(formerly known as Lithium Consolidated Ltd)
ACN 612 008 358
CONSOLIDATED FINANCIAL REPORT
FOR THE YEAR ENDED
30 JUNE 2020
TEMPEST MINERALS LTD ACN 612 008 358
Phone: +61 8 9200 0435 Fax: +61 8 9380 6761 Address: Level 2, Suite 9 389 Oxford Street, Mount Hawthorn WA 6016
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Contents
Cautionary Statements
Corporate Information
Letter from the Chairman
Review of Operations
Directors’ Report
Auditor’s Independence Declaration
Consolidated Statement of Profit or Loss and Other Comprehensive Income for the
Year Ended 30 June 2020
Consolidated Statement of Financial Position as at 30 June 2020
Consolidated Statement of Changes In Equity for the Year Ended 30 June 2020
Consolidated Statement of Cash Flows for the Year Ended 30 June 2020
Notes To The Consolidated Financial Statements for the Year Ended 30 June 2020
Director’s Declaration
Independent Auditor’s Report
Corporate Governance Statement
Shareholder Information
Interests in Tenements
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TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Cautionary Statements
Forward-looking statements
This document may contain certain forward-looking statements. Such statements are only predictions,
based on certain assumptions and involve known and unknown risks, uncertainties and other factors,
many of which are beyond the company’s control. Actual events or results may differ materially from the
events or results expected or implied in any forward-looking statement.
The inclusion of such statements should not be regarded as a representation, warranty or prediction with
respect to the accuracy of the underlying assumptions or that any forward-looking statements will be or
are likely to be fulfilled.
Tempest Minerals Ltd undertakes no obligation to update any forward-looking statement to reflect
events or circumstances after the date of this document (subject to securities exchange disclosure
requirements).
The information in this document does not take into account the objectives, financial situation or
particular needs of any person or organisation. Nothing contained in this document constitutes
investment, legal, tax or other advice.
Competent Person Statement
The information in this report that relates to Exploration Results and general project comments is based
on information compiled by Dr Anthony Morey, a Competent Person who is a Member of the Australian
Institute of Geoscientists and the Society of Economic Geologists. Dr Morey is a consulting geologist to
Tempest Minerals Limited. Dr Morey has sufficient experience that is relevant to the style of mineralisation
and type of deposit under consideration and to the activities being 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’. Dr Morey consents to the inclusion in the report of the
matters based on his (or her) information in the form and context in which it appears.
Page 2
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Corporate Information
Directors and Company Secretary
Brian Moller (Non-Executive Chairman)
Don Smith (Managing Director)
Vincent Mascolo (Non-executive Director)
Andrew Haythorpe (Non-executive Director)
Owen Burchell (Non-Executive Director)
Paul Jurman (Company Secretary)
Head Office and Registered Office
Tempest Minerals Ltd (formerly known as Lithium Consolidated Ltd)
Level 2, Suite 9
389 Oxford Street
Mt Hawthorn, WA 6016
Tel: +61 8 9200 0435
www.tempestminerals.com
Auditors
BDO Audit Pty Ltd
Level 10, 12 Creek Street
Brisbane QLD 4000
Tel: +61 7 3237 5999
Fax: +61 7 3221 9227
www.bdo.com.au
Share Registry
Link Market Services Limited
Level 21, 10 Eagle Street
Brisbane QLD 4000
Tel: 1300 554 474
www.linkmarketservices.com.au
Stock Exchange Listing
Australian Securities Exchange Ltd
ASX Code: TEM
Australian Company Number
612 008 358
Solicitor
HopgoodGanim Lawyers
Level 8, Waterfront Place
1 Eagle Street
Brisbane QLD 4000
Tel: +61 7 3024 0000
Fax: +61 7 3024 0300
www.hopgoodganim.com.au
Page 3
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Letter from the Chairman
Dear Shareholder
On behalf of the Board of Directors of Tempest Minerals Ltd (Tempest or the Company), I take
pleasure in presenting the Annual Report for 2020.
This year has been marked by unprecedented market turbulence due to the coronavirus
pandemic. As a company with a worldwide portfolio of early stage metal projects, Tempest
redirected its focus away from overseas territories to Australia as international travel and lockdown
restrictions escalated.
The Company has also sought to diversify its commodity base away from being only focussed on
lithium with a sale of its Nevada mining claims to ASX listed Argosy Minerals Ltd. Tempest retains
exposure to any project upside that may be achieved through a future additional project success
based milestone consideration.
Tempest also secured exciting gold focussed opportunities, when in December 2019, it completed
its purchase of a 100% interest in the Western Australian based exploration company Warrigal
Mining Pty Ltd (Warrigal). The acquisition of Warrigal provides existing shareholders to 510km2 of
high-quality precious and base metal exploration projects located in the Mount Magnet and
Yalgoo mineral fields of the Murchison Province of Western Australia less than 500km North-East of
Perth.
As part of the acquisition, Don Smith and Owen Burchell, founding directors of Warrigal, joined the
Board to bolster the technical team. The enthusiasm and drive they bring to the Board has been
inspiring and we look forward to accelerating the exploration program in the December 2020
quarter and beyond.
Tempest was also able to reach agreement with AIM listed Premier African Minerals Limited
(Premier) for the sale of its Mozambique and Zimbabwe mineral exploration projects. The
consideration received, comprising 124,512,702 Premier shares, enables Tempest to share any
upside on successful exploration results by Premier.
The Company was pleased with the successful completion of an Entitlement Offer (and Additional
Placement) in August 2020. Proceeds therefrom will be applied to fund exploration programs over
the next 6-12 months at the WA projects.
We were delighted to supplement our technical team with the addition of Dr Anthony Morey
during the year who specialises in mineralization systems with a particular focus on structural
geology and the relationship to base metals and gold. Having previously worked at the Golden
Grove Copper/Zinc/Gold Mine, Dr Morey’s knowledge of the geology in the Murchison region is
expected to be invaluable in the development of the Tempest projects in that region.
I would like to extend my thanks to the Company’s CEO Mr Don Smith, my fellow Directors and the
management team for their ongoing efforts in advancing the Company’s projects in a challenging
year.
This year has presented many challenges but I’m excited by the opportunities ahead, particularly
as we seek to expand our Australian gold and base metals footprint amid robust gold prices.
On behalf of the Board, I thank you for your continued support and look forward to bringing you
further news as our exploration efforts continue.
Yours faithfully
Brian Moller
Chairman
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TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Review of Operations
Overview
The 2019-2020 year was a busy one for Tempest Minerals Limited (Tempest or TEM) with some
significant challenges faced including:
●
●
long standing unfavourable lithium and exploration market conditions; and
the advent of the global COVID-19 pandemic. The effect on the company was largely
minimised due to existing remote working procedures and exploration activities delayed
only relatively briefly, due to short lived travel restrictions in Western Australia compared to
other jurisdictions.
There were also a number of organisational changes
● A change in corporate strategy away from exclusive lithium exploration to a diversified
portfolio;
● Sale of the Company’s African assets; and
● A change in company name in August 2020.
A number of exciting developments also prevailed during the reporting period including:
The acquisition of private exploration company Warrigal Mining Pty Ltd;
The appointment of key consultants; and
●
●
● Exciting results from exploration programs at the Australian projects.
Strategy
Tempest strategy is to maximise shareholder value and benefit all through the discovery and
development of high potential precious, base and energy metals. We will achieve this by being
industry leaders through excellence in sustainable business, innovation and science.
Growth
As part of the Company’s obligation to increase shareholder value, Tempest Minerals Ltd frequently
reviews organic and acquisition-based growth opportunities which fit the company’s corporate
and technical criteria.
Australian Projects
Warrigal
In December 2019, TEM completed its purchase of a 100% interest in the Western Australian based
exploration company Warrigal Mining Pty Ltd (Warrigal). (Refer previous ASX release “Completion
of Warrigal Mining Acquisition” dated 13 December 2019). The acquisition of Warrigal provides
existing shareholders to 510km2 of high-quality precious and base metal exploration projects
located in the Mount Magnet and Yalgoo mineral fields of the Murchison Province of Western
Australia less than 500km North-East of Perth.
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TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Review of Operations
War West Project
Background
93km2 of granted tenure and sits within 20km of two
milling and processing facilities. The Warriedar Project
is flanked by greenstones and volcanics and
is
interpreted by TEM to host a significant Intrusive
Related Gold System (IRGS).
Although a previously lesser known mineralisation style
in Western Australia, more
recent high-profile
examples such as DeGrey Mining ASX:DEG Hemi and
Northern Star ASX:NST Pogo Mine have spotlighted the
potential.
The War West Project is exemplified by a large 15km x
3km highly altered zone of intermediate composition
intrusive known as the Walganna Suite.
The project is highlighted further by multiple indicator
geochemical anomalies within the altered zone with
high grade vein rock chips with frequent visible gold
along with significant legacy alluvial and artisanal
hard rock gold mining within the project bounds.
Historical gold production at the Warriedar Mining
Centre and State Battery occurred between 1913-
1935 reported an average grade of 10.7g/t Au. The
Warriedar Mine produced copper between 1958-1969
at a grade of 9.83% Cu.
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TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Review of Operations
Activities
During the reporting period, the Company completed multiple geological mapping campaigns
and one 500m offset grid pattern-based surface geochemistry program. The aim of the surface
sampling program was to obtain further insight into the geology and source of the mineralization
through multi-element geochemistry.
Parts of the planned program were not completed due to logistical challenges associated with the
outbreak of the COVID-19 virus. Also, areas of deeper than expected transported cover were
encountered which will require alternative sampling techniques such as Rotary Air Blast (RAB)
drilling.
Some highlights of this work are shown below:
Figure 1: Sample points - AsBiMoSbTeW (ppm)
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TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Review of Operations
Figure 2: Sample points - Arsenic (ppm)
Figure 3: Sample points - AsBiMoSbTeW (ppm)
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TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Review of Operations
Further work including infill surface sampling and drilling is anticipated to resume in the December
2020 quarter.
Meleya Project
Background
The Meleya Project comprises the Eastern side of the Walganna Suite of intermediate intrusives
which have known gold mineralisation as well as >20km of previously unrecognised greenstones
and volcanics of the Yalgoo Foldbelt which are interpreted as being along strike from World Class
Copper-Zinc-Lead-Gold-Silver VMS deposit Golden Grove.
This previously unexplored sequence now includes large exposures of outcropping prospective
rocks mapped geologically and geochemically as both metal bearing and highly prospective for
hosting significant orogenic gold and Volcanogenic Massive Sulphide (VMS) deposits.
Activities
Activities during the reporting period included a large scale 1000m x 500m offset grid surface and
auger sampling program. The raw data from this program was processed using a number of
advanced geochemical algorithms which identified multiple large-scale anomalies.
Figure 4: Warriedar geology map with distribution of CHI4 index data
Some of the samples were also scrutinized using advanced geochemical ‘fingerprinting’
techniques including: full digestion, fused bead LA-ICPMS and XRF analysis methods, chondrite
normalised immobile element trace plots and fertility indicators. These showed the majority of
samples received fit in the dacitic/rhyodacitic categories as well as the ‘F-II / F-IIIa / F-IV’ fertility
fields - which is a key requirement for enabling economically viable archaean VMS deposits in
Australia and worldwide (including Golden Grove – figure 5 & 6).
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TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Review of Operations
Figure 5: Comparable host rock geochemistry between Golden Grove and Meleya (a-b immobile
element plots, c-d normalised chondrite trace element plots)
Figure 6: Plot of La/Yb vs Yb as proxy for fertility receptor for VMS (F1 Purple being non-fertile)
TEM commissioned renowned geophysicist Kim Frankcombe of ExploreGeo Pty Ltd to review the
regional geophysical data and produce remodelled high-resolution magnetic data (refer Figure 7).
Existing target zones identified from legacy geophysical data in the Meleya Zone correspond with
targets identified from this new data as well as zones of geochemical prospectivity.
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TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Review of Operations
Figure 7: Total Magnetic Intensity image of the Meleya Zone with new targets
Messenger Project
Background
The Messenger Project comprises 2 tenements totalling of 93km2 located nearby the world class
EMR Golden Grove base and precious metal mine. The project itself and neighbouring prospecting
leases have all been subject to artisanal mining since at least 1907 when gold was first discovered
at the location. The Messenger Project has outcrops of the key Golden Grove Unit as well as large
outcrops of underexplored mafics, ultramafics and greenstone and associated quartz lodes.
Activities
Although hindered by COVID-19 restrictions, exploration work undertaken included desktop studies
and initial reconnaissance mapping (refer Figure 8).
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TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Review of Operations
Key volcanic outcrops with geochemical anomaly
Circular Magnetic Target
Figure 8: Messenger Project overview
Euro Project
Background
The Euro Project comprises 4 pending tenements for a total of 176.5km2 located in the same
geological structures (folded greenstones) which host several major deposits including the
Rothsay Gold Mine, Mount Mulgine Tungsten Project and the Karara Iron Mine.
Activities
Work completed during the reporting period included data compilation and analysis (refer
Figure 9).
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TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Review of Operations
Figure 9: Euro Project overview
Range Project
Background
Located in the heart of the Mount Magnet mineral field and 5km along strike of the prolific +6Moz
Mount Magnet Operations, the Range Project consists of 17 tenements for 20km2. Work completed
during the reporting period included continued data digitisation and analysis (refer Figure 10).
Activities
Field mapping and sampling was conducted this September 2020 quarter. Further work including
infill surface sampling and drilling is anticipated to resume in the December 2020 quarter.
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TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Review of Operations
Figure 10: Range Project Overview
South East Yilgarn Projects (YLP)
Background
The YLP consists of 3 tenements (1 granted 2 pending) for a total of 105.4km2 highly prospective for
lithium and gold (refer Figure 11).
Activities
Work conducted during the reporting period include further technical review and data analysis.
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TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Review of Operations
Koolyanobbing
Windarling
Mt Marion
Kalgoorlie KCGM
Kambala St Ives
Bald HIll
Widgiemooltha
Rocky Hill
Caranning
Greenbushes
Mt Cattlin
Figure 11: Yilgarn Projects Overview
African Projects
In June 2020, the Company entered into a sale agreement with Premier African Minerals Limited
(Premier) where Premier agreed to purchase the African projects. Premier completed its due
diligence in July 2020 and settlement occurred by payment of the purchase consideration of
AUD$150,000 plus the payment of inspection fees for the claims in Zimbabwe through the issue of
124,512,702 Premier shares to the Company issued at a deemed issue price of 0.0744p
("Consideration Shares"), the issue price being the daily volume weighted average price during the
five days trading days immediately prior to completion.
Premier is an African focussed resources company with projects in Zimbabwe, Mozambique and
Namibia and has exposure to commodities including: Lithium, Gold and Tungsten. Premier is listed
on the London Alternative Investment Market (AIM) under the ticker (PREM).
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TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Review of Operations
Zimbabwe
Mozambique
Africa
Nevada
The Company sold its 80% interest in the Tonopah Lithium Project in the Clayton Valley, in West Central
Nevada, in the United States of America, to ASX listed Argosy Minerals Ltd.
Likely Developments
The Company will continue its mineral exploration activities (subject to any restrictions that may apply in
relation to the COVID-19 pandemic, as noted above) with the objective of finding mineralised resources.
The Company will also consider the acquisition of further prospective exploration interests and where
appropriate secure joint venture partners to assist in financing exploration activities.
The Coronavirus (COVID-19) pandemic has to date not had a significant direct financial impact on the
Company. Staff have been able to work from home and have remained in good health. Whilst field
exploration programs have been delayed or rescheduled as a result of certain travel restrictions and
gradual opening up of boarders, the Company is on track to complete the majority of its planned
exploration program during the current field season. The majority of the planned program for the 2020
calendar year is focussed on projects located in Western Australia.
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TEMPEST MINERALS LTD- ACN 612 008 358
ANNUAL REPORT 2020
Directors’ Report
The directors submit their report on the consolidated entity (“Group”) consisting of Tempest Minerals Ltd
(formerly known as Lithium Consolidated Ltd) and the entities it controlled at the end of, and during, the
financial year ended 30 June 2020.
Directors
The following persons were directors of Tempest Minerals Ltd during the financial year and up to the date
of this report, unless otherwise stated:
Mr Brian Moller
Mr Vincent Mascolo
Mr Andrew Haythorpe (appointed 11 October 2019)
Mr Owen Burchell (appointed 10 January 2020)
Mr Don Smith (appointed 10 January 2020)
Mr Shanthar Pathmanathan (resigned 11 October 2019)
Information on Directors
The board has a strong combination of technical, managerial and capital markets experience. Expertise
and experience include operating and mineral exploration. The names and qualifications of the current
directors are summarised as follows:
Brian Moller – Non-Executive Chairman
Brian specialises in capital markets, mergers and acquisitions and corporate restructuring, and has acted
in numerous transactions and capital raisings in the industrial, resources and energy sectors. He has been
a partner at the legal firm, HopgoodGanim for 30 years and leads the Corporate Advisory and
Governance practice. Mr Moller acts for many publicly listed companies in Australia and regularly
advises boards of directors on corporate governance and related issues.
Brian is a solicitor of the Supreme Court of Queensland and Solicitor and Barrister of the Supreme Court of
Western Australia.
Brian is a Non-Executive Director of ASX listed DGR Global Ltd, Dark Horse Resources Ltd and dual TSX
and AIM-listed SolGold plc and chairman of ASX listed Platina Resources Ltd and AusTin Limited.
During the past three years, Mr Moller has also served as a director of the following listed companies:
DGR Global Ltd*
Aus Tin Mining Limited*
Dark Horse Resources Limited*
Platina Resources Ltd*
Aguia Resources Limited (resigned 14 June 2019)
Solgold PLC*^
*denotes current directorship
^denotes listed on the Toronto Stock Exchange and the London Stock Exchange
Brian is a member of the Audit & Risk Management Committee.
Don Smith – Managing Director
Don is a geologist and entrepreneur with over 20 years in the mining industry. He has worked in
operational, development, exploration and consultant roles for junior through to multinational firms
spanning over 10 countries and numerous commodities including base metals, precious metals and
energy minerals.
Don has a Bachelor of Science from Newcastle University and a Master of Business Administration from
the Australian Institute of Business. Don is also a member of the Australasian Institute of Mining and
Metallurgy and a member of the Australian Institute of Geoscientists.
Don does not sit on the board of any other listed companies.
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TEMPEST MINERALS LTD- ACN 612 008 358
ANNUAL REPORT 2020
Directors’ Report
Vincent Mascolo - Non-Executive Director
Vincent is a qualified mining engineer with extensive experience in gold and coal mining, quarrying and
civil works. He has been a director of various public and private companies over the past 27 years and is
currently Chief Executive Officer and Managing Director of AIM listed IronRidge Resources Ltd.
During the past three years, Vince has also served as a director of the following listed companies:
DGR Global Ltd
IronRidge Resources Limited^
^denotes listed on the Alternative Investment Market of the London Stock Exchange
Vincent is chairman of the Audit & Risk Management Committee.
Andrew Haythorpe – Non-Executive Director
Andrew has 30 years’ experience in geology, funds management and has been a Director and
Chairman of a number of TSX and ASX listed companies. Since 1999, Andrew has been involved in over
A$300 million of mergers and acquisitions and capital raisings in mining and technology companies listed
on the TSX and ASX.
Andrew has a Bachelor of Science (Hons) from the James Cook University, is a member of the Australian
Institute of Company Directors (MAICD) and a Fellow of the Australian Minerals Institute (FAusIMM).
During the past three years, Andrew has also served as a director of the following listed companies:
Accelerate Resources Ltd (resigned 3 July 2020)
Owen Burchell – Non-Executive Director
Owen is a mining engineer with 20 years of technical, operational and corporate experience including
management positions at Rio Tinto, BHP and Barrick Gold through to numerous mining start-ups, closures
and operational turnaround projects.
Owen holds several post graduate qualifications from the West Australian School of Mines and is the
holder of a First Class Managers Certificate of Competency. Owen is also a member of the Australasian
Institute of Mining and Metallurgy.
Owen does not sit on the board of any other listed companies.
Shanthar Pathmanathan - Chief Executive Officer and Executive Director (resigned 11 October 2019)
Company Secretary
Paul Jurman is involved with a diverse range of Australian public listed companies in company
secretarial and financial roles. He is currently company secretary of Platina Resources Ltd and Carnavale
Resources Ltd.
Interests in Securities
As at the date of this report, the interests of each director in shares and options issued by the Company
are shown in the table below:
Directors
B. Moller
D. Smith
V. Mascolo
A. Haythorpe
O. Burchell
Page 18
Shares
2,493,750
9,902,576
1,575,000
513,000
9,902,577
Unlisted Options
($0.04896, expiring
30-Sep-20)
Unlisted Options ($0.04,
expiring 30-Sep-2022)
132,500
377,796
-
-
377,796
3,000,000
4,000,000
3,000,000
3,000,000
3,000,000
TEMPEST MINERALS LTD- ACN 612 008 358
ANNUAL REPORT 2020
Directors’ Report
Principal Activities
The principal activity of the Group during the period was mineral exploration.
Corporate
The Company changed its name from Lithium Consolidated Ltd to Tempest Minerals Ltd after obtaining
shareholder approval at a general meeting on 27 August 2020.
Dividends Paid or Recommended
There were no dividends paid or recommended during the financial year.
Review of Operations
Information on the operations of the Group during the financial year and up to the date of this report is
set out separately in the Annual Report under Review of Operations.
Operating Results
The Group’s operating loss for the financial year was $1,652,907 (2019: $5,272,868). Exploration and
evaluation expenditure before the impairment during the year totalled $366,546 (2019: $301,997). The
increased loss was caused principally by:
General corporate and administrative expenses ($317,444);
Employee benefits expense ($502,746);
Exploration assets impairment ($749,785); and
Legal expenses ($197,353).
Review of Financial Condition
Capital Structure
As at 30 June 2019 the Company had 90,822,122 ordinary shares, 9,200,000 performance rights and
4,000,000 options on issue.
During the year ended 30 June 2020, the following shares were issued:
3,500,000 shares were issued upon exercise of performance rights at no consideration, as per
performance rights agreement;
In September 2019, the Company completed a capital raising comprised of a (1 for 4) non-
renounceable entitlement offer combined with an additional offer on the same terms. 29,734,064
shares were issued raising $1,486,354;
1,253,091 shares were issued as an exclusivity fee to the shareholders of Warrigal Mining Pty Ltd
(Warrigal) as part of the acquisition agreement;
In December 2019, the Company completed the purchase of a 100% interest in Warrigal. Under
the share sale agreement, the Company issued a total of 16,637,384 shares in satisfaction of
Tranche 1 and 2 of the agreement. Tranche 3 under the share sale agreement which required a
cash payment of $200,089.56 was satisfied in full by the issue of 4,001,791 Ordinary Shares and
4,001,791 Unlisted Options pursuant to the Additional Offer component of the Entitlement Offer;
and
On 5 December 2019, the Company completed a private placement to sophisticated investors
through the issue of 1,318,221 shares at $0.027 per share, raising $35,592.
During the year ended 30 June 2020, the following unlisted options were issued:
29,734,064 free attaching options were issued as part of the September 2019 entitlement offer
capital raising. The options are exercisable at $0.05 each and expire on 30 September 2020;
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TEMPEST MINERALS LTD- ACN 612 008 358
ANNUAL REPORT 2020
Directors’ Report
6,693,088 options were issued to the lead managers of the additional offer that was made on the
same terms as the September 2019 entitlement offer capital raising. The options are exercisable
at $0.05 each and expire on 30 September 2020;
In December 2019, the Company completed the purchase of a 100% interest in Warrigal. Under
the share sale agreement, Tranche 3 required a cash payment of $200,089.56 and was satisfied
in full by the issue of 4,001,791 Ordinary Shares and 4,001,791 Unlisted Options issued pursuant to
the Additional Offer component of the Entitlement Offer.
No new performance rights were issued during the year ended 30 June 2020.
During the year ended 30 June 2020, 3,654,000 options expired, 3,500,000 performance rights were
exercised and 5,200,000 performance rights were cancelled.
As at 30 June 2020 the Company had 147,266,673 ordinary shares, 500,000 performance rights and
40,774,943 unlisted options on issue.
Financial Position
At 30 June 2020, the Group’s net assets totalled $1,140,144 (2019: $935,822) which included cash assets
of $106,008 (2019: $298,125). The movement in net assets largely resulted from the following factors:
Exploration assets impairment of $749,785
Operating losses other than the exploration assets impairment of $903,122;
Cash outflows from operating activities of $1,108,401; and
Cash outflows on exploration and evaluation assets of $451,816.
The Group’s working capital, being current assets less current liabilities has decreased from $222,030 in
2019 to $171,137 in 2020.
Treasury policy
The Group does not have a formally established treasury function. The Board is responsible for managing
the Group’s finance facilities. The Group does not currently undertake hedging of any kind and is not
currently directly exposed to material currency risks.
Liquidity and funding
The Group has sufficient funds to finance its operations and exploration activities, and to allow the
Group to take advantage of favourable business opportunities, not specifically budgeted for, or to fund
unforeseen expenditure.
Significant Changes in State of Affairs
Other than the securities issued as noted above, there were no other significant changes in the state of
affairs of the Group in the financial year.
Subsequent Events
On 25 June 2020, the Company announced a non-renounceable entitlement offer to eligible
shareholders of one new fully paid ordinary share for every two shares held at an issue price of $0.016 per
share, to raise approximately $1,178,134 (before costs). On 28 July 2020, after the close of the entitlement
offer and achieving a 69.43% take-up rate, the Company issued a total of 51,121,816 shares to raise a
total of $817,949 (before costs). On 3 August 2020, the Company announced it completed the
placement of the Shortfall arising from the non-renounceable Entitlement Offer and issued 22,511,599
shares raising a further $360,185.
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TEMPEST MINERALS LTD- ACN 612 008 358
ANNUAL REPORT 2020
Directors’ Report
On 29 July 2020, the Company completed the sale of its African projects to Premier African Minerals
Limited for the purchase consideration of A$150,000 plus the payment of inspection fees for the claims in
Zimbabwe through the issue of 124,512,702 Premier shares at a deemed issue price of 0.0744 pence.
On 4 August 2020, the Company accommodated additional demand from the shortfall placement to
raise $176,000 through the issue of 11 million shares at $0.016 each.
On 11 September 2020, the Company issued 3,750,000 ordinary fully paid shares to nominees of RM
Corporate Finance Pty Ltd as consideration for acting as Lead Manager and for placing the Shortfall
from the entitlement offer. Shareholder approval for the issue was received at the General Meeting held
on 27 August 2020.
The Company changed its name to Tempest Minerals Ltd after receiving approval from shareholders at
the General Meeting held on 27 August 2020, to better reflect its new focus on gold and base metal
exploration projects in Western Australia.
18 million unlisted options exercisable at $0.04 each expiring on or before 30 September 2022 were
approved by shareholders at the General Meeting held on 27 August 2020 and issued to directors and
the company secretary of the Company as follows:
Name
B. Moller
D. Smith
V. Mascolo
A. Haythorpe
O. Burchell
P. Jurman
Unlisted Options ($0.04, expiring 30-Sep-2022)
3,000,000
4,000,000
3,000,000
3,000,000
3,000,000
2,000,000
Other than the matters noted above, there are no material matters or circumstances that have arisen
since the end of the year which significantly affected or may significantly affect the operations of the
Group, the results of those operations, or the state of affairs of the Group in future financial years.
Business Results
The prospects of the Group in progressing their exploration projects may be affected by a number of
factors. These factors are similar to most exploration companies moving through exploration phase and
attempting to get projects into development. Some of these factors include:
Exploration - the results of the exploration activities may be such that the estimated resources are
insufficient to justify the financial viability of the projects. The Group undertakes extensive
exploration and product quality testing prior to establishing JORC compliant resource estimates
and to (ultimately) support mining feasibility studies. The Group engages external experts to assist
with the evaluation of exploration results where required and utilises third party competent
persons to prepare JORC resource statements or suitably qualified senior management of the
Group. Economic feasibility modelling of projects will be conducted in conjunction with third
party experts and the results of which will usually be subject to independent third-party peer
review.
Regulatory and Sovereign - the Group currently operates in Australia and operated in Zimbabwe
and Mozambique during the year and deals with local regulatory authorities in relation to the
exploration of its properties. The Group may not achieve the required local regulatory approvals
Page 21
TEMPEST MINERALS LTD- ACN 612 008 358
ANNUAL REPORT 2020
Directors’ Report
to continue exploration or properly assess development prospects. The Group takes appropriate
legal and technical advice to ensure it manages its compliance obligations appropriately.
Social Licence to Operate – the ability of the Group to secure and undertake exploration and
development activities within prospective areas is also reliant upon satisfactory resolution of
native title and (potentially) overlapping tenure. To address this risk, the Group develops strong,
long term effective relationships with landholders with a focus on developing mutually
acceptable access arrangements. The Group takes appropriate legal and technical advice to
ensure it manages its compliance obligations appropriately.
Environmental - All phases of mining and exploration present environmental risks and hazards.
The Group’s operations are subject to environmental regulations pursuant to a variety of state
and municipal laws and regulations. Environmental legislation provides for, among other things,
restrictions and prohibitions on spills, releases or emissions of various substances produced in
association with mining operations. Compliance with such legislation can require significant
expenditures and a breach may result in the imposition of fines and penalties, some of which
may be material. Environmental legislation is evolving in a manner expected to result in stricter
standards and enforcement, larger fines and liability and potentially increased capital
expenditures and operating costs. Environmental assessments of proposed projects carry a
heightened degree of responsibility for companies and directors, officers and employees. The
Group assesses each of its projects very carefully with respect to potential environmental issues,
in conjunction with specific environmental regulations applicable to each project, prior to
commencing field exploration. Periodic reviews are undertaken once field exploration
commences.
Safety - Safety is of critical importance in the planning, organisation and execution of the
Group’s exploration and development activities. The Group is committed to providing and
maintaining a working environment in which its employees are not exposed to hazards that will
jeopardise an employee’s health, safety or the health and safety of others associated with our
business. The Group recognises that safety is both an individual and shared responsibility of all
employees, contractors and other persons involved with the operation of the organisation. The
Group has a Safety and Health Management system which is designed to minimise the risk of an
uncontrolled safety and health event and to continuously improving safety culture within the
organisation.
Funding - the Group will require additional funding to continue exploration and potentially move
from the exploration phase to the development phases of its projects. There is no certainty that
the Group will have access to available financial resources sufficient to fund its exploration,
feasibility or development costs at those times.
Market - there are numerous factors involved with exploration and early stage development of
its projects, including variance in commodity price and labour costs which can result in projects
being uneconomical.
Environmental Issues
The Group is subject to significant environmental regulations under the (Federal, State and local) laws in
which the Group operates, which currently includes Australia and previously included Zimbabwe and
Mozambique.
The directors monitor the Group’s compliance with environmental obligations. The directors are not
aware of any compliance breach arising during the year and up to the date of this report.
Native Title
Mining tenements that the Group currently holds, may be subject to Native Title claims. The Group has a
policy that is respectful of the Native Title rights and will, as required, negotiate with relevant indigenous
bodies.
Page 22
TEMPEST MINERALS LTD- ACN 612 008 358
ANNUAL REPORT 2020
Directors’ Report
Covid-19
The financial results for the year have been influenced by the impacts of COVID-19 and the resulting
changes in government legislation relating to matters such as limited physical contact between staff
and with clients, temporary closure of some businesses that the Group would otherwise have traded
with, changes to the welfare system and various stimulus payments.
It is not practical to quantify the exact financial impact of COVID-19, but changes in the current year's
result that are directly or indirectly attributable to COVID-19 include:
-Reduced travel costs
-Increased information technology costs
-Increased workplace health & safety costs
-Physical access to some locations in Western Australia were limited for a short period.
The Group has taken the following steps to minimise regulatory and financial risk to the business
-Significantly reducing staff travel to minimise physical contact
-Enabling staff to work from home, where possible
-Education programs for staff to build awareness of how to reduce risk of infection
-Maintaining relationships with suppliers and other partners
-Continuous updating of cash-flow projections as circumstances change.
Remuneration Report (Audited)
This report details the nature and amount of remuneration for each director and other key management
personnel.
The names of key management personnel of Tempest Minerals Ltd who have held office during the
financial year are:
Brian Moller
Non-Executive Chairman
Don Smith
Non-Executive Director (appointed 10 January 2020) and Managing Director
(appointed 3 April 2020)
Vincent Mascolo
Non-Executive Director
Andrew Haythorpe
Non-Executive Director (appointed 11 October 2019), Interim Managing Director
(from 28 October 2019 until 3 April 2020) and Non-Executive Director (from 3
April 2020)
Owen Burchell
Non-Executive Director (appointed 10 January 2020)
Shanthar Pathmanathan Chief Executive Officer and Executive Director (resigned 11 October 2019)
Duncan Cornish
Company Secretary and Chief Financial Officer (resigned 3 March 2020)
The Group’s remuneration policy seeks to align director and executive objectives with those of
shareholders and the business, while at the same time, recognising the early development stage of the
Group and the criticality of funds being utilised to achieve development objectives. The board believes
the current policy has been appropriate and effective in achieving a balance of these objectives.
The Group’s remuneration policy provides for long-term incentives to be offered through a director and
employee share option plan and also through a performance rights plan. Options may be granted
under these plans to align directors’, executives’, employees’ and shareholders’ interests. Two methods
may be used to achieve this aim, the first being performance rights and options that vest upon reaching
or exceeding specific predetermined objectives, and the second being options granted with higher
exercise prices (than the share price at issue) rewarding share price growth.
Page 23
TEMPEST MINERALS LTD- ACN 612 008 358
ANNUAL REPORT 2020
Directors’ Report
Remuneration Report (Audited) (Continued)
The board of directors is responsible for determining and reviewing the Group’s remuneration policy,
remuneration levels and performance of both executive and non-executive directors. Independent
external advice will be sought when required. No independent external advice was sought during the
current year.
Performance-Based Remuneration
Performance-based remuneration includes both short-term and long-term incentives and is designed to
reward key management personnel for reaching or exceeding specific objectives or as recognition for
strong individual performance. Short-term incentives are available to eligible staff of the Group and may
be comprised of cash bonuses, determined on a discretionary basis by the board. No short-term
incentives were made available during the year.
Long-term incentives are comprised of share options and performance rights, which are granted from
time-to-time to encourage sustained strong performance in the realisation of strategic outcomes and
growth in shareholder value.
The exercise price of the options is determined after taking into account the underlying share price
performance in the period leading up to the date of grant and if applicable, performance conditions
attached to the share options. Subject to specific vesting conditions, each option is convertible into one
ordinary share.
The Group’s policy for determining the nature and amount of remuneration of board members and key
executives is set out below.
Directors
Board policy is to remunerate non-executive directors at market rates for comparable companies for
time, commitment and responsibilities. The maximum aggregate amount of fees that can be paid to
non-executive directors is subject to approval by shareholders at the Annual General Meeting and is not
linked to the performance of the Group. The maximum aggregate amount of fees that can be paid to
non-executive directors approved by shareholders is currently $300,000. One-third, by number, of non-
executive directors retires by rotation at the Company’s Annual General Meeting. Retiring directors are
eligible for re- election by shareholders at the Annual General Meeting of the Company. The
appointment conditions of the non-executive directors are set out and agreed in letters of appointment.
Executives
The remuneration structure for executives is based on a number of factors, including length of service,
particular experience of the individual concerned, and overall performance of the Group.
The executives receive payments provided for under an employment or service agreement, which may
include cash, superannuation, short-term incentives, and equity-based performance remuneration.
The Company agreed terms with Mr Don Smith under which Mr Smith agreed to be employed as the
Managing Director and Chief Executive Officer of the Company (“CEO Agreement). The key terms of
the CEO agreement are set out below:
Base remuneration of $240,000 per annum inclusive of superannuation (from ASX listing date,
being 3 April 2020);
Long term incentive and KPIs to be decided by the Board; and
2 months’ written notice of termination by either party.
Page 24
TEMPEST MINERALS LTD- ACN 612 008 358
ANNUAL REPORT 2020
Directors’ Report
Remuneration Report (Audited) (Continued)
Remuneration Details of Key Management Personnel
The remuneration of the key management personnel of Tempest Consolidated Ltd for the years ended
30 June 2020 and 30 June 2019 were as follows:
Year Ended 30 June 2020:
Short Term Benefits
Post-Employment
Equity-settled Share-
based Payments
Key Management
Personnel
Salary &
Fees
Non-
cash
Benefits
Super-
annuation
Termina
tion
Shares
Options
Total
/Rights
Performance
related %
%
consisting
of options
/rights
$
$
$
$
$
$
$
%
%
B. Moller
D. Smith 1
V. Mascolo
A. Haythorpe 2
O. Burchell 1
56,250
53,700
37,500
148,522
16,200
S. Pathmanathan 3
61,276
D. Cornish4
Total
62,500
435,948
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
5,821
33,517
-
-
5,821
33,517
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
56,250
53,700
37,500
148,522
16,200
100,614
62,500
475,286
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1. Mr Smith and Mr Burchell were appointed as Non-Executive Directors on 10 January 2020. Mr Smith replaced Mr Haythorpe
as Managing Director on 3 April 2020.
2. Mr Haythorpe was appointed as Interim Managing Director on 11 October 2019 and resumed as a Non-Executive Director
on 3 April 2020.
3. Mr Pathmanathan resigned on 11 October 2019.
4. Mr Cornish resigned on 3 March 2020.
No equity-based remuneration was provided to key management personnel of the Group for the year
ended 30 June 2020.
Year Ended 30 June 2019:
Short Term Benefits
Equity-settled
Share-based
Payments
Key Management
Personnel
Salary &
Fees
Non-
cash
Benefits
Post-
Employment
Super-
annuation
Shares Options
Total
/Rights
Performance
related %
%
consisting
of options
/rights
$
$
$
$
$
$
%
%
B. Moller
60,000
S. Pathmanathan
207,763
40,000
120,000
427,763
V. Mascolo
D. Cornish
Total
Page 25
-
-
-
-
-
-
19,737
-
-
-
-
-
-
18,661
78,661
159,701
387,201
18,661
58,660
18,776
138,776
19,737
-
215,798
663,298
23.7%
41.2%
31.8%
13.5%
23.7%
41.2%
31.8%
13.5%
TEMPEST MINERALS LTD- ACN 612 008 358
ANNUAL REPORT 2020
Directors’ Report
Remuneration Report (Audited) (Continued)
Company Performance, Shareholder Wealth, and Director and Executive Remuneration
During the financial year, the Company has generated losses as its principal activity was mineral
exploration.
As the Company is still in the exploration and development stage, the link between remuneration,
company performance and shareholder wealth is tenuous. Share prices are subject to the influence of
commodity prices and market sentiment towards the sector, and as such, increases and decreases
might occur independent of executive performance and remuneration.
Shares Held by Key Management Personnel
Details of shares held directly, indirectly or beneficially by key management personnel during the year
ended 30 June 2020 were as follows:
Key
Management
Personnel
B. Moller
D. Smith1
V. Mascolo
A. Haythorpe2
O. Burchell1
S. Pathmanathan3
D. Cornish4
Balance at
1 July 2019
Conversion of
performance rights
Other
Changes
Balance at
30 June 2020
1,530,000
NA
550,000
NA
NA
636,750
510,000
500,000
132,5005
2,162,500
-
6,601,7186
6,601,718
500,000
-
1,050,000
-
-
342,0007
342,000
6,601,7186
6,601,718
2,000,000
500,000
NA
NA
NA
NA
1. Appointed 10 January 2020
2. Appointed 11 October 2019
3. Resigned 11 October 2019
4. Resigned 3 March 2020
5. Participation in September 2019 entitlement offer capital raising
6. The Company issued 1,253,091 shares as an exclusivity fee and a further 16,637,384 shares as consideration for the
acquisition of 100% of the share capital of Warrigal to Warrigal shareholders. These shares were issued to Mr Smith
and Mr Burchell in their capacity as Warrigal shareholders.
7. Shares held on appointment date
Options Held by Key Management Personnel
Details of options held directly, indirectly or beneficially by key management personnel during the year
ended 30 June 2020 were as follows:
Key Management
Personnel
Balance at 1
July 2019
Other
Expired/
Movement5
Forfeited
Balance at 30
June 2020
Total Vested
30 June 2020
Total Vested and
Exercisable 30
June 2020
B. Moller
D. Smith1
V. Mascolo
A. Haythorpe2
O. Burchell1
-
132,500
NA
377,796
-
NA
NA
-
-
377,796
-
-
-
-
-
132,500
132,500
377,796
377,796
-
-
-
-
132,500
377,796
-
-
377,796
377,796
377,796
S. Pathmanathan3
2,000,000
D. Cornish4
1,000,000
-
-
(2,000,000)
(1,000,000)
NA
NA
NA
NA
NA
NA
Page 26
TEMPEST MINERALS LTD- ACN 612 008 358
ANNUAL REPORT 2020
Directors’ Report
Remuneration Report (Audited) (Continued)
1. Appointed 10 January 2020
2. Appointed on 11 October 2019
3. Resigned 11 October 2019
4. Resigned 3 March 2020
5. Free attaching options issued during September 2019 entitlement offer and Additional Offer component of the
Entitlement Offer.
Options Granted as Remuneration
No new options were granted during the year as remuneration.
2,000,000 options previously granted to Mr Pathmanathan in December 2018 were forfeited upon his
resignation. 1,000,000 options previously granted to Mr Cornish in 2016 expired unexercised on 31
December 2019.
Performance Rights Held by Key Management Personnel
Details of performance rights held directly, indirectly or beneficially by key management personnel
during the year ended 30 June 2020 were as follows:
Key Management
Personnel
Balance
at 1 July
2019
Granted as
Compen-
sation
Exercised
Forfeited
Balance at
30 June
2020
Total Vested
30 June 2020
Total Vested
and
Exercisable
30 June 2020
B. Moller
D. Smith1
500,000
NA
V. Mascolo
500,000
A. Haythorpe2
O. Burchell1
NA
NA
S. Pathmanathan3
7,000,000
D. Cornish4
500,000
-
-
-
-
-
-
-
(500,000)
-
(500,000)
-
-
-
-
-
-
-
(2,000,000)
(5,000,000)
(500,000)
-
-
-
-
-
-
NA
NA
-
-
-
-
-
NA
NA
-
-
-
-
-
NA
NA
1. Appointed 10 January 2020
2. Appointed 11 October 2019
3. Resigned 11 October 2019
4. Resigned 3 March 2020
Performance Rights Granted as Remuneration
No performance rights were granted during the year as remuneration.
3,500,000 performance rights previously granted were converted into shares during the year.
Other transactions with Key Management Personnel
Technical consulting services amounting to $77,098 were provided by Galt Mining Solutions Pty Ltd, a
company controlled by directors, Don Smith and Owen Burchell for year ended 30 June 2020.
There have been no other transactions with key management personnel during the year ended 30 June
2020.
End of Remuneration Report (Audited)
Page 27
TEMPEST MINERALS LTD- ACN 612 008 358
ANNUAL REPORT 2020
Directors’ Report
Options
At the date of this report, the unissued ordinary shares of the Company under options are as follows:
Unlisted Options
Issue Date
5-Dec-18
19-Sep-19
28-Aug-20
TOTAL
Expiry Date
Exercise Price
5-Dec-20
30-Sep-20
30-Sep-22
$0.2489
$0.04896
$0.04
Number
346,000
40,428,943
18,000,000
58,774,943
There have been no unissued shares or interests under option of any controlled entity within the
economic entity during or since reporting date. Option holders do not have any rights to participate in
any share issue or other interests in the Company or any other entity.
Performance Rights
At the date of this report, the number of performance rights on issue are as follows:
Issue Date
29-Jun-18
5-Dec-18
TOTAL
Directors’ Meetings
Expiry Date
10-Jan-2021
10-Jan-2021
Exercise Price
n/a
n/a
Number
327,000
173,000
500,000
The meetings (held while a director) attended by each director during the financial year were:
Directors
B. Moller
D. Smith
V. Mascolo
A. Haythorpe
O. Burchell
S. Pathmanathan
Corporate Governance
Board
Audit & Risk Committee
Meetings
Attended
Meetings
Attended
10
4
10
6
4
4
10
4
10
6
4
4
2
n/a
2
n/a
n/a
n/a
1
n/a
2
n/a
n/a
n/a
In recognising the need for the highest standards of corporate behaviour and accountability, the
directors of Tempest Minerals Ltd support and, where practicable or appropriate, have adhered to the
ASX Principles of Corporate Governance. The Company’s corporate governance statement is set out in
this Annual Report.
Page 28
TEMPEST MINERALS LTD- ACN 612 008 358
ANNUAL REPORT 2020
Directors’ Report
Indemnifying Directors and Auditors
The Company has entered into a Deed with each of the Directors (and the Company Secretary)
whereby the Company has agreed to provide certain indemnities to each Director (and the Company
Secretary) to the extent permitted by the Corporations Act and to use its best endeavours to obtain and
maintain directors’ and officers’ indemnity insurance, subject to such insurance being available at
reasonable commercial terms.
The Company has paid premiums to insure each of the directors (and the Company Secretary) of the
Company against liabilities for costs and expenses incurred by them in defending any legal proceedings
arising out of their conduct while acting in the capacity of director (or Company Secretary) of the
Company, other than conduct involving a wilful breach of duty in relation to the Company. The
contracts include a prohibition on disclosure of the premium paid and nature of the liabilities covered
under the policy.
The Company has not given an indemnity or entered into an agreement to indemnify, or paid or agreed
to pay insurance premiums in respect of any person who is or has been an auditor of the Company or a
related entity during the year and up to the date of this report.
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. The Company was not a party to any such
proceedings during the year.
Non-Audit Services
During the financial year, BDO also provided taxation and accounting services, to a total amount of
$7,636 (2019: 9,045) for preparation of income tax return and tax compliance.
Auditor’s Independence Declaration
The lead auditor’s independence declaration under section 307C of the Corporations Act 2001 is
attached to and forms part of this financial report.
Signed in accordance with a resolution of the board of directors.
Don Smith
Managing Director
28 September 2020
Perth, Western Australia
Page 29
TEMPEST MINERALS LTD- ACN 612 008 358
ANNUAL REPORT 2020
Auditor’s Independence Declaration
Tel: +61 7 3237 5999
Fax: +61 7 3221 9227
www.bdo.com.au
Level 10, 12 Creek St
Brisbane QLD 4000
GPO Box 457 Brisbane QLD 4001
Australia
DECLARATION OF INDEPENDENCE BY T J KENDALL TO THE DIRECTORS OF TEMPEST MINERALS LTD
As lead auditor of Tempest Minerals Ltd for the year ended 30 June 2020, I declare that, to the best of
my knowledge and belief, there have been:
1. No contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit; and
2. No contraventions of any applicable code of professional conduct in relation to the audit.
This declaration is in respect of Tempest Minerals Ltd and the entities it controlled during the year.
T J Kendall
Director
BDO Audit Pty Ltd
Brisbane, 28 September 2020
BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities which are all members of BDO
Australia Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit Pty Ltd and BDO Australia Ltd are members
of BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent
member firms. Liability limited by a scheme approved under Professional Standards Legislation.
Page 30
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Consolidated Statement of Profit or Loss and Other Comprehensive Income
For the Year Ended 30 June 2020
Note
30 June 2020
30 June 2019
Revenue
Business Development
Corporate and administrative expenses
Depreciation
Employee benefits expense
Exploration expenses
Fair value adjustment for held for sale asset
Fixed asset written off
Foreign exchange (loss)/gain
Impairment of exploration assets
Legal expenses
Share-based payments benefit / (expense)
Loss before income tax expense
Income tax expense
Loss for the year
Other comprehensive income
2
3
9
3
14
8
21
4
$
$
47,714
12,455
(9,595)
(317,444)
(4,012)
(502,746)
(175,326)
42,588
(2,175)
(6,656)
(111,236)
(416,907)
(653)
(460,770)
(230,366)
-
-
18,964
(749,785)
(3,775,024)
(197,353)
(66,552)
221,883
(242,779)
(1,652,907)
(5,272,868)
-
-
(1,652,907)
(5,272,868)
Other comprehensive income/(loss) for the period, net of
tax
-
-
Total comprehensive income/(loss) for the period
(1,652,907)
(5,272,868)
Loss for the period attributable to:
Owners of the parent company
Non-controlling interests
Total comprehensive income for the period attributable to:
Owners of the parent company
Non-controlling interests
(1,652,831)
(5,272,292)
(76)
(576)
(1,652,907)
(5,272,868)
(1,652,831)
(5,272,292)
(76)
(576)
(1,652,907)
(5,272,868)
Loss per share attributable to owners of the parent
company
Basic and diluted earnings per share
17
Cents
(1.3)
Cents
(5.8)
The accompanying notes form part of these financial statements.
Page 31
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Consolidated Statement of Financial Position
As at 30 June 2020
Note
30 June 2020
30 June 2019
$
$
5
6
7
14
9
8
10
11
12
106,008
25,479
21,701
167,924
321,112
7,196
961,811
969,007
298,125
14,762
-
-
312,887
2,529
711,263
713,792
1,290,119
1,026,679
149,975
149,975
90,857
90,857
149,975
90,857
1,140,144
935,822
11,242,943
8,965,067
246,410
667,057
(10,348,388)
(8,695,557)
1,140,965
(821)
1,140,144
936,567
(745)
935,822
CURRENT ASSETS
Cash and cash equivalents
Trade and other receivables
Prepayments
Held for sale assets
Total Current Assets
NON-CURRENT ASSETS
Plant & equipment
Exploration and evaluation assets
Total Non-Current Assets
TOTAL ASSETS
CURRENT LIABILITIES
Trade and other payables
Total Current Liabilities
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued capital
Reserves
Accumulated losses
Equity attributable to owners of the parent company
Non-controlling interests
TOTAL EQUITY
The accompanying notes form part of these financial statements.
Page 32
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Consolidated Statement of Changes in Equity
For the Year Ended 30 June 2020
Attributable to Owners of Parent Company
Note
Issued Capital
Accumulated
Losses
Share-Based
Payments
Reserve
$
$
$
Total
$
Non-
controlling
Interests
Total Equity
$
$
Balance at 30 June 2018
8,945,687
(3,660,715)
681,108
5,966,080
(168)
5,965,912
Loss for the period
Total comprehensive income
-
-
(5,272,292)
(5,272,292)
-
-
(5,272,292)
(5,272,292)
(576)
(576)
(5,272,868)
(5,272,868)
Issue of shares
Exercise of performance rights
Share-based payments expense / (benefit)
Expire of options
Balance at 30 June 2019
Loss for the period
Total comprehensive income
Issue of shares
Issue of options
Exercise of performance rights
Share-based payments expense / (benefit)
11
11
21
11
12
11
21
10,380
9,000
-
-
-
-
-
(10,380)
(9,000)
242,779
237,450
(237,450)
-
-
242,779
-
-
-
-
-
-
-
242,779
-
8,965,067
(8,695,557)
667,057
936,567
(745)
935,822
-
-
(1,652,831)
(1,652,831)
1,943,711
-
334,165
-
-
-
-
-
-
-
-
(1,652,831)
(1,652,831)
1,943,711
135,401
135,401
(334,165)
-
(221,883)
(221,883)
(76)
(76)
(1,652,907)
(1,652,907)
-
-
-
-
1,943,711
135,401
-
(221,883)
Balance at 30 June 2020
11,242,943
(10,348,388)
246,410
1,140,965
(821)
1,140,144
The accompanying notes form part of these financial statements.
Page 33
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Consolidated Statement of Cash Flows
For the Year Ended 30 June 2020
CASH FLOWS FROM OPERATING ACTIVITIES
Interest receipts
Other receipts/payments
Payments to suppliers and employees
30 June 2020
30 June 2019
$
$
4,747
-
12,455
4,792
(1,113,148)
(1,357,053)
Net cash used in operating activities
16 (A)
(1,108,401)
(1,339,806)
CASH FLOWS FROM INVESTING ACTIVITIES
Payments for exploration and evaluation assets
(451,816)
(306,968)
Purchase of property, plant and equipment
Proceed from sale of assets
Cash acquired on acquisition of Warrigal Mining Pty Ltd
9
13
(8,354)
42,967
4,724
(3,182)
-
-
Net cash used in investing activities
(412,479)
(310,150)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from the issue of shares
Share issue costs
Net cash provided by financing activities
Net increase/(decrease) in cash held
Cash at Beginning of Period
Foreign exchange movement on cash balances
Cash at End of Year
5
The accompanying notes form part of these financial statements.
1,521,946
(183,218)
1,338,728
-
-
-
(182,152)
(1,649,956)
298,125
(735)
115,238
1,948,081
-
298,125
Page 34
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Notes to the Consolidated Financial Statements
For the Year Ended 30 June 2020
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The financial statements are for the consolidated entity consisting of Tempest Minerals Ltd and its
Controlled Entities. Tempest Minerals Ltd is a listed public company, incorporated and domiciled in
Australia. The principal activity of the Group during the year was gold and lithium exploration.
The financial statements are general purpose financial statements that have been prepared in
accordance with the Corporations Act 2001, Australian Accounting Standards, and other authoritative
pronouncements of the Australian Accounting Standards Board. Tempest Minerals Ltd is a for-profit entity
for the purpose of preparing the financial statements. The financial statements are presented in
Australian dollars.
Compliance with Australian Accounting Standards ensures that the financial statements and notes also
comply with International Financial Reporting Standards.
The financial statements have been prepared on an accruals basis and are based on historical cost,
except for held for sale assets that are fair valued. The financial report was authorised for issue on 28
September 2020 by the directors of the Company. Separate financial statements for Tempest Minerals
Ltd as an individual entity are no longer presented following a change to the Corporations Act 2001.
However, financial information required for Tempest Minerals Ltd as an individual entity is included in
Note 26.
Material accounting policies adopted in the preparation of these financial statements are presented
below. They have been consistently applied unless otherwise stated.
Going Concern
The financial statements have been prepared on a going concern basis which contemplates the
continuity of normal business activities and the realisation of assets and discharge of liabilities in the
ordinary course of business.
For the year ended 30 June 2020 the Group generated a consolidated loss of $1,652,907 and incurred
operating cash outflows of $1,108,401. As at 30 June 2020 the Group has cash and cash equivalents of
$106,008 and net assets of $1,140,144. These conditions indicate a material uncertainty that may cast a
significant doubt on the group’s ability to continue as a going concern.
The Group’s ability as a going concern will depend upon the Group being able to manage its liquidity
requirement and by taking some or all of the following actions:
1.
raising additional capital;
2.
3.
successful exploration and subsequent exploitation of the Group’s tenements;
reducing its working capital expenditure; and
4. disposing of non-core projects.
After taking into account the current financial position of the Group and the Entitlement Offer and
additional placement completed in August 2020, the directors have a reasonable expectation that the
Group will have adequate resources to fund its future operational requirements and for these reasons
they continue to adopt the going concern basis in preparing the financial report.
Should the Group be unable to continue as a going concern, it may be required to realise its assets and
extinguish its liabilities other than in the ordinary course of business, and at amounts that differ from those
stated in the financial statements. This financial report does not include any adjustments relating to the
recoverability and classification of recorded asset amounts or the amounts or classification of liabilities
and appropriate disclosures that may be necessary should the Group be unable to continue as a going
concern.
Page 35
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2020
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Principles of Consolidation
Subsidiaries
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Tempest
Minerals Ltd ("Company" or "parent entity") as at 30 June 2020, and the results of all subsidiaries for the
period then ended. Tempest Minerals Ltd and its subsidiaries together are referred to in these financial
statements as the Group or the economic entity.
The names of the subsidiaries are contained in Note 24. All subsidiaries in Australia have a 30 June
financial year end and are accounted for by the parent entity at cost. All subsidiaries in Africa have a 31
December financial year end and are accounted for by the parent entity at cost.
Subsidiaries are all entities over which the Group has control. The Group has control over an entity when
the Group is exposed to, or has a right to, variable returns from its involvement with the entity, and has
the ability to use its power to affect those returns. Subsidiaries are fully consolidated from the date on
which control is transferred to the Group. They are de-consolidated from the date that control ceases.
Intercompany transactions, balances and unrealised gains on transactions between Group companies
are eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of the
impairment of the asset transferred. Accounting policies of controlled entities have been changed
where necessary to ensure consistency with the policies adopted by the Group.
Non-controlling Interests
Equity interests in a subsidiary not attributable, directly or indirectly, to the Group are presented as “non-
controlling interests”. The Group initially recognises non-controlling interests that are present ownership
interests in subsidiaries and are entitled to a proportionate share of the subsidiary’s net assets on
liquidation at either fair value or at the non-controlling interests’ proportionate share of the subsidiary’s
net assets. Subsequent to initial recognition, non-controlling interests are attributed their share of profit or
loss and each component of other comprehensive income. Non-controlling interests are shown
separately within the equity section of the statement of financial position and statement of profit and
loss and other comprehensive income.
Changes in ownership interests
When the Group ceases to have control, joint control or significant influence, any retained interest in the
entity is remeasured to its fair value, with the change in the carrying amount recognised in profit or loss.
The fair value is the initial carrying amount for the purposes of subsequently accounting for the retained
interest as an associate, joint venture or financial asset. In addition, any amounts previously recognised in
other comprehensive income in respect of that entity are accounted for as if the Group had directly
disposed of the related assets or liabilities. This may mean that amounts previously recognised in other
comprehensive income are reclassified to profit or loss.
Segment Reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the
chief operating decision maker. The chief operating decision maker, who is responsible for allocating
resources and assessing performance of the operating segments, has been identified as the Managing
Director.
The Group has identified its operating segments based on the internal reports that are reviewed and
used by the Board of Directors (chief operating decision makers) in assessing performance and
determining the allocation of resources.
Page 36
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2020
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Segment Reporting (Continued)
The Group is managed primarily on the basis of geographical locations as these locations have notably
different risk profiles and performance assessment criteria. Operating segments are therefore
determined on the same basis. Reportable segments disclosed are based on aggregating operating
segments where the segments are considered to have similar economic characteristics and are similar
with respect to any external regulatory requirements. Management currently identifies the Group as
having only one reportable segment, being the exploration of mineral projects.
Income Tax
The income tax expense/(income) for the period comprises current income tax expense/(income) and
deferred tax expense/(income). Current income tax expense charged to profit or loss is the tax payable
on taxable income calculated using applicable income tax rates enacted, or substantially enacted, as
at reporting date. Current tax liabilities/(assets) are therefore measured at the amounts expected to be
paid to/ (recovered from) the relevant taxation authority.
Deferred income tax expense reflects movements in deferred tax asset and deferred tax liability
balances during the period as well unused tax
income tax
expense/(income) is charged or credited directly to equity instead of profit or loss when the tax relates
to items that are credited or charged directly to equity.
Current and deferred
losses.
Deferred tax assets and liabilities are calculated at the tax rates that are expected to apply to the
period when the asset is realised or the liability is settled, based on tax rates enacted or substantively
enacted at reporting date. Their measurement also reflects the manner in which management expects
to recover or settle the carrying amount of the related asset or liability.
Deferred tax assets and liabilities are ascertained based on temporary differences arising between the
tax bases of assets and liabilities and their carrying amounts in the financial statements. Deferred tax
assets also result where amounts have been fully expensed but future tax deductions are available. No
deferred income tax will be recognised from the initial recognition of an asset or liability, excluding a
business combination, where there is no effect on accounting or taxable profit or loss. The Company
and its Australian 100% owned controlled entities have formed a tax consolidated group.
Deferred tax assets relating to temporary differences and unused tax losses are recognised only to the
extent that it is probable that future taxable profit will be available against which the benefits of the
deferred tax asset can be utilised. The amount of benefits brought to account or which may be realised
in the future is based on the assumption that no adverse change will occur in income taxation legislation
and the anticipation that the economic entity will derive sufficient future assessable income to enable
the benefit to be realised and comply with the conditions of deductibility imposed by the law.
Exploration and Evaluation Assets
Exploration and evaluation expenditure incurred is accumulated in respect of each identifiable area of
interest. Such expenditures comprise net direct costs and an appropriate portion of related overhead
expenditure but do not include overheads or administration expenditure not having a specific nexus
with a particular area of interest. These costs are only carried forward to the extent that they are
expected to be recouped through the successful development of the area or where activities in the
area have not yet reached a stage which permits reasonable assessment of the existence of
economically recoverable reserves and active or significant operations in relation to the area are
continuing.
A regular review will be undertaken on each area of interest to determine the appropriateness of
continuing to carry forward costs in relation to that area of interest. A provision is raised against
exploration and evaluation assets where the directors are of the opinion that the carried forward net
cost may not be recoverable or the right of tenure in the area lapses. The increase in the provision is
charged against the results for the year. Accumulated costs in relation to an abandoned area are
written off in full against profit or loss in the year in which the decision to abandon the area is made.
When production commences, the accumulated costs for the relevant area of interest are amortised
over the life of the area according to the rate of depletion of the economically recoverable reserves.
Page 37
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2020
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Restoration Costs
Costs of site restoration are provided over the life of the facility from when exploration commences and
are included in the costs of that stage. Site restoration costs include the dismantling and removal of
mining plant, equipment and building structures, waste removal, and rehabilitation of the site in
accordance with clauses of the exploration and mining permits. Such costs have been determined using
estimates of future costs, current legal requirements and technology on an undiscounted basis.
Any changes in the estimates for the costs are accounted for on a prospective basis. In determining the
costs of site restoration, there is uncertainty regarding the nature and extent of the restoration due to
community expectations and future legislation. Accordingly, the costs have been determined on the
basis that the restoration will be completed within one year of abandoning the site.
The economic entity is not currently liable for any future restoration costs in relation to current areas of
interest. Consequently, no provision for restoration has been deemed necessary.
Impairment of Non- Financial Assets
At each reporting date, the economic entity reviews the carrying values of its tangible and intangible
assets to determine whether there is any indication that those assets have been impaired. If such an
indication exists, the recoverable amount of the asset, being the higher of the asset’s fair value less costs
to sell and value in use, is compared to the asset's carrying value. Any excess of the asset's carrying
value over its recoverable amount is expensed to profit or loss.
Other Receivables
Due to the short-term nature of these receivables, their carrying value is assumed to approximate fair
value. The maximum exposure to credit risk is the carrying value of receivables. Collateral is not held as
security, and the receivables are not exposed to foreign exchange risk.
The Group has applied the simplified approach to measuring expected credit losses, which uses a
lifetime expected loss allowance. To measure the expected credit losses, trade receivables have been
grouped based on days overdue.
Other receivables are recognised at amortised cost, less any allowance for expected credit losses
Cash and Cash Equivalents
Cash and cash equivalents include cash on hand, deposits held at call with banks and other short-term
highly liquid investments with original maturities of less than 3 months.
Issued Capital
Ordinary shares are classified as equity. Transaction costs (net of tax where the deduction can be
utilised) arising on the issue of ordinary shares are recognised in equity as a reduction of the share
proceeds received.
Trade and Other Payables
These amounts represent financial liabilities for goods and services provided to the Group prior to the
end of the financial year and which are unpaid.
Financial liabilities are carried at amortised cost and are initially measured at fair value including
transaction costs. They are subsequently measured at amortised cost using the effective interest rate
method.
Trade payables are non-interest bearing and are generally on 30-60 days terms. Due to their short-term
nature trade and other payables are not discounted.
Page 38
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2020
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Share Based Payments
The economic entity makes equity-settled share based payments to directors, employees and other
parties for services provided or the acquisition of exploration assets. Where applicable, the fair value of
the equity is measured at grant date and recognised as an expense over the vesting period, with a
corresponding increase to an equity account. The fair value of shares is ascertained as the market bid
price. The fair value of options is ascertained using the Black and Scholes option valuation pricing model
which incorporates all market vesting conditions. Where applicable, the number of shares and options
expected to vest is reviewed and adjusted at each reporting date such that the amount recognised for
services received as consideration for the equity instruments granted shall be based on the number of
equity instruments that eventually vest.
Where the fair value of services rendered by other parties can be reliably determined, this is used to
measure the equity-settled payment.
Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST (or overseas VAT), except
where the amount of GST incurred is not recoverable. In these circumstances the GST (or overseas VAT) is
recognised as part of the cost of acquisition of the asset or as part of an item of the expense.
Receivables and payables in the statement of financial position are shown inclusive of GST. Cash flows
are presented in the statement of cash flows on a gross basis except for the GST component of investing
and financing activities which are disclosed as operating cash flows.
Foreign Currency Transactions and Balances
Functional and presentation currency
The functional and presentation currency of Tempest Minerals Ltd and its Australian subsidiaries is
Australian dollars ($A).
Transactions and balances
Foreign currency transactions are translated into functional currency using the exchange rates prevailing
at the date of the transaction. Foreign currency monetary items are translated at the year-end
exchange rate.
Non-monetary items measured at historical cost continue to be carried at the exchange rate at the
date of the transaction. Non-monetary items measured at fair value are reported at the exchange rate
at the date when fair values were measured. Exchange differences arising on the translation of
monetary items are recognised in profit or loss, except where deferred in equity as a qualifying cash flow
or net investment hedge.
Group Companies
The financial results and position of foreign operations whose functional currency is different from the
economic entity’s presentation currency are translated as follows:
assets and liabilities are translated at period-end exchange rates prevailing at that reporting
date;
income and expenses are translated at average exchange rates for the period;
retained earnings are translated at the exchange rates prevailing at the date of the transaction.
Exchange differences arising on translation of foreign operations are recognised in other comprehensive
income.
Page 39
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2020
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Plant and Equipment
Each class of property, plant and equipment is carried at cost less, accumulated depreciation and any
impairment losses.
Plant and equipment are measured on the cost basis and therefore carried at cost less accumulated
depreciation and any accumulated impairment. In the event the carrying amount of plant and
equipment is greater than the estimated recoverable amount, the carrying amount is written down
immediately to the estimated recoverable amount and impairment losses are recognised either in profit
or loss. A formal assessment of recoverable amount is made when impairment indicators are present.
The carrying amount of plant and equipment is reviewed periodically by directors to ensure it is not in
excess of the recoverable amount from these assets. The recoverable amount is assessed on the basis of
the expected net cash flows that will be received from the asset’s employment and subsequent
disposal. The expected net cash flows have been discounted to their present values in determining
recoverable amounts.
The cost of fixed assets constructed within the Consolidated Entity includes the cost of materials, direct
labour, borrowing costs and an appropriate proportion of fixed and variable overheads.
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as
appropriate, only when it is probable that future benefits associated with the item will flow to the
Consolidated Entity and the cost of the item can be measured reliably. All other repairs and
maintenance are charged to the profit and loss and other comprehensive income during the financial
year in which they are incurred.
Depreciation
The depreciable amount of all fixed assets is depreciated on a straight-line basis over the asset’s useful
life to the Consolidated Entity commencing from the time the asset is held ready for use. Leasehold
improvements are depreciated over the shorter of either the unexpired period of the lease or the
estimated useful lives of the improvements.
The depreciation rates used for plant and equipment is 33%. The assets’ residual values and useful lives
are reviewed, and adjusted if appropriate, at each balance date.
Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These
gains and losses are included in the profit or loss.
Employee Benefits
Short-term employee benefit obligations
Liabilities for wages and salaries, including non-monetary benefits, annual leave and accumulating sick
leave expected to be settled wholly within 12 months after the end of the reporting period are
recognised in liabilities in respect of employees' services rendered up to the end of the reporting period
and are measured at amounts expected to be paid when the liabilities are settled.
Earnings Per Share (EPS)
Basic earnings per share is calculated by dividing the loss attributable to equity holders of the Company,
excluding any costs of servicing equity other than ordinary shares, by the weighted average number of
ordinary shares outstanding during the financial year adjusted for any bonus elements in ordinary shares
issued during the year.
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to
take into account the after income tax effect of interest and other financing costs associated with
dilutive potential ordinary shares and the weighted average number of shares assumed to have been
issued for no consideration in relation to dilutive potential ordinary shares.
Page 40
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2020
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Held for sale assets
The Directors have resolved to dispose its exploration assets held in Africa and these have been classified
as assets held for sale as at the reporting period. The carrying value of this disposal group is estimated by
reference to the negotiation conducted with third parties and the Directors’ judgement as to the
probably value that can be realised by the Group.
Adoption of new and revised Accounting Standards
For the year ended 30 June 2020, the Board has reviewed all new and revised standards and
interpretations issued by the AASB.
The Board has also reviewed all new Standard and Interpretations that have been issued but not yet
effective for the year ended 30 June 2020. As a result of this review, the Board has determined that there
is no impact, material or otherwise, of the new and revised Standards and Interpretations on its business
and, therefore, no change necessary to accounting policies.
Critical Accounting Estimates and Judgements
The directors evaluate estimates and judgments incorporated into the financial statements based on
historical knowledge and best available current
reasonable
expectation of future events and are based on current trends and economic data, obtained both
externally and within the economic entity.
information. Estimates assume a
Key Judgements:
Exploration and Evaluation Assets
The Group performs regular reviews on each area of interest to determine the appropriateness of
continuing to carry forward costs in relation to that area of interest. These reviews are based on detailed
surveys and analysis of exploration and drilling results performed to reporting date. Exploration and
evaluation assets at 30 June 2020 were $961,811.
Share based payments transactions
The Group measures the cost of equity-settled transactions with employees and consultants by
reference to the fair value of the equity instruments at the date at which they are granted. The fair value
of options is determined by an internal valuation using a Black-Scholes option pricing model. The fair
value of performance rights is determined by the underlying share price at grant date.
Page 41
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2020
NOTE 2: REVENUE
Revenue from operating activities:
Interest received
Sale of tenements
30 June 2020
30 June 2019
$
$
4,747
42,967
47,714
12,455
-
12,455
During the year, the Company sold its Tonopah Lithium Project (TLP) (located in the Clayton Valley, West
Central Nevada, in the United States of America) to Argosy for an upfront cash payment of USD $30,000
(AUD $42,967) and an additional milestone payment upon definition of a JORC compliant lithium reserve
at TLP.
NOTE 3: EXPENSES
Included in expenses are the following items:
ASX, ASIC, share registry expenses
Audit and external accounting fees
Consulting fees
Insurance
Marketing
Travel expenses
Others
Employee benefits expense comprises:
Salaries, wages and superannuation
Directors and senior management fees
Provision for leave entitlement
NOTE 4: INCOME TAX EXPENSE
30 June 2020
30 June 2019
$
$
98,337
54,214
1,200
37,300
29,855
70,069
26,469
100,614
433,672
(31,540)
67,703
48,736
74,803
24,314
58,317
133,992
45,841
227,500
220,000
13,270
30 June 2020
30 June 2019
$
$
(a) The prima facie tax on the operating loss is reconciled to income
tax expense as follows:
Prima facie tax/(benefit) on loss from ordinary activities before
income tax at 27.5% (2019: 27.5%)
(454,549)
(1,450,039)
Adjust for tax effect of:
Non-deductible amounts
Deferred tax assets not bought to account
Income tax expense/(benefit)
(77,940)
532,489
-
743,578
706,461
-
Deferred tax asset not recognised through equity
148,418
132,641
Page 42
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2020
NOTE 4: INCOME TAX EXPENSE (Continued)
(b) Recognized deferred tax assets and liabilities
Deferred tax assets
Temporary differences
Carried forward tax losses
Deferred tax liabilities
30 June 2020
30 June 2019
$
$
88,061
-
150,061
45,537
Exploration and evaluation assets
(88,061)
(195,598)
Net deferred tax asset
-
-
Unrealised tax losses available
Unrealised temporary differences available
Net unrealised deferred tax assets at 27.5%
NOTE 5: CASH AND CASH EQUIVALENTS
Cash at bank and on hand
Short term deposits
Less: reclassification to available for sale asset – refer Note 14
NOTE 6: RECEIVABLES
Current:
Other receivables
NOTE 7: PREPAYMENTS
Current:
Prepayments
Page 43
7,428,968
266,972
5,811,325
-
2,116,383
1,598,114
30 June 2020
30 June 2019
$
$
115,238
-
(9,230)
106,008
276,916
21,209
-
298,125
30 June 2020
30 June 2019
$
$
25,479
25,479
14,762
14,762
30 June 2020
30 June 2019
$
$
21,701
21,701
-
-
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2020
NOTE 8: EXPLORATION AND EVALUATION ASSETS
Exploration and evaluation expenditure carried forward in respect
of areas of interest are:
Exploration and evaluation phase - at cost
961,811
711,263
30 June 2020
30 June 2019
$
$
Movement in exploration and evaluation assets:
Opening balance - at cost
Capitalised exploration expenditure
Warrigal Mining acquisition
Impairment of exploration assets
Reclass to Held for sale asset – refer Note 14
Total exploration and evaluation assets
Carrying amount at the end of the year
711,263
366,546
754,113
(749,785)
(120,326)
961,811
961,811
4,184,290
301,997
-
(3,775,024)
-
711,263
711,263
During the year ended 30 June 2020, the Company acquired Warrigal Mining Pty Ltd and recognised
$754,113 of exploration expenditure as initial share acquisition cost (refer to note 13).
The Board reviewed, assessed and impaired the carrying value of tenements held in Western Australia,
Zimbabwe and Mozambique that were either surrendered or deemed not prospective for lithium
mineralisation.
At 30 June 2020, the Company was in the process of disposing its African assets in Mozambique and
Zimbabwe. The carrying value of these assets were reclassified as Held for Sale asset (refer to note 14).
Recoverability of the carrying amount of exploration assets is dependent on the successful development
and commercial exploitation of projects, or alternatively, through the sale of the areas of interest.
NOTE 9: PLANT AND EQUIPMENT
At cost
Accumulated depreciation
Write-off
Total plant and equipment
Reconciliation of the carrying amounts for property, plant and
equipment is set out below:
Balance at the beginning of period
Additions during the period
Acquisition of Warrigal Mining – assets acquired
Depreciation expense
Write-off
Carrying amount at the end of period
30 June 2020
30 June 2019
$
$
14,036
(4,665)
(2,175)
7,196
2,529
8,354
2,500
(4,012)
(2,175)
7,196
3,182
(653)
-
2,529
-
3,182
-
(653)
-
2,529
Page 44
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2020
NOTE 10: TRADE AND OTHER PAYABLES
Current:
Trade payables and accrued expenses
Short term employee benefits
Total payables (unsecured)
30 June 2020
30 June 2019
$
$
149,975
-
149,975
59,317
31,540
90,857
The average credit period on purchases of goods and services is 30 days. No interest is paid on trade
payables.
NOTE 11: CONTRIBUTED EQUITY
Fully paid ordinary shares
Balance at the beginning of period
90,822,122
10,133,023
90,499,122
10,113,643
2020
2019
No. of
Shares
$
No. of
Shares
$
Share issues:
1 July 2019
19 September 2019
26 November 2019
12 December 2019
12 December 2019
30 December 2019
5 December 2018
5 December 2018
Balance as at 30 June
Total transaction costs associated with
share issues
(a)
(b)
(c)
(d)
(d)
(e)
-
-
-
-
-
-
-
-
-
-
3,500,000
334,165
29,734,064
1,486,354
38,846
549,034
200,089
35,592
1,253,091
16,637,384
4,001,791
1,318,221
-
-
-
-
173,000
150,000
10,380
9,000
147,266,673
12,777,103
90,822,122
10,133,023
-
(1,534,160)
-
(1,167,956)
Net issued capital
11,242,943
8,965,067
Ordinary shareholders are entitled to participate in dividends and the proceeds on the winding up of the
company in proportion to the number of and amount paid on the shares held. Every ordinary
shareholder present at a meeting in person or by proxy is entitled to one vote on a show of hands or by
poll. Ordinary shares have no par value.
Notes for the above table:
(a) 3,500,000 shares with a fair value of $334,165 were issued upon exercise of performance rights at
no consideration, as per the performance rights agreement.
(b) In September 2019, the Company completed a capital raising comprised of a (1 for 4) non-
renounceable entitlement offer combined with an additional offer on the same terms, raising
$1,486,354 before costs.
(c) 1,253,091 shares were issued as an exclusivity fee to the shareholders of Warrigal Mining Pty Ltd
(Warrigal) as part of the share sale agreement.
(d) In December 2019, the Company completed the purchase of a 100% interest in Warrigal. Under
the share sale agreement, the Company issued a total of 16,637,384 shares in satisfaction of
Tranche 1 and 2 of the agreement. These shares were valued at $0.033. Tranche 3 under the
share sale agreement which required a cash payment of $200,089.56 was satisfied by the issue of
4,001,791 ordinary shares and 4,001,791 unlisted options pursuant to the Additional Offer
component of the Entitlement Offer (refer to note 13).
(e) In December 2019, the Company completed a private placement to sophisticated investors at
$0.027 per share.
Page 45
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2020
NOTE 11: CONTRIBUTED EQUITY (Continued)
Options
Unlisted Share Options
Balance at the beginning of the
reporting period
Options issued during the period:
Issued pursuant to Rights issue and
Additional Offer
Issued pursuant to Entitlement
Offer – Lead manager
Issued in satisfaction of Tranche 3
Warrigal Mining acquisition
Note
Weighted
average
exercise price
30 June 2020
No. of Options
Weighted
average
exercise price
30 June 2019
No. of Options
$0.188
4,000,000
$0.157
6,154,000
$0.04896
29,734,064
12
$0.04896
6,693,088
$0.04896
4,001,791
-
-
-
-
-
-
Issued to a director
Issued to consultants
Expired/forfeited
21
21
-
-
-
-
$0.15
$0.25
2,000,000
346,000
$0.182
(3,654,000)
$0.133
(4,500,000)
Exercisable at end of year
$0.052
40,774,943
$0.188
4,000,000
Performance Rights
Weighted
average
exercise price
Note
30 June 2020
No. of
Performance
Rights
Weighted
average
exercise price
30 June 2019
No. of
Performance
Rights
Unlisted Performance Rights
Balance at the beginning of the
year
Performance Rights
issued/cancelled during the
period:
Issued to a director
Issued to consultants
Exercised
Forfeited/expired
Balance at end of year
Capital Management
21
21
11
-
-
-
-
-
-
9,200,000
-
-
(3,500,000)
(5,200,000)
500,000
-
-
-
-
-
-
7,177,000
2,000,000
173,000
(150,000)
-
9,200,000
Exploration companies such as Tempest Minerals Ltd are funded almost exclusively by share capital.
Management controls the capital of the Group to ensure it can fund its operations and continue as a
going concern. Capital management policy is to fund its exploration activities principally by way of
equity, and where required, debt and/or project finance. No dividend will be paid while the Group is in
exploration stage. There are no externally imposed capital requirements.
There have been no other changes to the capital management policies during the year.
Page 46
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2020
NOTE 12: RESERVES
Share-Based Payments Reserve
Opening balance
Conversion of performance rights
Issue of shares to consultants
Expiry of options
Recognised as share based payment expense / (benefit) – refer Note
21
Issue of options to lead manager
Closing balance
During the year ended 30 June 2020:
30 June 2020
30 June 2019
$
$
667,057
681,108
(334,165)
-
-
(9,000)
(10,380)
(237,450)
(221,883)
242,779
135,401
246,410
-
667,057
3,500,000 performance rights vested during the year and were converted to shares. The full
amount of $334,165 was transferred out of the share-based payments reserve (refer Note 11a);
$3,184 share-based payment expense was recognised from the remaining value allocation of
the performance rights granted in October 2016;
Options and performance rights that lapsed during the year amounting to $225,067 were
adjusted through profit and loss; &
6,693,088 options were issued to the corporate advisors as partial consideration for acting as
Lead Managers of the capital raising undertaken in September 2019. These options were valued
using the Black-Scholes option pricing model and recognised as a capital raising cost (refer Note
21).
NOTE 13: ACQUISITION OF SUBSIDIARY
During the year ended 30 June 2020, the parent entity acquired 100% of the issued capital of Warrigal
Mining Pty Ltd (Warrigal). The purchase was satisfied by the issue of:
1,253,091 shares issued to Warrigal shareholders on 21 November 2019 as an option exclusivity
fee at a deemed issue price of $0.031 each
Under the share sale agreement, the Company issued a total of 16,637,384 shares in satisfaction
of Tranche 1 and 2 of the agreement. These shares were valued based on the ASX closing price
prior to acquisition date of $0.033 per share. Tranche 3 under the share sale agreement which
required a cash payment of $200,089.56 was satisfied in full by the issue of 4,001,791 Ordinary
Shares and 4,001,791 Unlisted Options issued pursuant to the Additional Offer component of the
Entitlement Offer at a price of $0.05.
This transaction was an acquisition of assets and does not meet the requirements of AASB 3 Business
Combinations.
The purchase price was allocated as follows:
Purchase consideration (shares issued)
Cash consideration
Assets and liabilities acquired at acquisition date:
Page 47
30 June 2020
$
787,969
-
787,969
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2020
NOTE 13: ACQUISITION OF SUBSIDIARY (Continued)
Cash
Other receivables
Plant and equipment
Exploration and evaluation expenditure – fair value of mineral properties acquired
Total
The cash inflow on acquisition is as follows:
Net cash acquired on acquisition of Warrigal
Cash paid for reimbursement of past expenditure
Net cash outflow
NOTE 14: HELD FOR SALE ASSETS
4,724
26,632
2,500
754,113
787,969
4,724
-
4,724
On 11 June 2020, the Company entered into a conditional Sale and Purchase agreement with Premier
African Minerals Ltd to dispose of its African Lithium and Gold assets in Zimbabwe and Mozambique. The
sale was completed subsequent to year end on 29 July 2020 and the net assets disposed have been
reported in the financial statements for the year ended 30 June 2020 as held for sale assets.
Net assets
The carrying value of assets and liabilities as at 30 June 2020:
Exploration and evaluation assets
Other receivables
Cash
Fair value adjustment to assets
Total asset held for sale
Trade creditors
Net assets
Purchase consideration
Purchase price (share issue)
Reimbursement of fees (share issue)
30 June 2020
$
120,326
1,659
9,230
42,588
173,803
(5,879)
167,924
150,000
17,924
167,924
Purchase consideration of AUD $150,000 plus the payment of inspection fees for the claims in
Zimbabwe satisfied through the issue of 124,512,702 Premier African Minerals Limited (Premier) shares
at a deemed issue price of 0.0744 pence.
Page 48
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2020
NOTE 15: OPERATING SEGMENTS
Segment Information
Identification of reportable segments
The Group has identified its operating segments based on the internal reports that are reviewed and
used by the Board of Directors (chief operating decision makers) in assessing performance and
determining the allocation of resources.
The Group is managed primarily on the basis of geographical locations as these locations have notably
different risk profiles and performance assessment criteria. Operating segments are therefore
determined on the same basis.
Reportable segments disclosed are based on aggregating operating segments where the segments are
considered to have similar economic characteristics and are similar with respect to any external
regulatory requirements. Management currently identifies the Group as having only one reportable
segment, being the exploration of mineral projects.
Basis of accounting for purposes of reporting by operating segments
(a) Accounting policies adopted
Unless stated otherwise, all amounts reported to the Board of Directors, being the chief decision maker
with respect to operating segments, are determined in accordance with accounting policies that are
consistent to those adopted in the annual financial statements of the Group.
(b) Segment assets
Where an asset is used across multiple segments, the asset is allocated to that segment that receives
majority economic value from that asset. In most instances, segment assets are clearly identifiable on
the basis of their nature and physical location.
(c) Segment liabilities
Liabilities are allocated to segments where there is a direct nexus between the incurrence of the liability
and the operations of the segment. Borrowings and tax liabilities are generally considered to relate to
the Group as a whole and are not allocated. Segment liabilities include trade and other payables and
certain direct borrowings.
(d) Unallocated items
The following items of revenue, expenses, assets and liabilities are not allocated to operating segments
as they are not considered part of the core operations of any segment:
Derivatives
Net gains on disposal of available-for-sale investments
Impairment of assets and other non-recurring items of revenue or expense
Income tax expense
Deferred tax assets and liabilities
Current tax liabilities
Other financial liabilities
Intangible assets
Discontinuing operations
Page 49
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2020
NOTE 15: OPERATING SEGMENTS (Continued)
i. Segment Performance
Australia
Zimbabwe Mozambique
Unallocated items
$
$
$
$
Total
$
30 June 2020
REVENUE
Interest revenue
Other income
Total segment revenue
4,747
-
4,747
-
-
-
Reconciliation of segment revenue to Group revenue
Total Group revenue
4,747
-
Reconciliation of segment result of Group net loss after tax
-
-
-
-
-
42,967
42,967
4,747
42,967
47,714
42,967
47,714
Segment net loss before
tax
(756,021)
(145,875)
(80,177)
(52,577)
(1,034,650)
Amounts not included in segment result but reviewed by Board
- Corporate charges
- Depreciation and
amortisation
- Fair value adjustment
Net Loss after tax from
continuing operations
(656,831)
(4,012)
42,588
(1,652,905)
Total
$
Australia
Zimbabwe Mozambique
Unallocated
items
$
$
$
$
30 June 2019
REVENUE
Interest revenue
Total segment revenue
12,036
12,036
Reconciliation of segment revenue to Group revenue
Total Group revenue
12,036
-
-
-
419
419
419
-
-
-
12,455
12,455
12,455
Reconciliation of segment result of Group net loss after tax
Segment net loss before tax
12,036
(172,321)
(63,940)
(3,783,392)
(4,007,617)
Amounts not included in segment result but reviewed by Board
- Corporate charges
- Depreciation and
amortisation
Net Loss after
tax
continuing operations
from
Page 50
(1,264,598)
(653)
(5,272,868)
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2020
NOTE 15: OPERATING SEGMENTS (Continued)
ii. Segment assets
Australia
Zimbabwe Mozambique
Unallocated
items
$
$
$
$
Total
$
30 June 2020
Reconciliation of segment assets
to Group assets
Segment Assets
Unallocated Assets
- Corporate
- Held for sale asset
Total Group Assets
Segment Asset Increases
(Decreases)
Capitalised expenditure for the
period
961,811
-
-
-
-
-
-
-
-
-
961,811
160,384
160,384
167,924
167,924
1,290,119
- Exploration and Other
297,326
37,572
34,185
- Impairment write-down
(629,515)
(36,541)
(23,594)
(332,189)
1,031
10,591
-
-
-
369,083
(689,650)
(320,567)
Australia
Zimbabwe Mozambique
Unallocated
items
$
$
$
$
Total
$
30 June 2019
Reconciliation of segment
assets to Group assets
Segment Assets
Unallocated Assets
- Corporate
Total Group Assets
Segment Asset Increases
(Decreases)
Capitalised expenditure
the period
for
607,045
104,218
-
-
- Exploration and Other
99,542
104,218
- Impairment write-down
-
-
99,542
104,218
Page 51
-
-
-
-
-
-
711,263
315,416
315,416
1,026,679
98,237
301,997
(3,775,024)
(3,775,024)
(3,676,787)
(3,473,027)
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2020
NOTE 15: OPERATING SEGMENTS (Continued)
iii. Segment liabilities
Australia
Zimbabwe Mozambique
Unallocated
items
$
$
$
$
Total
$
30 June 2020
Reconciliation of segment
liabilities to group liabilities
Unallocated Liabilities
149,975
259
5,620
- Available for sale asset
-
(259)
(5,620)
Total Group Liabilities
149,975
-
-
-
-
-
155,854
(5,879)
149,975
Australia
Zimbabwe Mozambique
Unallocated
items
$
$
$
$
Total
$
1,745
9,374
3,124
3,701
17,944
30 June 2019
Reconciliation of segment
liabilities to group liabilities
Unallocated Liabilities
- Corporate
-
Total Group Liabilities
1,745
9,374
3,124
72,913
76,614
72,913
90,857
NOTE 16: CASH FLOW INFORMATION
A. Reconciliation of Cash Flow from Operations with Loss after Income
Tax:
Loss after income tax
(1,652,907)
(5,272,868)
30 June 2020
30 June 2019
$
$
Non-cash flows in loss from ordinary activities:
Depreciation
Fixed asset written off
Impairment – Mining assets
Equity settled compensation
Fair value adjustment to held for sale asset
Others
Changes in operating assets and liabilities:
(Increase)/Decrease in receivables
(Increase)/Decrease in prepayments and other assets
4,012
2,175
653
-
749,785
3,775,024
(221,882)
242,779
(42,588)
26,305
(32,418)
-
-
-
4,792
3,834
Increase/(decrease) in payables and accruals
59,118
(107,288)
Increase/(decrease) in provisions
Cash flows from operations
-
13,268
(1,108,401)
(1,339,806)
Page 52
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2020
NOTE 16: CASH FLOW INFORMATION
(Continued)
B. Non-cash Financing Activities
Share issue:
-
3,500,000 shares issued at no consideration upon the exercise
of performance rights
- A total of 21,892,266 shares were issued to complete the
acquisition of Warrigal
-
-
173,000 shares issued at no consideration, pursuant to board
resolutions to advisors of the Company for services rendered,
valued at $0.06 each, being the share price at the time of
issue.
150,000 shares with a fair value of $9,000 upon exercise of
performance rights.
NOTE 17: EARNINGS PER SHARE
334,165
787,969
-
-
-
-
10,380
9,000
30 June 2020
30 June 2019
$
$
Net loss used in the calculation of basic and diluted EPS attributable
to owners of the parent company
(1,652,907)
(5,272,868)
Weighted average number of ordinary shares outstanding during the
period used in the calculation of basic EPS
130,357,100
90,683,188
Options are considered potential ordinary shares. Options issued are not presently dilutive and were not
included in the determination of diluted earnings per share for the period.
NOTE 18: COMMITMENTS
(a) Exploration Commitments
The Group has certain obligations to expend minimum amounts on exploration in tenement areas. These
obligations may be varied from time to time and are expected to be fulfilled in the normal course of
operations of the Group.
The following commitments exist at balance date but have not been brought to account. If the relevant
option to acquire a mineral tenement is relinquished the expenditure commitment also ceases. The
Group has the option to negotiate new terms or relinquish the tenements and also to meet expenditure
requirements by joint venture or farm-in arrangements.
30 June 2020
30 June 2019
$
300,831
803,556
127,671
$
985,050
1,230,000
-
1,232,058
2,215,050
Not later than 1 year
Later than 1 year but not later than 5 years
Later than 5 years
Total commitment
(b) Lease Commitments
The Group has no leases.
(c) Capital Commitments
The Group has no capital commitments.
Page 53
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2020
NOTE 19: CONTINGENT LIABILITIES
At the date of signing this report, the Company is unaware of any contingent liabilities that should be
disclosed in accordance with AASB 137. It is however noted that the Warrigal Mining acquisition (refer to
Note 13) has attached royalty clauses in place, ranging from 0.5% to 2% net smelter return (NSR) royalty
payable to the vendors from production date. The Company is currently at an exploration stage and
cannot ascertain an amount that would constitute a contingent liability.
NOTE 20: RELATED PARTY TRANSACTIONS
Parent Entity
Tempest Minerals Ltd is the legal parent and ultimate parent entity of the Group.
Subsidiary
Interests in subsidiaries are disclosed in Note 24.
Key Management Personnel
Short-term employee benefits
Share-based payments
Related Party Transactions
30 June 2020
30 June 2019
$
$
475,286
-
475,286
447,500
215,798
663,298
A number of key management persons, or their related parties, hold positions in other entities that result
in them having control or significant influence over the financial or operating policies of those entities.
Transactions between related parties are on normal commercial terms and conditions unless otherwise
stated.
Technical consulting services provided by Galt Mining Solutions Pty
Ltd, a company controlled by directors, Don Smith and Owen
Burchell.
77,098
-
30 June 2020
30 June 2019
$
$
Page 54
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2020
NOTE 21: SHARE-BASED PAYMENTS
Director and Employee Share-based Payments
Share based payment expenses / (benefits) recognised during the year are as follows:
Share based payment expense recognised during the period:
Allocation of value of performance rights issued to directors in Oct
2016 1
30 June 2020
30 June 2019
$
$
3,184
208,708
Options and Performance Rights reversed 2
(225,067)
Allocation of value of performance rights issued to a consultant in Jun
2018
Shares issued to advisors in Dec 2018
Allocation of value of options issued to consultants in Dec 2018
Allocation of value of options issued to a director in Dec 2018
Allocation of value of performance rights issued to a director in Dec
2018
-
-
-
-
-
-
8,926
10,380
1,360
3,000
10,405
(221,883)
242,779
1.
7.5 million performance rights which have various vesting conditions, performance hurdles and
expiry dates were granted to directors in October 2016. The weighted average fair value of
performance rights granted was 9.04 cents. All of the performance rights expire 72 months after
issue date. In January 2018, 200,000 performance rights were exercised and 600,000 performance
rights expired when a director resigned. The fair value of the performance rights after the excise and
cancellation totalled $623,700 and has been spread over the period to 30 June 2020, being the last
vesting date on the performance rights.
2. Options and performance rights that lapsed/expired or forfeited during the year amounting to
$225,067 were adjusted through the profit and loss statement.
Other Share-based Payments
During the year, the Company issued 6,693,088 options to corporate advisors as partial
consideration for acting as the Lead Managers of the capital raising undertaken in September
2019, the fair value of which has been recorded as part of share issue costs and therefore not
recognised as an expense in the reporting year. The options vested on grant date and expire
on 30 September 2020.
The weighted average fair value of options granted during the period was 2.023 cents. The fair
values at grant date were determined by using a Black-Scholes option pricing model that
takes into account the share price at issue date, exercise price, expected volatility, option life,
expected dividends, the risk free rate, the impact of dilution, the fact that the options are not
tradeable. The inputs used for the Black-Scholes option pricing model for the options granted
were as follows:
Issue date: 19 September 2019
share price at issue date: 5 cents
exercise price: 5 cents
expected volatility: 105.30%
expected dividend yield: nil
risk free rate: 1.00%
The fair value of the options is valued at $135,401 in total.
Page 55
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2020
NOTE 22: AUDITOR’S REMUNERATION
Remuneration for the auditor of the parent entity:
BDO Audit Pty Ltd and its related entities:
Auditing or reviewing the financial reports
Taxation
30 June 2020
30 June 2019
$
$
41,511
7,636
49,147
37,591
9,045
46,636
Taxation includes review of tax-effect accounting note and preparation of income tax returns.
NOTE 23: FINANCIAL RISK MANAGEMENT
(a) Financial Risk Management Policies
The Group's financial instruments comprise cash balances, receivables and payables, loans to and from
subsidiaries and a loan from a related party. The main purpose of these financial instruments is to provide
finance for Group operations.
Treasury Risk Management
Key executives of the Company meet on a regular basis to analyse exposure and to evaluate treasury
management strategies in the context of the most recent economic conditions and forecasts. The
board of directors has overall responsibility for the establishment and oversight of the Group's risk
risk
management framework. Management
management policies and reports to the board.
responsible for developing and monitoring the
is
Financial Risks
The main risks the Group is exposed to through its financial instruments are interest rate risk, foreign
currency risk, credit risk and liquidity risk. These risks are managed through monitoring of forecast cash
flows, interest rates, economic conditions and ensuring adequate funds are available.
Interest Rate Risk
The Group's exposure to interest rate risk, which is the risk that a financial instrument's cash flows or fair
value will fluctuate as a result of changes in market interest rates, arises in relation to the Group's bank
balances. This risk is managed through the use of variable rate bank accounts.
Liquidity Risk
Liquidity risk is the risk that the Group will not be able meet its financial obligations as they fall due. This
risk is managed by ensuring, to the extent possible, that there is sufficient liquidity to meet liabilities when
due, without incurring unacceptable losses or risking damage to the Group's reputation.
The Group's activities are funded from equity and where required and available debt and/or project
finance. There is no requirement to repay principal or pay interest on the related party loan during the
loan term.
Credit Risk
The maximum exposure to credit risk, excluding the value of any collateral or other security, at balance
date to recognised financial assets, is their carrying amount, net of any provisions for impairment of those
assets, as disclosed in the statement of financial position and notes to the financial statements.
Page 56
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2020
NOTE 23: FINANCIAL RISK MANAGEMENT (Continued)
Credit risk arises from exposures to deposits with financial institutions and sundry receivables.
Credit risk is managed and reviewed regularly by key executives. The key executives monitor credit risk
by actively assessing the rating quality and liquidity of counter parties:
only banks and financial institutions with an ‘A’ rating are utilised; and
all other entities are rated for credit worthiness taking into account their size, market position and
financial standing.
At 30 June 2020, there was no concentration of credit risk, other than bank balances.
Foreign Currency Risk
The Group is exposed to fluctuations in foreign currencies arising from the purchase of goods and
services in currencies other than the relevant entity's functional currency.
Financial assets and liabilities exist for the Group's Zimbabwe and Mozambique operations, and thus
there is exposure to the US Dollars and Mozambique New Metical. As this risk is minor, it is not hedged. At
reporting date, the net foreign currency risk (stated in $AUD) was $304 (2019 $1,363).
(b) Financial Instrument Composition and Contractual Maturity Analysis
Financial assets:
Within 6 months:
cash & cash equivalents (i)
receivables (i)
prepayments
Financial liabilities:
Within 6 months:
payables (i)
30 June 2020
30 June 2019
$
$
106,008
25,479
21,701
153,188
298,125
14,762
-
312,887
(149,975)
(149,975)
(90,857)
(90,857)
(i) Non-interest bearing. The contractual cash flows do not differ to the carrying amount.
(c) Net Fair Values
Fair values of financial assets and financial liabilities are materially in line with carrying values.
(d) Sensitivity Analysis
The Company has performed sensitivity analysis relating to its exposure to interest rate risk. At year end,
the effect on profit and equity as a result of a 1% change in the interest rate, with all other variables
remaining constant, is immaterial.
Page 57
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2020
NOTE 24: SUBSIDIARIES
The consolidated financial statements incorporate the assets, liabilities and results of the following wholly
owned subsidiaries in accordance with the accounting policy described in Note 1:
Country of
incorporation
Ownership interest
30 June 2020
30 June 2019
Australia
Australia
U.S.A.
Australia
Australia
Australia
Mozambique
Zimbabwe
Australia
100%
80%
100%
100%
100%
100%
100%
100%
100%
100%
80%
100%
100%
100%
100%
100%
100%
-
West Resource Ventures Pty Ltd
South Resource Ventures Pty Ltd
LCME Holdings Inc.
Li3 (Mozambique) Pty Ltd 1
Li3B (Mozambique)Pty Ltd 1
Li3C (Mozambique) Pty Ltd 1
LithiumB, S.A 1
Licomex (Private) Limited 1
Warrigal Mining Pty Ltd
1. Disposed subsequent to year end.
NOTE 25: SUBSEQUENT EVENTS
On 25 June 2020 the Company announced a non-renounceable entitlement offer to eligible
shareholders of one new fully paid ordinary share for every two shares held at an issue price of $0.016 per
share, to raise approximately $1,178,134 (before costs). On 28 July 2020, after the close of the entitlement
offer and achieving a 69.43% take-up rate, the Company issued a total of 51,121,816 shares to raise a
total of $817,949 (before costs). On 3 August 2020, the Company announced it completed the
placement of the Shortfall arising from the non-renounceable Entitlement Offer and issued 22,511,599
shares raising a further $360,185.
On 29 July 2020, the Company completed the sale of its African projects to Premier African Minerals
Limited for the purchase consideration of A$150,000 plus the payment of inspection fees for the claims in
Zimbabwe through the issue of 124,512,702 Premier shares at a deemed issue price of 0.0744 pence.
On 4 August 2020, the Company accommodated additional demand from the shortfall placement to
raise $176,000 through the issue of 11 million shares at $0.016 each.
On 11 September 2020, the Company issued 3,750,000 ordinary fully paid shares to nominees of RM
Corporate Finance Pty Ltd as consideration for acting as Lead Manager and for placing the Shortfall
from the entitlement offer. Shareholder approval for the issue was received at the General Meeting held
on 27 August 2020.
The Company changed its name to Tempest Minerals Ltd after receiving approval from shareholders at
the General Meeting held on 27 August 2020, to better reflect its new focus on gold and base metal
exploration projects in Western Australia.
18 million unlisted options exercisable at $0.04 each expiring on or before 30 September 2022 were
approved by shareholders at the General Meeting held on 27 August 2020 and issued to directors and
the company secretary of the Company as follows:
Page 58
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2020
NOTE 25: SUBSEQUENT EVENTS (Continued)
Name
B. Moller
D. Smith
V. Mascolo
A. Haythorpe
O. Burchell
P. Jurman
Unlisted Options ($0.04, expiring 30-Sep-2022)
3,000,000
4,000,000
3,000,000
3,000,000
3,000,000
2,000,000
Other than the matters noted above, there are no material matters or circumstances that have arisen
since the end of the year which significantly affected or may significantly affect the operations of the
Group, the results of those operations, or the state of affairs of the Group in future financial years.
NOTE 26: PARENT ENTITY INFORMATION
The following information relates to the parent entity, Tempest Minerals Ltd at 30 June 2020. This
information has been prepared using consistent accounting policies as presented in Note 1.
Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
Net assets
Contributed equity
Reserves
Accumulated losses
Total equity
Loss for the period
Other comprehensive income for the period
30 June 2020
30 June 2019
$
128,137
969,007
1,097,144
142,094
-
142,094
955,050
$
232,026
713,793
945,819
89,112
-
89,112
856,707
11,242,943
8,965,067
246,410
667,057
(10,534,303)
(8,775,417)
955,050
856,707
(1,001,341)
(4,895,275)
-
-
Total comprehensive income for the period
(1,001,341)
(4,895,275)
The Company has no contingent liabilities other than as referred to in Note 19, nor has it entered into any
guarantees in relation to the debts of its subsidiaries. The Company has not entered into any contractual
commitments for the acquisition of property, plant and equipment.
The Company and its Australian controlled entities have formed a tax consolidated group as at the date
of this report.
Page 59
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2020
NOTE 27: COMPANY DETAILS
The registered office and principal place of business is:
Level 2, Suite 9
389 Oxford Street
Mount Hawthorn, Western Australia 6016 Australia
NOTE 28: DIVIDENDS & FRANKING CREDITS
There were no dividends paid or recommended during the financial year. There are no franking credits
available to the shareholders of the Company.
Page 60
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Director’s Declaration
In the opinion of the Directors of Tempest Minerals Limited:
(a)
The accompanying financial statements and notes are in accordance with the Corporations
Act 2001 including:
(i) giving a true and fair view of the Group’s financial position as at 30 June 2020 and of its
performance for the year then ended; and
(ii) complying with Accounting Standards, the Corporations Regulations 2001, professional
reporting requirements and other mandatory requirements.
(b)
(c)
There are reasonable grounds to believe that the Company will be able to pay its debts as
and when they become due and payable.
The financial statements and notes thereto are in accordance with International Financial
Reporting Standards issued by the International Accounting Standards Board.
This declaration has been made after receiving the declarations required to be made to the
directors in accordance with section 295A of the Corporations Act 2001 for the financial year
ended 30 June 2020.
Signed in accordance with a resolution of the Directors made pursuant to s 295(5) of the
Corporations Act 2001.
On behalf of the Board.
Don Smith
Managing Director
Dated 28 September 2020
Perth, Western Australia
Page 61
Tel: +61 7 3237 5999
Fax: +61 7 3221 9227
www.bdo.com.au
Level 10, 12 Creek St
Brisbane QLD 4000
GPO Box 457 Brisbane QLD 4001
Australia
INDEPENDENT AUDITOR'S REPORT
To the members of Tempest Minerals Ltd
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Tempest Minerals Ltd (the Company) and its subsidiaries (the
Group), which comprises the consolidated statement of financial position as at 30 June 2020, the
consolidated statement of profit or loss and other comprehensive income, the consolidated statement
of changes in equity and the consolidated statement of cash flows for the year then ended, and notes
to the financial report, including a summary of significant accounting policies and the directors’
declaration.
In our opinion the accompanying financial report of the Group, is in accordance with the Corporations
Act 2001, including:
(i)
Giving a true and fair view of the Group’s financial position as at 30 June 2020 and of its
financial performance for the year ended on that date; and
(ii)
Complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s responsibilities for the audit of the Financial
Report section of our report. We are independent of the Group in accordance with the Corporations
Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s
APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code)
that are relevant to our audit of the financial report in Australia. We have also fulfilled our other
ethical responsibilities in accordance with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been
given to the directors of the Company, would be in the same terms if given to the directors as at the
time of this auditor’s report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities which are all members of BDO
Australia Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit Pty Ltd and BDO Australia Ltd are members of
BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member
firms. Liability limited by a scheme approved under Professional Standards Legislation.
Page 62
Material uncertainty related to going concern
We draw attention to Note 1 in the financial report which describes the events and/or conditions which
give rise to the existence of a material uncertainty that may cast significant doubt about the group’s
ability to continue as a going concern and therefore the group may be unable to realise its assets and
discharge its liabilities in the normal course of business. Our opinion is not modified in respect of this
matter.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the financial report of the current period. These matters were addressed in the context of
our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide
a separate opinion on these matters. In addition to the matter described in the Material uncertainty
related to going concern section, we have determined the matters described below to be the key audit
matters to be communicated in our report.
Carrying value of exploration and evaluation assets
Key audit matter
How the matter was addressed in our audit
Refer to Note 8 in the financial report.
The Group carries exploration and
evaluation assets as at 30 June 2020 in
relation to the application of the Group’s
accounting policy for exploration and
evaluation assets.
The recoverability of exploration and
evaluation asset is a key audit matter
due to the significance of the total
balance and the level of procedures
undertaken to evaluate management’s
application of the requirements of AASB
6 Exploration for and Evaluation of
Mineral Resources in light of any
indicators of impairment that may be
present.
Our procedures included, but were not limited to the
following:
•
•
•
Obtaining evidence that the Group has valid rights
to explore in the areas represented by the
capitalised exploration and evaluation expenditure
by obtaining supporting documentation such as
license agreements and also considering whether the
Group maintains the tenements in good standing
Making enquiries of management with respect to the
status of ongoing exploration programs in the
respective areas of interest.
Enquiring of management, reviewing ASX
announcements and reviewing directors’ minutes to
ensure that the Group has not decided to
discontinue activities in any applicable areas of
interest, and to assess whether there are any other
facts or circumstances that existed to indicate
impairment.
BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities which are all members of BDO
Australia Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit Pty Ltd and BDO Australia Ltd are members of
BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member
firms. Liability limited by a scheme approved under Professional Standards Legislation.
Page 63
Other information
The directors are responsible for the other information. The other information comprises the
information in the Group’s annual report for the year ended 30 June 2020, but does not include the
financial report and the auditor’s report thereon.
Our opinion on the financial report does not cover the other information and we do not express any
form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the directors for the Financial Report
The directors of the Company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due to
fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the group to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the Group or to cease
operations, or has no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of this financial report.
A further description of our responsibilities for the audit of the financial report is located at the
Auditing and Assurance Standards Board website at:
https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf
This description forms part of our auditor’s report.
BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities which are all members of BDO
Australia Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit Pty Ltd and BDO Australia Ltd are members of
BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member
firms. Liability limited by a scheme approved under Professional Standards Legislation.
Page 64
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 23 to 27 of the directors’ report for the
year ended 30 June 2020.
In our opinion, the Remuneration Report of Tempest Minerals Ltd, for the year ended 30 June 2020,
complies with section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the
Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility
is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with
Australian Auditing Standards.
BDO Audit Pty Ltd
T J Kendall
Director
Brisbane, 28 September 2020
BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities which are all members of BDO
Australia Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit Pty Ltd and BDO Australia Ltd are members of
BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member
firms. Liability limited by a scheme approved under Professional Standards Legislation.
Page 65
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Corporate Governance Statement
The board of directors of Tempest Minerals Ltd is responsible for the corporate governance of the
consolidated entity. The Board guides and monitors the business and affairs of Tempest Minerals Ltd on
behalf of the shareholders by whom they are elected and to whom they are accountable.
Tempest Minerals Ltd’s Corporate Governance Statement (which can be found on the Company’s
website www.tempestminerals.com) is structured with reference to the Australian Securities Exchange
(“ASX”) Corporate Governance Council’s (the “Council”) “Corporate Governance Principles and
Recommendations, 3rd Edition”, which are as follows:
Principle 1
Principle 2
Principle 3
Principle 4
Principle 5
Principle 6
Principle 7
Principle 8
Lay solid foundations for management and oversight
Structure the board to add value
Act ethically and responsibly
Safeguard integrity in corporate reporting
Make timely and balanced disclosure
Respect the rights of security holders
Recognise and manage risk
Remunerate fairly and responsibly
A copy of the eight Corporate Governance Principles and Recommendations can be found on the
ASX’s website.
The Board is of the view that, during the reporting period, with the exception of the departures from the
ASX Guidelines as set out below, it otherwise complies with all of the ASX Guidelines.
Roles and Responsibilities of the Board and Management
ASX CGC Principle 1
Lay solid foundations for management and oversight.
Role of the Board
The Board of Directors is pivotal in the relationship between shareholders and management and the role
and responsibilities of the Board underpin corporate governance.
The Board is committed to administering the policies and procedures with openness and integrity,
pursuing the true spirit of corporate governance commensurate with the Group’s needs.
Generally, the powers and obligations of the Board are governed by the Corporations Act and the
general law.
Without limiting those matters, the Board expressly considers itself responsible for the following:
Ensuring compliance with the Corporations Act, ASX Listing Rules (where appropriate) and all
relevant laws;
Oversight of the Group including its framework of control and accountability systems to enable
risk to be assessed and managed;
Appointing and removing the chief executive officer;
Ratifying the appointment and, where appropriate, removal of senior executives including the
chief financial officer and the Group secretary;
Input into and final approval of management’s development of corporate strategy and
performance objectives;
Monitoring senior executive’s performance and implementation of strategy;
Ensuring appropriate resources are available to senior executives;
Approving and monitoring the progress of major capital expenditure, capital management and
acquisitions and divestitures;
Approving and overseeing Committees where appropriate to assist in the Board’s function and
powers.
Page 66
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Corporate Governance Statement
The Functions, Powers and Responsibilities of the Board are set out in the Company’s Corporate
Governance Charter which is available from the corporate governance section of the Company’s
website.
The board meets on a regular basis to review the performance of the Company against its goals both
financial and non-financial. In normal circumstances, prior to the scheduled board meetings, each
board member is provided with a formal board package containing appropriate management and
financial reports.
Appropriate background checks are conducted on proposed new directors and material information
about a director being re-elected is provided to security holders.
Written agreements are entered in to with directors and senior management clearly setting out their
roles and responsibilities.
The company secretary works directly with the chair and the executive director on the functioning of all
board and committee procedures.
Diversity
The Group is committed to workplace diversity and ensuring a diverse mix of skills amongst its directors,
officers and employees.
Recommendation 1.5 requires that listed entities should establish a policy concerning diversity. Whilst the
Group does not currently have a Diversity policy due to its size and nature of its operations, it strives to
attract the best person for the position regardless of gender, age, ethnicity or cultural background.
As at 30 June 2020, the number of men and women in the whole organisation is a follows:
Male
Female
Board Members
Officers
Other
5
1
0
0
0
0
Performance Evaluation
The Board (in carrying out the functions of the Remuneration and Nomination Committees) considers
remuneration and nomination issues annually and otherwise as required in conjunction with the regular
meetings of the Board.
No formal performance evaluations of the Board or management were undertaken during the year
ended 30 June 2020.
Board Composition
ASX CGC Principle 2
Structure of the Board to add value
Nomination Committee
Recommendation 2.1 requires the Board to establish a nomination committee.
Although the Board has adopted a Nominations Committee Charter, the Board has not formally
established a Nominations Committee as the Directors consider that the Company is currently not of a
size nor are its affairs of such complexity as to justify the formation of this Committee. The Board as a
whole is able to address these issues and is guided by the Nominations Committee Charter. The
Company will review this position annually and determine whether a Nominations Committee needs to
be established.
The Nomination Committee Charter is set out in the Company’s Corporate Governance Charter which is
available from the corporate governance section of the Group’s website.
Page 67
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Corporate Governance Statement
The Company is developing an appropriate board skills matrix. The skills, experience and expertise
relevant to the position of each director who is in office at the date of the Annual Report is detailed in
the director’s report.
Corporate Governance Council Recommendation 2.4 requires a majority of the Board to be
independent Directors. The Corporate Governance Council defines independence as being free from
any interest, position, association or relationship that might influence, or reasonably be perceived to
influence, in a material capacity to bring independent judgement to bear on issues before the board
and to act in the best interests of the entity and its security holders generally.
In the context of Director independence, “materiality” is considered from both the Group and the
individual Director perspective. The determination of materiality requires consideration of both
quantitative and qualitative elements. An item is presumed to be material (unless there is qualitative
evidence to the contrary) if it is equal to or greater than 10% of the appropriate base amount.
Qualitative factors considered included whether a relationship is strategically important, the competitive
landscape, the nature of the relationship and the contractual or other arrangements governing it and
other factors which point to the actual ability of the Director in question to shape the direction of the
Group.
In accordance with the Council’s definition of independence above and the materiality thresholds set,
the following Company directors were not considered to be independent and therefore the Group does
not currently comply with Recommendation 2.4:
Name
D. Smith
Managing Director
Position
Reason for non-compliance
B. Moller
Chairman
O. Burchell
Non-Executive Director
A. Haythorpe
S. Pathmanathan
Non-Executive Director
(appointed 11 October 2019),
Interim Managing Director
(from 28 October 2019 until 3
April 2020) and Non-Executive
Director (from 3 April 2020)
Chief Executive Officer and
Executive Director – resigned
11 October 2019
Mr Smith is employed by the Company in an executive
capacity and also a director of Galt Mining Solutions
Pty Ltd, which provides technical consulting services to
the Company
Mr Moller is a principal of HopgoodGanim Lawyers, a
material professional advisor to the Company
Mr Burchell is a director of Galt Mining Solutions Pty Ltd,
which provides technical consulting services to the
Company
Mr Haythorpe was employed by the Company in an
executive capacity during the financial year.
Mr Pathmanathan was employed by the Company in
an executive capacity
Tempest Minerals Ltd considers industry experience and specific expertise, as well as general corporate
experience, to be important attributes of its Board members. The Directors noted above have been
appointed to the Board of Tempest Minerals Ltd due to their considerable industry and corporate
experience. The term in office held by each Director in office at the date of this report is as follows:
Name
Brian Moller
Term in Office
4 years, 2 months
Vincent Mascolo
4 years, 7 months
Andrew Haythorpe
Owen Burchell
Don Smith
Page 68
1 year
9 months
9 months
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Corporate Governance Statement
Directors have the right to seek independent professional advice in the furtherance of their duties as
directors at the Group’s expense. Written approval must be obtained from the chair prior to incurring
any expense on behalf of the Group. Informal induction is provided to any new directors.
Act Ethically and Responsibly
ASX CGC Principle 3
Code of Conduct
The Directors are subject to certain stringent legal requirements regulating the conduct both in terms of
their internal conduct as directors and in their external dealings with third parties both on their own and
on behalf of the Group.
To assist directors in discharging their duty to the Group and in compliance with relevant laws to which
they are subject, the Group has adopted a Corporate Ethics Policy and Corporate Code of Conduct
within its Corporate Governance Charter.
The Corporate Ethics Policy sets out rules binding Directors in respect of:
a Director’s legal duties as an officer of the Company;
a Director’s obligations to make disclosures to the ASX and the market generally; and
dealings by Directors in shares in the Company.
The Corporate Ethics Policy, as set out in the Company’s Corporate Governance Charter is available
from the corporate governance section of the Group’s website.
Safeguard Integrity in Corporate Reporting
ASX CGC Principle 4
Audit Committee
The Board has established an Audit and Risk Management Committee which operates under a charter
approved by the Board.
Recommendation 4.1 states that an audit committee should be structured so that it:
i. consists only non-executive directors;
ii. consists of a majority of independent directors;
iii.
is chaired by an independent chair, who is not the chair of the Board; and
iv. has at least three members.
The members of the Audit and Risk Management Committee are Vincent Mascolo (chairman of the
Committee) and Brian Moller. While both members of the Committee are non-executive directors, only
Vince Mascolo is considered independent (based on the Council’s definition). While the Committee is
chaired by an independent director (Vincent Mascolo), the Company does not presently comply with
parts i, ii and iv of Recommendation 4.1.
All members of the Audit and Risk Management Committee are considered financially literate in the
context of the Company’s affairs.
The Audit and Risk Management Committee Charter is set out in the Company’s Corporate Governance
Charter which is available from the corporate governance section of the Group’s website.
Certification of financial reports
The Board ensures it receives the required declarations in writing to the Board that the Company’s
financial statements present a true and fair view, in all material aspects, of the Company’s financial
condition and operational results and are in accordance with relevant accounting standards, that this is
founded on a sound system of risk management and internal compliance and control and that the
Company’s risk management and internal compliance and control system is operating efficiently and
effectively. This representation is prior to the Director’s approval of the release of the annual and half
Page 69
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Corporate Governance Statement
yearly accounts. This representation is made after enquiry of, and representation by, appropriate levels
of management.
The Group ensures that its external auditors are present at the AGM to answer any questions with regard
to the efficacy of the financial statement audit and the associated independent audit report.
Continuance Disclosure
ASX CGC Principle 5
Make timely and balanced disclosure
The Group duly complies with ASX and ASIC requirements for the timely and accurate reporting of the
Group’s financial activities, thus ensuring that the Group has disclosed all information which has a
material impact on shareholders. This includes the Annual Financial Report, Interim Financial Report,
quarterly cash flows, new and relinquished tenements and changes in directors and shareholder interests
and other events which are identified to be material. All ASX announcements are available on the
Group’s website.
The Company Secretary is responsible for communication with the ASX, including responsibility for
ensuring compliance with the continuous disclosure requirements of the ASX Listing Rules and oversight
of information distributed to the ASX.
Respect The Rights of Security Holders
ASX CGC Principle 6
The Board of directors undertakes to ensure that shareholders are informed of all major developments
affecting the Group. Information is communicated to shareholders through the annual report, interim
financial report, announcements made to the ASX, notices of Annual General and Extraordinary
General Meetings, the AGM and Extraordinary General Meetings.
The Board encourages full participation of shareholders at Annual and Extraordinary General Meetings
to ensure a high level of accountability and identification with the Group’s direction, strategy and goals.
In particular, shareholders are responsible for voting on the re-election of directors.
The Group also offers shareholders the option to receive ASX announcements and other notices from the
Company electronically.
Risk Management
ASX CGC Principle 7
Recognise and manage risk
The Board has established an Audit and Risk Management Committee which operates under a charter
approved by the Board.
Recommendation 7.1 states that an audit committee should be structured so that it:
i. consists only non-executive directors;
ii. consists of a majority of independent directors;
iii.
is chaired by an independent chair, who is not the chair of the Board; and
iv. has at least three members.
The members of the Audit and Risk Management Committee are Vincent Mascolo (chairman of the
Committee) and Brian Moller. While both members of the Committee are non-executive directors, only
Vince Mascolo is considered independent (based on the Council’s definition). While the Committee is
chaired by an independent director (Vincent Mascolo), the Company does not presently comply with
parts i, ii and iv of Recommendation 7.1.
All members of the Audit & Rick Management Committee are considered to have sufficient technical,
legal and industry experience in the context of the Company’s affairs to properly assess the risks facing
the Group.
Page 70
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Corporate Governance Statement
The Company has developed a basic framework for risk management and internal compliance and
control systems which cover organisational, financial and operational aspects of the Company’s affairs.
Further detail of the Company’s risk management policies can be found within the Audit and Risk
Management Committee Charter.
Recommendation 7.2 requires that the Board review the Company’s risk management framework and
disclose whether such a review has taken place. Business risks are considered regularly by the Board
and management at management and Board meetings. A formal report to the Board as to the
effectiveness of the management of the Company’s material business risks has not been formally
undertaken.
The Audit and Risk Management Committee Charter is set out in the Company’s Corporate Governance
Charter which is available from the corporate governance section of the Group’s website.
The Company does not have a separate internal audit function. The board considers that the Company
is not currently of the size or complexity to justify a separate internal audit function, and that appropriate
internal financial controls are in place. Such controls are monitored by senior financial management
and the Audit and Risk Committee.
The Director’s Report sets out some of the key risks relevant to the Company and its operations. Although
not specifically defined as such, the risks include economic, environmental and social sustainability risks.
As noted above, the Company regularly reviews risks facing the Company and adopts appropriate
mitigation strategies where possible.
Remuneration
ASX CGC Principle 8
Remunerate fairly and responsibly
Remuneration Committee
The Board has not established a Remuneration Committee which operates under a charter approved by
the Board.
Although the Board has adopted a Remuneration Committee Charter, the Board has not formally
established a Remuneration Committee as the Directors consider that the Company is currently not of a
size nor are its affairs of such complexity as to justify the formation of this Committee. The Board as a
whole considers themselves to have sufficient legal, corporate, commercial and industry experience in
the context of the Company’s affairs to properly assess the remuneration issues required by the Group
and is able to address these issues while being guided by the Remuneration Committee Charter. The
Company will review this position annually and determine whether a Remuneration Committee needs to
be established.
The Company believes that given the size and nature of its operations, non-compliance by the
Company with Recommendation 8.1 will not be detrimental to the Company.
It is the Company’s objective to provide maximum stakeholder benefit from the retention of a high
quality Board and Executive team by remunerating directors and key executives fairly and appropriately
with reference to relevant employment market conditions. To assist in achieving this objective, the
Board links the nature and amount of executive director’s and officer’s remuneration to the Group’s
financial and operations performance. The expected outcomes of the remuneration structure are:
retention and motivation of key Executives
attraction of quality management to the Group
performance incentives which allow executives, management and staff to share the rewards of
the success of Tempest Minerals Ltd.
For details on the amount of remuneration and all monetary and non-monetary components for Key
Management Personnel during the period, please refer to the Remuneration Report within the Directors’
Report. In relation to the payment of bonuses, options, performance rights and other incentive
payments, discretion is exercised by the Remuneration Committee and the Board, having regard to the
overall performance of Tempest Minerals Ltd and the performance of the individual during the period.
Page 71
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Corporate Governance Statement
There is no scheme to provide retirement benefits to directors other than statutory superannuation.
The Remuneration Committee Charter is set out in the Company’s Corporate Governance Charter
which is available from the corporate governance section of the Group’s website.
Remuneration Policy
The Group’s remuneration policy is also further detailed in the Remuneration Report in the Directors
Report.
Non-Executive Director Remuneration
Non-executive directors are remunerated at market rates for time, commitment and responsibilities.
Non-executive directors are remunerated by fees as determined by the Board with the aggregate
directors’ fee pool limit of $300,000. The maximum aggregate amount of fees that can be paid to non-
executive directors is subject to approval by shareholders at the Annual General Meeting. Independent
consultancy sources provide advice, as required; ensuring remuneration is in accordance with market
practice. Fees for non-executive Directors are not linked to the performance of the Group. However, to
align Directors’ interests with shareholders’ interests, the Directors are encouraged to hold shares in the
Company and are, subject to approval by shareholders, periodically offered options and/or
performance rights.
The Company has adopted a Trading Policy that includes a prohibition on hedging, aimed at ensuring
participants do not enter into arrangements which would have the effect of limited their exposure to risk
relating to an element of their remuneration.
Other Information
Further information relating to the Group’s corporate governance practices and policies has been
made publicly available on the Group’s web site.
Page 72
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Shareholder Information
Additional information required by the Australian Securities Exchange Ltd and not shown elsewhere in
this report is as follows. The information is current as at 21 September 2020.
(a) Distribution of equity securities
The number of holders, by size of holding, in each class of security are:
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 – 50,000
50,001 - 100,000
100,001 and over
Total
Ordinary Shares
No. Holders
No. Shares
11
59
166
483
160
312
1,191
4,378
210,119
1,489,144
13,041,138
13,069,379
207,835,930
235,650,088
There are 250 shareholders holding less than a marketable parcel.
Unlisted Options ($0.04896 @ 30-Sep-20)
No. Holders
No. Options
9
54
28
37
19
56
203
5,345
144,554
207,415
876,199
1,736,981
37,458,449
40,428,943
%
0.00
0.09
0.63
5.53
5.55
88.20
100
%
0.01
0.36
0.51
2.17
4.30
92.65
100
Unlisted Options ($0.2489 @ 5-Dec-20)
Unlisted Options ($0.04 @ 30-Sep-22)
No. Holders
No. Options
No. Holders
No. Options
-
-
-
6
6
-
-
-
-
18,000,000
18,000,000
-
-
-
1
2
3
-
-
-
69,200
276,800
346,000
Performance Rights
No. Holders
No. Perf. Rights
-
-
-
-
3
3
-
-
-
-
500,000
500,000
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 50,000
50,001 – 100,000
100,001 and over
Total
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 and over
Total
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 and over
Total
Page 73
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Shareholder Information
(b) Twenty Largest Shareholders
The names of the twenty largest holders of Quoted Ordinary Shares are:
#
Registered Name
Number of
Shares
% of total
Shares
1
2
3
4
5
6
7
7
8
9
10
11
11
GALT INDUSTRIES PTY LTD
V-DOOR PTY LTD
AUSTRALIAN CONSOLIDATED VENTURE CAPITAL PTY LTD
MR ANTHONY DE NICOLA & MRS TANYA LOUISE DE NICOLA
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
HAWERA PTY LTD
MR MICHAEL PEREIRA
MR DAVID LEANDER NICHOLS
EASTERN GOLDFIELDS EXPLORATION PTY LTD
BIG SMOKEY EXPLORATION LLC
COSANN PTY LTD
KELVERLEY PTY LTD
BOND STREET CUSTODIANS LIMITED
12 WHITMEAL PTY LTD
13
ROMARDO GROUP PTY LTD
14 MR VITTORIO LETIZIA
15
16
NETWEALTH INVESTMENTS LIMITED (SUPER SERVICES A/C)
NETWEALTH INVESTMENTS LIMITED (WRAP SERVICES A/C)
16 WILLING VALE PTY LTD
16
RAGGED RANGE MINING PTY LTD
16 MR MICHAEL MASCOLO
16 MR MAXWELL MILTON
17 MR GIUSEPPE MARIO COMMISSO
18
ALAN FRANK CLELAND
19 MR DAVID GREGORY CARTER
20 MR VINCENT DAVID MASCOLO
Top 20 total
Total shares on issue
Page 74
9,902,577
9,902,577
6,000,000
5,750,000
5,608,932
4,250,000
4,000,000
4,000,000
3,457,358
3,378,320
3,000,001
3,000,000
3,000,000
2,775,000
2,250,000
2,142,600
2,107,304
2,000,000
2,000,000
2,000,000
2,000,000
2,000,000
1,820,000
1,673,943
1,611,363
1,575,000
4.20%
4.20%
2.55%
2.44%
2.38%
1.80%
1.70%
1.70%
1.47%
1.43%
1.27%
1.27%
1.27%
1.18%
0.95%
0.91%
0.89%
0.85%
0.85%
0.85%
0.85%
0.85%
0.77%
0.71%
0.68%
0.67%
91,204,975
38.69%
235,650,088
100.0%
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Shareholder Information
(c) Substantial Shareholders
The Company has no substantial shareholders.
(d) Voting rights
All ordinary shares carry one vote per share without restriction.
Options and Performance Rights do not carry voting rights.
(e) Restricted securities
As at the date of this report, there are no ordinary shares subject to ASX escrow.
(f) On-market buy back
There is not a current on-market buy-back in place.
(g) Business objectives
The Group has used its cash and assets that are readily convertible to cash in a way consistent with its
business objectives.
Page 75
TEMPEST MINERALS LTD - ACN 612 008 358
ANNUAL REPORT 2020
Interests in Tenements
Tempest Minerals Ltd held the following interests in tenements as at the date of this report:
Tenement/Project
Name
Tenement
Number
Status
Interest
Rocky Prospect
E70/5321
Granted
Caranning
E63/1815
Application
Windarling
E77/2384
Application
Warriedar Region
E59/2224
E59/2308
E59/2374
E59/2375
E59/2350
E59/2381
E59/2319
Messenger
Euro
Granted
Granted
Granted
Granted
Granted
Granted
Granted
E59/2410
Application
E59/2418
Application
E59/2419
Application
Magnet Region
P58/1770
P58/1773
P58/1781
P58/1783
P58/1784
P58/1785
P58/1786
P58/1787
M58/229
P58/1832
P58/1680
P58/1698
P58/1753
P58/1761
P58/1768
P58/1769
P58/1774
P58/1796
Page 76
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
Location of
Tenements
Western Australia
Western Australia
Western Australia
Western Australia
Western Australia
Western Australia
Western Australia
Western Australia
Western Australia
Western Australia
Western Australia
Western Australia
Western Australia
Western Australia
Western Australia
Western Australia
Western Australia
Western Australia
Western Australia
Western Australia
Western Australia
Western Australia
Western Australia
Western Australia
Western Australia
Western Australia
Western Australia
Western Australia
Western Australia
Western Australia
Western Australia