RRDSL has won a claim at an amount of approximately
TT$1.1 million (US$163,000) against 360 Oil and Gas Limited in the Supreme Court of Trinidad and
Tobago in respect of unpaid service fees.
Arbitration commences against LandOcean Energy Services Co Limited
On 14 July 2021, the Company announced that its legal advisers Dentons UK and Middle East LLP have
now filed an arbitration request in the London Court of International Arbitration, which officially marks
commencement of arbitration proceedings against LandOcean Energy Services Co Limited.
Pursuant to the Request, the Group is claiming various sums from LandOcean Energy Services Co Limited
currently estimated in excess of US$8.4 million. There are additional claims of US$1.8 million that fall outside
of the Request, and the Company is exploring options of bringing these claims separately in the courts
of Trinidad and Tobago. These sums are owed to the Group by LandOcean Energy Services Co Limited
pursuant to the sale and purchase agreement of Range Resources Trinidad Limited. In accordance with
the Australian Accounting Standards these amounts have not been recognised in the financial
statements as contingent assets.
Claim Against Range Resources Trinidad Limited
On 4 August 2022, the company provided following update in relation to its wholly owned subsidiary in
Trinidad, Resources Drilling Services Limited ("RRDSL").
RRDSL, through its attorney (Robin B. Ramoutar & Co), has submitted three claims at a total amount of
approximately TT$14.9 million (US$2.21 million) against Range Resources Trinidad Limited ("RRTL" or the
"Defendant") in the Supreme Court of Trinidad and Tobago in respect of breach of loan, service and
equipment rental contracts from the Defendant (the "Claims"). A Court date will be scheduled in due
course.
Arbitration proceedings Against LandOcean Energy Services Co Limited
On 22 August 2022, the company announced that the London Court of International Arbitration ("LCIA")
issued a consent award on 12 August 2022 in relation to two of the four Stage 1 Claims. Under the consent
award, LandOcean Energy Services Co Limited is required to make payment of US$301,265 to Star
Phoenix by 16 September 2022, being 35 days from the date of the consent award.
The issuing of the consent award makes a successful conclusion of two of the four Stage 1 Claims. The
Company will provide further updates on the remaining Stage 1 Claims in due course.
Environmental regulations and performance
Star Phoenix Group Ltd
Annual report ended 30 June 2022
The Group’s operations are not regulated by any significant environmental regulation under a law of
the Commonwealth or of a state or territory.
The Directors have considered compliance with the National Greenhouse and Energy Reporting Act
2007 which requires entities to report annual greenhouse gas emissions and energy use. The directors
have assessed that there is no current reporting requirements, but may be required to do so in the
future.
Share options
As at 30 June 2022, the Company had no unissued ordinary shares of Star Phoenix under option. During
the year ended 30 June 2022 no ordinary shares of the Company were issued on the exercise of options
(2021: nil).
Indemnifying directors and officers
In accordance with the constitution, except where prohibited by the Corporations Act 2001, every
director, principal executive officer and secretary of the Company shall be indemnified out of the
property of the Company against any liability incurred by him/her in his/her capacity as director, principal
executive officer or secretary of the Company or any related corporation in respect of any act or omission
whatsoever and howsoever occurring or in defending any proceedings whether civil or criminal.
During the financial year, the Company has paid premiums of US$12,431 to insure the Directors and
Officers against certain liabilities arising out of the conduct of acting as an officer of the Company. Under
the terms and conditions of the insurance contract, the nature of liabilities insured against and the
premium paid cannot be disclosed.
Meetings of Directors
During the financial year, eight meetings of the board of directors were held. Attendances by each
director during the year were as follows:
Director
Board Meetings
Eligible to attend
Attended
Zhiwei Gu
7
7
Lubing Liu
7
7
Mu Luo
7
7
Proceedings on behalf of the company
Star Phoenix Group Ltd
Annual report ended 30 June 2022
No person has applied for leave of Court 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 any part of those proceedings.
The Company was not a party to any such proceedings during the year.
Corporate governance
In recognising the need for the highest standards of corporate behaviour and accountability, the Board
has adhered to the principles of sound corporate governance. The Board of the Company and its
subsidiaries are committed to achieving and demonstrating robust corporate governance practices
which are appropriate for the Group’s size and stage of development, and which facilitate the long-term
performance and sustainability of the Company as well as protecting and enhancing the interests of its
shareholders and other stakeholders.
During the year, the Directors adopted the UK's QCA Corporate Governance Code for Small and Mid-
Size Quoted Companies (the "QCA Code"), in replacement of the ASX's Corporate Governance Council's
Corporate Governance Principles and Recommendations 3rd Edition, as the basis for its corporate
governance. The Corporate Governance Statement and Corporate Governance Plan are available on
the Company's website www.starphoenixgroup.com.
Non-audit services
The total value of non-audit services provided by a related practice of BDO Audit (WA) Pty Ltd in respect
to the Company’s tax compliance is US$34,345 (2021: US$36,338).
The board of directors has considered the position and is satisfied that the provision of the non-audit
services is compatible with the general standard of independence for auditors imposed by the
Corporations Act 2001. The directors are satisfied that the provision of non-audit services by the auditor
did not compromise the auditor independence requirements of the Corporations Act 2001 for the
following reasons:
1. all non-audit services have been reviewed by the Board to ensure they do not impact the
impartiality and objectivity of the auditor; and
2. none of the services undermine the general principles relating to auditor independence as set
out in APES 110 Code of Ethics for Professional Accountants.
Remuneration Report (Audited)
Remuneration policy
The remuneration policy of Star Phoenix Group has been designed to align director and executive
objectives with shareholder and business objectives by providing a fixed remuneration component and
offering specific long-term incentives based on key performance areas affecting the Group’s financial
results. The Board of Star Phoenix Group Limited believes the remuneration policy to be appropriate and
effective in its ability to attract and retain the best executives and directors to run and manage the
Group, as well as create alignment of goals between directors, executives and shareholders.
The Board’s policy for determining the nature and amount of remuneration for Board members and senior
executives of the Company is as follows:
Star Phoenix Group Ltd
Annual report ended 30 June 2022
The remuneration policy, setting the terms and conditions for the executive directors and other senior
executives, was developed and approved by the Board.
Non-executive directors, executive directors and senior executives receive a base salary (which is based
on factors such as length of service and experience), which is calculated on a total cost basis and
includes any FBT charges related to employee benefits including motor vehicles, as well as employer
contributions to superannuation funds where applicable.
Executive and non-executive directors can be employed by the Company on a consultancy basis on
Board approval, with remuneration and terms stipulated in individual consultancy agreements.
The Company does not currently have a Remuneration Committee. In its absence, the full Board is
responsible for the determination of the remuneration of Directors and senior executives and ensuring
that such remuneration is appropriate and not excessive. Where considered necessary, the Board may
engage a remuneration consultant to assist with setting and reviewing the Company’s executive and
non-executive remuneration policies to ensure the Company attracts and retains executives and
Directors who will create value for shareholders. As the Company grows in size, it is planned that the
Company will establish a separate remuneration committee with its own remuneration committee
charter. No remuneration consultant has been used during the year.
The Board is also responsible for evaluating the performance of Directors and the senior executives. It is
envisaged that once the Company is of a sufficient size to establish a Nomination Committee, that
committee will be responsible for arranging the performance evaluation of the Board, its committees,
and individual Directors on behalf of the Board. This evaluation will be based on specific criteria, including
the business performance of the Company and its subsidiaries, whether strategic objectives are being
achieved and the development of management and personnel. A formal performance evaluation was
not undertaken during the financial year; however, the Company intends to undertake such review
during the following financial year.
All remuneration paid to directors and executives is valued at the cost to the Company and expensed.
Shares given to directors and executives are valued as the difference between the market price of those
shares and the amount paid by the director or executive. Unlisted options are valued using the Black-
Scholes methodology.
The Board policy is to remunerate non-executive directors at market rates for comparable companies
taking into consideration time, commitment, and level of responsibility. Fees for non-executive directors
are not linked to the performance of the Group. The directors are not required to hold any shares in the
Company under the Constitution of the Company; however, to align directors’ interests with shareholder
interests, the directors are encouraged to hold shares in the Company.
Under the Company’s share trading policy, all employees and directors of the Company and its related
companies are prohibited from trading in the Company’s shares or other securities if they are in possession
of inside information.
The Board believes that it has implemented suitable practices and procedures that are appropriate for
an organisation of this size and maturity.
Company performance, shareholder wealth and directors and
executive’s remuneration
Star Phoenix Group Ltd
Annual report ended 30 June 2022
No relationship exists between shareholder wealth, director and executive remuneration and Company
performance.
Key Management Personnel
Name
Position
Appointed/Resigned
Mr Lubing Liu
Executive Chairman
Appointed as an Executive
Director on 1 March 2018 and as
Joint Company Secretary 01 April
2020. Appointed as Executive
Chairman from 1 June 2022.
Dr Mu (Robin) Luo
Executive Director
Appointed as Non-Executive
Director on 11 January 2019 and
as Company Secretary and
Executive Director on 1 June 2022
Mr Zhiwei Gu
Non-Executive Director
Appointed as Executive
Chaireman on 10 December
2018. Ceased to be Executive
Chaireman on 31 May 2022 and
remain as a Non-Excutive Director
from 1 June 2022.
Details of remuneration
The remuneration for the Key Management Personnel of the Group during the year was as follows:
2022
Short Term Benefits
Post-
employment
benefits
Other
Fees (iv)
Total
Cash
salary &
fees
One-off
payment
Terminatio
n benefits
Superannuation
/ pensions
Currency
US$
US$
US$
US$
US$
US$
Directors & Officers
Mr Gu (i)
159,399
-
-
-
-
159,399
Mr L Liu (ii)
94,867
-
-
3,525
-
98,392
Dr Luo
20,041
-
-
-
-
20,041
Total
274,307
-
-
3,525
-
277,832
Star Phoenix Group Ltd
Annual report ended 30 June 2022
(i) Fees of US$159,399 paid to Mr Gu in his capacity as Executive Chairman. During the year, no incentives were in
place for Mr Gu.
(ii) Fees paid to Mr L Liu comprised US$3,525 superannuation contributions and salary of US$29,989 and consulting fee
of $64,878 in his capacity as Chief Operating Officer and Trinidad General Manager. During the year, no incentives
were in place for Mr Liu.
2021
Short Term Benefits
Post-
employment
benefits
Share
based
payme
nts
Total
Cash
salary &
fees
One-off
payment
Terminatio
n benefits
Superannuation
/ pensions
Options
Currency
US$
US$
US$
US$
US$
US$
Directors & Officers
Mr Gu (i)
254,251
-
-
-
125,000
379,251
Mr L Liu (ii)
199,463
-
-
29,397
39,452
228,860
Dr Luo
55,222
-
-
-
-
55,222
Dr Meng (iii)
-
-
-
-
-
-
Total
508,936
-
-
29,397
164,452
702,785
(i) Fees paid to Mr Gu comprised US$254,251 received in his capacity as Executive Chairman, and 5,468,959 ordinary
shares, for a subscription value of US$125,000, were issued to him for additional consulting work. During the year, no
incentives were in place for Mr Gu.
(ii) Fees paid to Mr L Liu comprised US$29,397 superannuation contributions (part of the contributions was for prior
year) and salary of US$199,463 in his capacity as Chief Operating Officer and Trinidad General Manager. Mr Liu was
issued 1,726,077 shares, for a subscription value of US$39,452, for his consulting work. During the year, no incentives
were in place for Mr Liu.
(iii) Dr Meng did not receive any remuneration in the year. Dr Meng ceased to be a director on 11 December 2020.
(iv) Other fees were directors’ fees settled with the issue of shares. Please see notes above.
Equity instrument disclosures relating to Key Management Personnel
Share-based payments (year ended 30 June 2022)
Star Phoenix Group Ltd
Annual report ended 30 June 2022
No options were issued to key management personnel. All existing options expired in the financial year
and there has not been an expense reversal.
Fully paid share holdings
The numbers of shares in the Company held during the financial year or at time of resignation by Key
Management Personnel of the Company, including their personally related parties, are set out below.
2022
Balance at
the start of
the year
Granted as
Compensation
Other
Changes
Balance at
the end of
the year
Balance
held
indirectly
Mr Gu
5,489,793
-
-
5,489,793
-
Mr L Liu
1,726,077
-
-
1,726,077
-
Dr Luo
-
-
-
-
-
Total:
7,215,870
-
-
7,215,870
-
Options held by Key Management Personnel
There were no options in the company held during the financial year or at time of resignation by Key
Management Personnel of the Company, including their personally related parties.
Loans to Key Management Personnel
There were no loans made to directors of SPG and other Key Management Personnel of the Group,
including their personally related parties during the 2021 or 2022 financial years.
Employment contracts of Directors and other Key Management Personnel
On appointment, Executive Directors and Other Key Management Personnel enter into an employment
contract with the Company (or another company within the Group). This contract sets out their duties,
remuneration and other terms of employment. These contracts may be terminated by either the
Company or the employee as detailed below.
All non-executive directors are eligible to receive consulting fees for services provided to the Company
over and above the services expected from a non-executive director.
Mr Lubing Liu as Chief Operating Officer, Trinidad General Manager, Executive Director
and Joint Company Secretary (appointed as Joint Company Secretary on 1 April 2020)
Chief Operating Officer and Trinidad General Manager contract
Star Phoenix Group Ltd
Annual report ended 30 June 2022
Contract start date:
24 December 2019 to 31 May 2022
Base Payment:
US$236,712 per annum
Superannuation:
US$22,488 per annum
Notice period:
6 months
Termination benefits:
Payment in lieu of notice at Company option for termination
without cause
Mr Lubing Liu as Executive Chairman
Executive Chairman contract (commenced 1 June 2022)
Contract date:
1 June 2022
Base Payment:
US$260,000 per annum
Superannuation:
10% of base
Notice period:
3 months
Termination benefits:
3 months’ salary plus superannuation
Mr Zhiwei Gu as Executive Chairman
Executive Chairman contract (commenced 1 March 2020)
Contract start date:
1 March 2020 to 31 May 2022
Base Payment:
US$55,000 per annum
Superannuation:
No superannuation entitlement
Notice period:
6 months
Termination benefits:
Payment in lieu of notice at Company option for
termination without cause
Consulting services:
Mr Gu provided additional executive and consulting
services over, and above services rendered to the
Company at a rate of US$26,667 per month
Mr Zhiwei Gu as Non-Executive Director (appointed 1 June 2022)
Star Phoenix Group Ltd
Annual report ended 30 June 2022
Contract start date:
1 June 2022
Base Payment:
US$55,000 per annum
Superannuation:
No superannuation entitlement
Notice period:
3 months
Termination benefits:
3 months’ fees
Dr Mu Luo as Non-Executive Director (appointed 11 January 2019)
Non-Executive Director contract
Contract start date:
11January 2019 to 31 May 2022
Base Payment:
US$25,000 per annum (US$50,000 from 1 August 2019)
Superannuation:
No superannuation entitlement
Termination benefits:
None
Dr Mu Luo as Company Secretary and Executive Director (appointed 1 June 2022)
Secretary and Executive Director contract (commenced 1 June 2022)
Contract start date:
1 June 2022
Base Payment:
US$180,000 per annum
Superannuation:
10% of base
Termination benefits:
3 months’ salary plus superannuation
Additional information
The earnings of the consolidated entity for the five years to 30 June 2022 are summarised below:
Star Phoenix Group Ltd
Annual report ended 30 June 2022
2022
2021
2020
2019
2018
$'000
$'000
$'000
$'000
$'000
Revenue
3
99
8,539
12,357
13,059
EBITDA
(1,470)
(1,443)
(19,073)
(39,044)
(6,000)
EBIT
(1,195)
(6,413)
(20,542)
(43,002)
(10,951)
(Loss)/profit
after income
tax
(1,337)
(6,695)
47,952
(49,461)
(17,530)
The factors that are considered to affect total shareholders return ('TSR') are summarised below:
2022
2021
2020
2019
2018
$'000
$'000
$'000
$'000
$'000
Share price
at financial
year end
(US$)
0.0115
0.0187
0.02
0.0004
0.002
Basic
earnings per
share (US$)
(0.001)
(0.046)
0.397
(0.552)
(0.231)
Voting and comments made at the company’s 2021 Annual General Meeting
Star Phoenix Group Ltd received 99.7% of “yes” votes on its remuneration report for the 2021 financial
year.
The
Board
believes
that
this
reflects
the
conservative
remuneration
practices of the company.
This is the end of the audited remuneration report.
Auditor’s Independence Declaration
The auditor’s independence declaration, as required under Section 307C of the Corporations Act 2001,
for the year ended 30 June 2022 has been received and can be found on the following page.
This report is signed in accordance with a resolution of the Board of Directors.
Lubing Liu: Chairman
31 October 2022
Star Phoenix Group Ltd
Annual report ended 30 June 2022
Auditor’s Independence Declaration
In accordance with Section 307C of the Corporations Act 2001, I am pleased to provide the following
declaration of independence to the directors of Star Phoenix Group Ltd and Controlled Entities. As the
lead audit partner for the audit of the financial report of Star Phoenix Group Ltd and Controlled Entities
for the year ended 30 June 2022, I declare that, to the best of my knowledge and belief, there have been
no contraventions of:
(i) the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
(ii) any applicable code of professional conduct in relation to the audit.
Name of Firm
Mitchell Wilson & Partners
Name of Partner
Douglas Mitchell
Date
Address
883 Toorak Road
Camberwell VIC 3124, Australia
Star Phoenix Group Ltd
Annual report ended 30 June 2022
Consolidated Statement of Profit or Loss and other
Comprehensive Income for the year ended 30 June
2022
The below consolidated statement of profit or loss and other comprehensive income should be read in conjunction
with the accompanying notes.
Note
Consolidated
2022 (US$)
2021 (US$)
(Restated)*
Revenue from continuing operations
3
-
-
Operating expenses
-
-
Depreciation, depletion and amortisation
-
-
Cost of sales
-
-
Gross loss
-
-
Other income and expenses from continuing operations
Other income
3
-
87,899
Finance Income/(costs)
4b
2,792
4,603
Foreign exchange gain
3
(30,756)
6,226
General and administration expenses
4c
(1,112,049)
(1,809,084)
Impairment of assets
4d
(55,326)
(153,225)
Loss before income tax expense from continuing
operations
(1,195,339)
(1,863,582)
Income tax credit/(expense)
-
-
Loss after income tax expense from continuing
operations
(1,195,339)
(1,863,582)
Gain/(loss) from discontinued operations, net of
tax
6
(141,349)
(4,405,320)
(Loss)/profit for the year attributable to equity
holders of Star Phoenix Group Limited
(1,336,247)
(6,268,902)
Star Phoenix Group Ltd
Annual report ended 30 June 2022
Note
Consolidated
2022 (US$)
2021 (US$)
(Restated)*
Other comprehensive income
Items that may be reclassified to profit or loss
Exchange differences on translation of foreign
operations
19c
59,920
11,322
Other comprehensive (loss)/income for year, net
of tax
59,920
11,322
Total comprehensive (loss)/profit attributable to
equity holders of Star Phoenix Group Limited
(1,276,767)
(6,257,580)
Loss per share from continuing operations attributable to the ordinary equity holders of the Company:
Basic and diluted (loss) per share (cents per share) 9a
(0.008)
(0.013)
Earnings/(Loss) per share from attributable to the ordinary equity holders of the Company:
Basic and diluted earnings/(loss) per share (cents
per share)
9a
(0.001)
(0.044)
*Refer to note 2a for detailed information on restatement of comparatives
Consolidated Statement of Financial Position as at
30 June 2022
The below consolidated statement of financial position should be read in conjunction with the accompanying
notes.
Note
Consolidated
2022 (US$)
2021 (Restated
US$)*
2020 (Restated
US$)*
Assets
Current Assets
Cash and cash equivalents
10
758,346
1,911,072
3,164,752
Trade and other receivables
11
229,292
103,866
2,248,359
Assets of disposal group classified as held for sale 7a
4,043,011
4,249,038
7,922,861
Total current assets
5,030,649
6,263,976
13,335,972
Star Phoenix Group Ltd
Annual report ended 30 June 2022
Note
Consolidated
2022 (US$)
2021 (Restated
US$)*
2020 (Restated
US$)*
Non-Current Assets
Right of use asset
12
-
63,333
183,333
Property, plant and equipment
14
-
83,624
100,349
Total non-current assets
-
146,957
283,682
Total assets
5,030,649
6,410,933
13,619,654
Current liabilities
Trade and other payables
15
4,505,946
4,849,906
4,791,791
Liabilities directly associated with assets classified
as held for sale
7b
691,097
450,653
1,154,300
Provisions
17
5,796,048
5,796,048
5,991,944
Total current liabilities
10,993,091
11,096,607
11,938,035
Non-current liabilities
Trade and other payables
15
-
-
296,245
Total non-current liabilities
-
-
296,245
Total liabilities
10,993,091
11,096,607
11,234,280
Net assets/(liabilities)
(5,962,442)
(4,685,676)
1,385,374
Equity
Contributed equity
18
388,570,504
388,570,504
388,383,974
Reserves
19
23,460,290
23,400,370
23,389,048
Accumulated losses
(417,993,236)
(416,656,550)
(410,387,648)
Total equity/deficit
(5,962,442)
(4,685,676)
1,385,374
Star Phoenix Group Ltd
Annual report ended 30 June 2022
The above consolidated statement of financial position should be read in conjunction with the accompanying
notes.
*Refer to not 2a for detailed information on restatement of comparatives
Consolidated Statement of Changes in Equity for
the year ended 30 June 2022
The below consolidated statement of changes in equity should be read in conjunction with the accompanying
notes.
Note
Contributed
equity
Accumulated
losses
Foreign
currency
translation
reserve
Share-based
payment
reserve
Option
premium
reserve
Non-
controlling
interests
Total
equity
(US$)
(US$)
(US$)
(US$)
(US$)
(US$)
Balance at 1 July
2020(Originally reported)
388,383,974
(409,284,204)
3,015,222
8,316,464
12,057,362
2,488,818
Adjustment due to prior
period error (Note 2a)
(1,103,444)
(1,103,444)
Balance at 1 July 2020
388,383,974
(410,387,648)
3,015,222
8,316,464
12,057,362
-
1,385,374
Exchange difference on
translation of foreign
operations
-
-
11,322
-
-
-
11,322
Loss attributable to
members of the
company
-
(1,863,582)
-
-
-
-
(1,863,582)
Gain/(Loss) from
discontinued operations
-
(4,405,320)
-
-
-
-
(4,405,320)
Total comprehensive loss
for the year
-
(6,268,902)
11,322
-
-
-
(6,257,580)
Transactions with owners in their capacity as owners:
Issue of share capital
18
186,530
-
-
-
-
-
186,530
Realisation of FCTR on
disposal of foreign
operation
19
-
-
(4,993,916) -
-
-
(4,993,916)
Non-controlling interests
-
-
-
-
-
-
-
Balance at 30 June 2021
388,570,504
(416,656,550)
3,026,544
8,316,464
12,057,362
-
(4,685,676)
Star Phoenix Group Ltd
Annual report ended 30 June 2022
Balance at 1 July 2021
388,570,504
(416,656,550)
3,026,544
8,316,464
12,057,362
-
(4,685,676)
Exchange difference on
translation of foreign
operations
-
-
59,920
-
-
-
59,920
Loss from continuing
operations of the
company
-
(1,195,339)
-
-
-
-
(1,195,339)
Profit/(loss) from
discontinued operations
-
(141,349)
-
-
-
-
(141,349)
Transfer reserves to
accumulated loss
20,373,826
(8,316,464)
(12,057,362)
-
Total comprehensive loss
for the year
-
19,037,138
59,920
(8,316,464)
(12,057,362) -
(1,276,767)
Transactions with owners in their capacity as owners:
Issue of share capital
18
-
-
-
-
-
-
-
Balance at 30 June 2022
388,570,504
(397,619,412)
3,086,464
-
-
-
(5,962,442)
Consolidated Statement of Cash Flows for the year
ended 30 June 2022
The below consolidated statement of cashflows should be read in conjunction with the accompanying notes.
Note
Consolidated
2022 (US$)
2021 (US$)
Cash flows from operating activities
Receipts from customers
150,000
218,088
Other Receipts
(906)
72,763
Payments to suppliers and employees
(1,590,220)
(1,841,025)
Income taxes (paid)/received
(12.970)
(90,795)
Payment for exploration expenditure
-
(175,448)
Net cash outflow from operating activities
22
(1,454,096)
(1,816,417)
Cash flows from investing activities
Payment for property, plant & equipment
-
-
Proceeds from disposal of property, plant and
equipment
278,902
330,065
Net cash inflow/(outflow) on disposal of subsidiary
-
-
Net cash inflow from investing activities
278,902
330,065
Cash flows from financing activities
Receipts from share issue
-
-
Star Phoenix Group Ltd
Annual report ended 30 June 2022
Note
Consolidated
2022 (US$)
2021 (US$)
Interest and other finance income
2,231
191
Provision of short-term loan
-
-
Payments for principal element of leases
-
-
Proceeds received from related company
-
277,328
Net cash inflow from financing activities
2,231
277,519
Net (decrease)/increase in cash and cash
equivalents
(1,172,964)
(1,208,834)
Net foreign exchange differences
20,238
(44,846)
Cash and cash equivalents at beginning of
financial year
1,911,072
3,164,752
Cash and cash equivalents at end of financial year
10
758,346
1,911,072
Notes to Consolidated Financial Statements
Note 1: Significant accounting policies
These financial statements are general purpose financial statements that have been prepared in
accordance with Australian Accounting Standards, Australian Accounting Interpretations, other
authoritative pronouncements of the Australian Accounting Standards Board and the Corporations Act
2001. Star Phoenix Group Ltd is a for-profit entity for the purpose of preparing the financial statements.
The financial statements cover the Group consisting of Star Phoenix Group Ltd and its controlled entities.
Financial information for Star Phoenix Group Ltd as an individual entity is disclosed in Note 25. Star Phoenix
Group Ltd is a listed public company, incorporated and domiciled in Australia.
The following is a summary of the material accounting policies adopted by the Group in the preparation
of the financial statements. The accounting policies have been consistently applied, unless otherwise
stated. The financial report was authorised for issue by the Directors on 17 February2023.
Basis of preparation
Historical cost convention
The financial statements have been prepared under the historical cost convention, except for, where
applicable, the revaluation of financial assets and liabilities at fair value through profit or loss, financial
assets at fair value through other comprehensive income, certain classes of property, plant and
equipment.
Compliance with IFRS
Star Phoenix Group Ltd
Annual report ended 30 June 2022
The financial statements of Star Phoenix Group Ltd also comply with International Financial Reporting
Standards (IFRS) as issued by the International Accounting Standards Board (IASB). The financial
statements were approved by the Board of Directors on 17 February 2023.
Functional and presentation currency
Items included in the financial statements of each of the Group’s entities are measured using the currency
of the primary economic environment in which the entity operates (the “Functional Currency”). The
consolidated financial statements are presented in United States Dollars (USD), which is Star Phoenix
Group Ltd.’s functional and presentation currency.
Going concern
This report has been prepared on the going concern basis, which contemplates the continuity of normal
business activity and the realisation of assets and settlement of liabilities in the normal course of business.
For the year ended 30 June 2022 the Group recorded a loss of US$1,362,820 (2021: a loss of US$6,257,580),
had net cash outflows of US$1,172,964 (2021: cash outflows of US$1,208,834) and had a cash balance of
US$758,346 (2021: cash balance of US$1,911,072).
As at the reporting date (17 February 2023), the company had a cash balance of approximately
US$457,000. Management believe there are sufficient funds to meet the Group’s working capital
requirements for the next 6 months. The ability of the Group to continue as a going concern beyond that
timeframe is dependent on securing additional funding through the issue of shares and/or debt to fund
its activities. The Company is currently seeking other opportunities to further expand its operations in other
geographic locations.
These conditions indicate a material uncertainty that may cast a significant doubt about the Group’s
ability to continue as a going concern and, therefore, it may be unable to realise its assets and discharge
its liabilities in the normal course of business.
The Company is currently seeking other opportunities to expand its operations in other geographic
locations and a successful investment in a new project may be used to raise additional capital and
subsequently generate positive cash flows. The Company is also focusing on managing its existing cash
reserves.
.
Should the Company not be able to continue as a going concern, it may be required to realise its assets
and discharge its liabilities other than in the ordinary course of business, and at amounts that differ from
those stated in the financial statements. The financial report does not include any adjustments relating to
the recoverability and classification of recorded asset amounts or liabilities that might be necessary
should the Company not continue as a going concern.
(a) Principles of consolidation
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Star
Phoenix Group Ltd (“Parent Entity” or “Company”) as at 30 June 2022 and the results of all subsidiaries for
the year then ended. Star Phoenix Group Ltd and its subsidiaries together are referred to as the “Group”.
Subsidiaries are all those entities (including special purpose 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
Star Phoenix Group Ltd
Annual report ended 30 June 2022
investment with the entity and has the ability to affect those returns through its power to direct the
activities of the entity.
Where controlled entities have entered or left the Group during the year, their operating results have
been included/excluded from the date control was obtained or until the date control ceased. A list of
controlled entities is contained in Note 13 to the financial statements. All controlled entities have a 30
June financial year-end.
All inter-company balances and transactions between entities in the Group, including any unrealised
profits or losses have been eliminated on consolidation. Accounting policies of subsidiaries have been
changed where necessary to ensure consistencies with those policies applied by the Group.
Associates are all entities over which the Group has significant influence but not control or joint control,
generally accompanying a shareholding of between 20-50% of the voting rights. Investments in
associates are accounted for in the consolidated financial statements using the equity method of
accounting, after initially being recognised at cost.
(b) Income tax
The charge for current income tax expense is based on the profit for the year adjusted for any non-
assessable or disallowed items. It is calculated using tax rates that have been enacted or are substantively
enacted by the reporting date within each jurisdiction.
Deferred tax is accounted for using the liability method in respect of temporary differences arising
between the tax bases of assets and liabilities and their carrying amounts in the financial statements. No
deferred income tax will be recognised from the initial recognition of an asset or liability, excluding a
business combination, where there is no effect on accounting or taxable profit or loss.
Deferred tax is calculated at the tax rates that are expected to apply to the period when the asset is
realised or the liability is settled. Deferred tax is credited in profit or loss except where it relates to items
that may be credited directly to equity, in which case the deferred tax is adjusted directly against equity.
Deferred income tax assets are recognised to the extent that it is probable that future tax profits will be
available against which deductible temporary differences can be utilised.
Deferred tax liabilities and assets are not recognised for temporary differences between the carrying
amount and tax bases of investments in foreign operations where the company is able to control the
timing of the reversal of the temporary differences and it is probable that the differences will not reverse
in the foreseeable future.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax
assets and liabilities and when the deferred tax balances relate to the same taxation authority. Current
tax assets and liabilities are offset where the entity has a legally enforceable right to offset and intends
either to settle on a net basis, or to realise the asset and settle the liability simultaneously.
Current and deferred tax is recognised in profit or loss, except to the extent that it relates to items
recognised in other comprehensive income or directly in equity. In this case, the tax is also recognised in
other comprehensive income or directly in equity, respectively.
The amount of benefits brought to account or which may be realised in the future is based on the
assumption that no adverse change will occur in income taxation legislation and the anticipation that
Star Phoenix Group Ltd
Annual report ended 30 June 2022
the Group will derive sufficient future assessable income to enable the benefit to be realised and comply
with the conditions of deductibility imposed by the law.
(c) Property, plant and equipment
Owned assets
Plant and equipment are measured on the historical cost basis less accumulated depreciation and
impairment losses.
The cost of fixed assets constructed within the Group includes the cost of materials, direct labour,
borrowing costs and an appropriate proportion of fixed and variable overheads.
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. All other repairs and maintenance are
charged to profit or loss during the financial period in which they are incurred.
Depreciation
The depreciable amount of all fixed assets including capitalised lease assets is depreciated on a straight-
line basis over their useful lives to the Group commencing from the time the asset is held ready for use.
Leasehold improvements are depreciated over the shorter of either the unexpired period of the lease or
the estimated useful lives of the improvements.
The depreciation rates used for each class of depreciable asset are:
Class of fixed Asset
Depreciation Rate
Plant & equipment
11.25% - 33%
Production equipment
10 - 20%
Motor vehicles, furniture & fixtures
25 - 33%
Leasehold improvements
10 - 12.50%
The residual values of the assets and their useful lives are reviewed and adjusted if appropriate at each
reporting date.
The carrying amount of plant and equipment is reviewed annually by the directors to ensure it is not in
excess of the recoverable amount from these assets. The recoverable amount is assessed on the basis of
the expected net cash flows which will be received from the employment of the assets and subsequent
disposal. The expected net cash flows have been discounted to their present values in determining
recoverable amounts.
The carrying amount of the asset is written down to its recoverable amount if its carrying amount is greater
than its estimated recoverable amount.
Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These
gains or losses are included in profit or loss. When revalued assets are sold, amounts included in the
revaluation reserve relating to that asset are transferred to accumulated losses.
Star Phoenix Group Ltd
Annual report ended 30 June 2022
(d) Exploration and evaluation expenditure and the recognition of assets
Acquisition costs for exploration and evaluation projects are accumulated in respect of each identifiable
area of interest. These costs are only carried forward to the extent that they are expected to be recouped
through the successful development of the area or where activities in the area have not yet reached a
stage that permits reasonable assessment of the existence of economically recoverable reserves.
Accumulated costs in relation to an abandoned area are written off in full against profit in the year in
which the decision to abandon the area is made.
A regular review is undertaken of each area of interest to determine the appropriateness of continuing
to carry forward costs in relation to that area of interest.
The recoverability of the carrying amount of the exploration and evaluation assets is dependent on the
successful development and commercial exploitation, or alternatively, sale of the respective areas of
interest.
The carrying values of expenditures carried forward are reviewed for impairment at each reporting date
when the facts, events or changes in circumstances indicate that the carrying value may be impaired.
Accumulated expenditures are written off to profit or loss to the extent to which they are considered to
be impaired.
The group applies AASB 6 Exploration and Evaluation of Mineral Resources which is equivalent to IFRS 6.
The carrying value of exploration and evaluation expenditure is historical cost less impairment.
(e) Financial instruments
The Group’s financial instruments include cash and cash equivalents and trade and other receivables.
A financial asset shall be measured at amortised cost if it is held within a business model whose objective
is to hold assets in order to collect contractual cash flows which arise on specified dates and that are
solely principal and interest.
A debt investment shall be measured at fair value through other comprehensive income if it is held within
a business model whose objective is to both hold assets in order to collect contractual cash flows which
arise on specified dates that are solely principal and interest as well as selling the asset on the basis of its
fair value.
All other financial assets are classified and measured at fair value through profit or loss unless the entity
makes an irrevocable election on initial recognition to present gains and losses on equity instruments (that
are not held-for-trading or contingent consideration recognised in a business combination) in other
comprehensive income ('OCI').
Despite these requirements, a financial asset may be irrevocably designated as measured at fair value
through profit or loss to reduce the effect of, or eliminate, an accounting mismatch. For financial liabilities
designated at fair value through profit or loss, the standard requires the portion of the change in fair value
that relates to the entity's own credit risk to be presented in OCI (unless it would create an accounting
mismatch).
Simpler hedge accounting requirements are intended to more closely align the accounting treatment
with the risk management activities of the entity. Impairment requirements use an 'expected credit loss'
Star Phoenix Group Ltd
Annual report ended 30 June 2022
('ECL') model to recognise an allowance. Impairment is measured using a 12-month ECL method unless
the credit risk on a financial instrument has increased significantly since initial recognition in which case
the lifetime ECL method is adopted. For receivables, a simplified approach to measuring expected credit
losses using a lifetime expected loss allowance is available.
(f) Foreign currency transactions and balances
Functional and presentation currency
The functional currency of each entity within the Group is determined using the currency of the primary
economic environment in which that entity operates.
Transaction and balances
Foreign currency transactions are translated into the functional currency using the exchange rates
prevailing at the date of the transaction. Foreign currency monetary items are translated at the year-end
exchange rate. Non-monetary items measured at historical cost continue to be carried at the exchange
rate at the date of the transaction.
Non-monetary items measured at fair value are reported at the exchange rate at the date when fair
values were determined.
Exchange differences arising on the translation of monetary items are recognised in profit or
loss
Exchange differences arising on the translation of non-monetary items are recognised directly in equity
to the extent that the gain or loss is directly recognised in equity; otherwise the exchange difference is
recognised in profit or loss.
(h) Provisions
Provisions for legal claims, service warranties and make good obligations are recognised when the Group
has a present legal or constructive obligation as a result of past events, it is probable 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.
Provisions are measured at the present value of management’s best estimate of the expenditure required
to settle the present obligation at the reporting date. The discount rate used to determine the present
value reflects the current market assessments of the time value of money and the risk specific to the
liability. The increase in the provision due to the passage of time is recognised as interest expense.
(i) Cash and cash equivalents
Cash and cash equivalents include cash on hand, deposits held at call with banks, other short-term highly
liquid investments with original maturities of three months or less that are readily convertible to known
amounts of cash and which are subject to insignificant risk of changes in value, and bank overdrafts.
Star Phoenix Group Ltd
Annual report ended 30 June 2022
Bank overdrafts are shown within short-term borrowings in current liabilities on the statement of financial
position.
(j) Trade 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 consolidated entity 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.
(k) Revenue recognition
Revenue is recognised at an amount that reflects the consideration to which the consolidated entity 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.
Revenue from a contract to provide services is recognised over time as the services are rendered based
on either a fixed price or an hourly rate.
Revenue from the sale of oil and gas and related products was recognised when the Group had
transferred to the buyer control of the product. In the case of oil, this usually occurs at the time of lifting.
Other revenue is recognised when control has passed.
(l) Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of
GST incurred is not recoverable from the Australian Tax Office. In these circumstances the GST is
recognised as part of the cost of acquisition of the asset or as part of an item of the expense. Receivables
and payables in the statement of financial position are shown inclusive of GST.
Cash flows are presented in the consolidated statement of cash flows on a gross basis, except for the GST
component of investing and financing activities, which are disclosed as operating cash flows.
(m) Comparative figures
When required by Accounting Standards, comparative figures have been adjusted to conform to
changes in presentation for the current financial year.
(n) Fair value estimation
The fair value of financial assets and financial liabilities must be estimated for recognition and
measurement for disclosure purposes.
Star Phoenix Group Ltd
Annual report ended 30 June 2022
The fair value of financial instruments traded in active markets (such as publicly traded derivatives, and
trading and available-for-sale securities) is based on quoted market prices at the reporting date. The
quoted market price used for financial assets held by the Group is the current bid price.
The fair value of financial instruments that are not traded in an active market (for example over-the-
counter derivatives) is determined using valuation techniques. The Group uses a variety of methods and
makes assumptions that are based on market conditions existing at each reporting date.
The carrying value less impairment provision of trade receivables and payables are assumed to
approximate their fair values due to their short-term nature. The fair value of financial liabilities for
disclosure purposes is estimated by discounting the future contractual cash follows at the current market
interest rate that is available to the Group for similar financial instruments.
(o) Investments in associates
Investments in associates are accounted for using the equity method of accounting in the consolidated
financial statements.
Under the equity method, the investment in the associate is carried in the consolidated statement of
financial position at cost plus post-acquisition changes in the Group’s share of net assets of the associate.
After application of the equity method, the Group determines whether it is necessary to recognise any
additional impairment loss with respect to the Group’s net investment in the associate.
The Group's share of the associate post-acquisition profits or losses is recognised in the statement of profit
or loss and other comprehensive income. The cumulative post-acquisition movements are adjusted
against the carrying amount of the investment. When the Group's share of losses in the associate equals
or exceeds its interest in the associate, including any unsecured long-term receivables and loans, the
Group does not recognise further losses, unless it has incurred obligations or made payments on behalf
of the associate.
The reporting dates of the associate and the Group are identical and the associate’s accounting policies
conform to those used by the Group for like transactions and events in similar circumstances.
(p) Trade and other payables
These amounts represent liabilities for goods and services provided to the Group prior to the end of
financial year which are unpaid. The amounts are unsecured and are usually paid within 30 days of
recognition unless alternative terms are agreed.
(q) Dividends
Provision is made for the amount of any dividend declared, being appropriately authorised and no longer
at the discretion of the entity, on or before the end of the financial year but not distributed at reporting
date.
(r) Contributed equity
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares
or options are shown in equity as a deduction, net of tax, from the proceeds.
Star Phoenix Group Ltd
Annual report ended 30 June 2022
(s) Earnings per share
Basic earnings per share
Basic earnings per share is calculated by dividing the profit or loss attributable to equity holders of the
Company, excluding any costs of servicing equity other than ordinary shares, by the weighted average
number of ordinary shares outstanding during the financial year, adjusted for bonus elements in ordinary
shares issued during the year.
Diluted 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.
(t) Segment reporting
Operating segments are reported in a manner consistent with the internal reporting to the chief operating
decision maker. The chief operating decision maker, who is responsible for allocating resources and
assessing performance of the operating segments, has been identified as the Chief Executive Officer.
(u) Impairment of assets
Goodwill and intangible assets that have an indefinite useful life are not subject to amortisation and are
tested annually for impairment, or more frequently if events or changes in circumstances indicate that
they might be impaired. Other assets are tested 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. The
recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. For the purposes
of assessing impairment, assets are grouped at the lowest levels for which they are separately identifiable
cash inflows which are largely independent of the cash inflows from other assets or groups of assets (cash-
generating units). Non-financial assets other than goodwill that suffered an impairment are reviewed for
possible reversal of the impairment at the end of each reporting period.
(v) Share-based payments
The fair value of options granted is recognised as an expense with a corresponding increase in equity.
The total amount to be expensed is determined by reference to the fair value of the options granted,
which includes any market performance conditions and the impact of any non-vesting conditions but
excludes the impact of any service and non-market performance vesting conditions.
(w) Employee benefits
Wages and salaries and annual leave
Liabilities for wages and salaries, including non-monetary benefits are recognised in current liabilities in
respect of employees’ services up to the reporting date and are measured at the amounts expected to
be paid when the liabilities are settled.
Long service benefit
Star Phoenix Group Ltd
Annual report ended 30 June 2022
The liability for long service benefit is recognised in current and non-current liabilities, depending on the
unconditional right to defer settlement of the liability for at least 12 months after the reporting date. The
liability is measured as the present value of expected future payments to be made in respect of services
provided by employees up to the reporting date using the projected unit credit method. Consideration
is given to expected future wage and salary levels, experience of employee departures and periods of
service.
(x) Leases
Except for short-term leases and leases of low-value assets, right-of-use assets and corresponding lease
liabilities are recognised in the statement of financial position. Straight-line operating lease expense
recognition is replaced with a depreciation charge for the right-of-use assets (included in operating costs)
and an interest expense on the recognised lease liabilities (included in finance costs). In the earlier periods
of the lease, the expenses associated with the lease under AASB 16 will be higher when compared to
lease expenses under AASB 117. However, EBITDA (Earnings Before Interest, Tax, Depreciation and
Amortisation) results improve as the operating expense is now replaced by interest expense and
depreciation in profit or loss. For classification within the statement of cash flows, the interest portion is
disclosed in operating activities and the principal portion of the lease payments are separately disclosed
in financing activities.
(y) Borrowings
Loans and borrowings are initially recognised at the fair value of the consideration received, net of
transaction costs. They are subsequently measured at amortised cost using the effective interest method.
Where there is an unconditional right to defer settlement of the liability for at least 12 months after the
reporting date, the loans or borrowings are classified as non-current.
(z) Inventories
Inventories include consumable supplies and maintenance spares and are valued at the lower of cost
and net realisable value. Cost is determined on a weighted average basis and includes direct costs and
an appropriate portion of fixed and variable production overheads where applicable. Inventories
determined to be obsolete or damaged are written down to net realisable value, being the estimated
selling price less selling costs.
The directors evaluate estimates and judgements incorporated into the financial statements based on
historical knowledge and best available current information. Estimates assume a reasonable expectation
of future events and are based on current trends and economic data, obtained both externally and
within the Group. Areas involving a higher degree of judgement or complexity, or areas where
estimations and assumptions are significant to the financial statements are disclosed here.
(aa) Non-current assets classified as held for sale and discontinued operations
Non-current assets are classified as held for sale if their carrying amount will be recovered principally
through a sale transaction rather than through continuing use. They are measured at the lower of their
carrying amount and fair value less costs to sell. For non-current assets to be classified as held for sale,
they must be available for immediate sale in their present condition and their sale must be highly
probable.
Star Phoenix Group Ltd
Annual report ended 30 June 2022
An impairment loss is recognised for any initial or subsequent write down of the non-current assets to fair
value less costs to sell. A gain is recognised for any subsequent increases in fair value less costs to sell of
a non-current asset, but not in excess of any cumulative impairment loss previously recognised.
Non-current assets are not depreciated or amortised while they are classified as held for sale. Interest
and other expenses attributable to the liabilities of assets held for sale continue to be recognised.
Non-current assets classified as held for sale are presented separately on the face of the consolidated
statement of financial position, in current assets. The liabilities of disposal groups classified as held for sale
are presented separately on the face of the statement of financial position, in current liabilities.
Discontinued operations
A discontinued operation is a component of the Group’s business, the operations and cash flows of which
can be clearly distinguished from the rest of the Group and which:
represents a separate major line of business or geographical area of operations;
is part of a single co-ordinated plan to dispose of a separate major line of business or geographical
are of operations; and
is a subsidiary acquired exclusively with a view to resale.
Classification as a discontinued operation occurs at the earlier of disposal or when the operation meets
the criteria to be classified as held-for-sale.
When an operation is classified as a discontinued operation, the comparative consolidated statement of
profit or loss and other comprehensive income is re-presented as if the operation had been discontinued
from the start of the comparative year.
(bb) Right-of-use asset
A right-of-use asset is recognised at the commencement date of a lease. The right-of-use asset is
measured at cost, which comprises the initial amount of the lease liability, adjusted for, as applicable,
any lease payments made at or before the commencement date net of any lease incentives received,
any initial direct costs incurred, and, except where included in the cost of inventories, an estimate of costs
expected to be incurred for dismantling and removing the underlying asset, and restoring the site or asset.
Right-of-use assets are depreciated on a straight-line basis over the unexpired period of the lease or the
estimated useful life of the asset, whichever is the shorter. Where the Group expects to obtain ownership
of the leased asset at the end of the lease term, the depreciation is over its estimated useful life. Right-of
use assets are subject to impairment or adjusted for any remeasurement of lease liabilities.
Note 2: Significant estimates and judgements
Impairment of rigs and related equipment
The Company sold four production rigs for a total gain of US$83,543. The Company continues the sale
process of the remaining four production and four drilling rigs.
Impairment was calculated on an individual rig basis base on best information available. The recoverable
amount of these assets was estimated based on an indicative conditional offer received minus any
significant costs involved in selling of the assets.
Star Phoenix Group Ltd
Annual report ended 30 June 2022
For the rest of workover/swabbing rigs, based on rigs sold to date the evidence suggests that a lower
impairment percentage should apply. However, Management is of the opinion that given that
negotiations for those are still at a premature stage, the same impairment percentage should apply.
Classification of assets held for sale
In accordance with AASB 5 Assets held for sale and discontinued operations, an entity shall classify a non-
current assets as held for sale if its carrying amount will be recovered principally through a sale transaction
rather than through continuing use. For this to be the case, the asset must be available for immediate
sale in its present condition and that the sale must be highly probable. AASB 5 notes that the sale should
be expected to qualify as a completed sale within 12 months from the date of classification.
Management note that the sales process has extended beyond the 12 months as a result of the impact
of COVID-19 and the travel restrictions imposed by various governments meaning that potential vendors
have not been able to physically inspect the relevant assets and that as a result the sales process has
lasted longer than 12 months.
Management have judged that the impact of COVID-19 meets the criteria noted in AASB 5 regarding
delays caused by events or circumstances beyond management’s control and that they remain
committed to completing the sales process as soon as practicable.
COVID-19 pandemic
The impact of the COVID-19 pandemic is ongoing. Other than as addressed in specific notes, there does
not currently appear to be either any significant impact upon the financial statements or any significant
uncertainties with respect to events or conditions which may impact the consolidated entity
unfavourably as at the reporting date or subsequently as a result of the COVID-19 pandemic.
Note 2a: Restatement of comparatives
During the half year ended 31 December 2021, an error was discovered in the recognition of withholding
tax payable relating to prior years. Detailed calculation were carried out in this period and this resulted
in an increase of $1,103,444 in the withholding tax liability for the year ended 30 June 2020, an increase
of $182,803 in the withholding tax liability for the year ended 30 June 2021. The impact of the restatement
is noted below
30 June 2021
(US$)
Reported
Correction of
prior period
error
30 June 21 (US$)
Restated
Trade and other payable –(line
item affected Other
taxes payable)-Refer Note 10
3,563,659
1,286,247
4,849,906
Gain/(loss) from discontinued
operations-net of tax
(4,222,517)
(182,803)
(4,405,320)
30 June 2020
(US$)
Reported
Correction of
prior period
error
30 June 20 (US$)
Restated
Trade and other payable –(line
item affected Other
taxes payable)
3,688,347
1,103,444
4,791,791
Gain/(loss) from discontinued
operations-net of tax
53,191,671
(1,103,444)
52,088,227
Star Phoenix Group Ltd
Annual report ended 30 June 2022
Earnings per Share
30 June
2021 (US$)
Reported
30 June
2021 (US$)
Adjusted
Basic earnings/(loss) per share
(0.012)
(0.013)
Diluted earnings/(loss) per share
(0.04)
(0.044)
Note 3: Revenue
Note
Consolidated
2022 (US$)
2021 (US$)
From discontinued operations
Revenue from services to third parties
recognised over time
180,736
129,928
Total revenue from discontinued operations
180,736
129,928
Other income from continuing operations
Foreign exchange gain
(30,756)
6,226
Government grant
-
72,763
Other income
-
15,136
Total other income
-
87,899
Other income from discontinued operations
Other income
8,894
450,089
Total other income from discontinued
operations
8,894
450,089
Revenue from third party services and sale of oil is solely generated in the Republic of Trinidad and
Tobago.
Government grant relates to “cash flow boost” which is a support from the Australian government to
eligible entities during the period associated with COVID-19. Other income from continuing operations
relates to gain on settlement of employee liabilities.
Other income from discontinued operations relates to gain from disposal of assets and oil field services.
Note 4: Expenses
Note
Consolidated
2022 (US$)
2021 (US$)
a: Cost of sales – continuing operations
Costs of operations
-
-
Depreciation and amortisation
-
-
Total cost of sales from continuing
operations
-
-
a: Cost of sales – discontinued operations
Costs of production
4,443
45,794
Staff Costs
202,871
254,598
Depreciation and amortisation
-
-
Impairment of Receivables
-
1,615,572
Star Phoenix Group Ltd
Annual report ended 30 June 2022
Note
Consolidated
2022 (US$)
2021 (US$)
Impairment of Rigs and related equipment
5
-
3,437,053
Total cost of sales from discontinued
operations
207,314
5,353,017
b: Finance costs – continuing operations
Foreign exchange loss /(Gain)
-
-
Interest (income)/expense
(2,792)
(4,603)
Interest on convertible note
-
-
Total finance costs from continuing
operations
(2,792)
(4,603)
b: Finance (income)/costs – discontinued operations
Interest expense
-
-
Foreign exchange (gain)/loss
37,241
275,309
Total finance (income)/costs from
discontinued operations
37,241
275,309
c: General and administration expenses – continuing operations
Directors’ and officers’ fees and benefits
277,832
702,785
Legal fees
219,153
102,872
Business development, financial and other
consulting fees
188,046
361,066
Listing fees
105,354
146,216
Other expenses
321,664
496,145
Total general and administration expenses
from continuing operations
1,112,049
1,809,084
d: Asset values written down- continuing operations
Impairment of assets
11
55,326
153,225
Total Assets written down
55,326
153,225
Note 5: Impairment of non-current assets held for sale
Management is required to make judgements concerning the cause ,timing and amount of
impairments.Management considers the impact of competitive conditions ,cost of capital ,funding
,obsolescence and discontinuance of services in its identification of impairment indicators.Key
assumptions on which management use in the determination is fair value less costs to sell including
binding sales agreements,projected revenues ,capital expenditures and cutomer base . No impairment
assessment were undertaken for the year as at 30 June 2022. As a result, no impairment was recorded in
relation to the rigs and related equipment. Refer to Impairment of rigs and related equipment in Note 4
and note 7a.
Note 6: Discontinued operations
In the prior year financial statements, the company has classified its business in Trinidad as discontinued.
Therefore, the table presents the financial information for the group’s operations in Trinidad.
The financial performance and cash flows of the Trinidad operations are shown below.
Star Phoenix Group Ltd
Annual report ended 30 June 2022
Note
Consolidated
2022 (US$)
2021 (US$)
Revenue from third party services
3
180,736
129,928
Other income
8,894
450,089
Operating expenses
4a
(4,443)
(45,794)
Depreciation, depletion and amortisation
-
-
Staff costs
4a
(202,871)
(254,598)
Administrative expenses
(57,921)
(86,052)
Insurance expense
(65,886)
(57,990)
Impairment of Rigs and related equipment
7a
-
(3,437,053)
Impairment of Receivables
-
(1,615,572)
Finance income/(expense)
(37,241)
92,506
Legal fees
(22,740)
(272,884)
Gain from disposal of assets
60,123
83,543
Taxation benefit
-
608,557
Loss from dicontinued operations
(141,349)
(4,405,320)
Net cash (outflow)/inflow from operating
activities
(281,699)
(746,051)
Net cash Inflow/(outflow) from investing
activities
278,902
154,617
Net cash inflow from financing activities
-
277,328
Net cash (decrease)/increase in cash
generated by the subsidiary
(2,797)
(314,106)
Current period discontinued operations relate to Range Resources Drilling Service Ltd.
Gain/(loss) from discontinued operations, net of tax
Gain/(loss) from RRDSL
(307,932)
(4,405,320)
Total Gain/(loss) from discontinued operations,
net of tax
(307,932)
(4,405,320)
Note 7a: Assets of disposal group classified as held for sale
Note
Consolidated
2022 (US$)
2021 (US$)
Current assets
Rigs and related inventory
3,175,977
3,635,878
Property, plant and equipment
361,410
613,160
Total current assets
3,537,387
4,249,038
Total held for sale assets
3,537,387
4,249,038
Disposal of rigs and related inventory held by Range Resources Drilling
Services
Star Phoenix Group Ltd
Annual report ended 30 June 2022
The Company has also been actively marketing the rigs and equipment. As a result, the Company sold
production rigs for a total gain of US$10,816. The Company continues the sale process of the remaining
three production and four drilling rigs.
During the period, no impairment charge was recognised by management in the year ended 30 June
2022 (2021: US$3,437,053).
Note 7b: Liabilities directly associated with assets classified as held for
sale
Note
Consolidated
2022 (US$)
2021 (US$)
Current liabilities
Trade and other payables
-
-
Deferred tax liabilities
691,097
450,653
Accrued expenditure
-
-
Total current liabilities
691,097
450,653
Total held for sale liabilities
691,097
450,653
Note 8: Auditor’s remuneration
Note
Consolidated
2022 (US$)
2021 (US$)
Remuneration of the auditor of the Parent Entity for:
Auditing or reviewing the financial report
by BDO Audit (WA) Pty Ltd
52,203
80,750
Non-audit services provided by a related
entity of BDO Audit (WA) Pty Ltd in respect
to Parent Entity’s tax compliance
34,345
36,338
Total remuneration for the Parent Entity
86,548
117,088
Remuneration of the auditors of the subsidiaries
Auditing or reviewing the financial report
by MHA Macintyre Hudson
-
9,072
Auditing or reviewing the financial report
by BDO Barbados
-
7,500
Auditing or reviewing the financial report
by BDO Trinidad
-
11,142
Auditing or reviewing the financial report
by Felicia Hosein & Company Trinidad
5,925
-
Total remuneration for the subsidiaries
5,925
27,714
Star Phoenix Group Ltd
Annual report ended 30 June 2022
Note 9: Earnings/(Loss) per share
Note
Consolidated
2022 (US$)
2021 (US$)
a: Basic loss per share
Loss per share from continuing operations
attributable to the ordinary equity holders
of the company
(0.008)
(0.013)
Loss per share attributable to the ordinary
equity holders of the company
(0.009)
(0.044)
Loss per share from discontinued
operations attributable to the ordinary
equity holders of the company
(0.001)
(0.031)
b: Diluted loss per share
Loss per share from continuing operations
attributable to the ordinary equity holders
of the company
n/a
n/a
Loss per share attributable to the ordinary
equity holders of the company
n/a
n/a
Loss per share from discontinued
operations attributable to the ordinary
equity holders of the company
n/a
n/a
c: Reconciliation of gain/(loss) used in calculating earnings per share
Basic/ Diluted loss per share
Loss from continuing operations
attributable to the ordinary equity holders
of the company
(1,195,339)
(1,863,582)
Gain/(loss) attributable to the ordinary
equity holders of the company
(1,407,967)
(6,694,656)
Loss from discontinued operations
attributable to the ordinary equity holders
of the company
(212,628)
(4,831,074)
d: Weighted average number of shares used as the denominator
Weighted average number of ordinary
shares used as the denominator in
calculating basic EPS
150,876,970
146,267,513
Note 10: Cash and cash equivalents
Note
Consolidated
2022 (US$)
2021 (US$)
Cash at bank and on hand
758,346
1,911,072
Risk exposure
Information about the Group’s exposure to credit risk, foreign exchange risk and price risk is provided in
Note 26.
Star Phoenix Group Ltd
Annual report ended 30 June 2022
Note 11: Trade and other receivables
Note
Consolidated
2022 (US$)
2021 (US$)
Current
Trade receivables (i)
20
-
Taxes receivable
40,228
39,342
Other receivables (ii)
138,763
13,182
Prepayments
19,833
20,849
Other taxes receivable
30,448
30,493
Total trade and other receivables
229,292
103,866
(i)
Trade receivables are generally due for settlement within 30 days. They are presented as current assets
unless collection is not expected for more than 12 months after the reporting date.
(ii)
Other receivables comprise tribunal fees of GBP 90,000 paid on behalf LandOcean Energy Services Co
Limited. This amount will deduct reimbursement from Dentons.
The consolidated entity has increased its monitoring of debt recovery as there is an increased probability
of customers delaying payment, due to the COVID-19 pandemic. An impairment of US$55,326 (30 June
2021: $153,225) has been recognised relating to continuing operations and no impairment has been
recognised relating to non-continuing operations in the year to 30 June 2022 (30 June 2021: $1,598,847).
Fair value approximates the carrying value of trade and other receivables at 30 June 2022 and 30 June
2021.
Risk exposure
Information about the Group’s exposure to credit risk, foreign exchange risk and price risk is provided in
Note 26.
Allowance for expected credit losses
The consolidated entity has recognised a loss in profit or loss in respect of the expected credit losses for
the year ended 30 June 2022 as described above.
Note 12: Right-of-Use Asset
Note
Consolidated
2022 (US$)
2021 (US$)
Non-current
Right-of-use asset
-
63,333
Total trade and other receivables
-
63,333
Star Phoenix Group Ltd
Annual report ended 30 June 2022
The amount relates to the office lease in Beijing, People’s Republic of China, expiring on 31 August 2021.
Amortisation of US$43,333 was recognised in the Income Statement with regards to the asset. The bond
has been refunded to the company.
Note 13: Controlled entities
The consolidated financial statements incorporate the assets, liabilities and results of the following
subsidiaries in accordance with accounting policy described in Note 1(a).
Controlled Entities Consolidated
Country of
Incorporation
Percentage Owned (%)
30 June 2021
30 June 2020
Subsidiaries of Star Phoenix Group Limited:
Range Resources (Barbados) Limited
Barbados
100
100
SOCA Petroleum Limited
Barbados
100
100
Range Resources Drilling Services Limited
Trinidad
100
100
West Indies Exploration Company Limited Trinidad
100
100
Range Resources Trinidad Limited
(disposed of)
Trinidad
-
100
Range Resources West Coast Limited
Trinidad
100
100
Range Resources (Barbados) GY Limited
Barbados
100
100
Range Resources GY Shallow Limited
Trinidad
100
100
Range Resources GY Deep Limited
Trinidad
100
100
Star Phoenix Group UK Limited
United Kingdom 100
100
Range Resources HK Limited
Hong Kong
100
100
PT Hengtai Weiye Oil and Gas
Indonesia
60
60
PT Jasmine Oil and Gas Services
Indonesia
60
60
PT Lubuk Kawai Raya (i)
Indonesia
46.8
46.8
PT Aceh Timur Kawai Energi (i)
Indonesia
42.1
42.1
Georgian Oil Pty Ltd
Australia
100
100
Shanghai AusQuality International Trading
Co. Ltd
China
100
100
Junior Star Tec Limited
China
100
100
Star Phoenix Group Ltd
Annual report ended 30 June 2022
(i)
Indirect control of these entities was obtained with the acquisition of 60% of the share capital in PT
Hengtai Weiye Oil and Gas
(ii)
In the subsidiaries, only Star Phoenix Group UK Limited and the Chinese entities are continuing entities.
The rest of the entities are discontinued.
Note 14: Property, Plant & Equipment
Consolidated
Production
equipment
and access
roads
Gathering
station and
field office
Leasehold
improvement
Motor vehicle,
furniture,
fixtures &
fittings
Total
US$
US$
US$
US$
US$
Year ended 30 June 2021
Opening net book
amount
-
-
-
100,349
100,349
Depreciation
charge
-
-
-
(16,725)
(16,725)
Closing net book
amount
-
-
-
83,624
83,624
At 30 June 2021
Cost
2,072,722
-
-
323,402
2,396,124
Accumulated
depreciation
(2,072,722)
-
-
(239,778)
(2,312,500)
Net book amount
-
-
-
83,624
83,624
Year ended 30 June 2022
Opening net book
amount
-
-
-
83,624
83,624
Depreciation
charge
-
-
-
(83,624)
(83,624)
Closing net book
amount
-
-
-
-
-
At 30 June 2022
Cost
-
-
-
83,624
83,624
Accumulated
depreciation
-
-
-
(83,624)
(83,624)
Net book amount
-
-
-
-
-
Note 15: Trade and other payables
Note
Consolidated
2022 (US$)
2021 (US$)
(Restated)
a: Current
Trade payables
244,136
304,455
Star Phoenix Group Ltd
Annual report ended 30 June 2022
Note
Consolidated
2022 (US$)
2021 (US$)
(Restated)
Sundry payables and accrued expenses (i)
55,212
155,268
Other payables (ii)
4,206,598
4,390,183
Total
4,505,946
4,849,906
b: Non-Current
Other payables – interest bearing
-
-
Other payables – non-interest bearing
-
-
Total
4,505,946
4,849,906
(i)
Amount mainly relates to accrued expenditure from operations in Trinidad and Australia.
(ii)
Amount mainly relates to withholding taxes payable as a result of debt eliminations.
Note 16: Deferred taxes
Other
Accrued
interest
Total
Deferred tax asset US$ US$ US$
Movements: Year ended 30 June 2022
Opening balance
-
30,493
30,493
Charged/(credited) - to profit or loss
-
(45)
(45)
Closing net book amount (i)
-
30,448
30,448
(i)
Deferred tax asset is included in the asset held for sale (note 7a)
Fair value
uplift on
business
combination
Accelerated
depreciation
Total
Deferred tax liability US$ US$ US$
Movements: Year ended 30 June 2021
Opening balance
-
1,154,300
1,154,300
Foreign currency movement
-
-
-
Charged/(credited) - to profit or loss
-
(703,647)
(703,647)
Closing net book amount
-
450,653
450,653
Movements: Year ended 30 June 2022
Opening balance
-
450,653
450,653
Foreign currency movement
-
-
-
Charged/(credited) - to profit or loss
-
240,444
240,444
Closing net book amount (i)
691,097
691,097
(i) Deferred tax liability is included in liabilities directly associated with assets held for sale (note 7b)
Note 17: Provisions
Star Phoenix Group Ltd
Annual report ended 30 June 2022
Note
Consolidated
2022 (US$)
2021 (US$)
Provision (i)
5,796,048
5,796,048
Total
5,796,048
5,796,048
(i) Provision relates to an estimate of the potential land taxes that may be payable by the Company on
expired exploration licences in Trinidad. The determination of provisions involves management
judgements about the probability of outcomes of future events and estimates on timing and amount of
expected future cash flows.
The amount and timing of settlement in respect of land taxes are uncertain and dependent on factors
that are not within management control as payment dates are uncertain.
Note 18: Contributed equity
Note
Consolidated
2022 (US$)
2021 (US$)
150,876,970 (2021: 150,876,970) fully paid
ordinary shares
409,614,906
409,614,906
Share issue costs
(21,044,402)
(21,044,402)
Total contributed equity
388,570,504
388,570,504
Consolidated
2022 No.
2022 (US$)
2021 No.
2021 (US$)
a: Fully paid ordinary shares
At the beginning of
reporting period
150,876,970
409,614,906
141,367,955
409,428,374
Shares issued to directors
during year
-
-
9,509,015
186,530
Total contributed equity
150,876,970
409,614,906
150,876,970
409,614,906
At the date of this report, the Company’s issued capital comprises 150,876,970 ordinary fully paid shares.
Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the
Company in proportion to the number of and amounts paid on the shares held.
On a show of hands every holder of ordinary shares present at a meeting of the Company, in person or
by proxy, is entitled to one vote and upon a poll each share is entitled to one vote.
On 4 January 2021, the Group announced to issue 7,195,036 shares to directors. During the year, the
Group also issued announced a subscription of 2,313,979 new ordinary shares to management.
Note 19: Reserves
Star Phoenix Group Ltd
Annual report ended 30 June 2022
Note
Consolidated
2022 (US$)
2021 (US$)
a: Share-based payment reserve
Balance 1 July 2021
8,316,464
8,316,464
Share based payment expenses
-
-
Balance 30 June 2022
8,316,464
8,316,464
The share-based payment reserve records items recognised as expenses on the fair valuation of shares
and options issued as remuneration to employees, directors and consultants. For the year ended 30
June 2022 the amount was nil reflecting the fact that all options vested during the year.
Note
Consolidated
2022 (US$)
2021 (US$)
b: Option premium reserve
Balance 1 July 2021
12,057,362
12,057,362
Fair value movement of exercised options that
were originally classified as a derivative liability
-
-
Balance 30 June 2022
12,057,362
12,057,362
The option premium reserve is used to recognise the grant date fair value of options.
Note
Consolidated
2022 (US$)
2021 (US$)
c: Foreign currency translation reserve
Balance 1 July 2021
3,026,544
3,015,222
Currency translation differences arising during
the year
59,920
11,322
Currency translation differences arising due to
disposal of subsidiary
-
-
Balance 30 June 2022
3,086,464
3,026,544
The foreign currency translation reserve is used to record exchange differences arising from the
translation balances of foreign subsidiaries.
Total reserves at 30 June 2022
23,460,290
23,400,370
Note 20: Contingent liabilities and contingent assets
The Directors are not aware of any contingent liabilities or contingent assets as at 30 June 2022.
Note 21: Segment reporting
Star Phoenix Group Ltd
Annual report ended 30 June 2022
30 June 2022
Trinidad –
Oil & Gas
Production
US$
Trinidad –
Oilfield
Services
US$
Indonesia
US$
Unallocated
US$
Total
US$
Segment revenue
Total segment revenue
-
2,792
2,792
Intersegment revenue
-
Revenue from external
customers
-
Other income
-
2,792
2,792
Segment result
Depreciation
-
-
-
Interest Income/(expense)
-
-
(30,756)
(30,756)
Other segment
income/(expenses)
-
-
(1,112,049)
(1,112,049
Impairment of Receivables
-
-
(55,326)
(55,326)
Impairment of Rigs and related
equipment
-
-
Gain on disposal
-
-
(212,628)
(212,628)
Profit/(Loss) before income tax
-
-
(212,628)
(212,628)
Income tax
-
-
-
-
Profit/(Loss) after income tax
-
(212,628)
-
(1,195,339)
(1,407,967)
Segment assets
Segment assets
-
4,386,451
-
634,401
5,020,851
Total assets
-
4,386,451
-
634,401
5,020,851
Segment liabilities
Segment liabilities
-
9,606,408
-
1,488,166
11,054,574
Total liabilities
-
9,606,408
-
1,488,166
11,054,574
30 June 2021
Trinidad –
Oil & Gas
Production
US$
Trinidad –
Oilfield
Services
US$
Indonesia
US$
Unallocated
US$
Total
US$
Total segment revenue
Intersegment revenue
-
580,017
-
98,728
678,745
Revenue from external
customers
-
129,928
-
-
129,928
Other income
-
450,089
-
98,728
548,817
Segment result
Depreciation
-
-
-
(16,725)
(16,725)
Interest income/(expense)
-
226,839
-
(222,236)
4,603
Other segment expenses
-
(805,348)
-
(1,586,849)
(2,392,197)
Impairment of receivables
-
(1,479,072)
-
(136,500)
(1,615,572)
Impairment of Rigs and related
equipment
-
(3,437,053)
-
-
(3,437,053)
Gain on disposal
-
83,543
-
-
83,543
Profit/(Loss) before income tax
-
(4,831,074)
-
(1,863,582)
(6,694,656)
Income tax
-
608,557
-
-
608,557
Profit/(Loss) after income tax
-
(4,222,517)
-
(1,863,582)
47,941,852
Segment assets
Segment assets
-
4,586,856
-
1,824,078
6,410,934
Total assets
-
4,586,856
-
1,824,078
6,410,934
Star Phoenix Group Ltd
Annual report ended 30 June 2022
(i) Unallocated assets
30 June 2022
US$
30 June 2021
US$
Segment assets
Cash
519,900
1,668,255
Other
125,607
155,822
Total segment assets
642,507
1,824,077
Note
Consolidated
2022 (US$)
2021 (US$)
Segment result – all other segments
Directors’ and officers’ fees and benefits
277,832
702,785
Finance costs
30,756
6,840
Other general and administration expenses
889,543
1,378,474
Total unallocated segment expenses
1,198,131
2,088,099
Accounting policies
AASB 8 requires operating segments to be identified on the basis of internal reports about components
of the Group that are regularly reviewed by the chief operating decision maker in order to allocate
resources to the segment and to assess its performance. The chief operating decision maker is the
Executive Chairman and through this role the Board of Directors.
Information regarding these segments is presented above. The accounting policies of the reportable
segments are the same as those of the Group. Segment information is prepared in conformity with the
accounting policies of the entity as disclosed in Note 1.
Segment revenues and expenses are those directly attributable to the segments and include any joint
revenue and expenses where a reasonable basis of allocation exists. Segment assets include all assets
used by a segment and consist principally of cash, receivables, plant and equipment, exploration
expenditure capitalised and development assets net of accumulated depreciation and amortisation.
While most such assets can be directly attributed to individual segments, the carrying amount of certain
assets used jointly by two or more segments is allocated to the segments on a reasonable basis.
Segment disclosures do not include deferred income taxes.
30 June 2022
Trinidad –
Oil & Gas
Production
US$
Trinidad –
Oilfield
Services
US$
Indonesia
US$
Unallocated
US$
Total
US$
Segment liabilities
Segment liabilities
-
9,676,636
-
133,724
9,810,360
Total liabilities
-
9,676,636
-
133,724
9,810,360
Star Phoenix Group Ltd
Annual report ended 30 June 2022
Note 22 Cash flow information
Note 23: Share based payments
Employee option plan
No options were issued to key management personnel. All options expired during the prior year as
vesting conditions were not met.
Expenses recognised in the profit or loss
During the year, no share-based payments were recognised in profit/loss statement. (2021: Nil).
Note 24: Related party transactions
(a) Parent entity
Note
Consolidated
2022 (US$)
2021 (US$)
Reconciliation of cash flow from operations with loss after income tax
Gain/(loss) after income tax
(1,336,247)
(6,086,099)
Non-cash flows in profit
(15,136)
Depreciation, depletion and amortisation
55,326
120,000
Share based payment- consultants and
employees
201,654
Impairment of non-current assets
(206,028)
16,725
Impairment reversal
Gain on disposal of subsidiary
Foreign exchange (gain)/loss
30,756
(44,846)
Impairments recognised on held for sale
assets
3,437,053
Decrease in other current assets
221
7,543
(Increase)/decrease in trade and other
receivables
115,629
1,867,165
Decrease in deferred tax asset
Increase/(decrease) in trade and other
payables
(354,197)
(420,933)
Increase/(Decrease) in deferred tax
liabilities
240,444
(703,647)
increase/(Decrease) in provisions
(195,896)
Items reclassified as investing activities on
gain on disposal of subsidiary
Net cash outflow (from)/to operations
(1,454,096)
(1,816,417)
Star Phoenix Group Ltd
Annual report ended 30 June 2022
The ultimate Parent Entity and ultimate Australian Parent Entity within the Group is Star Phoenix Group
Ltd.
(b) Subsidiaries
Interests in subsidiaries are set out in Note 13.
(c) Transactions with Key Management Personnel
The following transactions occurred during the year with Key Management Personnel or their related
parties:
2022
US$
2021
US$
Consulting fees paid or payable to Kaiyuan Guosen
Management Consulting Limited, a company owned by Mr Gu
159,399
379,251
Consulting fees paid or payable to Ten Faye Limited, a
company owned by Mr L Liu
64,878
35,833
Note
Consolidated
2022 (US$)
2021 (US$)
d: Key Management Personnel compensation
Short–term benefits
277,832
508,936
Post-employment benefits
-
29,397
Issue Shares to directors
-
164,452
Total
277,832
702,785
Note 25: Parent entity information
The following details information related to the Parent Entity Star Phoenix Group Limited, at 30 June
2022. The information presented here has been prepared in accordance using consistent accounting
policies as presented in Note 1.
Note
Consolidated
2022 (US$)
2021 (US$)
Current assets
504,942
1,648,398
Non-current assets
117,502
146,957
Total assets
622,444
1,795,355
Current liabilities
1,448,166
133,724
Non-current liabilities
-
-
Total liabilities
1,448,166
133,724
Contributed equity
388,570,480
388,570,480
Accumulated losses
(416,141,109)
(411,246,995)
Reserves
26,744,907
24,338,146
Star Phoenix Group Ltd
Annual report ended 30 June 2022
Note
Consolidated
2022 (US$)
2021 (US$)
Total equity
(825,722)
1,661,631
Loss for the year from continuing operations
(1,195,339)
(1,863,582)
Loss for the year for discontinued operations
(140,908)
(4,405,320)
Total comprehensive loss for the year
(1,336,247)
(6,268,902)
No contingent liabilities were recognised as disclosed in Note 20.
Note 26: Financial risk management
The Group has exposure to the following risks from their use of financial instruments:
Credit risk
Liquidity risk
Market risk
This note presents information about the Group’s exposure to each of the above risks, their objectives,
policies and processes for measuring and managing risk, and the management of capital. Further
quantitative disclosures are included throughout these financial statements. The Board of Directors has
overall responsibility for the establishment and oversight of the risk management framework.
Risk management policies are established to identify and analyse the risks faced by the Group, to set
appropriate risk limits and controls, and to monitor risks and adherence to limits. Risk management
policies and systems are reviewed to reflect changes in market conditions and the Group’s activities.
The Group, through training and management standards and procedures, aims to develop a
disciplined and constructive control environment in which all consultants and agents understand their
roles and obligations.
Credit risk
Credit risk is the risk of financial loss to the Group if counterparty to a financial instrument fails to meet its
contractual obligations, and arises principally from the Group’s receivables and cash held at financial
institutions.
Credit risk is managed on a group basis. Individual risk limits are set based on internal or external ratings
in accordance with limits set by the board.
The credit quality of financial assets that are neither past due or impaired can be assessed by reference
to external credit ratings (if available) or to historical information about counterparty default rates.
Note
Consolidated
2022 (US$)
2021 (US$)
Cash at bank, restricted deposits and short-term bank deposits (S&P ratings)
AAA -
504,942
1,648,398
AA-
11,957
19,857
A+
-
-
Star Phoenix Group Ltd
Annual report ended 30 June 2022
Note
Consolidated
2022 (US$)
2021 (US$)
BBB+
241,446
242,817
BBB-
-
-
Not rated
-
-
Total
10
758,346
1,911,072
Exposure to credit risk
The carrying amount of the Group’s financial assets represents the maximum credit exposure. The
Group’s maximum exposure to credit risk at the reporting date was:
Note
Consolidated
2022 (US$)
2021 (US$)
Trade and other receivables – non-current (i)
-
Trade and other receivables – current (i)
11
229,292
103,866
Cash and cash equivalents
10
758,346
1,911,072
Total
987,638
2,014,938
(i) Counterparties without an external credit rating.
Loans and receivables
The Group’s exposure to credit risk is influenced mainly by the individual characteristics of each debtor.
No collateral was held in relation to these receivables.
Impairment losses
Following the sale of Range Resources Trinidad Limited (which held interests in the upstream assets in
Trinidad) to LandOcean Energy Services Co Limited Energy Services Co Ltd (LandOcean Energy Services
Co Limited), certain sums remain due and payable to the Group.
During
the
2021
financial
year,
the
Board
made
the
decision
to
fully
impair
the
receivable from LandOcean Energy Services Co Limited and the performance bond receivable to
adhere to accounting standards given the situation and age of the balances, resulting to an impairment
of US$1,722,462. No further payments have been received to date.
Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The
Group’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient
liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring
unacceptable losses or risking damage to the Group’s reputation.
Star Phoenix Group Ltd
Annual report ended 30 June 2022
The Group uses activity-based costing to cost its activities, which assists in monitoring cash flow
requirements and optimising its cash return on investments. Typically, the Group ensures that it has
sufficient cash on demand to meet expected operational expenses for a period of 12 months; this
excludes the potential impact of extreme circumstances that cannot reasonably be predicted, such as
natural disasters.
Group 2022
Carrying
amount
Contractual
cash flows
Within one
year
1-2 years
2-5 years
Financial liabilities at amortised cost
Trade and other
payables
4,505,946
4,505,946
4,505,946
-
-
Total
4,505,946
4,505,946
4,505,946
-
-
Group 2021
Carrying
amount
Contractual
cash flows
Within one
year
1-2 years
2-5 years
Financial liabilities at amortised cost
Trade and other
payables (Note 15)
4,849,906
4,849,906
4,849,906
-
-
Total
4,849,906
4,849,906
4,849,906
-
-
Market risk
Market risk is the risk that changes in market prices, such as interest rates and equity prices will affect the
Group’s income or the value of its holdings of available for sale assets. The objective of market risk
management is to manage and control market risk exposures within acceptable parameters, while
optimising the return.
Foreign exchange risk
The Group operates internationally and is exposed to foreign exchange risk arising from various currency
exposures, primarily with respect to the US dollar, AU dollar, TT Dollar, British pound and Chinese Renminbi.
Foreign exchange risk arises from future commercial transactions and recognised assets and liabilities
denominated in a currency that is not the entity’s functional currency. The risk is measured using sensitivity
analysis and cash flow forecasting.
The Group’s treasury risk management policy is to closely monitor exchange rate fluctuations. To date,
the Group has not sought to hedge its exposure to fluctuations in exchange rates, however this policy will
be reviewed on an ongoing basis.
The Group’s exposure to foreign currency risk at the reporting date was as follows:
Star Phoenix Group Ltd
Annual report ended 30 June 2022
Consolidated
2022 AUD
2021 AUD
2022 GBP
2021 GBP
Cash
30,735
45,090
4,837
91,056
Amount payable to other
entities
(18,025)
(20,800)
(11,250)
(11,250)
Total
12,710
24,290
(6,413)
79,806
Consolidated
2022 TTD
2021 TTD
2022 RMB
2021 RMB
Cash
1,629,759
1,636,585
3,183,084
8,449,697
Amount payable to other
entities
(475,902)
(184,564)
-
-
Total
(1,153,857)
1,452,021
3,183,084
8,449,697
Sensitivity
Based upon the amounts above, had the US dollar strengthened by 10% with all other variables held
constant, there would not have been a material impact on the profit and equity of the Group. A 10%
weakening of the US dollar against the above currencies at 30 June would have had an equal but
opposite effect, on the basis that all other variables remain constant.
Interest rate risk
There is no material interest rate risk exposure in the Group.
Fair values versus carrying amounts
The fair value of financial assets and liabilities, together with the carrying amounts shown in the
statement of financial position, are as follows:
Group
30 June 2022
US$
30 June 2021
US$
Carrying amount
Fair value
Carrying
amount
Fair
value
Trade and other
receivables
229,292
229,292
103,866
103,866
Cash and cash
equivalents
758,346
758,346
1,911,072
1,911,072
Trade and other
payables
(4,505,946)
(4,505,946)
(4,172,216)
(4,172,216)
Total
(3,518,308)
(3,518,308)
(2,157,278)
(2,157,278)
The basis for determining fair value is disclosed in Note 1(n).
Other price risks
The Group is not exposed to any other price risks.
Capital management
Star Phoenix Group Ltd
Annual report ended 30 June 2022
The entity’s objectives when managing capital is to safeguard its ability to continue as a going concern,
so that it can continue to provide returns for shareholders and to maintain an optimal capital structure to
reduce the cost of capital.
The Group is working on identifying new projects in the energy and resources spectrum.
The capital structure of the group consists of cash and cash equivalents and equity attributable to equity
holders of the Company, comprising issued capital, reserves and accumulated losses as disclosed in
Notes 18 and 19 respectively. None of the entities within the group are subject to externally imposed
capital requirements.
Gearing ratio
The Board reviews the capital structure on an annual basis. As a part of this review the Board considers
the cost of capital and the risks associated with each class of capital.
Note
Consolidated
2022 (US$)
2021 (US$)
Financial assets
Cash and cash equivalents
10
758,346
1,911,072
Financial liabilities
Trade and other payables
15
(4,505,946)
(3,563,659)
Net debt
(4,505,946)
(3,563,659)
Equity
(5,962,442)
3,399,429
Net debt to equity ratio
N/A
N/A
Categories of financial instruments
Note
Consolidated
2022 (US$)
2021 (US$)
Financial assets
Cash and cash equivalents
10
758,346
1,911,072
Trade and other receivables – current
11
229,292
103,864
Total
987,638
2,014,936
Financial liabilities
Trade and other payables - non-current
-
-
Trade and other payables – current
15
4,505,946
3,563,659
Total
4,505,946
3,563,659
The carrying amount reflected above represents the Group’s maximum exposure to credit risk for such
loans and receivables.
(a) Fair value hierarchy
AASB 13 requires disclosure of fair value measurements by level of the following fair value measurement
hierarchy:
(a) Quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1),
Star Phoenix Group Ltd
Annual report ended 30 June 2022
(b) Inputs other than quoted prices included within level 1 that are observable for the asset or liability,
either directly or indirectly (level 2), and
(c) Inputs for the asset or liability that are not based on observable market data (unobservable inputs
(level 3).
The Group’s policy is to recognise transfers into and transfers out of fair value hierarchy levels as at the
end of the end of the reporting period. There were no transfers between the levels of the fair value
hierarchy during the year ended 30 June 2021.
(b) Fair values of other financial instruments
The Group has financial instruments which are measured at amortised cost in the consolidated
statement of financial position.
Due to their short-term nature, the carrying amounts of the current receivables, current payables,
current borrowings, and current other financial liabilities is assumed to approximate their fair value.
Note 27: Events after the reporting date
Update on RRDSL Claim
On 28 July 2022, the Company announced that RRDSL has won a claim at an amount of approximately
TT$1.1 million ($163,000) against 360 Oil and Gas Limited in the Supreme Court of Trinidad and Tobago in
respect of unpaid service fees.
Lodgement of Claim Against Range Resources Trinidad Limited
On 4 August 2022, the company announced that RRDSL, through its attorney (Robin B. Ramoutar & Co),
has submitted three claims at a total amount of approximately TT$14.9 million ($2.21million) against Range
Resources Trinidad Limited ("RRTL" or the "Defendant") in the Supreme Court of Trinidad and Tobago in
respect of breach of loan, service and equipment rental contracts from the Defendant (the "Claims"). A
Court date will be scheduled in due course.
Update on arbitration proceedings against LandOcean Energy Services Co Limited
On 22 August 2022, the company updated that the London court of international Arbitration issued a
consent award on 12 August 2022 (of which the Company was notified on 19 August 2022) in relation to
two of the four Stage 1 Claims. Under the consent award, LandOcean Energy Services Co Limited is
required to make payment of US$301,265 to Star Phoenix by 16 September 2022, being 35 days from the
date of the consent award.
The issuing of the consent award makes a successful conclusion of two of the four Stage 1 Claims. The
Company will provide further updates on the remaining Stage 1 Claims in due course.
On 21 September 2022, the Company confirms that no payment has yet been received. LandOcean
Energy Services Co Limited has indicated that the Chinese State Administration of Foreign Exchange has,
as yet, not permitted the payment to be made. The Company is monitoring the situation closely and will
provide further updates as appropriate, in addition to the remaining Stage 1 Claims, in due course.
Note 28: New accounting Standards and interpretations
Star Phoenix Group Ltd
Annual report ended 30 June 2022
Australian accounting Standards/amendments released but not yet effective: 30 June 2022
year end
There are no other standards that are not yet effective and that would be expected to have a material
impact on Star Phoenix Group in the current or future period and on foreseeable future transactions.
New and Amended Accounting Policies Not Yet Adopted by the Entity
AASB 2020-1: Amendments to Australian Accounting Standards – Classification of Liabilities as Current or
Non-current
The amendment amends AASB 101 to clarify whether a liability should be presented as current or non-
current.
The Entity plans on adopting the amendment for the reporting period ending 30 June 2024. The
amendment is not expected to have a material impact on the financial statements once adopted.
Note 29: Company details
The registered office of the company is:
c/o Edwards Mac Scovell, Level 1, 8 St Georges Terrace, Perth WA 6000
Telephone: +61 8 6205 3012
The principal place of business is:
c/o Edwards Mac Scovell, Level 1, 8 St Georges Terrace, Perth WA 6000
Telephone: +61 8 6205 3012
Star Phoenix Group Ltd
Annual report ended 30 June 2022
Directors’Declaration
THE DIRECTORS OF THE COMPANY DECLARE THAT:
The financial statements, comprising the consolidated statement of profit or loss and other
comprehensive income, consolidated statement of financial position, consolidated statement of
cash flows, consolidated statement of changes in equity, accompanying notes, are in
accordance with the Corporations Act 2001 and:
•
comply with Accounting Standards and the Corporations Regulations 2001 and other
mandatory professional reporting requirements; and
•
give a true and fair view of the Group’s financial position as at 30 June 2022 and of its
performance for the year ended on that date.
•
The company has included in the notes to the financial statements an explicit and unreserved
statement of compliance with International Financial Reporting Standards.
•
In the directors’ opinion, there are reasonable grounds to believe that the company will be able
to pay its debts as and when they become due and payable.
•
The directors have been given the declarations by the chief executive officer and chief financial
officer required by section 295A.
This declaration is made in accordance with a resolution of the Board of Directors and is signed for and
on behalf of the directors by:
Zhiwei Gu
Chairman
October 2022
Star Phoenix Group Ltd
Annual report ended 30 June 2022
Independent Audit Report to the Members of
Star Phoenix Group Limited
Opinion
We have audited the financial report of Star Phoenix Group Ltd and Controlled Entities
(the company and its controlled entities (the Group)), which comprises the
consolidated statement of financial position as at 30 June 2022, 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 statements, including a summary of
significant accounting policies and the directors’ declaration.
We do not express an opinion on the accompanying financial report of the Group.
Because of the significance of the matters described in the Basis for disclaimer of
opinion section of our report, we have not been able to obtain sufficient appropriate
audit evidence to provide a basis for an audit opinion on this financial report.
Basis for disclaimer of opinion
We have been unable to obtain sufficient appropriate audit evidence on the books
and records of the consolidated entity. Specifically, we have been unable to satisfy
ourselves on the following areas:
i.
As disclosed in Note 5 of the financial statements, the Group’s current
assets as at 30 June 2022 include an amount classified as assets held for
sale. During the year ended 30 June 2022, there has been a continued
deterioration in the operating and economic performance of the Group,
which created an impairment indicator of the assets included in this
amount on 30 June 2021. The Directors have undertaken an impairment
assessment as at 30 June 2021and 30 June 2022 and have estimated the
recoverable amount of these assets based on sales price achieved for four
specific rigs. This resulted in an impairment expense being recognised in the
prior year.
The valuation methodology used to arrive at the recoverable amount was
not in accordance with the requirements of Australian Accounting
Standards, and we were unable to perform alternative procedures to
determine whether any adjustments to the carrying value of the property
plant and equipment, rigs and related inventory included in assets held for
sale as at 30 June 2022 were necessary.
Star Phoenix Group Ltd
Annual report ended 30 June 2022
The previous audit report opinion for the year ended 30 June 2020 and 30
June 2021 was also modified with respect to this matter.
ii.
As disclosed in note 15 of the financial statements, the Group’s current
liabilities as at 30 June 2022 includes an amount in respect of withholding
tax liabilities due on overseas interest payments from loans which were
settled in the financial year ended 30 June 2020. During the current year,
management undertook a review of the withholding tax amounts and as
at the date of this report this reassessment is completed but lodgement has
not been made to the Australia Taxation Office.
Other Information
The directors are responsible for the other information. The other information comprises
the information included in the Group’s annual report for the year ended 30 June 2022,
but does not include the financial report and our auditor’s report thereon. Our opinion
on the financial report does not cover the other information and accordingly we do
not express any form of assurance conclusion thereon. In connection with our audit of
the financial report, our responsibility is to read the other information and, in doing so,
consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit or otherwise appears to be materially
misstated. If, based on the work we have performed, we conclude that there is a
material misstatement of this other information, we are required to report that fact. We
have nothing to report in this regard.
Responsibilities of the Directors for the Financial Report
The directors of the company are responsible for the preparation of the financial report
that gives a true and fair view in accordance with Australian Accounting Standards
and the Corporations Act 2001 and for such internal control as the directors determine
is necessary to enable the preparation of the financial report that gives a true and fair
view and is free from material misstatement, whether due to fraud or error. In preparing
the financial report, the directors are responsible for assessing the ability of the Group
to continue as a going concern, disclosing, as applicable, matters related to going
concern and using the going concern basis of accounting unless the directors either
intend to liquidate the Group or to cease operations, or have no realistic alternative
but to do so.
Auditor’s Responsibilities for the Audit of the Financial Report
Our responsibility is to conduct an audit of the financial report in accordance with
Australian Auditing Standards and to issue an auditor’s report. However, because of
the matter described in the Basis for disclaimer of opinion section of our report, we
were not able to obtain sufficient appropriate audit evidence to provide a basis for an
audit opinion on the financial 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
Star Phoenix Group Ltd
Annual report ended 30 June 2022
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.
Report on the Remuneration Report
We have audited the Remuneration Report included in pages 10 to 16 of the directors’
report for the year ended 30 June 2022.
In our opinion, the Remuneration Report of Star Phoenix Group Ltd, for the year ended
30 June 2022, 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.
Douglas Mitchell
Auditor's name and
signature:
Mitchell Wilson & Partners
Name of firm:
Address:
883 Toorak Road
Camberwell VIC 3124 Australia
Dated this
day of
2022
Additional Information
Top 20 shareholders
Star Phoenix Group Ltd
Annual report ended 30 June 2022
The 20 largest shareholders of the Company as at 31 August 2022 are listed below:
Rank
Shareholder
Number of shares Percentage
held (%)
1.
Beijing Sibo Investment Management
24,476,210
16.22%
2.
Preceding Max Ltd
23,561,326
15.62%
3.
LandOcean Energy Services Co Limited Energy
Services Co Limited
17,390,770
11.53%
4
Sramek Biodynamics Holdings
15,365,998
10.18%
5.
Interactive investor services Nominees Limited
8,932,046
5.92%
6.
Abraham Limited
7,123,776
4.72%
7.
Mr Zhiwei Gu
5,489,793
3.64%
8.
Barclays Direct Investing Nominees Limited
5,153,533
3.42%
9.
Interactive Investor Services Nominees Limited
4,912,586
3.26%
10.
Hargreaves Landsdown (Nominees) Limited
<15942>
2,689,563
1.78%
11.
HSDL Nominees Limited
2,479,858
1.64%
12.
Hargreaves Lansdown (Nominees)Limited
1,729,584
1.15%
13.
Mr Lubing Liu
1,726,077
1.14%
14.
Hargreaves Lansdown (Nominees) Limited 1,697,395
1.13%
15.
Interactive Investor Services Nominees Limited
1,684,274
1.12%
16.
Pershing Nominees Limited
1,570,698
1.04%
17.
HSBC Client Holdings Nominee (UK) Limited
1,533,626
1.02%
18.
HSDL Nominees Limited
1,461,891
0.97%
19.
Lawshare Nominees Limited
1,078,273
0.72%
20.
Interactive Brokers LLC
1,000,016
0.66%
Total
131,057,293
86.86%
Star Phoenix Group Ltd
Annual report ended 30 June 2022
Substantial shareholders
An extract of the Company’s register of substantial shareholders (being those shareholders who held 5%
or more of the issued capital on 31 August 2022) is below:
Rank
Shareholder
Number of shares
Percentage
held (%)
1.
Beijing Sibo Investment
Management
24,476,210
16.22%
2.
Preceding Max Ltd
23,561,326
15.62%
3.
LandOcean Energy Services Co
Limited Energy Services
17,390,770
11.53%
4.
Sramek Biodynamics Holdings
15,365,998
10.18%
5.
Interactive investor services
Nominees Limited
8,932,046
5.92%
Distribution of equity securities
The number of shareholders by size of holding is set out below (31 August 2022):
Size of holding
Number of holders
Number of shares
1 – 1,000
1,985
573,035
1,001 – 5,000
515
1,255,928
5,001 – 10,000
130
1,024,036
10,001 – 100,000
166
5,030,240
100,001 and over
22
143,993,731
Total
2,818
150,876,970
Tenement schedule
The tenement schedule for the Group as at 30 June 2022 is tabulated below:
Tenement Reference
Location
Percentage held (%)
Operator
Perlak1
Indonesia
23
PT Aceh Timur
Kawai Energi
Star Phoenix Group Ltd
Annual report ended 30 June 2022
Notes:
1. The Company’s indirect interest in the Perlak field is held through its 60% shareholding in Hengtai,
which holds a 78% interest in Lukar which in turn holds a 49% interest in PT Aceh Timur Kawai
Energi.
Corporate Directory
Directors
Mr Lubing Liu
Executive Chairman
Dr Mu Luo
Executive Director, Company Secretary
Mr Zhiwei Gu
Non-Executive Director
Company Secretary
Mr Lubing Liu
Registered office &
principal place of
business
c/o Edwards Mac Scovell, Level 1, 8 St Georges Terrace
Perth WA 6000, Australia
Telephone: +61 8 6245 0222
Share Registry
(Australia)
Computershare Investor Services Pty Ltd
Level 11, 172 St Georges Terrace, Perth WA 6000
Telephone: +61 3 9415 4000
Share Registry
(United Kingdom)
Computershare Investor Services plc
PO Box 82, The Pavilions, Bridgwater Road, Bristol, UK BS99 6ZZ
Telephone: +44 370 702 0000
Auditor
Mitchell Wilson & Partners
883 Toorak Road
Camberwell VIC 3124, Australia
Stock Exchange
Listing
Star Phoenix shares are listed on Alternative Investment Market of
the London Stock Exchange (AIM code: STA)
Star Phoenix Group Ltd
Annual report ended 30 June 2022
Country of
Incorporation
Australia
Website
www.starphoenixgroup.com