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2020
ANNUAL REPORT
C o r p o r a t e D i r e C t o r y
Di re CtorS
Mr Kerry Harmanis
Mr Daniel Madden
Non-Executive Chairman
(appointed 15 July 2020)
Non-Executive Director
(resigned as Managing
Director and appointed as
Non-Executive Director
1 September 2020)
Mr Jeremy Kirkwood
Non-Executive Director
Mr Brian Dawes
Non-Executive Director
Ms Karen Gadsby
Non-Executive Director
Mr Peter Benjamin
(Appointed 24 July 2019)
Non-Executive Director
CoMpaNy Se Cre ta ry
Mr Alex Neuling
aUDitor S
HLB Mann Judd (WA Partnership)
Level 4, 130 Stirling Street
Perth, Western Australia 6000
Telephone +61 8 9227 7500
Facsimile +61 8 9227 7533
SHare re GiS try
Link Market Services
Level 12, QV1 Building
250 St Georges Terrace
Perth, Western Australia 6000
Telephone +61 8 9211 6670
re GiS tereD & priN CipaL oFFiCe
Australian Securities Exchange Limited
Se CUritie S e XCHaNGe LiS tiNG
Level 11 – 2 Mill Street
Perth WA 6000
Telephone +61 8 9380 4230
Facsimile +61 8 9382 8200
Level 40, Central Park
152-158 St Georges Terrace
Perth, Western Australia 6000
Website: www.talismanmining.com.au
ASX Code: TLM
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2020 ANNUAL REPORT
t a bLe oF C oNt eNt
S
Letter from the Chairman
Review of Operations
Directors’ Report
Remuneration Report
Auditor’s Independence Declaration
Independent Auditors’ Report
Financial Statements
Notes to the Consolidated Financial Statements
Directors’ Declaration
Additional Securities Exchange Information
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4
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24
31
32
36
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72
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Letter FroM
THE CHAIRMAN
Dear Talisman Shareholder,
It is my pleasure to address you for the first time as
Talisman’s Chairman, following my recent appointment to
the board.
My involvement with Talisman as an investor dates back to
2008, just after I stepped down as Executive Chairman of
Jubilee Mines following the $3.1 billion acquisition of that
company by Xstrata.
Since then, I have invested over $18 million in Talisman and
I am pleased to count myself as a significant shareholder
and long-term supporter of the Company’s journey over the
past 12 years.
In more recent times, Talisman has undergone a significant
transformation, initially with the $72.3 million cash sale of
the Company’s interest in the Monty copper-gold project
in Western Australia and, during the past financial year,
the sale of our interest in the Sinclair nickel project for $10
million plus associated trailing royalties.
These transactions allowed the Company to return a total of
$40.9 million in cash or 22 cents per share to shareholders
through a $29 million capital return, together with a special
fully-franked dividend of $11.8 million.
As a significant shareholder, I was very pleased to receive
over $6 million as a result of these capital management
initiatives thanks to the good efforts of the board and
management team. At the same time, this allowed Talisman
to be repositioned as a strongly cash-backed exploration
company with a potentially valuable royalty portfolio.
As such, I believe Talisman is well placed to participate in
what is currently a buoyant market for junior exploration
companies, especially in the gold sector.
During the past financial year, the Company has been
pursuing exploration within its Lachlan Copper-Gold Project
in NSW and, more recently, the Lucknow Gold Project in
NSW, where we recently completed a diamond drilling
program.
While both of these projects have merit and present
opportunities to discover high-grade copper and gold
mineralisation, they are assets that will require a longer
time horizon in terms of value realisation and generating
shareholder returns.
In light of this, Talisman has embarked on a search for new
growth opportunities in the gold and base metals sector.
3
Australia remains hugely prospective from a geological
perspective and is one of the best places in the world to
find, develop and operate high-quality resource assets.
I personally have enjoyed considerable success over the
years working in the WA resource sector, which is a Tier-1
jurisdiction with a world-class regulatory framework for
exploration and mining companies.
I have thoroughly enjoyed getting back into a hands-
on leadership role at Talisman since joining the board
in July and, with the support of a very capable technical
and financial advisory team, we have already made
strong progress in identifying and reviewing a number of
potentially exciting new growth opportunities.
I would like to assure shareholders that we will adopt a
patient, systematic and judicious approach in our search for
new projects or in our pursuit of value accretive corporate
transactions to ensure we find the best assets with the
potential to create long-term shareholder value – both at
the exploration stage and more advanced projects with
near-term development and production potential.
We recently announced the appointment of Shaun Vokes
as Interim Chief Executive Officer to oversee this important
transition phase and work closely with me and my team as
we undertake due diligence on new project opportunities.
Shaun has vast corporate and mining experience, and was
a key part of the executive team at Talisman between 2016
and 2020.
He succeeds Dan Madden, who has resigned as Managing
Director to pursue a new career opportunity. I would like to
extend my sincere thanks to Dan for his management of the
Company and hard work over a long period of time.
I would also like to acknowledge the significant contribution
of our previous Chairman, Jeremy Kirkwood, who remains
on the board as a Non-Executive Director and extend my
appreciation to the Company’s employees, executives and
contractors for their efforts throughout the year.
Finally, I would like to thank my fellow shareholders for your
continued support. I can assure you that we will embrace
the opportunities – and navigate the inevitable challenges
– that arise over the next few years with energy, vigour,
optimism, enthusiasm and, most importantly, integrity.
Yours faithfully,
Kerry Harmanis
Chairman
2020 ANNUAL REPORT reVieW oF
OPERATIONS
oVerVieW
Talisman Mining Limited (Talisman or the Company) has undergone significant activity in the past
financial year with the divestment of Talisman’s Sinclair Nickel Project in Western Australia (Sinclair)
to Saracen Nickel Pty Ltd and continued exploration at the Lachlan Copper Gold Project (Lachlan
Project) and the Lucknow Gold Project (Lucknow Project) in New South Wales.
During the 2020 financial year, Talisman entered into a
binding share sale agreement to divest Sinclair to Saracen
Nickel Pty Ltd, a wholly owned subsidiary of Saracen Mineral
Holdings Ltd (Saracen). The transaction was implemented
by way of a sale of all of the shares in Talisman Nickel Pty
Ltd (Talisman Nickel). The transaction was completed on 11
October 2019 with Talisman receiving the consideration of:
• $10 million cash (plus an additional $0.4M in post-
completion adjustments); and
• a 2% Net Smelter Return (NSR) royalty for:
• any future metal production from the Sinclair
tenements; and
• any future non-precious metal production from
Saracen’s Waterloo Nickel Project (Waterloo), which
is currently on care and maintenance.
The divestment consideration provided the Company with a
strong financial position to continue exploration activities at
the Lachlan and Lucknow Projects and to pursue potential
prospective exploration and advanced development gold
and base metal opportunities in Australia.
As a result of the Sinclair divestment, the Company
strengthened its royalty portfolio and is well placed to
benefit from any potential future production from Sinclair
and any potential future non-precious metal production
from Waterloo through the 2% NSR royalties. These
royalties complement the existing iron ore and copper-gold
royalties held as a result of previous asset transactions.
In August 2019 the Company announced that it had
entered into a farm-in for the Lucknow Project in NSW. The
Lucknow Goldfield was discovered in 1851 and was one of
the earliest goldfields to be mined commercially in Australia.
Historic production records at Lucknow are incomplete,
however in excess of 400,000 ounces of gold was reportedly
produced at grades of 100 to 200 g/t gold1.
Very little modern exploration has been completed outside
of the existing mine workings and in late June 2020
Talisman commenced its maiden drilling program to test
for potential down plunge extensions of the high-grade gold
ore shoots and repeat structures in proximity to the historic
Wentworth and Darcy shafts.
The Company also continued exploration activities at the
Lachlan Project in NSW where it currently controls over
2,700 km2 of exploration tenure through 100% owned
ground, farm-in arrangements and joint ventures.
During the financial year, a number of drill programs were
undertaken at the Lachlan Project, targeting gold-in-soil
anomalies with reverse circulation (RC) drilling as well as a
diamond drill program at the high-grade copper Blind Calf
Prospect. The impact of COVID-19 early in the 2020 year
delayed further drilling until May 2020.
COVID-19 impacted the Company’s activities during the
year, with the temporary suspension of field operations
and a temporary reduction in directors’ fees and executive
salaries being implemented in response to the pandemic.
All employees were assigned to a working from home roster
on a reduced working week from April-June 2020 with
reduced salaries on a pro-rata basis. As of July 2020, there
is a reduced executive team and workforce under revised
part-time working arrangements, resulting in significantly
reduced personnel costs going forward. Measures remain
in place across the corporate office and exploration sites
to protect the safety and well-being of all employees and
contractors.
1 NSW DIGS report, First Annual Exploration Report EL5770, 2001 - R00030162.
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LaCHLaN Copper-GoLD proJeCt
Talisman’s Lachlan Project area covers over 2,700km2 of exploration tenure including an extensive strike extent along the
Gilmore Suture (Figure 1). It is considered that this area has the potential to host a variety of deposit types including low
sulphation epithermal gold and base metal deposits (similar to the Mineral Hill deposit), structurally controlled gold deposits
(similar to the Mt Boppy deposit), structurally controlled copper deposits (similar to the Blind Calf deposit), Cobar style gold
and base metal deposits, as well as skarn deposits.
Figure 1: Lachlan Copper-Gold Project tenure and simplified geology
5
2020 ANNUAL REPORT re Vi e W oF op e r a t i oN S
down-plunge from previous high-grade intersections thereby
extending the high-grade component (Figure 3). A down hole
electromagnetic (DHEM) survey of BCRC0029 highlighted
further off-hole conductors in the area.
The Company has identified multiple gold and base metal
mineralisation exploration targets that are classified in 5
stages depending on corroborating geological information:
• Stage 1 Conceptual Targets;
• Stage 2
Prospect areas with anomalies defined from
surface sampling programs;
• Stage 3
Prospect areas with known gold or base
metal mineralisation intersected in bedrock
drilling in addition to anomalies defined from
surface sampling programs;
• Stage 4
• Stage 5
Prospect areas with economic grade
mineralisation and/or economic width
intersection; and
Prospect areas with economic grade and
width mineralisation that are subject to
targeted resource drilling.
On-ground exploration during the financial year included
reconnaissance mapping, soil sampling, diamond and RC
drilling and geophysical surveys.
Blind Calf Prospect
Prior RC drilling by Talisman has shown the Blind Calf-Dunbars
copper lode system (Figure 2) to be a copper bearing sheared
quartz lode, extending along strike for approximately 300m
and to a depth of over 200m (Figure 3). Drilling has identified a
zone of high-grade copper mineralisation (+5% Cu) within the
main lode system. Previous RC drilling by Talisman returned
high-grade copper intercepts over wide intervals including2:
• BCRC005
7m @ 5.68% Cu from 98m
• BCRC006
13m @ 5.71% Cu from 129m
• BCRC007
11m @ 4.78% Cu from 127m
Figure 2: Blind Calf Location
• BCRC010
21m @ 2.67% Cu from 117m
RC drilling completed at the Blind Calf Prospect at the
beginning of the financial year targeted three areas in
the Blind Calf region; down-plunge extensions, down-hole
electromagnetic conductors and a number of parallel lodes
to the north west, south and south-east of the Blind Calf-
Dunbars copper lode system.
Drilling of down-plunge extensions and down-hole
electromagnetic conductors at the Blind-Calf Dunbars
copper lode system intersected strongly altered volcanic
lithologies, with quartz veining and logged copper sulphide
mineralisation (chalcopyrite). The best result from this
drilling was:
• 10m @ 4.32% Cu from 176m including 4m @ 7.68% Cu
from 180m (BCRC0029)3.
The high-grade nature of the intersection is consistent with the
interpreted high-grade core to the mineralisation. Importantly
this hole intersected mineralisation approximately 50m
In the second half of the year, the Company completed
a four-hole, diamond drill program at Blind Calf. Initial
observations from logging of the core highlighted a
highly complex deformed rock package of fine to medium
grained sediments, with brecciated quartz sulphide veining,
boudinage quartz sulphide veining (Figure 4), sulphide
stringer veins and disseminated sulphide throughout the
host sedimentary rock package. These sulphide zones
returned anomalous assay results with the better grades
from the zones of brecciated semi-massive sulphide in
BCDD003 which returned 0.6m @ 5.81% Cu from 165m
within a broader zone of 1.75m @ 2.52% Cu from 165m
down hole4.
2 Refer ASX announcements dated 26 February 2018, 5 July 2018, 30 November 2018 and 9 September 2019 for full details of drill hole intersections.
3 Refer Talisman ASX announcement dated 9 September 2019 for full details including JORC tables.
4 Refer Talisman ASX announcement dated 5 May 2020 for full details including JORC tables.
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re Vi e W oF op e r a t i oN S
Figure 3: Blind Calf-Dunbars long section showing interpreted copper lode system and previously reported Talisman and historic drill holes5
BCDD001 which intersected the Blind Calf structure
some 80-100m below previous intersections, returned an
intersection of 0.6m @ 1.9% Cu from 243m, along with
a number of similar intersections throughout the hole
which correlate with the observed zones of disseminated
and stringer sulphides. These results confirm that the
mineralised Blind Calf host structure continues some
80-100m below previous intersections and remains open
at depth4.
Figure 4: Blind Calf Prospect – BCDD003: Brecciated quartz & semi-massive chalcopyrite sulphide vein
5 Refer ASX announcements dated 26 February 2018, 5 July 2018, 30 November 2018 and 9 September 2019 for full details of drill hole intersections.
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2020 ANNUAL REPORT re Vi e W oF op e r a t i oN S
Blind Calf Regional DHEM Conductors
Talisman identified a series of new downhole
electromagnetic conductive anomalies across the Blind Calf
region as a result of DHEM surveys conducted on RC drilling
completed at the beginning of the financial year6.
This drilling was undertaken to test interpreted potential
parallel lodes proximal to the Blind Calf-Dunbar copper
lode system.
As at the date of this report all five DHEM conductive
anomalies remain untested (Figure 5).
Figure 5: Blind Calf-Dunbars drill collar plan showing position of the completed diamond drill holes, the Long Section positions and the DHEM
target zones for future RC drilling.
6 Refer to ASX announcement dated 9 September 2019 for full details.
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re Vi e W oF op e r a t i oN S
Blind Calf – Alteration Mapping
Initial hyperspectral analysis and litho-geochemical
mapping of the Blind Calf-Dunbars mineralisation has
shown clear metal zonation within the Blind Calf system
which will aid future drill targeting of high-grade areas.
Global Ore Discovery (Brisbane) were engaged during the
year to undertake a detailed examination of the available
geochemical data set for the Blind Calf and Dunbars
deposits focusing on specific alteration mineralogy and
chemistry associated with the copper mineralisation. The
aim of the work was to determine whether alteration and
chemical vectors to high grade mineralisation can be
identified on a prospect scale and, if successful, to use these
vectors to help target deeper zones of mineralisation below
the current Blind Calf-Dunbars mineralised structure and
other parallel mineralised structures to the east and west.
The study has shown that the copper mineralisation is
associated with a distinct metal zonation pattern, with
elevated nickel and cobalt identified up to 40m from the
copper mineralisation and elevated antimony, bismuth,
arsenic and silver identified proximal to the copper
mineralisation (Figure 6). This pattern of subtle metal
zonation will prove highly valuable in directing future drilling
toward higher grade portions of the mineralised structures.
Figure 6: Schematic cross sections illustrating metal and alteration zonation interpreted from Blind Calf RC and diamond drill data.
The outcomes of the initial hyperspectral study of the
localised Blind Calf mineralisation has proven to be highly
encouraging and has provided some clear vectoring tools
for higher grade mineralisation within the system. Further
spectral work will be undertaken in the short to medium
term with the aim of building a three-dimensional alteration
and chemical model.
The findings to date will also be applied more regionally,
with follow-up work to include wider prospect scale
alteration mapping to highlight potential additional copper
lodes. Specifically, spectral alteration mapping will be
reviewed in conjunction with regional DHEM anomalies
identified from previous RC drilling.
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2020 ANNUAL REPORT re Vi e W oF op e r a t i oN S
Harding’s Prospect (EL8547): Gold-in-soils
Gold assay results from geochemical sampling in mid-2019
identified an anomaly at the Harding’s Prospect (Figure 7)
extending over 1km, with a peak assay value of +500ppb
Au (0.5g/t Au) in soils7. Surface verification identified a
sequence of sub-cropping highly altered volcanic rocks,
which are interpreted to represent a continuation of the
Mineral Hill volcanic sequence.
During the financial year a single drill traverse of four
holes for a total of 555m was completed across the peak
of the gold-in-soil anomaly. Drilling encountered siliceous
volcanic tuffaceous rocks with minor thin quartz veining
and sulphides (pyrite) noted on drilling. Results from
assays have shown thin isolated zones of elevated gold
mineralisation with one intersection consistent with the
surface geochemical anomalism. Gold assays returned
were less than 0.5g/t Au and are not considered
significant by Talisman.
Brooklyn-Kaolin Shaft Prospects
(EL8680 & EL8547): Gold-in-soils
Gold assay results from regolith sampling undertaken in
mid-2019 along the southeast extension of the Mineral Hill
Corridor highlighted multiple gold-in-soil anomalies7. The
area contains numerous historic workings and is hosted
by altered volcanic rocks. The Kaolin Shaft and Brooklyn
Prospects were two high-priority drill targets along this
trend (Figure 8 & Figure 9).
One drill traverse at Brooklyn and a single hole at Kaolin
Shaft were completed during the reporting period at
these two areas9. Assay results received from the Brooklyn
Prospect, showed broad zones of low-level gold anomalism
consistent with the surface geochemical anomaly (>0.25g/t
Au) across the western most drill hole, BKRC0001, including
two narrow zones at >0.5g/t Au. BKRC0002 and BKRC0003
did not return any significant results.
Figure 7: Harding’s Prospect RC drill collar location plan8
Figure 8: Brooklyn Prospect RC drill collar location plan8
Assay results from the hole completed at the Kaolin Shaft
Prospect returned elevated base metal (lead and zinc)
anomalism associated with logged base-metal sulphides in
an altered felsic volcanic rock sequence with the best result
being: 2m @ 2.95% Zn from 50m including 1m @ 4.77% Zn
from 50m (KSRC0001)9.
7 Refer Talisman ASX announcement dated 22 July 2019 for full details.
8 Refer to Figure 1 for Tenement details.
9 Refer Talisman ASX announcement dated 24 January 2020 for full details including JORC tables.
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re Vi e W oF op e r a t i oN S
Figure 9: Kaolin Shaft Prospect RC drill collar location plan8
Melrose Prospect (EL8719): Gold-in-soils
Figure 10: Melrose Gold prospect RC drill collar location plan8
Gold assay results from initial sampling conducted in
mid-2019 at the Melrose Prospect identified an anomaly
extending over 1.5km (Figure 10) and returned a peak assay
value of +400ppb Au (0.4g/t Au) in soils. Surface verification
identified a strongly altered gossanous unit and quartz
veining in a sequence of altered volcanic rocks. Further
geochemical sampling extended this geochemical anomaly
from 1.5km to more than 2.8km10.
A total of six RC drill holes for 928m were completed during
the reporting period testing approximately 500m of the
+2.8km strike (Figure 10). Drilling intersected a rock package
exhibiting broad zones of moderate to strong alteration
comprising intercalated felsic volcanics, quartz porphyries
and sediments with varied intensity of quartz veining and
sulphide mineralisation across all completed drill traverses.
Assay results confirmed geological observations, returning
broad low-level gold anomalism with moderate grade
mineralisation associated with zones of more intense
veining. The best result returned was from hole MGRC0004
which returned 1m @ 2.03 g/t Au from 65m9 on the
southern-most line drilled to date.
Joint Ventures
As previously announced to the ASX11, Haverford Holdings Ltd
(Haverford), a 100% owned subsidiary of Talisman, entered
into a Farm-In Agreement with Bacchus Resources Pty Ltd
(Bacchus) over certain Lachlan Project tenements (FIA).
The terms of the FIA were amended by the parties on
18 February 2020 to include a number of clarifications.
In accordance with the terms of the FIA (as amended):
• Haverford was deemed to have earned a 51% interest
in the Bacchus Tenements (EL8547, EL8571, EL8638,
EL8657, EL8658 and EL8680) by sole funding $1.3M of
on-ground exploration expenditure within the required
three-year period;
• Haverford could earn a further 29% interest in the
Bacchus Tenements (being 80% in aggregate) by
incurring a further $0.6M of third-party exploration
expenditure (Second Earn-in Expenditure) between
18 February 2020 and 17 August 2021 (Second Earn-In
Period) on the Bacchus Tenements. If Haverford does
not incur the Second Earn-In Expenditure by the end of
the Second Earn-in Period, Haverford will retain its 51%
interest in the Bacchus Tenements but will not earn any
additional interest;
10 Refer to ASX announcement dated 22 July 2019 for full details.
11 Refer Talisman ASX announcement “Further NSW Gold and Base Metals Tenure Secured” 09 January 2018.
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2020 ANNUAL REPORT re Vi e W oF op e r a t i oN S
• Bacchus is entitled to receive a 20% interest in the
Haverford Tenements (EL8615, EL8659 and EL8677) at
the end of the Second Earn-in Period; and
• at the end of the Second Earn-In Period, a formal joint
venture will be entered into in respect of both the
Bacchus Tenements and the Haverford Tenements
which provides that Bacchus will be free carried for 10%
of its joint venture interest until a decision to mine. Post
a decision to mine, Bacchus can then elect whether to
contribute or not, if Bacchus elects not to contribute,
Haverford shall acquire Bacchus’ interest in the joint
venture for 95% of fair value as agreed by the joint
venture participants or determined by an expert.
During the reporting period Haverford elected to continue
to earn into the Bacchus Tenements to potentially acquire
a further 29% legal and beneficial interest in the Bacchus
Tenements. Regardless of whether Haverford incurs the
Second Earn-In Expenditure, at the end of the Second Earn-
In Period Bacchus is entitled to receive a 20% interest in
certain Haverford Tenements which are included as part of
the Lachlan Project.
Following a review of Lachlan Project tenure during the
reporting period, Haverford relinquished EL8638 and
EL8657.
LUCKNoW GoLD proJeCt
In August 2019 Talisman entered into an exploration
farm-in agreement (EFIA) with privately owned Lucknow
Gold Ltd (Lucknow Gold) in relation to the Lucknow Gold
Project (EL6455) (Figure 11) in New South Wales (Lucknow
Project)12.
The Lucknow Goldfield was discovered in 1851 and was
one of the earliest goldfields to be mined commercially
in Australia. Historic production records at the Lucknow
Project are incomplete, however in excess of 400,000 ounces
of gold was reportedly produced at grades of 100 to 200 g/t
gold13.
Gold mineralisation at Lucknow is intimately associated
with the major NNW trending Lucknow Fault (Figure 11)
which dips 60° to 70° to the northeast. The fault separates
hanging wall serpentinite from the footwall volcanic rocks.
The volcanic rocks of the Oakdale Formation on the footwall
are competent and subject to brittle deformation, whereas
the hanging wall serpentinite is far less competent, and
more subject to ductile deformation.
Figure 11: Lucknow Project tenure.
12 Refer to ASX announcement dated 26 August 2019 for full details.
13 NSW DIGS report, First Annual Exploration Report EL5770, 2001-R00030162.
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It is interpreted that the jog in the Lucknow Fault caused
dilation, and the formation of east-west trending, vertical
fractures in the footwall. These fractures contain the
quartz plus calcite high grade gold bearing veins at the
Lucknow Project. The veins are zoned such that away from
the Lucknow Fault contact they consist of barren quartz,
moving to calcite plus quartz, then calcite only. Historic
gold mineralisation is localised at the intersection of steep
dipping east-west quartz plus pyrite+/-calcite veins, and
the ultramafic-dacite contact along the Lucknow Fault.
The bonanza grade gold mineralisation occurred in steeply
plunging shoots.
During the first half of the financial year, Talisman executed
the necessary land access agreements with key local land
holders for its maiden drill program at the Lucknow Project.
Commencement of drilling was delayed due to the impact
of Covid-19 in early 2020, however following detailed
risk assessment and the implementation of strict safety
guidelines, the Company commenced diamond drilling in
June 2020 to test the interpreted fault off-set position of the
historical gold lodes at Lucknow14 (Figure 12 & Figure 13).
Figure 12: Lucknow Project mine shaft locations and simplified geology.
14 Refer ASX announcement dated 5 June 2020.
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2020 ANNUAL REPORT re Vi e W oF op e r a t i oN S
Figure 13: Lucknow Project interpreted long section, showing the interpreted faulted offset mineralisation target position.
Subsequent to 30 June 2020, the Company completed its
maiden diamond drilling program at the Lucknow Project
targeting the interpreted high-grade lode offset position
of the historical Lucknow gold mine. Assays returned
low-grade gold mineralisation with the mineralised zones
interpreted to represent the more distal extensions of
the main gold lodes. The recent drilling, supported by a
structural and geological interpretation, suggests that the
ultramafic stratigraphy and prospective contact has been
offset to the north-west by a sinistral fault – indicating a
potential target to the north-west of recent drilling.
A review is currently underway to identify potential
future drill targets in the corridor to the north-west
along the Lucknow Fault, where there is evidence of gold
mineralisation in areas of minimal previous exploration.15
Lucknow Project Farm-in Agreement Key Terms
Talisman’s wholly owned subsidiary, Talisman B Pty Ltd
(Talisman B), entered into the EFIA with Lucknow Gold
relating to the Lucknow Project, with Talisman B as the
manager of exploration programs throughout the earn-in
period.
Talisman B has the right to earn up to a 70% interest in
the Lucknow Project, by spending a minimum of $1.5M on
exploration over four years and issuing $0.25M worth of
15 Refer ASX announcement dated 27 August 2020.
Talisman shares (under certain conditions) to Lucknow Gold.
On entering into the EFIA Talisman issued $0.1M worth
of shares to Lucknow Gold (at the 15-day VWAP prior to
entering into the agreement).
Talisman B has a minimum expenditure commitment of
$0.35M (Minimum Expenditure) within the first 12 months.
On satisfying the Minimum Expenditure requirement,
Talisman B can then elect to withdraw or continue to earn-
in to gain a 51% legal and beneficial interest in the Project
by sole funding a further $0.35M (cumulative expenditure
of $0.7M) within the next 12 months (cumulative total 24
months) (First Interest).
During the First Interest earn-in period, Talisman is required to:
• upon Talisman B incurring cumulative EFIA earn-in
expenditure of $0.5M, either pay Lucknow Gold $0.1M in
cash or issue Lucknow Gold with $0.1M worth of shares
(using the 15-day VWAP prior to the date on which the
$0.5M expenditure threshold is met); and
• upon Talisman B incurring cumulative EFIA earn-in
expenditure of $0.65M, either pay Lucknow Gold $0.05M
in cash or issue Lucknow Gold with $0.05M worth of
shares (using the 15-day VWAP prior to the date on
which the $0.65M expenditure threshold is met).
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Should Talisman acquire the First Interest it will have
the option to sole fund a further $0.8M on exploration
expenditure (cumulative expenditure of $1.5M) within a
further 24-month period (cumulative total 48 months) in
order to acquire an additional legal and beneficial interest
of 19% (Second Interest) in the Project, thereby taking its
total interest to 70%.
Talisman can withdraw from the EFIA at any time during
the first 12 months by satisfying the Minimum Expenditure
commitment and anytime thereafter by ensuring the
minimum pro-rata statutory expenditure commitments on
the Lucknow Project tenements have been satisfied.
At any time after Talisman B has earned the First
Interest, Talisman B may elect to form an unincorporated
exploration joint venture (EJV). If Talisman B earns the
Second Interest its participating interest in the EJV will be
70% and Lucknow Gold will be 30%, otherwise it will be
51% and Lucknow Gold will be 49%.
iMpaCt oF CoViD-19
In late March 2020 Talisman temporarily suspended all field
work, including drilling, at its NSW projects in response to
the onset and rapid escalation of the COVID-19 pandemic.
In early April, Talisman implemented the following
temporary changes to ensure the strength of the business:
• Non-Executive Directors took a 50% reduction in their
Director fees and Executive salaries were reduced by
25%; and
• All employees (including Executives) worked from
home on a three or four days work per week basis with
salaries reduced on a pro-rata basis.
In June 2020, following the staged lifting of COVID-19
restrictions across the country, the Company was able
to resume exploration drilling and ongoing business
development activities and implemented the staged lifting
of a number of these measures across a downsized team.
Measures remain in place across the corporate office and
exploration sites to protect the safety and well-being of
all our employees and contractors during the evolving
COVID-19 pandemic.
SiNCLair NiCKeL proJeCt
On 27 September 2019 Talisman executed a binding
share sale agreement to divest its Sinclair Nickel Project
in Western Australia (Sinclair) to Saracen Nickel Pty Ltd,
a wholly owned subsidiary of Saracen Mineral Holdings
Ltd (Saracen) (the Transaction)16. The Transaction
was implemented by way of a sale of all of the shares
in Talisman Nickel Pty Ltd (Talisman Nickel) and was
successfully completed on the 11th October 201917.
At completion the Transaction provided Talisman with
cash consideration of $10 million and an additional post-
completion working capital adjustment of $0.4 million. The
Transaction also provided Talisman with a 2% Net Smelter
Return royalty applicable to any future metal production
from the Sinclair tenements; and any future non-precious
metal production from Saracen’s Waterloo Nickel Project
(which is currently on care and maintenance).
Completion of the Transaction also removed annual holding
costs (excluding discretionary exploration expenses) of
approximately $2 million. Further, by acquiring all of the
shares in Talisman Nickel, Saracen assumed Talisman
Nickel’s obligation to make a conditional $2 million deferred
payment to Xstrata Nickel Australasia Operations Pty Ltd
(payable within six months should production of nickel
products at Sinclair recommence by 4 February 2021) and
Talisman Nickel’s contingent environmental liability for
Sinclair of $9 million (as at 30 June 2019).
Competent Persons’ Statement
Information in this report that relates to Exploration Results
and Exploration Targets is based on information completed
by Mr Donald Huntly, who is a member of the Australasian
Institute of Geoscientists. Mr Huntly is a full-time employee
of Talisman Mining Ltd and has sufficient experience
which is relevant to the style of mineralisation and types
of deposits under consideration and to the activities
undertaken to qualify as a Competent Person as defined in
the 2012 Edition of the “Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves”.
Mr Huntly consents to the inclusion in this report of the
matters based on information in the form and context in
which it appears.
No new information that is considered material is included
in this document. All information relating to exploration
results has been previously released to the market and is
appropriately referenced in this document. JORC tables are
not considered necessary to accompany this document.
16 Refer to ASX announcement dated 27 September 2019 for full details.
17 Refer to ASX announcement dated 11 October 2019 for full details.
15
2020 ANNUAL REPORT re Vi e W oF op e r a t i oN S
Forward-Looking Statements
This report may include forward-looking statements.
These forward-looking statements are not historical facts
but rather are based on Talisman Mining Ltd.’s current
expectations, estimates and assumptions about the
industry in which Talisman Mining Ltd operates, and beliefs
and assumptions regarding Talisman Mining Ltd.’s future
performance. Words such as “anticipates”, “expects”,
“intends”, “plans”, “believes”, “seeks”, “estimates”,
“potential” and similar expressions are intended to identify
forward-looking statements. Forward-looking statements
are only predictions and are not guaranteed, and they are
subject to known and unknown risks, uncertainties and
assumptions, some of which are outside the control of
Talisman Mining Ltd. Past performance is not necessarily
a guide to future performance and no representation or
warranty is made as to the likelihood of achievement or
reasonableness of any forward-looking statements or other
forecast. Actual values, results or events may be materially
different to those expressed or implied in this presentation.
Given these uncertainties, recipients are cautioned not to
place reliance on forward looking statements. Any forward-
looking statements in this announcement speak only at
the date of issue of this announcement. Subject to any
continuing obligations under applicable law and the ASX
Listing Rules, Talisman Mining Ltd does not undertake any
obligation to update or revise any information or any of the
forward looking statements in this announcement or any
changes in events, conditions or circumstances on which
any such forward looking statement is based.
teNeMeNt SCHeDULe
As at date of report
Project /
Tenement
Location and
Blocks
(Area)
LACHLAN PROJECT
NSW
Tenement
Status
Talisman
Equity (%)
Expiry Date
Joint Venture Partner /
Farm-In Party
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
100%
100%
100%
0%
51%
51%
51%
51%
100%
100%
07-07-23
18-10-23
08-12-23
02-12-24
03-04-22
23-05-22
13-10-22
08-12-22
27-03-24
27-03-24
Bacchus Resources Pty Ltd
(right to 20% interest)
Peel Mining Ltd
(TLM earning up to 75%)
Bacchus Resources Pty Ltd
(TLM earning up to 80%)
N/A
(726km2)
(373km2)
(193km2)
(174km2)
(205km2)
(258km2)
(256km2)
(20km2)
(86km2)
(191km2)
NSW
EL8615
EL8659
EL8677
EL8414
EL8547
EL8571
EL8658
EL8680
EL8718
EL8719
OTHER
EL8451
(276km2)
Granted
0%
16-07-25
Peel Mining Ltd
(TLM earning up to 75%)
EL 8977
(463km2)
Granted
100%
11-05-23
N/A
LUCKNOW PROJECT
NSW
EL6455
(29km2)
Granted
0%
28-08-21
Lucknow Gold Ltd (TLM
earning up to 70%)
16
re Vi e W oF op e r a t i oN S
Corporate GoVerNaNCe
StateMeNt
The Company’s Corporate Governance Statement can be
found on the Company’s website at www.talismanmining.
com.au/about-us/corporate-governance.html under the
heading marked “Corporate Governance Statement”.
The following governance-related documents can also be
found on the Company’s website:
Charters
• Board
• Audit Committee
• Nomination Committee
• Remuneration Committee
• Risk Committee
Constitution
• Constitution of Talisman Mining Limited
Board
• Code of Conduct – summary
• Policy and Procedure for the Selection and (Re)
Appointment of Directors
• Process for Performance Evaluation
Compliance, Controls and Policies
• Risk Management Policy – summary
• Continuous Disclosure Policy – summary
• Securities Trading Policy
• Diversity Policy
• Remuneration Policy
Shareholder Communication
• Shareholder Communication and Investor Relations Policy
17
2020 ANNUAL REPORT DireCtorS’
REPORT
Your Directors present their report together with the
financial statements of the Group consisting of Talisman
Mining Limited and the entities it controlled for the financial
year ended 30 June 2020. In order to comply with the
provisions of the Corporations Act 2001, the Directors report
as follows:
DireCtorS
The names of Directors who held office during or since
the end of the year and until the date of this report are as
follows. Directors were in office for this entire period unless
otherwise stated.
Kerry Harmanis
Non-Executive Chairman
15 July 2020 - current
Chairman (non-Executive/Non-Independent)
Kerry Harmanis joined the Talisman board on 15 July
2020 and is one of Western Australia’s most successful
mining executives and investors. Kerry has been a major
shareholder and strong supporter of Talisman since 2007
and currently holds an 18% stake in the Company.
With a career spanning more than 40 years in the
Australian exploration and mining industry, Kerry was the
founder and Executive Chairman of Jubilee Mines NL, a
highly successful West Australian nickel miner which he
established in 1987.
Through a combination of exploration success, focused
project development and operational consistency, Jubilee
Mines grew to become one of the most successful mid-tier
miners on the ASX until its acquisition by Xstrata for A$3.1
billion in October 2007.
During this period, Kerry led a highly successful geological
and operational team which helped Jubilee set new
benchmarks on the ASX for shareholder returns in the
resource sector.
In the 3 years immediately before the end of the financial
year, Kerry did not serve as a Director of any other ASX
listed entities.
Daniel Madden
BComACC, ACA, Governance Institute of Australia
Managing Director
1 July 2016 – 1 September 2020
Non-Executive Director
2 September 2020 - current
Managing Director (Executive/Non-Independent)
Dan Madden was appointed as Managing Director on 1 July
2016 and has been with Talisman since 2009 in his previous
roles as Chief Financial Officer and Company Secretary. Dan
has more than 17 years’ experience in the resource sector,
including Xstrata Nickel Australasia, Jubilee Mines NL and
Perilya Ltd.
He graduated from the University of Birmingham with a
degree in Commerce and Accounting before joining Deloitte
in the UK and Australia. He is an Associate Member of the
Institute of Chartered Accountants of England and Wales
and a member of the Governance Institute of Australia.
In the 3 years immediately before the end of the financial
year, Dan did not serve as a Director of any other ASX
listed entities.
Dan resigned as Managing Director on 1 September
2020, however remains as a Non-Executive director of the
Company.
Jeremy Kirkwood
BCom ANU
Non-Executive Director
15 July 2020 – current
Non-Executive Chairman
April 2016 – 15 July 2020
Non-Executive Director (Independent)
Jeremy Kirkwood joined Talisman in April 2016 and has
extensive experience in corporate strategy, investment
banking and global capital markets and provides invaluable
strategic input and guidance to the Company’s board and
management team.
Jeremy is a principal of Pilot Advisory Group and was
previously a Managing Director at Credit Suisse, Morgan
Stanley and Austock. He has primarily worked in public
markets, undertaking merger and acquisitions and capital
raisings for companies principally in the metal and mining,
energy and infrastructure sectors.
18
D i r e C t o r S' re p o r t
In the 3 years immediately before the end of the financial
year, Jeremy joined Joyce Corporation Ltd (ASX:JYC) as a
Non-Executive Director on 14 January 2020. In February
2018 he was appointed as the Chairman of Kin Mining Ltd
(ASX: KIN) where he remained until his resignation on 24
July 2019. Jeremy also served as a Director of ASX listed
Zenitas Ltd (ASX: ZNT) from April 2016, resigning on 5 March
2018.
Jeremy serves on the Company’s Audit, Nomination and
Remuneration Committees. With extensive industry
experience, Jeremy is considered qualified to hold these
responsibilities.
She worked as an Executive for North Ltd throughout
Australia for 13 years including at Robe River Iron
Associates and Energy Resources of Australia Ltd.
In the 3 years immediately before the end of the financial
year, Karen has served as a non-executive director of Joyce
Corporation Ltd since 1 July 2017.
Karen is the Chair of the Audit Committee and a member
of the Nomination and Remuneration Committees. With
her extensive experience in finance and having chaired a
number of Audit Committees, Karen is considered qualified
to hold these responsibilities.
Peter Benjamin
B.Sc. (Hons), Grad Dip (Exploration), (Bus Admin), GAICD,
MAusIMM, FFAIM
Non-Executive Director
24 July 2019 - current
Non-Executive Director (Independent)
Peter is a geologist with over 40 years’ experience in
senior exploration, project, operational and executive
management roles for both junior and mid-tier resource
companies. These roles have included significant experience
in the development and subsequent operations for open pit
and underground precious, base metal and bulk mineral
mines throughout Australia. Peter has extensive experience
in managing and implementing exploration strategies
which have led to the successful and ongoing discoveries
and delineation of new mineral resources and ore reserves.
Peter has previously held senior management roles at
Iluka Resources Limited, Shaw River Manganese Ltd and
Kalamazoo Resources Limited. Peter is now a consultant for
the resources industry, mainly focusing on gold, base metals
and mineral sands.
In the 3 years immediately before the end of the financial
year, Peter was managing director at Kalamazoo Resources
Ltd (ASX: KZR) from July 2017 until his resignation in
July 2018. He also served as a non-executive director of
Capricorn Resources Limited (ASX: CMM) from November
2018 to March 2019.
Peter is a member of the Audit, Nomination and
Remuneration Committees. With his extensive geological
and senior exploration management experience, Peter is
considered qualified to hold these responsibilities.
Brian Dawes
B. Sc. Mining, MAusIMM
Non-Executive Director
17 June 2009 – current
Non-Executive Director (Independent)
Brian is a mining engineer with extensive international
mining industry experience. He holds a BSc in Mining
from the University of Leeds in the United Kingdom and
is Member of the Australasian Institute of Mining and
Metallurgy.
Brian’s diverse expertise covers all key industry aspects
from exploration through the discovery, feasibility, funding,
approvals, project construction, commissioning, operations,
optimisation, logistics, marketing, and closure phases. This
includes site management and corporate responsibilities
in a diversity of challenging and successful underground
and open pit operations across many commodities and
geographies; mainly in copper, gold, nickel, zinc and lead,
and iron ore. Prior to joining Talisman, Brian held senior
positions with Jubilee Mines NL, Western Areas, LionOre
Australia, WMC, Normandy Mining, and Aberfoyle.
In the 3 years immediately before the end of the financial
year, Brian has served as a non-executive director of Kin
Mining Ltd (ASX: KIN) since 20 February 2018.
Brian serves on the Company’s Audit, Nomination and
Remuneration Committees. With extensive industry
experience and being financially literate, Brian is considered
qualified to hold these responsibilities.
Karen Gadsby
B. Comm., FCA, MAICD
Non-Executive Director
3 April 2008 - current
Non-Executive Director (Independent)
Karen is a professional Non-Executive Director with over
30 years’ finance and commercial experience across
several sectors.
19
2020 ANNUAL REPORT D i r e C t o r S' re p o r t
CoMpaNy SeCretarieS
priNCipaL aCtiVitieS
Alex Neuling
BSc, FCA (ICAEW), FCIS
Co-Company Secretary
1 May 2016 - current
Company Secretary
Alex Neuling is a Chartered Accountant and Chartered
Secretary with extensive corporate and financial experience
including as Director, Chief Financial Officer and / or
Company Secretary of various ASX-listed companies in the
mining, mineral exploration, oil & gas and other sectors.
Prior to those roles, Alex worked at Deloitte in London
and Perth. Alex also holds an honours degree in chemistry
from the University of Leeds in the United Kingdom and is
principal of Erasmus Consulting which provides company
secretarial and financial management consultancy services
to a variety of ASX-listed and other companies.
Shaun Vokes
BBus, CPA
Chief Financial Officer and Co-Company Secretary
1 May 2016 – 30 April 2020
Interim Chief Executive Officer
2 September 2020 - current
Chief Financial Officer and Co-Company Secretary
(ceased 30 April 2020)
Interim Chief Executive Officer (Appointed 2 September
2020)
Shaun joined Talisman in February 2016. He is a finance
professional with over 27 years’ experience in the
metalliferous resources industry gained predominantly in
senior operational and management roles within Australia
and Africa.
Prior to joining Talisman, Shaun spent five years as Manager,
Business Services/CFO for Kabanga Nickel Company Ltd in
Tanzania. Shaun’s experience includes project evaluation
and financing, business development, contract negotiation,
metals marketing, risk management and corporate and
financial governance for both private and ASX-listed entities
across a range of base and precious metals.
Shaun is a graduate of Curtin University and holds a
Bachelor of Business degree and is a member of the
Australian Society of Certified Practicing Accountants.
The principal activity of Talisman Mining Limited during the
course of the financial year was exploration for base metals
and other minerals, including copper, copper-gold, gold and
nickel.
reVieW oF operatioNS aND
FUtUre DeVeLopMeNtS
A detailed review of operations during the financial year
and commentary on future developments is set out in the
section titled “Review of Operations” in this Annual Report.
DiViDeNDS
The Directors resolved that no dividend be paid for the year.
A special dividend of 6.375 cents per share franked to 100%
was paid in the previous financial year.
FiNaNCiaL perForMaNCe aND
FiNaNCiaL poSitioN
Financial performance
During the financial year, the Group reported an operating
loss after tax of $4.8 million (2019: profit after tax $46.2
million). The Group reported an operating loss after tax
from continuing operations of $7.5 million (2019: loss after
tax $6.7 million).
Revenue for the year of $0.2 million (2019: $0.4 million)
consisted primarily of bank interest earned on the Group’s
short-term deposits held during the year.
During the financial year the Company completed a Share
Sale Agreement with Saracen Nickel Pty Ltd, a wholly owned
subsidiary of Saracen Mineral Holdings Ltd to divest its
Sinclair Nickel Project in Western Australia resulting in a
profit after tax from discontinued operations of $2.7 million.
Financial position
As at 30 June 2020, the Group had net assets of $13.3
million (2019: $17.4 million) including $12.9 million of cash
and cash equivalents (2019: $10.6 million).
20
Di r e C t o r S ' r e p o r t
SUbSeQUeNt eVeNtS
DireCtorS’ MeetiNGS
Mr Kerry Harmanis was appointed as non-executive
Chairman of the Company on 15 July 2020. Mr Harmanis
succeeded previous chair Jeremy Kirkwood, who remains on
the board of the Company as a Non-Executive Director.
Mr Dan Madden resigned as Managing Director on 1
September 2020, however, remains on the board of the
Company as a Non-Executive Director.
Mr Shaun Vokes was appointed as interim Chief Executive
Officer of the Company on 2 September 2020.
The following table sets out the number of Directors’
meetings (including meetings of committees of Directors)
held during the financial year and the number of meetings
attended by each director (while they were a director or
committee member). During the financial year, twelve board
meetings, two audit committee meetings, one renumeration
committee meeting and one nomination committee
meeting were held.
Board of directors
Audit committee
Remuneration
committee
Nomination
committee
Directors
Eligible to
attend
Attended
Eligible to
attend
Attended
Eligible to
attend
Attended
Eligible to
attend
Attended
Kerry Harmanis
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Jeremy Kirkwood
Daniel Madden
Brian Dawes
Karen Gadsby
Peter Benjamin
12
12
12
12
12
12
12
12
12
12
2
2
2
2
2
2
2
2
2
2
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Note: Executive Directors attending committee meetings during the year attended all or part of the meeting by invitation of the relevant Committee.
DireCtorS’ SHareHoLDiNGS
The following table sets out each Director’s relevant interest in shares, and options in shares of the Company or a related body
corporate as at the date of this report:
Directors
Kerry Harmanis
Jeremy Kirkwood
Daniel Madden
Brian Dawes
Karen Gadsby
Peter Benjamin
Fully paid ordinary shares
Number
Share Options
Number
33,859,138
419,000
50,000
353,333
311,334
101,093
-
2,500,000
7,500,000
1,750,000
1,750,000
1,750,000
21
2020 ANNUAL REPORT
Di r e C t o r S ' r e p o r t
SHare optioNS
Share options granted to Directors and key management personnel
At the date of this report, share options granted to the Directors and key management personnel of the Company and the
entities it controlled as part of their remuneration are:
Directors and senior management
Number of
options granted
Issuing Entity
Number of ordinary
shares under option
Kerry Harmanis
Jeremy Kirkwood
Daniel Madden
Brian Dawes
Karen Gadsby
Peter Benjamin
-
N/A
2,500,000
Talisman Mining Limited
7,500,000
Talisman Mining Limited
1,750,000
Talisman Mining Limited
1,750,000
Talisman Mining Limited
1,750,000
Talisman Mining Limited
-
2,500,000
7,500,000
1,750,000
1,750,000
1,750,000
Details of all unissued shares or interests under option as at the date of this report are:
Issuing entity
Grant Date
Expiry date
of options
Number of
shares under
option
Exercise
price of
options
Fair
Value
Vested
Date
Talisman Mining Limited
11-Nov-16
31-Oct-21
Talisman Mining Limited
11-Nov-16
31-Oct-21
40,000
40,000
$0.46
$0.32
30-Jun-19
$0.50
$0.32
30-Jun-20
Talisman Mining Limited
7-May-19
31-Oct-20
2,500,002
$0.14
$0.03
31-Oct-19
Talisman Mining Limited
27-Nov-19
31-Oct-20
194,444
$0.14
$0.02
30-May-20
Talisman Mining Limited
7-May-19
31-Oct-20
2,500,001
$0.16
$0.03
31-Oct-19
Talisman Mining Limited
27-Nov-19
31-Oct-20
194,444
$0.16
$0.02
30-May-20
Talisman Mining Limited
7-May-19
31-Oct-20
2,500,000
$0.18
$0.02
31-Oct-19
Talisman Mining Limited
27-Nov-19
31-Oct-20
194,444
$0.18
$0.02
30-May-20
Talisman Mining Limited
7-May-19
31-Oct-21
2,500,002
$0.14
$0.04
30-Apr-20
Talisman Mining Limited
27-Nov-19
31-Oct-21
194,444
$0.14
$0.03
30-Nov-20
Talisman Mining Limited
7-May-19
31-Oct-21
2,499,999
$0.16
$0.04
30-Apr-20
Talisman Mining Limited
27-Nov-19
31-Oct-21
194,444
$0.16
$0.03
30-Nov-20
Talisman Mining Limited
7-May-19
31-Oct-21
2,499,998
$0.18
$0.04
31-Oct-20
Talisman Mining Limited
27-Nov-19
31-Oct-21
194,444
$0.18
$0.03
30-Nov-20
Talisman Mining Limited
7-May-19
31-Oct-22
2,194,447
$0.14
$0.05
31-Oct-20
Talisman Mining Limited
27-Nov-19
31-Oct-22
194,444
$0.14
$0.04
30-May-21
Talisman Mining Limited
7-May-19
31-Oct-22
2,194,443
$0.16
$0.05
31-Oct-20
Talisman Mining Limited
27-Nov-19
31-Oct-22
194,444
$0.16
$0.04
30-May-21
Talisman Mining Limited
7-May-19
31-Oct-22
2,194,442
$0.18
$0.04
31-Oct-20
Talisman Mining Limited
27-Nov-19
31-Oct-22
194,448
$0.18
$0.04
30-May-21
The holders of these options do not have the right, by virtue of the option, to participate in any share issue or interest issue of
any other body corporate or registered scheme.
22
Di r e C t o r S ' r e p o r t
reMUNeratioN report
aUDitor iNDepeNDeNCe
The Remuneration Report, which forms part of the Directors’
report, outlines the remuneration arrangements in place for
the Key Management Personnel of Talisman Mining Limited
for the financial year ended 30 June 2020 and is included on
page 24.
Section 307C of the Corporations Act 2001 requires our
auditors, HLB Mann Judd, to provide the Directors of the
Company with an Independence Declaration in relation
to the audit of the annual report. This Independence
Declaration is set out on page 31 and forms part of this
Directors’ report for the year ended 30 June 2020.
proCeeDiNGS oN beHaLF oF tHe
CoMpaNy
No person has applied for leave of court to bring
proceedings on behalf of the Company or 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.
roUNDiNG oFF oF aMoUNtS
The Company has applied the relief available to it in ASIC
Legislative Instrument 2016/91, and accordingly certain
amounts included in this report and in the financial report
have been rounded off to the nearest $1,000 (where
rounding is applicable), under the option available to the
Company under ASIC Corporations (Rounding in Financial/
Directors’ Reports) Instrument 2016/191. The Company is
an entity to which this instrument applies.
eNViroNMeNtaL reGULatioNS
The Group’s environmental obligations are regulated
under both State and Federal legislation. Performance
with respect to environmental obligations is monitored by
the Board of Directors and subjected from time to time
to government agency audits and site inspections. No
significant or material environmental breaches have been
notified by any government agency during the year ended
30 June 2020.
iNDeMNiFiCatioN oF oFFiCerS
aND aUDitorS
The Company has agreed to indemnify all the Directors of
the Company for any liabilities to another person (other
than the Company or related body corporate) that may
arise from their position as Directors of the Company and
its controlled entities, except where the liability arises out of
conduct involving a lack of good faith.
During the financial year the Company paid a premium in
respect of a contract insuring the Directors and officers of
the Company and its controlled entities against any liability
incurred in the course of their duties to the extent permitted
by the Corporations Act 2001. The contract of insurance
prohibits disclosure of the nature of the liability and the
amount of the premium.
NoN-aUDit SerViCeS
Details of amounts paid or payable to the auditor for
non-audit services provided during the year by the auditor
are outlined in Note 25 to the financial statements. The
Directors are satisfied that the provision of non-audit
services is compatible with the general standard of
independence for auditors imposed by the Corporations
Act 2001.
The Directors are of the opinion that the services do not
compromise the auditor’s independence as all non-audit
services have been reviewed to ensure that they do not
impact the impartiality and objectivity of the auditor and
none of the services undermine the general principles
relating to auditor independence as set out in Code
of Conduct APES 110 Code of Ethics for Professional
Accountants issued by the Accounting Professional & Ethical
Standards Board.
23
2020 ANNUAL REPORT reMUNeratioN
REPORT
This report, which forms part of the Directors’ report,
outlines the remuneration arrangements in place for the
Key Management Personnel of Talisman Mining Limited for
the year ended 30 June 2020. The information provided in
this remuneration report has been audited as required by
Section 308(3C) of the Corporations Act 2001.
The Remuneration Report details the remuneration
arrangements for Key Management Personnel who are
defined as those persons having authority and responsibility
for planning, directing and controlling the major activities
of the Group, directly or indirectly, including any Director
(whether executive or otherwise) of the Group.
Key MaNaGeMeNt perSoNNeL
DetaiLS
The key management personnel of Talisman Mining Limited
during the year were:
Directors
Kerry Harmanis
Jeremy Kirkwood
Daniel Madden
Non-Executive Chairman
(Appointed 15 July 2020)
Non-Executive Chairman
(Resigned as Chairman
15 July 2020)
Managing Director
(Resigned as Managing
Director on 1 September 2020,
remains as a Non-Executive
Director)
Brian Dawes
Non-Executive Director
Karen Gadsby
Non-Executive Director
Peter Benjamin
Non-Executive Director
(Appointed 24 July 2019)
Other Key Management
Anthony Greenaway
General Manager – Geology
(Ceased 7 August 2020)
Shaun Vokes
Shaun Vokes
Chief Financial Officer/
Co-Company Secretary
(Ceased 30 April 2020)
Interim Chief Executive Officer
(Appointed 2 September 2020)
Except as noted, the named persons held their current
positions for the whole of the financial year and since the
financial year end.
Key MaNaGeMeNt perSoNNeL
(eXCLUDiNG NoN-eXeCUtiVe
DireCtorS)
The Board is responsible for determining the remuneration
policies for the Group, including those affecting Executive
Directors and other key management personnel. The
Board may seek appropriate external advice to assist in its
decision making.
The Company’s remuneration policy for Executive Directors
and key management personnel is designed to promote
superior performance and long-term commitment to the
Group. The main principles of the policy when considering
remuneration are as follows:
• Executive Directors and key management personnel are
motivated to pursue long term growth and success of
the Group within an appropriate control framework;
•
•
interests of key leadership are aligned with the long-
term interests of the Company’s shareholders; and
there is a clear correlation between performance and
remuneration.
The remuneration policy for Executive Directors and other
key management personnel has three main components,
fixed remuneration, long term incentive and a potential
discretionary bonus.
Fixed remuneration
Fixed remuneration is reviewed annually by the
Remuneration Committee. The process consists of a review
of relevant comparative remuneration in the market and
internally and, where appropriate, external advice on
policies and practices. The Remuneration Committee has
access to external, independent advice where necessary.
Executive Directors and other key management personnel
are given the opportunity to receive their fixed (primary)
remuneration in a variety of forms including cash and fringe
benefits such as motor vehicles and expense payment
plans. It is intended that the manner of payment chosen will
be optimal for the recipient without creating undue cost for
the Group. The fixed remuneration component is detailed in
the remuneration for key management personnel tables for
the years ended 30 June 2020 and 30 June 2019.
24
r eM U Ne r a t i oN r e p o r t
Non-Executive Directors may also receive share options where
this is considered appropriate by the Board as a whole and
with regard to the stage of the Group’s development. Such
options vest across the life of the option and are primarily
designed to provide an incentive to Non-Executive Directors
to remain with the Group. Options issued to Non-Executive
Directors are subject to shareholder approval.
A Non-Executive Directors’ fee pool limit of $300,000 per
annum was originally approved by the shareholders at the
General Meeting on 19 May 2008 and re-approved at the
30 June 2016 General Meeting. For the financial year ended
30 June 2020, this pool was utilised to a level of $227,350
(inclusive of superannuation). The fee paid for the 2020
financial year to the Chairman was $80,000 per annum and
for the Non-Executive Directors $50,000 per annum (excluding
statutory superannuation) except as noted below.
teMporary CHaNGeS
DUe to CoViD-19
On 2 April 2020, the Group announced that following the
suspension of field work due to the COVID-19 pandemic,
all non-executive directors would take a temporary 50%
reduction in their director fees and executive salaries would be
reduced by 25%. On 2 June 2020, the Group announced that
as drilling and ongoing business activities had resumed, the
temporary reductions would no longer be in place.
Long term incentives
To align the interests of key management personnel with the
long-term objectives of the Group and its shareholders, the
Group’s policy, having regard to the stage of development
of its assets, is to issue share options under the shareholder
approved ‘Executive and Employee Equity Plan’ (EEEP) and at
the discretion of the Board, subject to shareholder approval
for Directors. The issue of share options as remuneration
represents cost effective consideration to Directors and
key management personnel for their commitment and
contribution to the Group and are used as a strategic tool
to recruit and retain high calibre personnel. Options issued
during the year vest at various periods during the life of
the options and value is only realised by Directors and key
management personnel upon growth at various premiums
to the 5-day volume weighted share of the Company’s share
price from the date of the grant of the options.
Vesting conditions relating to the performance of the Group
are not considered appropriate having regard to the stage of
development of the Group’s assets.
Potential discretionary bonus
A potential discretionary bonus may be paid to Executive
Directors and other key management personnel. Any
potential bonus paid is at the discretion of the Remuneration
Committee and will typically be made in recognition of
contribution to the Group’s performance and other significant
efforts of Executive Directors and key management personnel
in applicable and appropriate circumstances. For the financial
year ended 30 June 2020, the Remuneration Committee
recommended bonuses totalling $25,000 be paid to one key
management personnel.
NoN-eXeCUtiVe DireCtorS
The Group’s Non-Executive Directors receive fees (including
statutory superannuation) for their services and the
reimbursement of reasonable expenses. The fees paid to
the Group’s Non-Executive Directors reflect the demands on,
and responsibilities of, the Directors. They do not receive any
retirement benefits (other than compulsory superannuation).
The Board decides annually the level of fees to be paid to Non-
Executive Directors with reference to market standards.
25
2020 ANNUAL REPORT r eM U Ne r a t i oN r e p o r t
Key terMS oF eMpLoyMeNt CoNtraCtS
Remuneration and other terms of employment of Directors and key management personnel are formalised in an employment
contract. The major provisions of the agreements related to the remuneration as at balance date are set out below.
Key Management
Personnel
Daniel Madden
Term of Agreement
Key Agreement Terms
Ongoing employment
agreement (ceased
employment as
Managing Director 1
September 2020)
Payment of a termination benefit on early termination by the
Group (other than for gross misconduct) at the end of the notice
period, is three months’ base salary. Where the Group elects to
dispense with the notice period and terminate employment, six
months’ base salary applies.
Notice
Period
3 months
Shaun Vokes
Ongoing employment
agreement (ceased
employment 30 April
2020)
Anthony Greenaway Ongoing employment
agreement (ceased
employment 7
August 2020)
Termination benefit payable on early termination by the Group
(other than for gross misconduct) is equal to three months’ base
salary.
3 months
Termination benefit payable on early termination by the Group
(other than for gross misconduct) is equal to one months’ base
salary.
1 month
Remuneration for Executive Directors and key management personnel consists of a base salary, superannuation and
performance incentives. Long term performance incentives may include options granted at the discretion of the Board
subject to obtaining the relevant approvals. The remuneration of the Managing Director is recommended to the Board by the
Remuneration Committee. Remuneration of key management personnel (excluding Non-Executive Directors) is recommended
annually by the Remuneration Committee in consultation with the Managing Director or equivalent.
26
r eM U Ne r a t i oN r e p o r t
reMUNeratioN oF Key MaNaGeMeNt perSoNNeL
Details of the nature and amount of each element of the remuneration for key management personnel during the year are set
out in the following tables:
Short-term employee benefits
Post-employment
benefits
Share-based
payment
Total
Salary
& fees
Bonus
Non-
monetary
Super-
annuation
$
$
$
$
Long
service
leave
accrual
Options (vi)
% of
compensation
linked to
performance
$
$
%
2020
Directors
Jeremy Kirkwood
73,333
Daniel Madden(i)
336,428
Brian Dawes
Karen Gadsby
Peter Benjamin (ii)
45,834
45,834
42,625
-
-
-
-
-
Executives
Shaun Vokes(iii)
356,904
25,000
Anthony Greenaway(iv)
264,047
-
-
6,967
67,813
148,113
20,200
31,961
15,455
203,444
607,488
47,470
97,658
47,470
97,658
31,016
77,690
$
-
-
-
-
-
-
4,354
4,354
4,049
28,869
25,084
-
-
-
-
-
1,165,005
25,000
20,200
105,638
15,455
528,482
1,859,780
2019
Directors
Jeremy Kirkwood
80,000
-
-
7,600
-
45,295
132,895
Daniel Madden
350,000
25,000
20,819
35,625
5,834
165,745
603,023
63,456
474,229
67,813
356,944
13.38%
19.00%
20,833
50,000
50,000
-
-
-
Alan Senior (v)
Brian Dawes
Karen Gadsby
Executives
Shaun Vokes
265,000
10,000
Anthony Greenaway(iv)
275,000
-
-
-
-
-
-
1,979
4,750
4,750
26,125
26,125
-
-
-
-
-
10,150
32,962
31,562
86,312
31,562
86,312
56,222
357,347
56,222
357,347
18.53%
15.73%
1,090,833
35,000
20,819
106,954
5,834
396,758
1,656,198
(i) Ceased employment as Managing director 1 September 2020, currently still a non-executive director.
(ii) Peter Benjamin was appointed as a Non-Executive Director on 24 July 2019.
(iii) Ceased employment 30 April 2020. Salary and fees include termination payments. Appointed as interim Chief Executive Officer 2 September 2020.
(iv) Ceased employment 7 August 2020.
(v) Alan Senior retired as a Non-Executive Director on 30 November 2018.
(vi) The value of share-based payments shown in the table are non-cash values based on an accounting valuation calculated under the Black Scholes option pricing
method. The values above represent the accounting expense recorded over the vesting period of the options. The options were granted in the 2017 and 2019
financial years, with the exception of options granted to Peter Benjamin in November 2019.
27
45.78%
33.49%
48.61%
48.61%
39.92%
34.08%
31.63%
30.79%
36.57%
36.57%
2020 ANNUAL REPORT
r eM U Ne r a t i oN r e p o r t
SHare-baSeD reMUNeratioN GraNteD aS CoMpeNSatioN
Options granted to directors during the financial year were approved by shareholders at the Annual General Meeting of the
Company on 26 November 2019. For details of share-based payments granted during the year refer to Note 19.
Name
During the financial year
Number
granted
Number
vested and
exercisable
% of grant
vested
% of grant
forfeited
% of compensation
for the year
consisting of
options
Peter Benjamin
1,750,000
583,332
33%
0%
39.92%
(i)
The value of options granted during the period is recognised in compensation over the vesting period of the grant, in accordance with Australian accounting
standards.
eXerCiSeD
No options granted as compensation in the current and/or prior year were exercised.
ForFeiteD / LapSeD / CaNCeLLeD DUriNG tHe year
Number granted
Shaun Vokes
Number forfeited/lapsed/
cancelled during the year
Financial Year Granted
833,333
FY18/19
28
r eM U Ne r a t i oN r e p o r t
otHer iNForMatioN
Shares held by Key Management Personnel
Opening
balance at
1 July
Shares received
on exercise of
options
Net other
change
Balance on
resignation
Closing
balance at
30 June
Balance held
nominally
Number
Number
Number
Number
Number
Number
-
-
-
-
101,093
-
-
N/A
N/A
N/A
N/A
N/A
N/A
N/A
419,000
50,000
353,333
311,334
101,093
-
-
-
-
20,000
66,667
-
-
-
101,093
-
1,234,760
86,667
-
-
-
-
-
-
-
-
N/A
419,000
(116,666)
-
50,000
353,333
311,334
-
-
-
20,000
66,667
-
-
-
-
(116,666)
1,133,667
86,667
N/A
N/A
N/A
N/A
N/A
2020
Directors
Jeremy Kirkwood
Daniel Madden
Brian Dawes
Karen Gadsby
Peter Benjamin
Executives
Shaun Vokes
Anthony Greenaway
2019
Directors
Jeremy Kirkwood
Alan Senior
Daniel Madden
Brian Dawes
Karen Gadsby
Executives
Shaun Vokes
Anthony Greenaway
419,000
50,000
353,333
311,334
-
-
-
1,133,667
419,000
116,666
50,000
353,333
311,334
-
-
1,250,333
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
29
2020 ANNUAL REPORT
r eM U Ne r a t i oN r e p o r t
Options held by Key Management Personnel
Opening
Options
Lapsed /
Closing
Vested
Vested
Vested and
balance at
Granted as
Options
Cancelled /
Balance on
balance at
but not
during the
exercisable
1 July
remuneration
Exercised
Forfeited
resignation
30 June
exercisable
year
at 30 June
Number
Number
Number
Number
Number
Number
Number
Number
Number
2020
Directors
Jeremy Kirkwood
2,500,000
Daniel Madden
7,500,000
Brian Dawes
1,750,000
Karen Gadsby
1,750,000
-
-
-
-
Peter Benjamin
-
1,750,000
Executives
Shaun Vokes
2,500,000
Anthony Greenaway
2,500,000
-
-
18,500,000
1,750,000
2019
Directors
Jeremy Kirkwood
750,000
2,500,000
Daniel Madden
3,000,000
7,500,000
Alan Senior
500,000
-
Brian Dawes
500,000
1,750,000
Karen Gadsby
500,000
1,750,000
Executives
Shaun Vokes
1,000,000
2,500,000
Anthony Greenaway
1,000,000
2,500,000
7,250,000
18,500,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
N/A
2,500,000
N/A
7,500,000
N/A
1,750,000
N/A
1,750,000
N/A
1,750,000
(833,333)
(1,666,667)
-
-
N/A
2,500,000
(833,333)
(1,666,667)
17,750,000
(750,000)
N/A
2,500,000
(3,000,000)
N/A
7,500,000
(300,000)
(200,000)
-
(500,000)
N/A
1,750,000
(500,000)
N/A
1,750,000
(1,000,000)
N/A
2,500,000
(1,000,000)
N/A
2,500,000
(7,050,000)
(200,000)
18,500,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,666,667
1,666,667
5,000,000
5,000,000
1,166,667
1,166,667
1,166,667
1,166,667
583,332
583,332
1,666,667
1,666,667
1,666,667
1,666,667
13,916,667
13,916,667
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
This Directors’ report is signed in accordance with a resolution of Directors made pursuant to s.298(2) of the Corporations Act
2001.
On behalf of the Directors
Daniel Madden
Non-Executive Director
Perth, 30 September 2020
30
a U Di t o r' S iN De p eDeN DeN Ce De
C L a r a t i oN
AUDITOR’S INDEPENDENCE DECLARATION
As lead auditor for the audit of the consolidated financial report of Talisman Mining Limited for the
year ended 30 June 2020, I declare that to the best of my knowledge and belief, there have been
no contraventions of:
a)
the auditor independence requirements of the Corporations Act 2001 in relation to the
audit; and
b)
any applicable code of professional conduct in relation to the audit.
Perth, Western Australia
30 September 2020
L Di Giallonardo
Partner
31
2020 ANNUAL REPORT
iN De p eN DeNt a
U Di t o r' S r e p o r t
INDEPENDENT AUDITOR’S REPORT
To the members of Talisman Mining Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Talisman Mining Limited (“the Company”) and its controlled
entities (“the Group”), which comprises the consolidated statement of financial position as at 30
June 2020, the consolidated statement of profit or loss and other comprehensive income, the
consolidated statement of changes in equity and the consolidated statement of cash flows for the
year then ended, and notes to the financial statements, including a summary of significant
accounting policies, and the directors’ declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the
Corporations Act 2001, including:
a) giving a true and fair view of the Group’s financial position as at 30 June 2020 and of its
financial performance for the year then ended; and
b) complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities
under those standards are further described in the Auditor’s Responsibilities for the Audit of the
Financial Report section of our report. We are independent of the Group in accordance with the
auditor independence requirements of the Corporations Act 2001 and the ethical requirements of
the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for
Professional Accountants (“the Code”) that are relevant to our audit of the financial report in
Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance
in our audit of the financial report of the current period. These matters were addressed in the context
of our audit of the financial report as a whole, and in forming our opinion thereon, and we do not
provide a separate opinion on these matters. We have determined the matters described below to
be the key audit matters to be communicated in our report.
32
iN De p eN DeNt a
U Di t o r' S r e p o r t
Key Audit Matter
How our audit addressed the key audit
matter
Discontinued Operations and Assets and Liabilities
Classified as Held for Sale
Note 5
On 27 September 2019, the Group entered into a Share
Sale Agreement to sell its current holdings in the
Sinclair Project asset which was held by Talisman
Nickel Pty Ltd. As a result of this transaction, Talisman
Nickel Pty Ltd’s assets and liabilities as at 30 June 2019
had been classified as held for sale as at that date. The
transaction was completed on 11 October 2019 and the
operation has been treated as a discontinued operation
for the year ended 30 June 2020.
The recognition and disclosure of this transaction in the
financial report is complex and required significant audit
attention, as the Group was required to separate its
assets, liabilities and operations into continuing and
discontinued operations. This has a significant impact
on the disclosure of the financial results and financial
position of the Group.
We considered this to be a key audit matter as it is
important to users’ understanding of the financial
statements as a whole.
Our procedures included but were not
limited to the following:
• We ensured that the accounting for
this transaction is in line with the
requirements of AASB 5 Non-current
Assets Held for Sale and Discontinued
Operations;
• We
reviewed
Agreement giving
transaction;
the Share Sale
this
rise
to
• We considered the fair values of the
assets and liabilities being disposed of
and recalculated the gain on disposal
of this asset together with the overall
from discontinued
tax
profit after
operations; and
• We ensured
the appropriate
disclosures have been made in the
financial statements.
that
Information other than the financial report and auditor’s report thereon
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 2020, but does not
include the financial report and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not
express any form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, 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.
33
2020 ANNUAL REPORT
iN De p eN DeNt a
U Di t o r' S r e p o r t
Auditor’s responsibilities for the audit of the financial report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee
that an audit conducted in accordance with Australian Auditing Standards will always detect a
material misstatement when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could reasonably be expected to
influence the economic decisions of users taken on the basis of this financial report.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional
judgement and maintain professional scepticism throughout the audit. We also:
-
Identify and assess the risks of material misstatement of the financial report, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from fraud is higher than for one resulting from
error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the
override of internal control.
-
-
- Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing
an opinion on the effectiveness of the Group’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by the directors.
Conclude on the appropriateness of the directors’ use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to
events or conditions that may cast significant doubt on the Group’s ability to continue as a
going concern. If we conclude that a material uncertainty exists, we are required to draw
attention in our auditor’s report to the related disclosures in the financial report or, if such
disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit
evidence obtained up to the date of our auditor’s report. However, future events or conditions
may cause the Group to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial report, including the
disclosures, and whether the financial report represents the underlying transactions and
events in a manner that achieves fair presentation.
-
We communicate with the directors regarding, among other matters, the planned scope and timing
of the audit and significant audit findings, including any significant deficiencies in internal control
that we identify during our audit.
We also provide the directors with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other
matters that may reasonably be thought to bear on our independence, and where applicable,
related safeguards.
From the matters communicated with the directors, we determine those matters that were of most
significance in the audit of the financial report of the current period and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter
should not be communicated in our report because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.
34
iN De p eN DeNt a
U Di t o r' S r e p o r t
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included within the directors’ report for the year ended
30 June 2020.
In our opinion, the Remuneration Report of Talisman Mining Limited for the year ended 30 June
2020 complies with section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the
Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our
responsibility is to express an opinion on the Remuneration Report, based on our audit conducted
in accordance with Australian Auditing Standards.
HLB Mann Judd
Chartered Accountants
Perth, Western Australia
30 September 2020
L Di Giallonardo
Partner
35
2020 ANNUAL REPORT
CoNSoLiDateD StateMeNt oF
FINANCIAL POSITION
AS AT 30 JUNE 2020
Assets
Current Assets
Cash and cash equivalents
Trade and other receivables
Assets classified as held for sale
Total Current Assets
Non-Current Assets
Receivables
Property, plant and equipment
Right-of-use assets
Intangible assets
Deferred exploration and evaluation expenditure
Total Non-Current Assets
Total Assets
Liabilities
Current Liabilities
Trade and other payables
Provisions
Lease liabilities
Liabilities directly associated with assets held for sale
Total Current Liabilities
Total Liabilities
Net Assets
Equity
Issued capital
Reserves
Accumulated losses
Total Equity
Note
30 Jun 20
30 Jun 19
$ `000
$ `000
8
9
5(ii)
9
10
11
12
13
14
16
15
5(ii)
17
18
18
12,937
305
-
13,242
120
282
82
47
-
531
10,591
270
16,123
26,984
120
334
-
55
-
509
13,773
27,493
379
56
86
-
521
521
945
56
-
9,139
10,140
10,140
13,252
17,353
31,966
765
(19,479)
13,252
31,866
240
(14,753)
17,353
The accompanying notes form part of these financial statements.
36
CoNSoLiDateD StateMeNt oF
PROFIT OR LOSS AND OTHER
COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2020
Continuing operations
Revenue
Other income
Exploration expenditure expensed as incurred
Employee benefits expense
Legal and corporate advisory expenses
Administrative expenses
Occupancy expenses
Finance costs
Depreciation and amortisation expense
Loss before income tax expense from continuing operations
Income tax expense
Loss after tax from continuing operations
Discontinued operations
Profit after tax from discontinued operations
Net (loss) / profit for the year
Other comprehensive income for the year, net of tax
Total comprehensive income / (loss) for the year
Earnings / (loss) per share:
From continuing and discontinued operations:
Basic (loss) / earnings per share (cents per share)
Diluted (loss) / earnings per share (cents per share)
From continuing operations:
Basic loss per share (cents per share)
Diluted loss per share (cents per share)
Note
30 Jun 20
30 Jun 19
$ `000
$ `000
2
2
13
2
2
2
3
5
6
6
6
6
204
25
(3,860)
(2,004)
(1,010)
(621)
(49)
(6)
(224)
(7,545)
-
(7,545)
432
10
(3,242)
(1,760)
(914)
(871)
(122)
(75)
(117)
(6,659)
-
(6,659)
2,742
52,895
(4,803)
-
(4,803)
(2.58)
(2.58)
(4.05)
(4.05)
46,236
-
46,236
24.90
24.90
(3.59)
(3.59)
The accompanying notes form part of these financial statements.
37
2020 ANNUAL REPORT
CoNSoLiDateD StateMeNt oF
CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2020
Note
30 Jun 20
30 Jun 19
$ `000
$ `000
inflows/(outflows)
Cash flows from operating activities
Payments to suppliers and employees
Payments for exploration and evaluation
Transaction finance costs
Recovery of exploration costs on sale of subsidiary
Interest received
Government grants
Net cash used in operating activities
Cash flows from investing activities
Payments for property, plant and equipment
Proceeds from disposal of property, plant and equipment
Proceeds from disposal of entity (net of sale costs)
Reallocation of cash to available for sale assets
Net cash provided by investing activities
Cash flows from financing activities
Proceeds from borrowings
Transaction costs relating to borrowings
Repayment of borrowings
Repayment of lease liabilities
Dividends paid
Return of capital
Net cash used in financing activities
8
5
5
8
8
8
15
7,18
17
Net increase in cash held
Cash previously classified as available for sale
Cash and cash equivalents at the beginning of the period
Cash and cash equivalents at the end of the period
8
The accompanying notes form part of these financial statements.
38
(2,799)
(5,199)
(6)
390
204
50
(3,305)
(4,758)
(483)
-
447
-
(7,360)
(8,099)
(115)
4
9,868
-
9,757
-
-
-
(78)
-
-
(78)
2,319
27
10,591
12,937
(311)
-
71,230
(27)
70,892
2,036
(105)
(18,628)
-
(11,838)
(29,016)
(57,551)
5,242
-
5,349
10,591
CoNSoLiDateD StateMeNt oF
CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2020
Issued
Capital
$ `000
Accumulated
Losses
Dividend
Payment
Reserve
Share-based
Payments
Reserve
Total Equity
$ `000
$ `000
$ `000
$ `000
Balance at 1 July 2019
31,866
(14,753)
-
240
17,353
Loss for the year
Other comprehensive income
Total comprehensive loss for the year
Shares issued during the year
Recognition of share-based payments
Unlisted options forfeited
Unlisted options lapsed
-
-
-
100
-
-
-
(4,803)
-
(4,803)
-
-
-
77
Balance at 30 June 2020
31,966
(19,479)
Balance at 1 July 2018
60,882
(50,917)
Profit for the year
Other comprehensive income
Total comprehensive income for the year
Profit set aside for dividend (*)
Dividends paid
Return of capital
Recognition of share-based payments
Unlisted options forfeited
Unlisted options cancelled or lapsed
-
-
-
-
-
(29,016)
-
-
-
46,236
-
46,236
(11,838)
-
-
-
-
1,766
Balance at 30 June 2019
31,866
(14,753)
-
-
-
-
-
-
-
-
-
-
-
-
11,838
(11,838)
-
-
-
-
-
-
-
-
-
648
(46)
(77)
765
(4,803)
-
(4,803)
100
648
(46)
-
13,252
1,679
11,644
-
-
-
-
-
-
372
(45)
(1,766)
46,236
-
46,236
-
(11,838)
(29,016)
372
(45)
-
240
17,353
(*) Transfer of proportion of profit for the year to reserve to facilitate payment of fully franked special dividend of 6.375 cents per ordinary share paid on 21 December 2018.
The accompanying notes form part of these financial statements.
39
2020 ANNUAL REPORT
NoteS to tHe CoNSoLiDateD
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2020
Note 1: StateMeNt oF
SiGNiFiCaNt aCCoUNtiNG
poLiCieS
Talisman Mining Limited (the Company) is a public company
listed on the Australian Securities Exchange (trading under
the symbol “TLM”) and incorporated and operating in
Australia.
The Company’s Registered Office and its principal place of
business are as follows:
Level 11 / 2 Mill Street
Perth
Western Australia 6000
The nature of the operations and principal activities of the
Company are described in the Directors’ Report.
SIGNIFICANT ACCOUNTING POLICIES
(a) Basis of preparation
These financial statements are general purpose financial
statements, which have been prepared in accordance with
the requirements of the Corporations Act 2001, Accounting
Standards and Interpretations and comply with other
requirements of the law.
The financial statements comprise the consolidated
financial statements for the Group. For the purposes
of preparing the consolidated financial statements, the
Company is a for-profit entity.
The accounting policies detailed below have been
consistently applied to all of the years presented unless
otherwise stated. The financial statements are for the Group
consisting of Talisman Mining Limited and its subsidiaries.
The financial statements have been prepared on a historical
cost basis. Historical cost is based on the fair values of the
consideration given in exchange for goods and services.
The financial statements are presented in Australian
dollars and all values are rounded to the nearest thousand
dollars ($’000) unless otherwise stated as permitted by the
option available to the Company under ASIC Corporations
(Rounding in Financial/Directors’ Reports) Instrument
2016/191. The Company is an entity to which this
instrument applies.
(b) Adoption of new and revised standards
Standards and Interpretations applicable to 30 June 2020
In the year ended 30 June 2020, the Directors have reviewed
all of the new and revised Standards and Interpretations
issued by the AASB that are relevant to the Group and
effective for the current annual reporting period. Those
which have a material impact on the Group are set out
below.
AASB 16 Leases
AASB 16 Leases supersedes AASB 117 Leases. The Group
has adopted AASB 16 from 1 July 2019 which has resulted in
changes in the classification, measurement and recognition
of leases. Aside from those exempted in AASB 16, the
changes result in leases where the Group is the lessee being
recognised on the Statement of Financial Position and
removes the former distinction between ‘operating’ and
‘finance’ leases. The new standard required recognition of
a right-of-use asset (the leased item) and a financial liability
(to pay rentals). The exceptions are short-term leases and
leases of low value assets.
The Group has adopted AASB 16 using the modified
retrospective approach under which the reclassifications
and the adjustments arising from the new leasing rules
are recognised in the opening Condensed Statement of
Financial Position on 1 July 2019. Under this approach, there
is no initial impact on accumulated losses and comparatives
have not been restated.
The Group leases various premises and equipment. Prior
to 1 July 2019, leases were classified as operating leases.
Payments made under operating leases were charged to
profit or loss on a straight-line basis over the period of the
lease.
From 1 July 2019, where a Group company is a lessee, the
Group recognises a right-of-use asset and a corresponding
liability at the date at which the lease asset is available for
use by the Group (i.e. commencement date). Each lease
payment is allocated between the liability and the finance
cost. The finance cost is charged to the profit or loss over
the lease period so as to produce a consistent period rate
of interest on the remaining balance of the liability for each
period.
The lease liability is initially measured at the present value
of the lease payments that are not paid at commencement
date, discounted using the rate implied in the lease. If
this rate is not readily determinable, the Group uses its
incremental borrowing rate.
40
No t e S t o tHe C
oN SoLiD
a t eD FiNaN Ci aL S
t a t eMeNt
S
liabilities in relation to leases which had previously been
classified as operating leases under the principles of AASB
117. These liabilities were measured at the present value of
the remaining lease payments, discounted using the lessee’s
incremental borrowing rate as of 1 July 2019. The weighted
average lessee’s incremental borrowing rate applied to
lease liabilities was 5%.
On initial application right-of-use assets were measured
at the amount equal to the lease liability, adjusted by the
amount of any prepaid or accrued lease payments relating
to that lease recognised in the Statement of Financial
Position as at 30 June 2019.
In the Consolidated Statement of Cash Flows, the Group
has recognised cash payments for the principal portion of
the lease liability within financing activities, cash payments
for the interest portion of the lease liability as interest paid
within operating activities and short-term lease payments
and payments for lease of low-value assets within operating
activities.
The adoption of AASB 16 resulted in the recognition of right-
of-use assets of $164,215 and lease liabilities of $164,215
in respect of all operating leases at 1 July 2019, other than
short-term leases and leases of low-value assets.
The net impact on accumulated losses was $nil.
Practical expedients applied
In applying AASB 16 for the first time, the Group has
used the following practical expedients permitted by the
standard:
For existing contracts as at 1 July 2019, the Group has
elected to apply the definition of lease contained in AASB
117 and Interpretation 4 and has not applied AASB 16 to
contracts that were previously not identified as leases under
AASB 117 and Interpretation; and
Accounting for operating leases with a remaining lease
term of less than 12 months as at 1 July 2019 as short-
term leases, with no right-of-use asset nor lease liability
recognised.
Lease payments included in the initial measurement of the
lease liability consist of:
• Fixed lease payments less any lease incentives
receivable;
• Variable lease payments that depend on an index
or rate, initially measured using the index or rate at
commencement date;
• Any amounts expected to be payable by the Group
under residual value guarantees;
• The exercise price of purchase options, if the Group is
reasonably certain to exercise the options; and
• Termination penalties of the lease term reflecting the
exercise of an option to terminate the lease.
Extension options are included in property leases across
the Group. In determining the lease term, management
considers all facts and circumstances that create an
economic incentive to exercise an extension option.
Extension options are only included in the lease term if,
at commencement date, it is reasonably certain that the
options will be exercised.
Subsequent to initial recognition, the lease liability is
measured by increasing the carrying amount to reflect
interest on the lease liability (using the effective interest
method) and by reducing the carrying amount to reflect
the lease payments made. The lease liability is remeasured
(with a corresponding adjustment to the right-of-use asset)
whenever there is a change in the lease term (including
assessments relating to extension and termination options),
lease payments due to changes in an index or rate, or
expected payments under guaranteed residual values.
Right-of-use assets comprise the initial measurement of
the corresponding lease liability, lease payments made at
or before commencement date, less any lease incentives
received and initial direct costs. These right-of-use assets
are subsequently measured at cost less accumulated
depreciation and impairment losses.
Where the terms of a lease require the Group to restore
the underlying asset, or the Group has an obligation
to dismantle and remove a leased asset, a provision is
recognised and measured in accordance with AASB 137. To
the extent that the costs relate to a right-of-use asset, the
costs are included in the related right-of-use asset.
Right-of-use assets are depreciated on a straight-line
basis over the term of the lease (or the useful life of the
leased asset if this is shorter). Depreciation starts on
commencement date of the lease.
Where leases have a term of 12 months or less, or relate
to low value assets, the Group has applied the optional
exemptions to not capitalise these leases and instead
account for the lease expense on a straight-line basis over
the lease term.
Impact on adoption of AASB 16
On adoption of AASB 16, the Group recognised lease
41
2020 ANNUAL REPORT No t e S t o tHe C
oN SoLiD
a t eD FiNaN Ci aL S
t a t eMeNt
S
Reconciliation of operating lease commitments previously
disclosed and lease liabilities on 1 July 2019
Below is a reconciliation of total operating lease
commitments as at 30 June 2019, as disclosed in the annual
financial statements for the year ended 30 June 2019, and
the lease liabilities recognised on 1 July 2019:
2019
$ `000
282
(35)
(11)
(72)
164
Operating lease commitments disclosed as at 30 June 2019
Short term leases recognised on a straight-line basis as an expense
Discounted using the lessee’s incremental borrowing rate at date of initial application
Non-lease components and other items
Lease liabilities as at 1 July 2019
Other than the above, there is no material impact of the new
and revised Standards and Interpretations on the Group.
Standards and interpretations in issue not yet adopted
The Directors have also reviewed all of the new and revised
Standards and Interpretations in issue not yet adopted
for the year ended 30 June 2020. As a result of this review
the Directors have determined that there is no material
impact of the Standards and Interpretations in issue not
yet adopted on the Group and, therefore, no change is
necessary to Group accounting policies.
No other new standards, amendments to standards
and interpretations are expected to affect the Group’s
consolidated financial statements.
(c) Statement of compliance
The financial report was authorised for issue on
30 September 2020.
The financial report complies with Australian Accounting
Standards, which include Australian equivalents to
International Financial Reporting Standards (AIFRS).
Compliance with AIFRS ensures that the financial report,
comprising the financial statements and notes thereto,
complies with International Financial Reporting Standards
(IFRS).
(d) Significant accounting estimates and
judgements
The application of accounting policies requires the use of
judgements, estimates and assumptions about carrying
values of assets and liabilities that are not readily apparent
from other sources. The estimates and associated
assumptions are based on historical experience and other
factors that are considered to be relevant. Actual results
may differ from these estimates.
The estimates and underlying assumptions are reviewed on
an ongoing basis. Revisions are recognised in the period in
which the estimate is revised if it affects only that period, or
in the period of the revision and future periods if the revision
affects both current and future periods.
Useful lives of depreciable assets
Management reviews its estimate of the useful lives of
depreciable assets at each reporting date, based on
the expected utility of the assets. Uncertainties in these
estimates relate to technical obsolescence that may change
the utility of certain software and IT equipment.
Share-based payment transactions
The Group measures the cost of equity-settled transactions
with employees and Directors by reference to the fair value
of the equity instruments at the date at which they are
granted. The fair value is determined by utilising a Black
Scholes model, using the assumptions detailed in Note 19.
Provision for restoration and rehabilitation
The provision for restoration and rehabilitation is based
on the net present value of the estimated cost of restoring
the environmental disturbance that has occurred up to
the reporting date. Significant estimates and assumptions
are made in determining the provision for restoration and
rehabilitation of the mine as there are numerous factors
that will affect the ultimate liability payable. These factors
include estimates of the extent and costs of restoration and
rehabilitation activities, technological changes, regulatory
changes, cost increases as compared to inflation rates and
changes in discount rates. These uncertainties may result
in future actual expenditure differing from the amounts
currently provided. The provision at 11 October 2019
represents management’s best estimate of the present
value of the future restoration and rehabilitation costs
required at the date of the sale.
Ore reserve and resource estimates
The Group estimates its ore reserves and mineral resources
based on information compiled by Competent Persons
(as defined in the 2012 edition of the Australasian Code
for Reporting of Exploration Results, Mineral Resources
and Ore Reserves [the JORC Code]). Reserves determined
in this way are taken into account in the calculation of
depreciation, amortisation, impairment, deferred mining
costs, rehabilitation and environmental expenditure.
42
No t e S t o tHe C
oN SoLiD
a t eD FiNaN Ci aL S
t a t eMeNt
S
In estimating the remaining life of the mine for the purposes
of amortisation and depreciation calculations, due regard is
given, not only to remaining recoverable metals contained
in proved and probable ore reserves, but also to limitations
which could arise from the potential for changes in
technology, demand, and other issues which are inherently
difficult to estimate over a lengthy time frame.
Where a change in estimated recoverable metals contained
in proved and probable ore reserves is made, depreciation
and amortisation is accounted for prospectively.
The determination of ore reserves and remaining mine
life affects the carrying value of a number of the Group’s
assets and liabilities including deferred mining costs and the
provision for rehabilitation.
Consolidation of a subsidiary begins when the Company
obtains control over the subsidiary and ceases when the
Company loses control of the subsidiary. Specifically, income
and expenses of a subsidiary acquired or disposed of during
the year are included in the consolidated statement of
comprehensive income from the date the Company gains
control until the date when the Company ceases to control
the subsidiary.
Note 2: reVeNUe aND eXpeNSeS
Revenue is measured at the fair value of the consideration
received or receivable. Amounts disclosed as revenue are
net of returns, trade allowances, rebates and amounts
collected on behalf of third parties.
(e) Going concern
Interest income
Interest income from a financial asset is recognised when it
is probable that the economic benefits will flow to the Group
and the amount of revenue can be reliably measured.
Interest income is accrued on a time basis, by reference
to the principal outstanding and at the effective interest
rate applicable, which is the rate that exactly discounts
estimated future cash receipts through the expected life of
the financial asset to that assets’ net carrying amount on
initial recognition.
Government grants
Grants from the government are recognised at their fair
value where there is a reasonable assurance that the grant
will be received, and the Group will comply with all attached
conditions.
Government grants relating to costs are deferred and
recognised in the statement of profit or loss and other
comprehensive income over the period necessary to match
them with the costs that they are intended to compensate.
Government grants relating to the purchase of property,
plant and equipment are included in non-current liabilities
as deferred income and are credited to statement of profit
or loss and other comprehensive income on a straight-line
basis over the expected lives of the related assets.
Government grants are presented as other income in the
statement of profit or loss and other comprehensive income.
The financial report has been prepared on the going
concern basis, which contemplates continuity of normal
business activities and the realisation of assets and
settlements of liabilities in the ordinary course of business.
(f) Basis of Consolidation
The consolidated financial statements incorporate the
financial statements of the Company and entities controlled
by the Company and its subsidiaries. Control is achieved
when the Company:
• has power over the investee;
•
is exposed, or has rights, to variable returns from its
involvement with the investee; and
• has the ability to use its power over the investee to
affect its returns.
The Company reassess whether or not it controls an
investee if facts and circumstances indicate that there are
changes to one or more of the three elements listed above.
When the Company has less than a majority of the voting
rights in an investee, it has the power over the investee
when the voting rights are sufficient to give it the practical
ability to direct the relevant activities of the investee
unilaterally. The Company considers all relevant facts and
circumstances in assessing whether or not the Company’s
voting rights are sufficient to give it power, including:
•
the size of the Company’s holding of voting rights
relative to the size and dispersion of holdings of the
other vote holders;
• potential voting rights held by the Company, other
vote holders or other parties; rights arising from other
contractual arrangements; and
• any additional facts and circumstances that indicate
that the Company has, or does not have, the current
ability to direct the relevant activities at the time that
decisions need to be made, including voting patterns at
previous shareholder meetings.
43
2020 ANNUAL REPORT No t e S t o tHe C
oN SoLiD
a t eD FiNaN Ci aL S
t a t eMeNt
S
Revenue
Bank interest
Other Income
Government grants
Other Expenses
Loss for the year includes the following expenses:
Non-cash share based payment expense
Other employee benefits
Operating lease rental expense
Legal and Corporate Advisory Expenses
Corporate advisory fees
Other legal fees
30 Jun 20
30 Jun 19
$ `000
$ `000
204
204
432
432
30 Jun 20
30 Jun 19
$ `000
$ `000
25
25
10
10
30 Jun 20
30 Jun 19
$ `000
$ `000
602
1,402
49
326
1,434
122
30 Jun 20
30 Jun 19
$ `000
196
814
1,010
$ `000
610
304
914
Note 3: iNCoMe taX
The income tax expense or benefit for the period is the tax
payable on the current period’s taxable income based on
the applicable income tax rate for each jurisdiction adjusted
by changes in deferred tax assets and liabilities attributable
to temporary differences and to unused tax losses.
The current income tax charge is calculated on the basis of
the tax laws enacted or substantively enacted at the end of
the reporting period in the countries where the Company’s
subsidiaries and associates operate and generate taxable
income. Management periodically evaluates positions taken
in tax returns with respect to situations in which applicable
tax regulation is subject to interpretation. It establishes
provisions where appropriate on the basis of amounts
expected to be paid to the tax authorities.
Current tax assets and liabilities for the current and prior
periods are measured at the amount expected to be
recovered from or paid to the taxation authorities. The tax
rates and tax laws used to compute the amount are those
that are enacted or substantively enacted by the balance
date.
Deferred income tax is provided on all temporary
differences at the balance date between the tax bases of
assets and liabilities and their carrying amounts for financial
reporting purposes.
44
No t e S t o tHe C
oN SoLiD
a t eD FiNaN Ci aL S
t a t eMeNt
S
Deferred income tax liabilities are recognised for all taxable
temporary differences except:
future and taxable profit will be available against which
the temporary difference can be utilised.
• when the deferred income tax liability arises from the
initial recognition of an asset or liability in a transaction
that is not a business combination and that, at the time
of the transaction, affects neither the accounting profit
nor taxable profit or loss; or
The carrying amount of deferred income tax assets is
reviewed at each balance date and reduced to the extent
that it is no longer probable that sufficient taxable profit will
be available to allow all or part of the deferred income tax
asset to be utilised.
• when the taxable temporary difference is associated
with investments in subsidiaries, associates or interests
in joint ventures, and the timing of the reversal of
the temporary difference can be controlled and it is
probable that the temporary difference will not reverse
in the foreseeable future.
Deferred income tax assets are recognised for all deductible
temporary differences, carry-forward of unused tax assets
and unused tax losses, to the extent that it is probable that
taxable profit will be available against which the deductible
temporary differences and the carry-forward of unused tax
credits and unused tax losses can be utilised, except:
• when the deferred income tax asset relating to the
deductible temporary difference arises from the initial
recognition of an asset or liability in a transaction that
is not a business combination and, at the time of the
transaction, affects neither the accounting profit nor
taxable profit or loss; or
Unrecognised deferred income tax assets are reassessed at
each balance date and are recognised to the extent that it
has become probable that future taxable profit will allow
the deferred tax asset to be recovered.
Deferred income tax assets and liabilities are measured at
the tax rates that are expected to apply to the year when
the asset is realised or the liability is settled, based on tax
rates (and tax laws) that have been enacted or substantively
enacted at the balance date.
Income taxes relating to items recognised directly in equity
are recognised in equity and not in profit or loss.
R&D tax rebates are presented with the government grant
approach. The credit will be recognised in profit before tax
over the periods necessary to match the benefit of the credit
with the costs for which it is intended to compensate. These
periods will then depend on whether the R&D costs are
capitalised or expensed as incurred.
• when the deductible temporary difference is associated
with investments in subsidiaries, associates or interests
in joint ventures, in which case a deferred tax asset is
only recognised to the extent that it is probable that
the temporary difference will reverse in the foreseeable
Deferred tax assets and deferred tax liabilities are offset
only if a legally enforceable right exists to set off current tax
assets against current tax liabilities and the deferred tax
assets and liabilities relate to the same taxable entity and
the same taxation authority.
30 Jun 20
30 Jun 19
$`000
$`000
The prima facie income tax expense on pre-tax accounting loss from operations
reconciles to the income tax benefit in the financial statements as follows:
Accounting profit / (loss) before income tax
(4,803)
46,236
Income tax expense / (benefit) calculated at 30% (2019: 30%)
Non-deductible expenses
Tax losses and deferred tax balances not recognised
Income tax benefit reported in the statement of comprehensive income
(1,441)
183
1,258
-
13,871
103
(13,974)
-
45
2020 ANNUAL REPORT
No t e S t o tHe C
oN SoLiD
a t eD FiNaN Ci aL S
t a t eMeNt
S
Unrecognised deferred tax balances
Deferred tax assets compromise of:
Tax losses carried forward
Impairment of financial assets
Provisions
Other deferred tax balances
Deferred tax liabilities compromise of:
Exploration expenditure capitalised
Other deferred tax balances
Income Tax expense not recognised directly in equity during the year
30 Jun 20
30 Jun 19
$`000
$`000
4,288
45
55
25
4,413
-
26
26
-
2,797
45
73
342
3,257
113
-
113
-
Tax consolidation legislation
The Company and its 100% owned Australian resident
subsidiaries have implemented the tax consolidation
legislation. Current and deferred tax amounts are
accounted for in each individual entity as if each entity
continued to act as a taxpayer on its own.
The Company recognises its own current and deferred tax
amounts and those current tax liabilities, current tax assets
and deferred tax assets arising from unused tax credits and
unused tax losses which it has assumed from its controlled
entities within the tax consolidated Group.
Assets or liabilities arising under tax funding agreements
with the tax consolidated entities are recognised as
amounts payable or receivable from or payable to other
entities in the Group. Any difference between the amounts
receivable or payable under the tax funding agreement
are recognised as a contribution to (or distribution from)
controlled entities in the tax consolidated Group.
Other taxes
Revenues, expenses and assets are recognised net of the
amount of GST except:
• when the GST incurred on a purchase of goods and
services is not recoverable from the taxation authority,
in which case the GST is recognised as part of the cost
of acquisition of the asset or as part of the expense item
as applicable; and
•
receivables and payables, which are stated with the
amount of GST included.
The net amount of GST recoverable from, or payable to,
the taxation authority is included as part of receivables or
payables in the statement of financial position.
Cash flows are included in the statement of cash flows on
a gross basis and the GST component of cash flows arising
from investing and financing activities, which is recoverable
from, or payable to, the taxation authority are classified as
operating cash flows.
Commitments and contingencies are disclosed net of the
amount of GST recoverable from, or payable to, the taxation
authority.
Note 4: SeGMeNt reportiNG
Talisman management has determined the operating
segments based on the reports reviewed by the Board
for strategic decision making. The Group operates in one
geographical segment, being Australia and has identified
the following continuing operating segment: Regional
Exploration.
The discontinued operation in the current period is identified
as the Sinclair operation and represented the Group’s
100% interest in the Sinclair Nickel Project (Sinclair) until
11 October 2019 when Talisman sold its interest to Saracen
Mineral Holdings Ltd (Saracen). Refer to Note 5.
The Monty Operation represented the Group’s 30% joint
venture interest in the Monty Cu-Au Project (Monty).
Sandfire Resources NL (Sandfire) acquired the Group’s 30%
interest in Monty, which was held by Talisman A Pty Ltd, on
2 October 2018. For further information see Note 5.
The Group’s board and General Manager of Geology
are responsible for budgets and expenditures relating
to the Group’s Regional Exploration activities. Regional
Exploration activities do not normally derive any income.
Should a project generated by Regional Exploration
activities commence generating income or lead to the
development of a mining operation, that operation would
then be disaggregated from Regional Exploration and
become reportable in a different segment.
46
No t e S t o tHe C
oN SoLiD
a t eD FiNaN Ci aL S
t a t eMeNt
S
Segment Results
Continued Operations
Discontinued Operations
Regional Exploration
Sinclair
Monty
Project
Unallocated
Items
Consolidated
$ `000
$ `000
$ `000
$ `000
$ `000
30 June 2020
Segment revenues / income
-
-
Segment profit / (loss) before
income tax expense
(3,840)
2,742
Segment assets
Segment liabilities
30 June 2019
512
(48)
Segment revenues / income
-
-
-
-
-
-
-
-
229
(3,705)
13,260
(472)
15
442
Segment (loss)/profit before
income tax expense
Segment assets
Segment liabilities
(3,582)
(2,952)
55,847
(3,077)
389
(472)
16,123
(9,139)
-
-
10,981
(529)
229
(4,803)
13,772
(520)
457
46,236
27,493
(10,140)
Note 5: DiSCoNtiNUeD
operatioNS aND aSSetS aND
LiabiLitieS CLaSSiFieD aS HeLD
For SaLe
Any retained portion of an investment in an associate or
joint venture that has not been classified as held for sale
continues to be accounted for using the equity method. The
Group discontinues the use of the equity method at the time
of disposal when the disposal results in the Group losing
significant influence over the associate or joint venture.
Non-current assets (or disposal groups) are classified as
held for sale if their carrying amount will be recovered
principally through a sale transaction rather than through
continuing use. This condition is regarded as met only when
the asset (or disposal group) is available for immediate sale
in its present condition subject only to terms that are usual
and customary for sales for such asset (or disposal groups)
and the sale is highly probable. Management must be
committed to the sale, which should be expected to qualify
for recognition as a complete sale within one year from the
date of classification.
When the Group is committed to a sale plan involving loss
of control of a subsidiary, all of the assets and liabilities
of that subsidiary are classified as held for sale when the
criteria described above are met, regardless of whether
the Group will retain a non-controlling interest in its former
subsidiary, after the sale.
When the Group is committed to a sale plan involving
disposal of an investment, or a portion of an investment, in
an associate or joint venture, the investment or the portion
of the investment that will be disposed of is classified as
held for sale when the criteria described above are met,
and the Group discontinues the use of the equity method
in relation to the portion that is classified as held for sale.
47
After the disposal takes place, the Group accounts for
any retained interest in the associate or joint venture in
accordance with AASB 139 unless the retained interest
continues to be an associate or a joint venture, in which
case the Group uses the equity method.
During the year, the Company completed a Share Sale
Agreement with Saracen Nickel Pty Ltd, a wholly owned
subsidiary of Saracen Mineral Holdings Limited (Saracen),
where Saracen acquired Talisman Nickel Pty Ltd, the
subsidiary which held the Company’s interest in the
Sinclair Nickel Project on a debt-free and cash-free basis.
Completion occurred on 11 October 2019. At 30 June 2019,
the Group had assets classified as held for sale of $16.123
million and liabilities directly associated with assets held for
sale of $9.139 million in relation to Talisman Nickel Pty Ltd.
During the prior year, the Company completed a Share
Sale Agreement with Sandfire Resources NL (Sandfire), its
partner in the Monty Mining Joint Venture and Springfield
Exploration Joint Venture (collectively the Doolgunna
Project), where Sandfire acquired Talisman A Pty Ltd, the
subsidiary which held the Company’s 30% interest in the
Doolgunna Project on a debt-free and cash-free basis.
Completion occurred on 12 October 2018.
2020 ANNUAL REPORT
No t e S t o tHe C
oN SoLiD
a t eD FiNaN Ci aL S
t a t eMeNt
S
Profit after tax from discontinued operations
Financial performance of discontinued operations
Gain on disposal of subsidiary
Other Income
Expenses
Exploration expenditure written off
Exploration expenditure expensed as incurred
Care and maintenance expenses
Administrative expenses
Finance costs
Realised foreign exchange
Unwinding of discount on provisions
Profit before income tax
Income tax
Profit after income tax
30 Jun 20
30 Jun 19
$ `000
$ `000
3,168
-
-
(245)
(104)
(1)
-
-
(76)
2,742
-
2,742
56,973
36
(803)
(1,394)
(512)
-
(409)
(732)
(264)
52,895
-
52,895
Financial performance from discontinued operations
The current year financial performance presented is for the period 1 July 2019 to the date of disposal, 11 October 2019:
Financial performance of discontinued operations
Other Income
Expenses
Exploration expenditure written off
Exploration expenditure expensed as incurred
Care and maintenance expenses
Administrative expenses
Unwinding of discount on provisions
Profit/(Loss) before income tax
Income tax
Profit/(Loss) after income tax
48
30 Jun 20
30 Jun 19
$ `000
$ `000
-
-
(245)
(104)
(1)
(76)
(426)
-
(426)
21
(803)
(1,394)
(512)
-
(264)
(2,952)
-
(2,952)
No t e S t o tHe C
oN SoLiD
a t eD FiNaN Ci aL S
t a t eMeNt
S
Consideration received or receivable on the sale of Talisman Nickel Pty Ltd
Disposal consideration (including working capital adjustment)
Less: net assets on disposal
Less: costs of sale paid or payable
Gain on disposal before income tax
Income tax expense1
Gain on disposal after income tax
Loss for the period from discontinued operation – Talisman Nickel Pty Ltd
Profit/(loss) after tax from discontinued operation
30 Jun 20
30 Jun 19
$ `000
10,390
(7,090)
(132)
3,168
-
3,168
(426)
2,742
$ `000
-
-
-
-
-
-
(2,952)
(2,952)
1 The tax expense related to the gain on disposal of Talisman Nickel Pty Ltd has been offset by available brought forward income tax losses. These income tax losses
relate to numerous components of the Group’s activities over several years and as a result, it is considered impracticable to calculate the amount that would relate to
the discontinued operation.
Consideration received or receivable on the sale of Talisman A Pty Ltd
During the prior year, the Company completed a Share Sale Agreement with Sandfire Resources NL (Sandfire), its partner in
the Monty Mining Joint Venture and Springfield Exploration Joint Venture (collectively the Doolgunna Project Joint Venture)
whereby Sandfire acquired Talisman A Pty Ltd, the subsidiary which held the Company’s 30% interest in the Doolgunna Project
Joint Venture, on a debt-free and cash-free basis. Completion of the sale transaction occurred on 12 October 2018. At 30 June
2018, the Group had assets classified as held for sale of $21.35 million and liabilities associated with assets held for sale of
$17.774 million in relation to Talisman A Pty Ltd.
Disposal consideration
Less: net asset disposal of Talisman A Pty Ltd
Less: costs of sale paid
Gain on disposal before settlement of project financing
Repayment of loan project financing out of disposal consideration
Gain on disposal before income tax
Income tax expense1
Gain on disposal after income tax
Loss for the period from discontinued operation
Profit after tax from discontinued operation
30 Jun 20
30 Jun 19
$ `000
-
-
-
-
-
-
-
-
-
-
$ `000
72,300
(2,451)
(855)
68,994
(12,021)
56,973
-
56,973
(1,126)
55,847
1 The tax expense related to the gain on disposal of Talisman A Pty Ltd has been offset by available brought forward income tax losses. These income tax losses relate
to numerous components of the Group’s activities over several years and as a result, it is considered impracticable to calculate the amount that would relate to the
discontinued operation.
49
2020 ANNUAL REPORT
No t e S t o tHe C
oN SoLiD
a t eD FiNaN Ci aL S
t a t eMeNt
S
Net assets of Talisman Nickel Pty Ltd at the date of sale and classified as held for sale at 30 June 2019
Cash
Trade and other receivables
Inventory
Deferred exploration and evaluation expenditure
Property, plant and equipment
Total assets
Trade creditors
Rehabilitation provision
Total liabilities
Net assets
Net cash inflow on disposal
30 June 20
30 Jun 19
$ `000
$ `000
-
-
-
-
-
-
-
-
-
-
27
241
22
13,197
2,636
16,123
83
9,056
9,139
6,984
30 Jun 20
30 Jun 19
Total cash and cash equivalents consideration received
Working capital adjustment
$ `000
10,390
(390)
Net cash and cash equivalents disposed of
-
-
Net cash received on disposal
Less: costs of sale paid
Proceeds from disposal of entity (net of sale costs)
Cash flows
10,000
(132)
9,868
$ `000
72,300
(214)
72,086
(856)
71,230
The current year Talisman Nickel Pty Ltd cash flows presented for the period 1 July 2019 to the date of disposal, 11 October
2019, included in the various categories in the consolidated statement of cash flows:
Net cash flows from operating activities
Net cash flows from investing activities
Net cash flows from financing activities
Net cash flows
30 Jun 20
30 Jun 19
$ `000
(478)
-
451
(27)
$ `000
(612)
-
625
24
50
No t e S t o tHe C
oN SoLiD
a t eD FiNaN Ci aL S
t a t eMeNt
S
Note 6: earNiNGS/LoSS
per SHare
Basic earnings/loss per share is calculated as net profit/loss
attributable to members of the parent, adjusted to exclude
any costs of servicing equity (other than dividends) and
preference share dividends, divided by the weighted average
number of ordinary shares, adjusted for any bonus element.
Diluted earnings per share is calculated as net profit/loss
attributable to members of the parent, adjusted for:
• costs of servicing equity (other than dividends) and
preference share dividends;
•
the after-tax effect of dividends and interest associated
with dilutive potential ordinary shares that have been
recognised as expenses; and
• other non-discretionary changes in revenues or
expenses during the period that would result from
the dilution of potential ordinary shares; divided by
the weighted average number of ordinary shares and
dilutive potential ordinary shares, adjusted for any
bonus element.
The Group does not report diluted earnings per share on
incurring an operating loss for the financial year, or in the
event there are no dilutive potential ordinary shares in
existence.
Basic earnings / (loss) per share
Diluted earnings per share
Basic loss per share from continuing operations
Diluted loss per share from continuing operations
Net profit / (loss) for the year
Net loss for the year from continuing operations
Weighted average number of ordinary shares for the purpose of basic and
diluted earnings / (loss) per share
Note 7: DiViDeNDS
Dividends declared and paid during the year
Special franked dividend (2019: 6.375 cents)
The special dividend was franked to 100% and was paid on 21 December 2018.
30 Jun 20
30 Jun 19
cents
(2.58)
(2.58)
(4.05)
(4.05)
$
(4,803)
(7,545)
cents
24.90
24.90
(3.59)
(3.59)
$
46,236
(6,659)
Number
Number
186,318,883
185,699,879
30 Jun 20
30 Jun 19
$ `000
-
$ `000
11,838
51
2020 ANNUAL REPORT
No t e S t o tHe C
oN SoLiD
a t eD FiNaN Ci aL S
t a t eMeNt
S
Note 8: CaSH aND CaSH eQUiVaLeNtS
Cash comprises cash at bank and in hand. Cash equivalents are short term, highly liquid investments that are readily
convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.
Cash at bank and on hand
Short-term deposits
30 Jun 20
30 Jun 19
$ `000
1,357
11,580
12,937
$ `000
511
10,080
10,591
Cash at bank earns interest at floating rates based on daily bank deposit rates. Short-term deposits are made for varying
periods of between one day and three months, depending on the immediate cash requirements of the Group, and earn
interest at the respective short-term deposit rates.
Reconciliation to the Statement of Cash Flows:
For the purposes of the statement of cash flows, cash and cash equivalents comprise cash on hand and at bank and
investments in money market instruments, net of outstanding bank overdrafts. Cash and cash equivalents as shown in the
statement of cash flows is reconciled to the related items in the statement of financial position as follows:
Profit / (loss) for the year after tax
Adjustments for:
Gain on disposal of business
Working capital adjustment on disposal of business
Depreciation and amortisation
Unwinding discount rate on mine closure provision
Equity settled share-based payments
Unlisted options forfeited
Share issued for expensed exploration expenditure
Unrealised foreign exchange
Exploration expenditure written off
Transaction costs related to loans and borrowings
Changes in net assets and liabilities
(Increase)/decrease in assets:
Trade and other receivables
Increase/(decrease) in liabilities:
Trade and other payables
Provisions
Net cash used in operating activities
52
30 Jun 20
30 Jun 19
$ `000
(4,803)
$ `000
46,236
(3,168)
(56,973)
390
224
76
648
(46)
100
-
-
-
-
117
264
372
(45)
-
47
803
105
35
(268)
(826)
10
(7,360)
1,237
6
(8,099)
No t e S t o tHe C
oN SoLiD
a t eD FiNaN Ci aL S
t a t eMeNt
S
Change in liabilities arising from financing activities
30 June 2020
Opening balance
Closing balance
30 June 2019
Opening balance
Prior year re-classification of financing liabilities as available for
sale
Foreign currency differences
Net cash from financing activities
Net cash (used in) financing activities
Other changes
Closing balance
Consolidated
Project Finance
Facility
Working Capital
Facility
Total
$ `000
$ `000
$ `000
-
-
-
15,559
1,033
-
(16,592)
-
-
-
-
-
-
-
2,036
-
-
-
15,559
1,033
2,036
(2,036)
(18,628)
-
-
-
-
Note 9: traDe aND otHer
reCeiVabLeS
Trade receivables are measured on initial recognition at fair
value and are subsequently measured at amortised cost
using the effective interest rate method, less any allowance
for impairment. Trade receivables are generally due for
settlement within periods ranging from 30 days to 45 days.
There are no receivables at balance date that are past-due.
Impairment of trade receivables is continually reviewed and
those that are considered to be uncollectible are written
off by reducing the carrying amount directly. An allowance
account is used when there is objective evidence that the
Group will not be able to collect all amounts due according
to the original contractual terms. Factors considered by
the Group in making this determination include known
significant financial difficulties of the debtor, review of
financial information and significant delinquency in making
contractual payments to the Group. The impairment
allowance is set equal to the difference between the
carrying amount of the receivable and the present value
of estimated future cash flows, discounted at the original
effective interest rate. Where receivables are short-term
discounting is not applied in determining the allowance.
The amount of the impairment loss is recognised in the
statement of comprehensive income within other expenses.
When a trade receivable for which an impairment allowance
had been recognised becomes uncollectible in a subsequent
period, it is written off against the allowance account.
Subsequent recoveries of amounts previously written off are
credited against other expenses in the statement of profit or
loss and other comprehensive income.
Current Assets
Goods and services tax recoverable
Other debtors
Prepayments
Non-Current Assets
Other debtors – security bonds
53
30 Jun 20
30 Jun 19
$ `000
$ `000
36
198
71
305
120
120
113
65
92
270
120
120
2020 ANNUAL REPORT
No t e S t o tHe C
oN SoLiD
a t eD FiNaN Ci aL S
t a t eMeNt
S
Note 10: property, pLaNt
aND eQUipMeNt
Plant and equipment is stated at cost less accumulated
depreciation and any accumulated impairment losses.
Such cost includes the cost of replacing parts that are
eligible for capitalisation when the cost of replacing the
parts is incurred. Similarly, when each major inspection is
performed, its cost is recognised in the carrying amount
of the plant and equipment as a replacement only if it is
eligible for capitalisation.
The recoverable amount of plant and equipment is the
higher of fair value less costs to sell and value in use. In
assessing value in use, the estimated future cash flows are
discounted to their present value using a pre-tax discount
rate that reflects current market assessments of the time
value of money and the risks specific to the asset.
For an asset that does not generate largely independent
cash inflows, recoverable amount is determined for the
cash-generating unit to which the asset belongs, unless the
asset’s value in use can be estimated to approximate fair
value.
Land and buildings are measured at fair value less
accumulated depreciation on buildings and less any
impairment losses recognised after the date of the
revaluation.
An impairment exists when the carrying value of an asset
or cash-generating unit exceeds its estimated recoverable
amount. The asset or cash-generating unit is then written
down to its recoverable amount.
Depreciation is calculated on a straight-line basis over the
estimated useful life of the assets as follows:
Mine site plant and equipment
Units of Production
Office furniture and equipment
2-6 years
For plant and equipment, impairment losses are recognised
in the statement of comprehensive income. However,
because land and buildings are measured at revalued
amounts, impairment losses on land and buildings are
treated as a revaluation decrement.
Motor vehicles
8-10 years
Derecognition and disposal
Leasehold improvements
10 years
The assets’ residual values, useful lives and amortisation
methods are reviewed, and adjusted if appropriate, at each
financial year end.
Impairment
The carrying values of plant and equipment are reviewed for
impairment at each balance date, with recoverable amount
being estimated when events or changes in circumstances
indicate that the carrying value may be impaired.
An item of property, plant and equipment is derecognised
upon disposal or when no further future economic benefits
are expected from its use or disposal.
Any gain or loss arising on derecognition of the asset
(calculated as the difference between the net disposal
proceeds and the carrying amount of the asset) is included
in profit or loss in the year the asset is derecognised.
54
No t e S t o tHe C
oN SoLiD
a t eD FiNaN Ci aL S
t a t eMeNt
S
Consolidated
Office furniture
and equipment
Leasehold
improve-
ments
Plant and
equipment
Motor
vehicles
Total
$ `000
$ `000
$ `000
$ `000
$ `000
155
24
-
-
-
-
-
-
155
334
-
-
-
(29)
126
44
-
-
(96)
282
4
-
-
(7)
21
Year ended 30 June 2020
At 1 July 2019, net of accumulated
depreciation
Additions
Disposals
Reclass to available for sale assets (i)
Depreciation charge for the year
Year ended 30 June 2019
At 1 July 2018, net of accumulated
depreciation
Additions
Disposals
Reclass to available for sale assets (i)
Depreciation charge for the year
At 30 June 2020
Cost or fair value
Accumulated depreciation
Net carrying amount
At 30 June 2019
Cost or fair value
Accumulated depreciation
Net carrying amount
40
-
-
(60)
135
103
101
-
-
(49)
155
844
(709)
135
804
(649)
155
-
2,636
33
2,772
26
-
-
(2)
24
56
(35)
21
52
(28)
24
-
-
(2,636)
-
-
-
-
-
-
-
-
150
-
-
(28)
155
427
(301)
126
277
-
(2,636)
(79)
334
1,327
(1,045)
282
427
1,283
(272)
155
(949)
334
(i) Refer Note 5.
The carrying value of plant and equipment held under hire purchase contracts as at 30 June 2020 is nil (2019: nil).
55
2020 ANNUAL REPORT
No t e S t o tHe C
oN SoLiD
a t eD FiNaN Ci aL S
t a t eMeNt
S
Note 11: riGHt-oF-USe aSSetS
Carrying Value
Cost
Accumulated depreciation
Carrying value as at 30 June 2020
Reconciliation
30 June 2020
Recognised on 1 July 2019 on adoption of AASB 16
Depreciation expense
Closing balance
AASB 16 has been adopted during the year. Refer note 1 for details.
Consolidated
Premises
$ `000
164
(82)
82
Consolidated
Premises
$ `000
164
(82)
82
Total
$ `000
164
(82)
82
Total
$ `000
164
(82)
82
Note 12: iNtaNGibLe aSSetS
Intangible assets acquired separately
Intangible assets acquired separately are recorded at
cost less accumulated amortisation and impairment.
Amortisation is charged on a straight-line basis over
their estimated useful lives. The estimated useful life and
amortisation method is reviewed at the end of each annual
reporting period, with any changes in these accounting
estimates being accounted for on a prospective basis.
Software license
Cost
Accumulated amortisation
Carrying value at end of financial year
Impairment of tangible and intangible assets other than
goodwill
The Group assesses at each balance date whether there is
an indication that an asset may be impaired. If any such
indication exists, or when annual impairment testing for
an asset is required, the Group makes an estimate of the
asset’s recoverable amount. An asset’s recoverable amount
is the higher of its fair value less costs to sell and its value
in use and is determined for an individual asset, unless
the asset does not generate cash inflows that are largely
independent of those from other assets or groups of assets
and the asset’s value in use cannot be estimated to be
close to its fair value. In such cases the asset is tested for
impairment as part of the cash-generating unit to which it
belongs. When the carrying amount of an asset or cash-
generating unit exceeds its recoverable amount, the asset
or cash-generating unit is considered impaired and is
written down to its recoverable amount.
30-Jun-20
30-Jun-19
$ `000
$ `000
146
(99)
47
110
(55)
55
56
No t e S t o tHe C
oN SoLiD
a t eD FiNaN Ci aL S
t a t eMeNt
S
Note 13: DeFerreD
eXpLoratioN aND eVaLUatioN
eXpeNDitUre
Exploration for and evaluation of Mineral Resources is the
search for Mineral Resources after the entity has obtained
legal rights to explore in a specific area, as well as the
determination of the technical feasibility and commercial
viability of extracting the Mineral Resource.
Exploration and evaluation expenditure is expensed
to the profit or loss as incurred except in the following
circumstances in which case the expenditure may be
capitalised:
•
the existence of a mineral deposit has been established
however additional expenditure is required to determine
the technical feasibility and commercial viability of
extraction and it is anticipated that future economic
benefits are more likely than not to be generated as a
result of the expenditure; and
•
the exploration and evaluation activity is within an area
of interest which was acquired as an asset acquisition
or in a business combination and measured at fair value
on acquisition.
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. An
impairment exists when the carrying value of expenditure
exceeds its estimated recoverable amount. The area of
interest is then written down to its recoverable amount
and the impairment losses are recognised in the statement
of comprehensive income. Where an impairment loss
subsequently reverses, the carrying amount of the asset is
increased to the revised estimate of its recoverable amount,
but only to the extent that the increased carrying amount
does not exceed the carrying amount that would have been
determined had no impairment loss been recognised for the
asset in previous years.
Upon approval for the commercial development of an
area of interest, exploration and evaluation assets are
tested for impairment and transferred to ‘Mine properties
and development’. No amortisation is charged during the
exploration and evaluation phase.
30-Jun-20
30-Jun-19
$ `000
$ `000
Costs carried forward in respect of areas of interest in the following phases:
Exploration and evaluation phase – at cost
Balance at beginning of year
Expenditure incurred
Exploration expensed as incurred
Expenditure written off
Reclass to available for sale assets (Note 5)
Carrying value at end of financial year
-
3,860
3,860
(3,860)
-
-
-
14,000
4,636
18,636
(4,636)
(803)
(13,197)
-
The recoupment of costs carried forward in relation to the areas of interest in the exploration and evaluation phases is
dependent on the successful development and commercial exploitation or the sale of the respective areas.
57
2020 ANNUAL REPORT
No t e S t o tHe C
oN SoLiD
a t eD FiNaN Ci aL S
t a t eMeNt
S
Life to date project
expenditure
expensed
Project Expenditure
expensed in
the period
Life to date project
expenditure
expensed
Project Expenditure
expensed in
the period
30 Jun 20
30 Jun 19
$ `000
$ `000
-
-
-
8,198
367
109
8,674
-
-
-
3,474
367
19
3,860
$ `000
8,069
28,056
587
4,724
-
90
$ `000
2,197
-
-
3,242
-
-
41,526
5,439
Sinclair(ii)
Springfield(i)
Halloween West JV
Lachlan Copper
Lucknow
Other Exploration Expenses
(i)
Includes the previous Halloween Project. Project sold October 2018.
(ii) Project sold in October 2019
Note 14: traDe aND otHer
payabLeS
Trade and other payables
Trade payables and other payables are carried at amortised
cost and represent liabilities for goods and services provided
to the Group prior to the end of the financial year that are
unpaid and arise when the Group becomes obliged to make
future payments in respect of the purchase of these goods
and services. Trade and other payables are presented
as current liabilities unless payment is not due within 12
months.
Current
Trade payables
Employee benefits
Other payables
Employee leave benefits
Wages, salaries, annual leave and sick leave
Liabilities accruing to employees in respect of wages and
salaries, annual leave, and sick leave expected to be settled
within 12 months of the balance date are recognised in
other payables in respect of employees’ services up to the
balance date. They are measured at the amounts expected
to be paid when the liabilities are settled. Liabilities for non-
accumulating sick leave are recognised when the leave is
taken and are measured at the rates paid or payable.
Liabilities accruing to employees in respect of wages and
salaries, annual leave, and sick leave not expected to be
settled within 12 months of the balance date are recognised
in non-current other payables in respect of employees’
services up to the balance date. They are measured as the
present value of the estimated future outflows to be made
by the Group.
30 Jun 20
30 Jun 19
$ `000
$ `000
202
126
51
379
696
168
81
945
58
No t e S t o tHe C
oN SoLiD
a t eD FiNaN Ci aL S
t a t eMeNt
S
Note 15: LeaSe LiabiLitieS
Current liabilities
Non-current liabilities
Reconciliation
Recognised on 1 July 2019 on adoption of AASB 16
Principal repayments
Closing balance
AASB 16 has been adopted during the year. Refer note 1 for details.
Consolidated
Premises
$ `000
86
-
86
Consolidated
Premises
$ `000
164
(78)
86
Total
$ `000
86
-
86
Total
$ `000
164
(78)
86
The Group leases office premises in Perth, Western Australia. The lease term is 3 years, expiring in July 2021.
Underlying assets serve as security for the related lease liabilities. A maturity analysis of future minimum lease payments is
presented below:
Lease payments
Interest
Net present values
Lease payments due
<1 year
1-2 years
$ `000
$ `000
90
(4)
86
-
-
-
Total
$ `000
90
(4)
86
Lease payments not recognised as a liability
Lease payments expensed during the period and thus not included in the measurement of the lease liability are as follows:
Short term leases
30 Jun 20
$ `000
88
At 30 June 2020 the Group was committed to short-term leases, giving rise to total commitments of $88,820 at that date.
Total cash outflow relating to leases for the period ended 30 June 2020 was $84,123.
59
2020 ANNUAL REPORT
No t e S t o tHe C
oN SoLiD
a t eD FiNaN Ci aL S
t a t eMeNt
S
Note 16: proViSioNS
Employee benefits
The provision for employee benefits represents vested long
service leave entitlements accrued.
The liability for long service leave is recognised in the
provision for employee benefits and measured as the
present value of expected future payments to be made in
respect of services provided by employees up to the balance
date. Consideration is given to expected future wage and
salary levels, experience of employee departures, and period
of service. Expected future payments are discounted using
market yields at the balance date on government bonds
with terms to maturity and currencies that match, as closely
as possible, the estimated future cash outflows.
Balance at beginning of financial year
Long service leave arising during the year
Long service leave taken during the year
Balance at the end of financial year
Current
Employee benefits
Note 17: iSSUeD CapitaL
Ordinary shares
Issued and fully paid
Movements in ordinary shares on issue
At 1 July
Return of capital(i)
Employee Benefits
$ `000
56
15
(15)
56
30 Jun 20
30 Jun 19
$ `000
$ `000
56
56
56
56
30 Jun 20
30 Jun 19
$
$
31,966,023
31,866,023
30 Jun 20
30 Jun 19
Number
$
Number
$
185,699,869
31,866,023
185,699,879
60,881,617
-
-
-
-
(29,015,514)
-
Issue of shares to Lucknow Gold(ii)
928,506
100,000
At 30June
186,628,475
31,966,023
185,699,879
31,866,023
Fully paid ordinary shares carry one vote per share and carry the right to dividend.
(i) On 8 March 2019 the Company returned capital of 15.625 cents per share to all shareholders (by equal capital reduction).
(ii) On 30 October 2019 the Company issued 928,506 shares to Lucknow Gold Ltd (‘Lucknow’) in satisfaction of subsidiary Haverford Holdings Pty Ltd’s obligation to pay
the first $100,000 to Lucknow pursuant to a Farm-In Agreement executed on 26 August 2019. Ordinary shares entitled 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.
60
No t e S t o tHe C
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On a show of hands every holder of ordinary shares present
at a meeting in person or by proxy, is entitled to one vote,
and upon a poll each share is entitled to one vote.
Note 18: reSerVeS aND
aCCUMULateD LoSSeS
Ordinary shares have no par value and the Company does
not have a limited amount of authorised capital.
Share Options
The Company has one share-based payment option scheme
under which options to subscribe for the Company’s
shares have been granted to certain Directors, other key
management personnel and all employees, refer Note 19.
Share-based payments reserve
This reserve is used to record the value of equity benefits
provided to employees and Directors as part of their
remuneration. Refer to Note 19 for further details of these
plans.
Accumulated Losses
Balance at beginning financial year
Net profit / (loss) for the year
Dividends paid
Transfer on unlisted options forfeited
Balance at end of financial year
Reserves
Share-based payment reserve
Balance at end of financial year
30 Jun 20
30 Jun 19
$ `000
$ `000
(14,753)
(4,803)
-
77
(50,917)
46,236
(11,838)
1,766
(19,479)
(14,753)
765
765
240
240
Movement in these reserves are set out in the Statement of Changes in Equity.
Note 19: SHare-baSe
payMeNt pLaNS
Executive and Employee Equity Plan (“EEEP”)
The Group has an Executive and Employee Equity Plan
(“EEEP”) for executives and employees of the Group. In
accordance with the provisions of the EEEP, as approved
by shareholders at a previous Annual General Meeting,
executives and employees may be granted options at the
discretion of the Directors.
Each employee share option converts into one ordinary
share of Talisman Mining Limited on exercise. No amounts
are paid or payable by the recipient on receipt of the option.
The options carry neither rights to dividends nor voting
rights. Options may be exercised at any time from the date
of vesting to the date of their expiry.
The number of options granted is at the sole discretion of
the Directors subject to the total number of outstanding
options being issued under the EEEP not exceeding 5% of
the Company’s issued capital at any one time.
Options issued to Directors are not issued under the EEEP
but are subject to approval by shareholders and attach
vesting conditions as appropriate.
The contractual life of each option granted is 2 to 5 years.
There are no cash settlement alternatives.
The following options lapsed during the financial year:
Grant Date
11-Nov-16
11-Nov-16
Expiry date of
options
31-Oct-19
31-Oct-19
Number of
shares under
option
150,000
140,000
Exercise
price of
options
$0.364
$0.404
Fair Value
Vested Date
Number
Lapsed
$0.270
$0.230
30-Jun-17
(150,000)
30-Jun-18
(140,000)
61
2020 ANNUAL REPORT
No t e S t o tHe C
oN SoLiD
a t eD FiNaN Ci aL S
t a t eMeNt
S
The following options were issued during the financial year to Peter Benjamin:
Issuing entity
Grant Date
Expiry date
of options
Number of
shares under
option
Exercise
price of
options
Fair
Value
Vested
Date
Talisman Mining Limited
27-Nov-19
31-Oct-20
Talisman Mining Limited
27-Nov-19
31-Oct-20
Talisman Mining Limited
27-Nov-19
31-Oct-20
Talisman Mining Limited
27-Nov-19
31-Oct-21
Talisman Mining Limited
27-Nov-19
31-Oct-21
Talisman Mining Limited
27-Nov-19
31-Oct-21
Talisman Mining Limited
27-Nov-19
31-Oct-22
Talisman Mining Limited
27-Nov-19
31-Oct-22
Talisman Mining Limited
27-Nov-19
31-Oct-22
194,444
194,444
194,444
194,444
194,444
194,444
194,444
194,444
194,448
$0.14
$0.02
30-May-20
$0.16
$0.02
30-May-20
$0.18
$0.02
30-May-20
$0.14
$0.03
30-Nov-20
$0.16
$0.03
30-Nov-20
$0.18
$0.03
30-Nov-20
$0.14
$0.04
30-May-21
$0.16
$0.04
30-May-21
$0.18
$0.04
30-May-21
The following share-based arrangements were in place at the end of the financial year:
Issuing entity
Grant Date
Expiry date
of options
Number of
shares under
option
Exercise
price of
options
Fair
Value
Vested
Date
Talisman Mining Limited
11-Nov-16
31-Oct-21
Talisman Mining Limited
11-Nov-16
31-Oct-21
40,000
40,000
$0.46
$0.32
30-Jun-19
$0.50
$0.32
30-Jun-20
Talisman Mining Limited
7-May-19
31-Oct-20
2,500,002
$0.14
$0.03
31-Oct-19
Talisman Mining Limited
27-Nov-19
31-Oct-20
194,444
$0.14
$0.02
30-May-20
Talisman Mining Limited
7-May-19
31-Oct-20
2,500,001
$0.16
$0.03
31-Oct-19
Talisman Mining Limited
27-Nov-19
31-Oct-20
194,444
$0.16
$0.02
30-May-20
Talisman Mining Limited
7-May-19
31-Oct-20
2,500,000
$0.18
$0.02
31-Oct-19
Talisman Mining Limited
27-Nov-19
31-Oct-20
194,444
$0.18
$0.02
30-May-20
Talisman Mining Limited
7-May-19
31-Oct-21
2,500,002
$0.14
$0.04
30-Apr-20
Talisman Mining Limited
27-Nov-19
31-Oct-21
194,444
$0.14
$0.03
30-Nov-20
Talisman Mining Limited
7-May-19
31-Oct-21
2,499,999
$0.16
$0.04
30-Apr-20
Talisman Mining Limited
27-Nov-19
31-Oct-21
194,444
$0.16
$0.03
30-Nov-20
Talisman Mining Limited
7-May-19
31-Oct-21
2,499,998
$0.18
$0.04
31-Oct-20
Talisman Mining Limited
27-Nov-19
31-Oct-21
194,444
$0.18
$0.03
30-Nov-20
Talisman Mining Limited
7-May-19
31-Oct-22
2,194,447
$0.14
$0.05
31-Oct-20
Talisman Mining Limited
27-Nov-19
31-Oct-22
194,444
$0.14
$0.04
30-May-21
Talisman Mining Limited
7-May-19
31-Oct-22
2,194,443
$0.16
$0.05
31-Oct-20
Talisman Mining Limited
27-Nov-19
31-Oct-22
194,444
$0.16
$0.04
30-May-21
Talisman Mining Limited
7-May-19
31-Oct-22
2,194,442
$0.18
$0.04
31-Oct-20
Talisman Mining Limited
27-Nov-19
31-Oct-22
194,448
$0.18
$0.04
30-May-21
The weighted average exercise price of each share option at the end of the financial year was $0.16 (2019: $0.16).
The weighted average remaining contract life of each share option at the end of the financial year was 1.30 years
(2019: 2.31 years).
There has been no alteration of the terms and conditions of the above share-based payment arrangements since grant date.
62
No t e S t o tHe C
oN SoLiD
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The following options were forfeited during the year:
Issuing entity
Grant Date
Expiry date
of options
Number of
shares under
option
Exercise
price of
options
Fair
Value Vested Date
Talisman Mining Limited
7-May-19
31-Oct-20
Talisman Mining Limited
7-May-19
31-Oct-20
Talisman Mining Limited
7-May-19
31-Oct-20
Talisman Mining Limited
7-May-19
31-Oct-21
Talisman Mining Limited
7-May-19
31-Oct-21
Talisman Mining Limited
7-May-19
31-Oct-21
Talisman Mining Limited
7-May-19
31-Oct-22
Talisman Mining Limited
7-May-19
31-Oct-22
Talisman Mining Limited
7-May-19
31-Oct-22
27,778
27,778
27,778
27,778
27,778
27,777
333,334
333,334
333,331
$0.14
$0.16
$0.18
$0.14
$0.16
$0.18
$0.14
$0.16
$0.18
31-Oct-19
31-Oct-19
31-Oct-19
30-Apr-20
30-Apr-20
30-Apr-20
31-Oct-20
31-Oct-20
31-Oct-20
30 Jun 20
30 Jun 19
Number
$
Number
$
Movements in options over ordinary shares on issue
At 1 July
23,120,000
239,783
7,925,000
1,678,836
Directors’ and employees’ remuneration
1,750,000
648,209
22,750,000
371,164
Unlisted options forfeited
Unlisted options cancelled
Unlisted options lapsed
At 30 June
(1,166,666)
(46,029)
(200,000)
(44,670)
-
-
(5,600,000)
(1,359,616)
(290,000)
(77,356)
(1,755,000)
(405,932)
23,413,334
764,607
23,120,000
239,783
The fair value of options granted during the year was $53,861 (2019: $837,523).
The fair value of the equity-settled share options granted under the option plan is estimated as at the date of grant using the
Black-Scholes model taking into account the terms and conditions upon which the options were granted.
November 2019 Options
Inputs into model
Exercise price
1
2
3
4
5
6
7
8
9
$ 0.14
$ 0.16
$ 0.18
$ 0.14
$ 0.16
$ 0.18
$ 0.14
$ 0.16
$ 0.18
Grant date share price (5 day VWAP)
$0.089
$0.089
$0.089
$0.089
$0.089
$0.089
$0.089
$0.089
$0.089
Expected volatility
98%
98%
98%
98%
98%
98%
98%
98%
98%
Risk-free interest rate
0.77% 0.77% 0.77% 0.77% 0.77% 0.77% 0.77% 0.77% 0.77%
Dividend yield (%)
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Expected life of options (years)
0.93
0.93
0.93
1.93
1.93
1.93
2.93
2.93
2.93
May 2019 Options
Inputs into model
1
2
3
4
5
6
7
8
9
Exercise price
$ 0.14
$ 0.16
$ 0.18
$ 0.14
$ 0.16
$ 0.18
$ 0.14
$ 0.16
$ 0.18
63
2020 ANNUAL REPORT
No t e S t o tHe C
oN SoLiD
a t eD FiNaN Ci aL S
t a t eMeNt
S
May 2019 Options
Inputs into model
1
2
3
4
5
6
7
8
9
Grant date share price (5 day VWAP)
$0.088
$0.088
$0.088
$0.088
$0.088
$0.088
$0.088
$0.088
$0.088
Expected volatility
98%
98%
98%
98%
98%
98%
98%
98%
98%
Risk-free interest rate
1.67% 1.67% 1.67% 1.67% 1.67% 1.67% 1.67% 1.67% 1.67%
Dividend yield (%)
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Expected life of options (years)
1.50
1.50
1.50
2.50
2.50
2.50
3.50
3.50
3.50
November 2016 Options
Inputs into model
Exercise price
1
2
3
4
5
$ 0.48
$ 0.52
$ 0.56
$ 0.62
$ 0.66
Exercise price post capital return(i)
$ 0.32
$ 0.36
$ 0.40
$ 0.46
$ 0.50
Grant date share price (5 day VWAP)
$ 0.425
$ 0.425
$ 0.425
$ 0.425
$ 0.425
Expected volatility
Risk-free interest rate
Dividend yield (%)
Expected life of options (years)
113%
1.77%
Nil
2.00
113%
1.77%
Nil
3.00
113%
1.77%
Nil
3.00
113%
1.77%
Nil
5.00
113%
1.77%
Nil
5.00
(i)
Exercise price adjusted after 15.625 cents per share return of capital on 8 March 2019. The expected life of the options is based on historical data and is not
necessarily indicative of exercise patterns that may occur. The expected volatility reflects the assumption that the historical volatility is indicative of future trends,
which may also not necessarily be the actual outcome. No other features of options granted were incorporated into the measurement of fair value.
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 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 regularly to reflect changes in
market conditions and the Group‘s activities. The Group’s
aim is to develop a disciplined and constructive control
environment in which all employees understand their roles
and obligations.
Note 20: FiNaNCiaL
iNStrUMeNtS
(a)
Introduction
The Group has exposure to the following risks arising from
financial instruments:
• Credit risk
• Liquidity risk
•
Interest rate risk
• Capital risk
• Foreign currency 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 this note and the financial report.
64
No t e S t o tHe C
oN SoLiD
a t eD FiNaN Ci aL S
t a t eMeNt
S
(b) Categories of financial instruments (includes assets classified as held for sale and associated
liabilities)
30 Jun 20
30 Jun 19
$ `000
$ `000
12,937
305
13,242
379
86
465
10,618
285
10,903
1,028
-
1,028
The carrying amount of financial assets recorded in the
financial statements, net of any allowance for losses,
represents the Group’s maximum exposure to credit risk
without taking account of the value of any collateral
obtained.
(d) Liquidity Risk Management
Ultimate responsibility for liquidity risk management rests
with the board of Directors, who have built an appropriate
liquidity risk management framework for the management
of the Group’s short, medium and long-term funding and
liquidity management requirements. The Group manages
liquidity risk by maintaining adequate reserves, banking
facilities and reserve borrowing facilities by continuously
monitoring forecast and actual cash flows and matching
the maturity profiles of financial assets and liabilities.
The following table details the Company’s and the Group’s
expected contractual maturity for its non-derivative
financial liabilities. These have been drawn up based on
undiscounted contractual maturities of the financial asset
and liabilities based on the earliest date the Group can
be required to repay. The tables include both interest and
principal cash flows.
Financial assets
Cash and cash equivalents
Receivables
Financial liabilities
Trade and other payables
Lease liabilities
Fair value of financial assets and liabilities
The carrying amount of financial assets and financial
liabilities recorded in the financial statements represents
their respective net fair values, determined in accordance
with the accounting policies disclosed in Note 1.
The Directors consider that the carrying amounts of
financial assets and financial liabilities recorded in the
financial statements approximate their fair value.
(c) Credit risk management
Credit risk refers to the risk that a counterparty will default
on its contractual obligations resulting in financial loss to
the Group. The Group has adopted a policy of only dealing
with creditworthy counterparties and obtaining sufficient
collateral where appropriate, as a means of mitigating
the risk of financial loss from defaults. The Group only
transacts with entities that are rated the equivalent of
investment grade and above. This information is supplied
by independent rating agencies where available and, if
not available, the Group uses publicly available financial
information and its own trading record to rate its major
customers. The Group’s exposure and the credit ratings
of its counterparties are continuously monitored, and
the aggregate value of transactions concluded is spread
amongst approved counterparties. Credit exposure is
controlled by counterparty limits that are reviewed and
approved by the Risk Management Committee annually.
The Group does not have any significant credit risk exposure
to any single counterparty or any Group of counterparties
having similar characteristics. The credit risk on liquid funds
and derivative financial instruments is limited because the
counterparties are banks with high credit ratings assigned
by international credit rating agencies.
.
65
2020 ANNUAL REPORT
No t e S t o tHe C
oN SoLiD
a t eD FiNaN Ci aL S
t a t eMeNt
S
Less than 1
month
1 to 3
months
3 months
to 1 year
1 to 5
years
5+ years
No fixed
term
Total
$ `000
$ `000
$ `000
$ `000
$ `000
$ `000
$ `000
2020
Financial Assets
Non-interest bearing
Variable interest rate
108
1,357
-
-
Fixed interest rate
-
11,580
1,465
11,580
Financial Liabilities
Non-interest bearing
Fixed interest rate
2019
Financial Assets
Non-interest bearing
Variable interest rate
Fixed interest rate
Financial Liabilities
Non-interest bearing
Fixed interest rate
253
-
253
114
538
-
652
841
-
841
-
-
-
-
-
80
80
-
-
-
-
-
-
-
126
-
126
-
-
10,120
10,120
187
-
187
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
197
-
-
305
1,357
11,580
197
13,242
-
-
-
51
-
-
379
-
379
165
538
10,200
51
10,903
-
-
-
1,028
-
1,028
(e)
Interest rate risk
The Group is not exposed to interest rate risk on existing
finance facilities as the Group’s borrowings are at fixed
interest rates for the respective terms of the facilities. (Refer
to Note 15).
Some of the Group’s assets are subject to interest rate risk
but the Group is not dependent on this income.
Interest rate sensitivity analysis
The sensitivity analysis of the Group’s exposure to interest
rate risk at the reporting date has been determined based
on a change of 50 basis points in interest rates taking place
at the beginning of the financial year and held constant
throughout the year.
At reporting date, if interest rates had been 50 basis points
higher and all other variables were constant, the Group’s
net loss would have reduced by $6,778 (2019: net profit
increased by $2,688).
(f) Capital risk management
The Board’s policy is to maintain a strong capital base so as
to maintain investor, creditor and market confidence and
to sustain future development of the business. The capital
structure of the Group consists of equity only, comprising
issued capital and reserves, net of accumulated losses.
The Group’s policy is to use capital market issues and debt
funding to meet the funding requirements of the Group.
There were no changes in the Group’s approach to capital
management during the year.
The Group is not subject to externally imposed capital
requirements.
66
No t e S t o tHe C
oN SoLiD
a t eD FiNaN Ci aL S
t a t eMeNt
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(g) Foreign currency exchange rate risk management
The Group undertakes certain borrowing transactions denominated in United States Dollars, hence exposures to exchange
rate fluctuations arises.
The carrying amounts of the Group’s foreign currency denominated monetary assets and monetary liabilities at balance date
are as follows:
US Dollars
Consolidated
Liabilities
Assets
2020
$’000
-
2019
$’000
21
2020
$’000
1
2019
$’000
1
Foreign currency sensitivity analysis
• net loss would increase by $10 (2019: net profit increase
The sensitivity analysis below details the Group’s sensitivity
to an increase/decrease in the Australian dollar against
the United States dollar. The sensitivity analysis includes
only outstanding foreign currency denominated monetary
items, including external loans within the Group where the
denomination of the loan is in a currency other than the
currency of the lender or the borrower and adjusts their
translation at balance date by a 1% increase in foreign
currency rates
A 1% increase in the currency rate is the sensitivity rate
used when reporting foreign currency risk internally to
management and represents management’s assessment of
the possible change in foreign exchange rates.
At balance date, if foreign exchange rates had been 1%
higher and all other variables were held constant, the
Group’s
of $291) and
• equity reserves would increase/decrease by $Nil (2019:
$Nil).
Note 21: CoMMitMeNtS aND
CoNtiNGeNCieS
Commitments
In order to maintain current rights of tenure to exploration
tenements, the Group is required to perform exploration
work to meet the minimum expenditure requirements
specified by various State governments. These obligations
are not provided for in the financial report and are payable
as follows:
Exploration expenditure
Within one year
After one year but not more than five years
Greater than five years
30 Jun 20
30 Jun 19
$’000
$’000
1,147
2,873
-
4,020
2,971
10,814
13,229
27,014
If the Group decides to relinquish certain exploration tenements and/or does not meet these obligations, assets recognised in
the statement of financial position may require review to determine the appropriateness of carrying values. The sale, transfer
or farm-out of exploration rights to third parties will reduce or extinguish these obligations.
67
2020 ANNUAL REPORT
No t e S t o tHe C
oN SoLiD
a t eD FiNaN Ci aL S
t a t eMeNt
S
Contingencies
There are no material contingent liabilities or assets as at
30 June 2020 and no contingent liabilities or assets were
incurred in the interval between the period end and the date
of this financial report.
Directors
Jeremy Kirkwood
Daniel Madden
Note 22: reLateD party
DiSCLoSUreS
Other transactions with key management
personnel
No member of the key management personnel appointed
during the year received a payment as part of his or her
consideration for agreeing to hold the position.
Executives
Shaun Vokes
Details of key management personnel
The key management personnel of Talisman Mining Limited
during the year were:
Short-term employee benefits
Post-employment benefits
Other long-term benefits
Share-based payments(i)
Non-Executive Chairman
(resigned as Chairman
15 July 2020)
Managing Director
(resigned as Managing Director
on 1 September 2020, remains
as a Non-Executive Director)
Brian Dawes
Non-Executive Director
Karen Gadsby
Non-Executive Director
Peter Benjamin
Non-Executive Director
(appointed 24 July 2019)
Chief Financial Officer/
Co-Company Secretary
(ceased 30 April 2020)
Anthony Greenaway
General Manager – Geology
(ceased 7 August 2020)
Key management personnel compensation is disclosed in
the Remuneration Report which forms part of the Directors’
Report and has been audited.
The total remuneration paid to key management personnel
of the Company and the Group during the year was as
follows:
30 Jun 20
30 Jun 19
$
$
1,210,205
1,146,652
105,638
15,455
528,482
106,954
5,834
396,758
Total key management personnel compensation
1,859,780
1,656,198
(i)
The value of share-based payments shown in the table above are non-cash values based on an accounting valuation calculated under the Black Scholes option
pricing method.
Note 23: iNtereSt iN SUbSiDiarieS
The consolidated financial statements include the financial statements of Talisman Mining Limited and the subsidiaries listed
in the following table:
Name
Country of
Incorporation
Talisman Nickel Pty Ltd
Haverford Holdings Pty Ltd
Talisman B Pty Ltd
Australia
Australia
Australia
68
Equity Interest
Investment
2020
2019
2020
2019
%
-
100
100
%
100
100
-
$
-
$
1
68,000
68,000
1
-
No t e S t o tHe C
oN SoLiD
a t eD FiNaN Ci aL S
t a t eMeNt
S
Talisman Mining Limited is the ultimate parent entity and
ultimate parent of the Group.
Balances and transactions between the Company and its
subsidiaries, which are related parties of the Company, have
been eliminated on consolidation.
Details of transactions between the Group and other related
entities are disclosed below.
Note 24: pareNt eNtity
DiSCLoSUreS
The financial information for the parent entity, Talisman
Mining Limited, has been prepared on the same basis as the
consolidated financial statements, except as set out below.
Investments in subsidiaries, associates and joint venture
entities
Investments in subsidiaries, associates and joint venture
entities are accounted for at cost in the parent entity’s
financial statements. Dividends received from associates
are recognised in the parent entity’s profit or loss, rather
than being deducted from the carrying amount of these
investments.
Share-based payments
The grant by the Company of options over its equity
instruments to the employees of subsidiary undertakings
in the Group is treated as a capital contribution to that
subsidiary undertaking. The fair value of employee services
received, measured by reference to the grant date fair value,
is recognised over the vesting period as an increase to
investment in subsidiary undertakings, with a corresponding
credit to equity.
Disclosures as at 30 June 2020 and for the year then ended
in relation to Talisman Mining Limited as a single entity are
noted below.
Assets
Current assets
Non-current assets
Total assets
Liabilities
Current liabilities
Total liabilities
Net assets
Equity
Issued capital
Share based payment reserve
Accumulated losses
Total equity
Profit for the year
Other comprehensive income
Total comprehensive income
69
30 Jun 20
30 Jun 19
$ `000
$ `000
12,871
298
13,169
392
392
10,721
327
11,048
529
529
12,777
10,519
31,966
765
(19,954)
12,777
31,866
240
(21,587)
10,519
Year ended
30 Jun 20
30 Jun 19
$ `000
1,513
-
1,513
$ `000
50,928
-
50,928
2020 ANNUAL REPORT
No t e S t o tHe C
oN SoLiD
a t eD FiNaN Ci aL S
t a t eMeNt
S
In order to maintain current rights of tenure to exploration
tenements, the Group is required to perform exploration
work to meet the minimum expenditure requirements
specified by various State governments. However, the
parent entity itself is not responsible for any minimum
exploration expenditure commitments.
Note 25: aUDitor’S
reMUNeratioN
The auditor of Talisman Mining Limited is HLB Mann Judd.
Remuneration received by the auditors:
30 Jun 20
30 Jun 19
$
1,750
-
46,274
48,024
$
2,000
1,500
44,046
47,546
Preparation of Fringe Benefit Tax Return
Audit of Western Australian Tenement Exploration Expenditure
Audit or review of the financial report
Total Remuneration of Auditors
Note 26: SUbSeQUeNt eVeNtS
Mr Kerry Harmanis was appointed as non-executive
Chairman of the Company on 15 July 2020. Mr Harmanis
succeeded previous chair Jeremy Kirkwood, who remains on
the board of the Company as a Non-Executive Director.
Mr Dan Madden resigned as Managing Director on 1
September 2020, however, remains on the board of the
Company as a Non-Executive Director.
Mr Shaun Vokes was appointed as interim Chief Executive
Officer of the Company on 2 September 2020.
70
DireCtorS’
DECLARATION
Talisman Mining Limited
The Directors of the Company declare that:
1.
the consolidated financial statements, comprising the Consolidated Statement of Profit or Loss and Other Comprehensive
Income, Consolidated Statement of Financial Position, Consolidated Statement of Cash Flows, Consolidated Statement of
Changes in Equity, and accompanying notes are in accordance with the Corporations Act 2001, and:
a. comply with Accounting Standards and the Corporations Regulations 2001; and
b. give a true and fair view of the financial position as at 30 June 2020 and of the performance for the year ended on
that date of the Group;
2.
the interim Chief Executive Officer and the acting Chief Financial Officer of the Group have each declared as required by
Section 295A that:
a.
the financial records of the Group for the financial year have been properly maintained in accordance with Section
286 of the Corporations Act 2001;
b.
the financial statements and notes for the financial year comply with the Accounting Standards; and
c.
the financial statements and notes for the financial year give a true and fair view.
3.
in the Directors’ opinion there are reasonable grounds to believe that the Company will be able to pay its debts as and
when they become due and payable.
4. The Group has included in the notes to the financial statements an explicit and unreserved statement of compliance with
International Financial Reporting Standards.
This declaration is made in accordance with a resolution of the Board of Directors
Daniel Madden
30 September 2020
71
2020 ANNUAL REPORT aDDitioNaL SeCUritieS
EXCHANGE INFORMATION
AS AT 29 SEPTEMBER 2020
1. N UMb er oF HoLDer S oF e Q Uit y Se CUritie S
(a) Distribution of holders of equity securities
Range
1 to 1,000
1,001 to 5,000
5,001 to 10,000
10,001 to 100,000
100,001 and Over
Total
(b) Voting rights
No. of holders
162
484
420
852
286
2,204
Securities
77,991
1,497,605
3,575,356
33,319,378
147,229,549
185,699,879
Each ordinary share is entitled to one vote when a poll is called, otherwise each member present at a meeting or by proxy has
one vote on a show of hands.
(c) Less than marketable parcel of shares
The number of shareholders holding less than a marketable parcel is 531 (holding a total of 1,014,113 shares) given a share
value of $0.12 cents per share.
(d) Substantial Shareholdings:
Ordinary Shareholders
Fully paid ordinary shares
Mr Kerry Kyriakos Harmanis
Number
33,859,138
%
18.23%
Set out above is an extract from the Company’s register of last substantial shareholder notices as received by the Company
and/or lodged at the ASX. Shareholdings and percentages reported in the table are as reported in the most recent
notifications received, however these may differ from current holdings as substantial holders are required to notify the
Company only in respect of changes which act to increase or decrease their percentage holding by at least 1% of total voting
rights.
2. CoMpaNy Se Cre ta ry
The name of the company secretary is Alexander Neuling.
3. re GiS te reD oFFiCe aN D pr iN CipaL aDMiNiS
tratiVe oFFiCe
Registered and principal administrative office:
Registered securities are held at the following address:
Level 11, 2 Mill Street
Perth, Western Australia 6000
Telephone +61 8 9380 4230
Link Market Services Limited
Level 12, QV1 Building
250 St Georges Terrace
Perth, Western Australia 6000
72
aD Di t i oNaL Se
C Ur i t i e S e X C HaN Ge iN F
o rMa t i oN
4 . Se C Uri tie S e XCHaN Ge LiS tiNG
Quotation has been granted for all the ordinary shares of the Company on all Member Exchanges of the Australian Securities
Exchange Limited.
5 . reStr iC teD Se CUrit ie S
As at the date of this report 928,560 ordinary shares are subject to voluntary escrow. The voluntary escrow period on these
securities ends on 30 October 2020.
6 . t WeNt y L arGe St HoLDer S oF orDiNary SHare S
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
Ordinary Shareholders
HARMAN NOMINEES PTY LTD
TYCHE HOLDINGS PTY LTD
HARMANIS HOLDINGS PTY LTD
MRS JASMINE KALIS
TYCHE HOLDINGS PTY LTD
TYCHE HOLDINGS PTY LTD
HARMANIS HOLDINGS PTY LTD
JETOSEA PTY LTD
SOSAWILL PTY LTD
INVESTMENT HOLDINGS PTY LTD
MR JOHN FORD
REGENT CORPORATION 2001 PTY LTD
SIREB PTY LTD
MR PETER CHARLES WIGHAM
BACK9 INVESTMENT MANAGEMENT PTY LTD
JARHAMCHE PTY LTD
MR BRIAN ERNEST ZUCAL & MR STEPHEN BRIAN ZUCAL
SYDNEY FUND MANAGERS LIMITED
TYCHE HOLDINGS PTY LTD
BNP PARIBAS NOMINEES PTY LTD
Number
11,111,111
6,400,001
4,437,575
4,000,000
3,850,000
3,510,000
3,080,451
2,600,000
2,550,000
2,500,000
2,136,768
1,930,825
1,904,464
1,740,500
1,600,000
1,593,501
1,550,000
1,500,000
1,470,000
1,381,364
%
5.98
3.45
2.39
2.15
2.07
1.89
1.66
1.40
1.37
1.35
1.15
1.04
1.03
0.94
0.86
0.86
0.83
0.81
0.79
0.74
73
2020 ANNUAL REPORT aD Di t i oNaL Se
C Ur i t i e S e X C HaN Ge iN F
o rMa t i oN
7. U NQUoteD e Q Uit y Se CUrit ie S
Class
Unlisted options
Unlisted options
Unlisted options
Unlisted options
Unlisted options
Unlisted options
Unlisted options
Unlisted options
Unlisted options
Unlisted options
Unlisted options
Exercise Price
$
Expiry Date
Number Number of holders
$ 0.46
31-Oct-21
40,000
$ 0.50
31-Oct-21
40,000
$ 0.14
31-Oct-20
$ 0.16
31-Oct-20
$ 0.18
31-Oct-20
$ 0.14
31-Oct-21
$ 0.16
31-Oct-21
$ 0.18
31-Oct-21
$ 0.14
31-Oct-22
$ 0.16
31-Oct-22
$ 0.18
31-Oct-22
2,694,446
2,694,445
2,694,444
2,694,446
2,694,443
2,694,442
2,388,891
2,388,887
2,388,890
3
3
15
15
15
15
15
15
13
13
13
All options have no voting rights.
8. oN -Ma rKe t bUy b a CK
At the date of this report the Company is not involved in an on-market buy-back.
74
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A
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I
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I
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Address:
Level 11, 2 Mill Street
Perth WA 6000
PO Box 7446 Cloisters Square
Perth WA 6850
Phone:
+61 8 9380 4230
Fax:
+61 8 9382 8200