2020 Annual Report
Contents
About Terramin ...................................................................................................................................................................... 3
Chairman’s Review ................................................................................................................................................................. 4
Financial Report ..................................................................................................................................................................... 5
Directors’ Report .................................................................................................................................................................... 6
Directors’ Declaration .......................................................................................................................................................... 17
Auditor’s Independence Declaration .................................................................................................................................... 18
Auditor’s Independent Report .............................................................................................................................................. 19
Consolidated Statement of Profit or Loss and Other Comprehensive Income ....................................................................... 22
Consolidated Statement of Financial Position ...................................................................................................................... 23
Consolidated Statement of Changes in Equity ...................................................................................................................... 24
Consolidated Statement of Cash Flows ................................................................................................................................. 25
Notes to the Consolidated Financial Statements .................................................................................................................. 26
Tenement Information ......................................................................................................................................................... 43
Reserves and Resources ....................................................................................................................................................... 44
Additional Securities Exchange Information ......................................................................................................................... 46
2
About Terramin
Terramin Australia Limited (the Company or Terramin) engages in the exploration, evaluation and development of base and precious
metal projects.
Terramin has a clear focus on growing a production pipeline of base and precious metal projects close to infrastructure and with low
capital and operating costs. Consistent with this focus, the Group holds a number of highly prospective mineral deposits and
exploration tenements across South Australia and Algeria.
Terramin’s major projects are:
Bird in Hand Gold Project (100% Terramin)
A high grade mineral Resource of 265,000 gold ounces at 12.6 g/t gold with the ore body open at depth and exploration upside in
near proximity. A recently completed feasibility study indicates a Post-Tax Nominal NPV8 of $141m1 and IRR of 80.5%. The pre-
production capital is a modest $54 million due to utilisation of Terramin’s nearby Angas processing facility to produce a gold
concentrate. Government approval processes are well advanced.
Tala Hamza Zinc Project (65% Terramin)
A large mineral Resource of 53.0 million tonnes @ 5.3% zinc and 1.3% lead on which a definitive feasibility study was completed in
2018. Mining lease and associated environmental impact study have been lodged for approval. Extensive established infrastructure
in place with attractive low power and fuel costs. Strong government support has been recently provided to the project.
Regional Prospects - South Australia
Additional interests held include the Kapunda Copper Joint Venture and two exploration earn-in agreements with a major
international mining company relating to the South Gawler Ranges and Wild Horse tenements in South Australia.
1. NPV8: NPV has been discounted using a discount rate of 8%. NPV and IRR are discounted from ramp up of start-up capital.
Registered and Business Office
Australian Securities Exchange
Terramin Australia Limited
Unit 7, 202-208 Glen Osmond Road
Fullarton, South Australia, 5063
+61 8 8213 1415
T
info@terramin.com.au
E
W
www.terramin.com.au
ABN 67 062 576 238
ACN 062 576 238
Auditors
Grant Thornton Audit Pty Ltd
Level 3, 170 Frome Street
Adelaide, South Australia, 5000
Share Registry
Computershare Investor Services Pty Ltd
Level 5, 115 Grenfell Street
Adelaide, South Australia, 5000
T 1300 556 161
ASX ticker code: TZN
Corporate Information
Directors
Feng Sheng
Executive Chairman
Michael Kennedy
Non-Executive Deputy-Chairman
Angelo Siciliano
Non-Executive Director
Kevin McGuinness
Non-Executive Director
Lulu Shi
Non-Executive Director
Executive Officer
Martin Janes
Company Secretary
André van Driel
3
Chairman’s Review
Dear Fellow Shareholders,
It is my pleasure to present Terramin Australia Limited’s 2020
Annual Report.
In 2020, Terramin made significant progress in moving its major
assets, Bird in Hand in South Australia and Tala Hamza in
Algeria, closer to development and production.
The development of the high grade Bird in Hand Gold Project is
advancing and with the Australian dollar gold price trading at
historical highs, we are very excited about the prospect of
moving the project into the construction phase in the coming
year.
In 2019, Terramin lodged the Mining Lease Application (MLA)
for the Bird in Hand Gold Project and a Miscellaneous Purposes
Licence (MPL) in respect of the processing of ore at the Angas
Zinc Mine site. The lodgement of these applications was
followed by an extensive period of public consultation that
closed in late 2019. During 2020, Terramin has achieved several
key milestones in respect to the project, including:
Completion of a Feasibility Study confirming a low capital,
high margin project with a short 1 year pay-back period
post completion of construction and robust financial
returns;
Confirmation by the South Australian Treasurer that it is
entitled to the concessional new mine royalty rate of 2%;
Ongoing responses to queries and information requests by
the South Australian Department for Energy and Mines
(DEM) in respect of its MLA and MPL applications with
approvals anticipated in the near term;
Preparation of the Program for Environment Protection
and Rehabilitation (PEPR) in line with the MLA and MPL
together with project implementation plans; and
Engagement with a number of parties which are interested
in concentrate offtake and funding or investing in the
project.
Terramin has continued engagement with its Tala Hamza
Project joint venture partners and the Algerian government
regarding the development of this project. Importantly in 2020,
Algeria established a new government which has seen a focus
on development of the
industry and the
appointment of a Minister of Mines.
local mining
An optimisation study was completed during the period and it
was agreed for the project to be submitted to the Algerian
mining regulator for approval. Importantly there have been
very strong indications of support for the project by local high
ranking officials, including a specific order for the development
of Tala Hamza being recently issued.
Discussions have also commenced on the future structure of
the joint venture for the development of the project and
access to local infrastructure, which are all very positive
indications of progress.
In summary, I believe that 2021 is going to be a very exciting
year for the Company with positive news on both of our core
projects and a planned increased focus on our exciting
exploration activities.
Finally, I would like to thank both our management team, who
have continued to work diligently on all our projects whilst
minimising costs, and all shareholders for your ongoing
support and wish you good health in these difficult times.
Feng (Bruce) Sheng
Executive Chairman
4
Financial Report
5
Directors’ Report
for the Year Ended 31 December 2020
Your Directors submit their report on the consolidated entity
Terramin Australia Limited (the Company or Terramin) and its
controlled entities (the Group), for the Year Ended 31
December 2020 and auditor’s report.
Mr Kevin McGuinness
BAA, ACA
Non-Executive Director
Appointed 17 April 2013
Directors
The following persons were Directors of the Company during
the whole of the year and up to the date of the report unless
stated otherwise:
Mr Feng (Bruce) Sheng
Executive Chairman
Appointed Director 17 April 2013 and
Executive Chairman 11 January 2018
Mr Sheng is Chairman of Melbourne based Asipac Group
(including Asipac Capital Pty Ltd and Asipac Group Pty Ltd)
(Asipac). He has owned and operated several businesses over
the years predominantly focused in property investment and
development. Asipac is an active investor in the resources
sector and a significant shareholder in Terramin. Asipac is also
an active member of the Australia China Business Council
(ACBC) and Mr Sheng is the Vice-President of the ACBC
(Victoria).
Mr Michael H Kennedy
B.Com (Economics)
Non-Executive Deputy Chairman
Appointed 15 June 2005
Mr Kennedy has enjoyed a 40 year career in the non-ferrous
mining and smelting industry, and has held a number of senior
marketing and
logistics roles with the CRA/RTZ Group,
managing raw material sales from the Bougainville, Broken Hill,
Cobar and Woodlawn mines, managed raw material purchases
and supply into the Port Pirie lead smelter, Budel zinc smelter
(Netherlands), and the Avonmouth (UK) and Cockle Creek
(Newcastle) zinc-lead smelters. He was the resident Director of
the Korea Zinc group of companies in Australia from 1991 until
2005, which encompassed the construction and commissioning
of the Sun Metals zinc refinery in Townsville. Mr Kennedy is a
member of the Audit, Risk and Compliance Committee and the
Nominations and Remuneration Committee.
Ms Lulu Shi
Non-Executive Director
Appointed 28 May 2020
Ms Shi is Vice President of China Non-Ferrous Metals Industry’s
Foreign Engineering and Construction and has considerable
project management experience through the acquisition and
development of base metals projects in Southern-Central Africa
and South-East Asia, notably the Launshya Copper Mine in
Zambia and the Tagaung Taung Nickel Project in Myanmar.
Mr McGuinness is a finance executive with more than 25
years of experience as a Director and
in executive
management with ASX listed and private companies in the
mining, medical equipment industries and not-for-profit
organisations. Mr McGuinness was previously the Chief
Financial Officer of Exact Mining Services. He is the current
Chairman of Green Industries SA, a former Director and
Chairman of the Royal Zoological Society of SA and a former
Director of ASX listed, Ellex Medical Lasers Limited. Mr
McGuinness is Chair of the Audit, Risk and Compliance
Committee and the Nominations and Remuneration
Committee.
Mr Angelo Siciliano
FIPA, Registered Tax Agent, BBus
Non-Executive Director
Appointed 2 January 2013
in property development and
Mr Siciliano has more than 20 years of experience as an
accountant
financial
accounting. Mr Siciliano is the Chief Financial Officer of
Asipac and for the last 18 years has owned and managed an
accounting practice predominantly focusing on taxation
advice and business consulting. Mr Siciliano is a fellow of the
Institute of Public Accountants. He is a member of the
Company’s Audit, Risk and Compliance Committee, and of
the Nominations and Remuneration Committee.
Company Secretary
Mr André van Driel
BCom, CPA, CertGovPrac
Finance Manager
Appointed 6 March 2020
Mr van Driel has more than 17 years’ experience in
accounting and tax roles within the resources sector,
including having worked for Newmont Australia Limited,
BHP Billiton Limited (now known as BHP Group Limied) and
Ramelius Resources Limited. André is a graduate of the CPA
Australia Certified Practising Accountants (CPA) program,
and has completed the Certificate in Governance Practice
with the Governance Institute of Australia Limited.
6
Directors’ Report (continued)
Meetings of Directors
The number of meetings of the Company’s Board of Directors
and of each Board committee held during the year ended 31
December 2020, and the number of meetings attended by each
Director were:
Directors
Directors’
Meetings
F Sheng
M Kennedy
K McGuinness
A Siciliano
X Wang
L Shi
E
12
12
12
12
4
7
A
12
12
12
12
2
6
Audit,
Risk & Compliance
Committee
A
E
-
-
4
4
4
4
4
4
-
-
-
-
Nominations &
Remuneration
Committee
A
E
-
-
1
1
1
1
1
1
-
-
-
-
E Number of meetings eligible to attend.
A Number of meetings attended.
Principal Activities
During the year, there were no significant changes in the nature
of the Group’s principal activities which continued to focus on
the development of and exploration for base and precious
metals (in particular zinc, lead and gold) and other economic
mineral deposits.
Operating Results
The consolidated loss of the Group after providing for income
tax was $5.4 million for the year ended 31 December 2020
(2019: $5.6 million). The major contributors to the result were
development costs, interest and administration expenditure in
relation to Australian and overseas operations.
The consolidated net asset position as at 31 December 2020
was $41.9 million, decreased from $50.5 million as at 31
December 2019. The decrease
is represented by the
consolidated Group loss of $5.4 million and the movement in
foreign currency translation reserve of $3.2 million as a result
of the Australia dollar strengthening against the Algerian Dinar
during the period.
Dividends Paid or Recommended
No dividends were paid or declared during the year and no
recommendation was made to pay a dividend.
Review of Operations
Algerian Government owned companies: Enterprise
National
des Produits Miniers Non-Ferreux et des
Substances Utiles Spa (ENOF) (32.5%) and Office National de
Recherché Géologique et Minière (ORGM) (2.5%). WMZ was
formed following a resolution of the State Participation
Council (CPE) to create a legal entity between ENOF and
Terramin for the development and mining of the Tala
Hamza zinc-lead deposit.
In late 2019 and early 2020, Algeria established a new
government under President Abdelmadjid Tebboune. Prior
to the new government being established the government
was in essentially caretaker mode with it not making any
decisions in respect of major projects, including Tala Hamza.
The new Algerian government spurred on by the negative
impacts of Covid-19 and lower oil prices on the Algerian
economy have focused on the establishment of new mines
as a key plank in rebuilding the Algerian economy. A
reflection of this commitment, the government has
appointed Minister of Mines who has no other
responsibilities.
During the year, Terramin has completed an optimisation
study with a particular focus on reviewing production levels,
cut-off grades and specific cost areas. The results of this
study has been presented to our partners. Following
extensive discussions and review, it has been have agreed
for the project to be submitted to the Algerian mining
regulator for approval. Terramin and its partners presented
its submission on the 29th July.
Terramin has also been encouraged by strong indications of
support for the project by both the President of Algeria, Mr
Abdelmadjid Tebboune and the Minister of Mines, Mr
Mohamed Arkab. Mr Tebboune has recently issued a
specific order for the development of Tala Hamza and Mr
Arkab spoke on national media regarding the development
of Tala Hamza stating that the Algeria government will be
working towards the development of Tala Hamza with
construction expected in 2021.
Discussions have commenced on the future structure of the
joint venture for the development of the project.
The local government authority (Wilaya) has approved the
Environmental Impact Study (and associated environmental
management plans) and is now undertaking a process of
consultation with the community.
During the year, the Company continued to focus on the
exploration, evaluation and development of base and precious
metal projects in Australia and Algeria. Highlights for each of
the Company’s major projects are reported below.
Terramin has also commenced engagement including site
meetings with various government agencies and authorities
in regard to critical infrastructure of the project such as land
acquisition, electricity, water and access to public road
North African Projects
Tala Hamza Zinc Project
(Terramin 65%)
The Tala Hamza Zinc Project is 100% owned by Western
Mediterranean Zinc Spa
(WMZ). Terramin has a 65%
shareholding in WMZ. The remaining 35% is held by two
7
Directors’ Report (continued)
Australian Projects
Bird in Hand Gold Project (including Angas Zinc Mine and
Processing Facility)
(Terramin / Terramin Exploration Pty Ltd 100%)
The Bird in Hand Gold Project is located approximately 30km
north of Terramin’s existing mining and processing facilities at
the Angas Zinc Mine in Strathalbyn. The project has a high grade
Resource of 265,000 ounces of gold at 12.6g/t, which is
amenable to underground mining.
Subject to required regulatory approvals, the Bird in Hand
material will be processed utilising the facilities at the Angas
Zinc Mine, which can be modified to process gold-bearing
material. The existing tailings dam has the capacity to hold all
the Bird in Hand tailings.
The Angas Zinc Mine and Processing Facility is located 2 km
outside the town of Strathalbyn, 60 km south east of Adelaide.
The mine is currently in care and maintenance pending the
resumption of exploration at depth and near mine, in addition
to evaluation of the development of the Bird in Hand Gold
lease
Project. The site remains
conditions on all levels.
in compliance with the
The Bird in Hand deposit has a global Mineral Resource Estimate
of 650 Kt (at a cut off of 1.0 g/t) including an Indicated Resource
of 432 Kt. Total material mined (at a project evaluation cut-off
grade of 1.0 grams per tonne) is 595 Kt at 11g/t (76% Indicated
and 24% Inferred) with an average mine production rate of 150
Ktpa and mine life of 4 years (5 years including pre-production
and final backfilling).
In June 2019, Terramin lodged the Mining Lease Application
(MLA) for the Bird in Hand Gold Project and a Miscellaneous
Purpose Lease (MPL) in respect of the processing of ore at the
Angas Zinc Mine site. The lodgement of these applications was
followed by an extensive period of public consultation that
closed in late September 2019.
In 2020, Terramin has continued to make progress in respect of
its MLA and MPL applications. Terramin continues to respond
to queries and information requests by the South Australian
Department for Energy and Mines (DEM) in respect of these
applications.
Terramin continues to update the Program for Environment
Protection and Rehabilitation (PEPR) in line with the MLA and
MPL and has commenced putting
together project
implementation plans.
Terramin has been advised by the South Australian Treasurer
that it is entitled to the concessional new mine royalty rate of
2% on all metal sales revenue for the earlier of the expiry of the
first 5 years of the project or up to 30 June 2026.
Terramin continues to engage with a number of parties with
strong interest, including offtake parties, streaming and
royalty companies, financial institutions and other mining
companies.
Adelaide Hills Project
(Terramin / Terramin Exploration Pty Ltd 100%)
The Adelaide Hills Project consists of eleven exploration
tenements that cover 2,649km² largely over the southern
Adelaide Fold Belt. This project area
is considered
prospective for gold, copper, lead and zinc.
In June 2019, Terramin entered into an earn in agreement
with Freeport-McMoRan Exploration Pty Ltd (Freeport) in
respect of the Wild Horse Copper Gold prospect near
Murray Bridge. Freeport have agreed to spend $3.0 million
over a maximum of 4 years to earn 51% and a further $20.0
million over a maximum of 6 years to earn a further 24%.
Preliminary exploration had commenced early in the year
but was suspended due to Covid 19 and while Freeport
reevaluate their international exploration priorities.
Kapunda Copper Joint Venture
(Terramin Exploration Pty Ltd 100%, subject to farm-out)
In August 2017, Terramin entered into an agreement with
Environmental Copper Recovery Pty Ltd (ECR) in respect of
the potential development of a low cost in situ recovery
(ISR) copper project near Kapunda, South Australia,
approximately 90 km north of Adelaide. The joint venture is
investigating the potential to extract through ISR the copper
from shallow oxide ores in and around the historic Kapunda
Mine workings.
During the year, ECR earned a 50% interest in the project
after spending $2.0 million and has elected to earn a further
25% by spending an additional $4.0 million. Subject to the
completion of this expenditure, Terramin will retain 25%
and receive a 1.5% royalty in respect of all metals extracted
by the joint venture.
Terramin and ECR have estimated a combined Resource of
47.4 million tonnes at 0.25% copper containing 119,000
tonnes of copper using a 0.05% copper cut off. This
Resource estimate is only in respect of that part of the
Kapunda mineralisation that is considered amendable to ISR
(copper oxides and secondary copper sulphides) and only
reports mineralisation that is within 100 metres of the
surface. ECR was successful in securing $2.6 million in
government funding to pursue the ISR test work.
Over the quarter, ECR continued with
its technical
assessment of the Kapunda ISR Project completing a
successful Hydrogeological testing program, identified a
range of suitable lixiviants and preformed metal recovery
tests to produce saleable copper products. ECR are now
working on advancing government approvals and obtaining
appropriate land access for it to commence the on-site
testing of the in situ recovery. This work is almost complete
and on-site work is expected to start in the coming months.
8
Directors’ Report (continued)
South Gawler Ranges Project
(Menninnie Metals Pty Ltd (MMPL) 100%)
The South Gawler Ranges Project is located in the Gawler
Craton of South Australia, an area that is becoming increasingly
recognised as an under-explored region with high discovery
potential. The project comprises a group of eighteen
Exploration Licenses totaling 4,524km2. The project area is
prospective for a range of deposit styles that host combinations
of gold, silver, copper, lead and zinc. The project hosts the
Menninnie Dam deposit, the largest undeveloped lead-zinc
deposit in South Australia.
In July 2019, Terramin entered into an earn-in agreement with
Freeport in respect of the South Gawler Ranges Project.
Freeport have agreed to spend $3.0 million over a maximum of
4 years to earn 70% and a further $5.0 million over a maximum
of 6 years to earn a further 10%. Preliminary exploration had
commenced early in the year but was suspended due to Covid
19 and while Freeport
international
exploration priorities.
reevaluate
their
Corporate
The Company agreed with its major shareholder Asipac to
increase the Standby Term Facility from $21.51 million to
$23.34 million.
5,000,000 options lapsed during the reporting period. There
were no options exercised and no options issued.
Significant Changes in State of Affairs
There were no significant changes in the state of affairs of the
Group during the year, other than as referred to in this report.
Subsequent Events
There are no other matters or circumstances that have arisen
since the end of the year that have significantly affected or may
significantly affect either the entities operations or state of
affairs in future years or the results of those operations in
future years.
Future Developments
Terramin’s focus will continue to be the approval, funding and
development of the Bird in Hand Gold Project and the Tala
Hamza Zinc Project.
Competent Person Statement
is based on
The information in this report that relates to Exploration
Results and Mineral Resources
information
compiled by Mr Eric Whittaker (Tala Hamza, Menninnie, Angas
and Kapunda Resources and Exploration Results) and Mr Dan
Brost (Bird in Hand Resource), both being Competent Persons
who are Member(s) of The Australasian Institute of Mining and
Metallurgy (AusIMM). Mr Whittaker was employed as the
Regional Exploration Manager of Terramin Australia Limited
and Mr Brost is a geologist consulting to Terramin.
Mr Whittaker and Mr Brost have sufficient experience that
is relevant to the style of mineralisation and type of deposit
under consideration and to the activity being undertaken to
qualify as Competent Person(s) as defined in the 2012
‘Australasian Code for Reporting of
Edition of the
Exploration Results, Mineral Resources and Ore Reserves’.
Mr Whittaker and Mr Brost consent to the inclusion in the
report of the matters based on their information in the form
and context in which it appears.
The information in this report that relates to Ore Reserves is
based on information compiled or reviewed by Mr Luke
Neesham, a Competent Person who is a Member of The
Australasian Institute of Mining and Metallurgy (AusIMM).
Mr Neesham is Principal Mining Engineer for GO Mining Pty
Ltd a consulting firm engaged by Terramin Australia Limited
to prepare mining designs and schedules for the Tala Hamza
Feasibility Study. Mr Neesham has sufficient experience that
is relevant to the style of mineralisation and type of deposit
under consideration and to the activity 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’. Mr Neesham
consents to the inclusion in the report of the matters based
on his information in the form and context in which it
appears.
Corporate Governance Statement
Terramin has adopted fit for purpose systems of control and
accountability as the basis for the administration and
compliance of effective and practical corporate governance.
These systems are reviewed regularly and revised
if
appropriate.
The Board is committed to administering the Company’s
policies and procedures with transparency and integrity,
pursuing the genuine spirit of good corporate governance
practice. To the extent they are applicable, the Company
has adopted the ASX Corporate Governance Council’s
Corporate Governance Principles and Recommendations,
3rd Edition. As the Group’s activities transform in size,
nature and scope, additional corporate governance
structures will be considered by the Board and assessed as
to their relevance.
In accordance with the ASX Listing Rules, the Corporate
Governance Statement and Appendix 4G checklist are
released to the ASX on the same day the Annual Report is
released. The Corporate Governance policies and charters
can be found on the Company’s website.
Audit and Risk Committee - assists the Board in the
effective discharge of its responsibilities in relation to
financial reporting and disclosure processes,
internal
financial controls, funding, financial risk management,
including external audit functions, and oversight of internal
control and risk management system’s effectiveness.
9
Directors’ Report (continued)
Nomination and Remuneration Committee - assists the Board
in discharging its responsibilities relating to the remuneration
of directors, executives and employees, succession planning,
and relevant policy establishment and monitoring.
This Corporate Governance Statement is current as at 31 March
2021 and has been approved by the Board.
Share Capital
(a) Ordinary Shares
As at 31 December 2020, there were 2,116,562,720 fully paid
ordinary shares in the capital of the Company on issue.
(b) Unlisted Options outstanding at the date of this
report
At the date of this report, 5,000,000 unlisted options over fully
paid ordinary shares in the capital of Terramin were on issue.
Expiry Date
2 August 2023
2 August 2023
Total
Exercise Price $ Number of Options on Issue
0.20
0.25
2,500,000
2,500,000
5,000,000
No person entitled to exercise an option had or has any right by virtue of the
option to participate in any share issue of the Company or any other body
corporate.
(c) Unlisted options exercised/cancelled/lapsed during
the year
During the year, 5,000,000 unlisted options over fully paid
ordinary shares in the capital of the Company had not vested,
and lapsed due to the CEO stepping down as CEO prior to their
vesting date.
Expiry Date
2 August 2023
2 August 2023
Total
Exercise Price $
Number of Options Lapsed
0.32
0.40
2,500,000
2,500,000
5,000,000
(d) Unlisted options exercised/cancelled since 31
December 2020
No unlisted options over fully paid shares in the Company have
been exercised or cancelled since 31 December 2020.
Remuneration Report – Audited
This remuneration report for the year ended 31 December 2020
outlines the remuneration arrangements of the Company in
accordance with requirements of the Corporations Act 2001
(Act) the Corporations Regulations 2001.
the
remuneration
remuneration
report details
The
arrangements for Key Management Personnel (KMP). Under
the Accounting Standards, KMPs are defined as those persons
having authority and responsibility for planning, directing and
controlling the major activities of the Company including any
Director (whether executive or otherwise). The information
regarding remuneration and entitlements of the Company’s
Board and KMP required for the purposes of Section 300A of
the Act is provided below.
(a) Directors and Other Key Management Personnel
The following persons were Directors of the Company
during the financial year and up until the date of this report
unless stated otherwise:
Executive and Non-Executive Directors
Mr F Sheng (Chairman - Non-Independent)
Mr MH Kennedy (Deputy Chairman - Independent)
Mr A Siciliano (Non-Independent)
Mr K McGuinness (Independent)
Mr L Shi (Independent)
The following persons are also Key Management Personnel
of the Group:
Other Key Management Personnel
Mr R Taylor (Chief Executive Officer)1
Mr M Janes (Executive Officer)2
Mr A van Driel (Finance Manager and Company Secretary)3
1. Mr R Taylor concluded his employment on 10 July 2020
2. Mr M Janes commenced as Executive Officer on 20 January 2020
3. Mr A van Driel commenced as Company Secretary on 6 March 2020
(b) Nominations and Remuneration Committee
The Nominations and Remuneration Committee
is a
committee of the Board. The current members of the
committee are Mr K McGuinness (Chair), Mr MH Kennedy
and Mr A Siciliano.
The Committee is responsible to assist the Board to:
to
discharge
adequately
ensure it is of an effective composition, size and
its
commitment
responsibilities and duties; and
independently ensure that the Company adopts and
complies with remuneration policies that:
attract, retain and motivate high calibre Directors and
KMP so as to enhance performance by the Company;
assess the human resource needs of the Company;
and
motivate Directors and management to pursue the
long-term growth and success of the Company within
an appropriate control framework and ensure that
shareholder and employee interests are aligned.
(c) Remuneration Policy and Practices
This report outlines the remuneration arrangements for
KMP of the Company. It is recognised that the performance
of the Company depends on the quality and skills of its
Directors and Executives. The Board is mindful of the need
to attract, motivate and retain highly skilled Directors and
Executives.
The Group’s KMP compensation is competitively set to
attract and retain appropriately qualified and experienced
Directors and Executives in accordance with the following
principles:
Provide competitive rewards in accordance with market
standards to attract and retain high calibre Directors and
other KMP; and
Link rewards with the strategic goals and performance
of the Group and the creation of shareholder value (by
the granting of share options where appropriate
10
Directors’ Report (continued)
.
The policy for determining the nature and amount of
remuneration of the KMP includes consideration of individual
performance in addition to the overall performance of the
Group. Historically, the Group’s performance was measured by
a range of financial and production indicators. Since the Angas
in care and maintenance, the
Zinc Mine was placed
remuneration of KMPs is dependent upon achievement of
progress towards a number of company objectives:
1) company funding;
2) progress towards the development of the Tala Hamza Zinc
Project (including delivery of revised DFS, decision to mine
by the partners, approvals, funding and transition towards
development);
3) progress towards the development of the Bird in Hand
Gold Project (including approvals, financing, firming and
expanding the existing resource); and
4) growing the Company’s assets.
Employment Contracts
I.
Mr Martin Janes, the Company’s Executive Officer, entered
into a consulting contract in January 2020 on an on-going
basis, which either the Company or Mr Janes may terminate
with 30 days written notice. Under this contract, Mr Janes
receives a weekly retainer of $3,750 for 2.5 days of service
per week.
Mr Richard Taylor stepped down as CEO during the year. His
employment contract was concluded on 31 January 2020.
Mr Taylor’s employment contract had no fixed term,
received a salary of $325,000 per annum (including
superannuation), and the Company or CEO may terminate
the agreement by providing 3 months’ notice. The Company
may elect, at its discretion, to make a payment in lieu but
this was not done on termination. Mr Taylor entered into a
consulting contract in February 2020 initially on a 3 month
fixed term to 30 April 2020 and then extended by a further
2 months until 30 June 2020. He received a monthly
retainer of $10,000 per month for his services.
Use of Remuneration Consultants
(d)
From time-to-time the Nominations and Remuneration
Committee may seek external remuneration advice as
required. No such advice was obtained during the year.
Unless agreed otherwise by the Board, termination
payments of any Executives or employees are not payable
in the instance of resignation or dismissal for serious
misconduct.
Remuneration Report Approval
(e)
At the last Annual General Meeting held on 21 May 2020, the
Remuneration Report for the financial year ending 31
December 2019 was approved by shareholders (52.95% voted
for the resolution).
(f)
Executive Remuneration and Incentives
Fixed Remuneration
I.
The fixed portion of Executive remuneration packages
comprise a base salary, statutory superannuation payment and
FBT charges related to employee benefits, such as car parking.
Executive performance and remuneration packages are
reviewed, where possible, annually by the Nominations and
Remuneration Committee. The review process
includes
consideration of both individual performance and the overall
performance of the Group.
Incentives
II.
Performance based remuneration may include both short-term
and long-term incentives, and is designed to reward KMP for
meeting or exceeding key performance indicators (KPI’s). KPI’s
may include financial metrics and completion of key group
objectives. The Board may from time-to-time approve the
award of such incentives subject to satisfaction of KPI’s. The
short-term incentive (STI) is an “at risk” bonus which may be
provided in the form of cash and/or equity securities. Long-
term incentives may be provided under the Terramin Australia
Employee Option Plan (EOP). The Directors may grant options
to employees to acquire shares at an exercise price set by the
Board. Each option converts into one ordinary share of the
Company when exercised. The grant of options is linked to the
achievement of the Company’s objectives (refer item (c) of the
remuneration report) and the creation of shareholder value.
(g) Directors Remuneration
I. Remuneration
The maximum aggregate fees payable to Non-Executive
Directors is subject to approval by shareholders at a general
meeting. All securities issued to Directors and related
parties must be approved by shareholders at a general
meeting.
or
via
remunerated
Non-Executive Directors are either paid a base fee plus
superannuation,
contractual
arrangements approved by the Board and negotiated in
consultation with the Nominations and Remuneration
Committee. The current Non-Executive base fees (other
than fees for the Chairman and Deputy Chairman) are
$40,000 per annum. The Chairman and Deputy Chairman
receive $100,000 and $60,000 per annum respectively. The
non-executive directors fees paid are consistent with fees
paid to non-executive directors of comparable companies.
Company policy supports the issue, where appropriate, of
equity securities to Directors (whether Executive or Non-
Executive) to help ensure Directors’ interests are aligned
with those of shareholders. The Board has not paid
director’s fees in shares during the reporting period.
The aggregate fees payable to Directors during 2020 was
$275,000 (with $337,500 remaining unpaid at reporting
date) compared to the maximum limit approved by
shareholders at the 2010 Annual General Meeting of
$700,000.
The Board recognises that from time-to-time, Non-
Executive Directors are called upon to provide services in
addition to their usual Director’s duties. Accordingly,
Directors may be compensated for additional duties
11
Directors’ Report (continued)
undertaken at the request of the Board, for instance extensive
investors. In
travel to Algeria or meetings with overseas
accordance with Company policy additional compensation of
up to $1,000 per day may be provided to Directors for work
additional to standard Board duties. This form of Non-Executive
in circumstances where
compensation
Directors are required to commit time beyond that expected of
a Non-Executive Director role and requires a continuous
commitment of 2 or more days. Additional remuneration may
be paid in shares in lieu of cash subject to shareholder approval.
is only provided
During 2020 no additional fees were paid to Non-Executive
Directors in relation to work outside of standard Board duties.
Director Options
II.
There were no options or other equity securities issued to
Directors during the year as remuneration.
Retirement or other Post-Employment Benefits
III.
The Company has no policy to provide benefits to its Directors
or Executives upon their retirement or otherwise upon
cessation of employment, other than by making the statutory
superannuation guarantee contributions as required by law.
Board and Committees – Membership and
IV.
Remuneration
The following table sets out the Chair and members of each
committee and the annual fees allocated for each position.
Committee
Each Non-Executive
Director
Additional work to
standard Board duties
1
Chairman Fee
$
Vice Chairman
Fee $
Member Fee
$
100,000
60,000
40,000
1,000/day
1,000/day
1,000/day
Audit, Risk and Compliance
K McGuinness (Chair),
MH Kennedy, A Siciliano
Nominations and Remuneration
K McGuinness (Chair),
MH Kennedy, A Siciliano
Due Diligence
K McGuinness (Chair),
MH Kennedy
7,500
7,500
-
-
-
-
5,000
5,000
-
1.
Subject to Board approval to compensate for work undertaken in
addition to standard Director’s duties and requires a commitment of 2 or more
days.
12
Directors’ Report (continued)
(h)
Parent Entity Directors’ and Executives’ Remuneration and Entitlements
During the year, the following cash and non-cash payments were made to the Key Management Personnel:
Key Management Personnel
Short Term Benefits
Salary &
Fees
Contract
Payments
Long Term
Benefits
Annual and
Long Service
Leave7
Directors1
MH Kennedy
A Siciliano
K McGuinness
F Sheng
W Xinyu1
L Shi
Key Management Personnel
R Taylor3
MS Janes4
A van Driel5
S Iacopetta6
TOTAL
2020
2019
2020
2019
2020
2019
2020
2019
2020
2019
2020
2019
2020
2019
2020
2019
2020
2019
2020
2019
2020
2019
63,927
63,927
-
-
-
-
-
-
-
-
-
-
48,050
296,804
-
-
126,146
-
-
38,957
238,123
399,688
-
50,000
50,000
55,000
55,000
100,000
100,000
-
40,000
-
-
50,000
-
180,000
-
-
-
-
-
435,000
245,000
Post-Employment
Share-based Payments
Total
Super-
annuation
Benefits
6,073
6,073
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(26,329)
10,102
-
-
2,350
28,196
17,100
-
6,738
11,984
-
-
-
-
(12,014)
4,535
(19,591)
37,507
(1,912)
38,804
Termination
Benefits
Share
Options
% of
Total
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
0.0%
0.0%
70,000
70,000
0.0%
50,000
0.0%
50,000
0.0%
55,000
0.0%
55,000
0.0%
100,000
0.0%
100,000
0.0%
-
0.0%
40,000
0.0%
0.0%
-
-
(103,489)
0.0%
(29,418)
187,533
35.9%
522,635
-
-
-
-
-
-
0.0%
0.0%
0.0%
0.0%
197,100
-
144,868
-
0.0%
-
0.0%
31,478
(103,489)
187,533
-
587,550
-
869,113
1. Refer to page 13 of the Directors’ Report for details of Non-Executive Directors’ fees allocated by role
2. During the period, Mr Wang agreed to waive the director fees accrued during the period that he held the position of director of Terramin.
3. Mr R Taylor concluded his employment on 10 July 2020
4. Mr M Janes commenced as Executive Officer on 20 January 2020
5. Mr A van Driel commenced as Company Secretary on 6 March 2020
6. Mr S Iacopetta concluded his employment on 1 March 2019
7. Represents the movements in the associated provisions
13
Directors’ Report (continued)
(i)
Key management personnel - shares and options over equity instruments
The movement during the reporting period in the number of ordinary shares or options over ordinary shares in Terramin Australia
Limited by each Key Management Personnel is as follows:
Shares Balance
1 Jan 20
Shares held prior to
commencing as KMP
Shares Acquired
during Year
Shares Issued as
Remuneration
Cessation as
KMP
Shares Balance
31 Dec 20
Shares
Key Management Personnel
Parent Entity Directors
MH Kennedy
A Siciliano
K McGuinness
F Sheng
W Xinyu
L Shi
Other Key Management Personnel
R Taylor1
M Janes2
A van Driel3
5,246,107
10,000,000
2,698,108
827,469,670
-
-
-
-
-
Total
1. Mr R Taylor concluded his employment on 10 July 2020
2. Mr M Janes commenced as Executive Officer on 20 January 2020
3. Mr A van Driel commenced on Company Secretary on 6 March 2020
845,413,885
-
-
-
-
-
-
-
125,974
-
125,974
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
5,246,107
10,000,000
2,698,108
827,469,670
-
-
-
125,974
-
845,539,859
Options
Key Management Personnel
Parent Entity Directors
MH Kennedy
A Siciliano
K McGuinness
F Sheng
W Xinyu
L Shi
Other Key Management Personnel
R Taylor2
M Janes3
A van Driel4
S Iacopetta5
Options Balance
1 Jan 20
Options Granted as
1
Incentive
Options Exercised
Cessation as
KMP
Balance Options
31 Dec 20
-
-
-
-
-
-
10,000,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(5,000,000)
5,000,000
-
-
-
-
-
-
Total
1. Relates to options granted during the reporting period as remuneration. Further details of Options, including terms and exercise price are included in the
-
-
(5,000,000)
10,000,000
5,000,000
Financial Report
2. Mr R Taylor concluded his employment on 10 July 2020
3. Mr M Janes commenced as Executive Officer on 20 January 2020
4. Mr A van Driel commenced as Company Secretary on 6 March 2020
14
Directors’ Report (continued)
(j) Shares and Options Issued or Lapsed during the
Year
No shares or options were granted to Non-executive Directors
or other KMPs as remuneration during the year. No shares
lapsed, however 5 million options lapsed during the year.
(k) Other Director and Key Management Personnel
transactions
Some KMP, 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. These entities transacted with the Group in the
reporting period. The terms and conditions of the transactions
were no more favourable than those available, or which might
reasonably be expected
to be available, on similar
transactions to non-Director related entities on an arm’s
length basis.
At 31 December 2020, Asipac owned 39.07% of the ordinary
shares in Terramin (2019: 39.07%) and is controlled by Mr
Sheng who is Executive Chairman of the Company. Mr
Siciliano is the Chief Financial Officer of Asipac.
Directors’ fees outstanding as at 31 December 2020
Directors
1
M Kennedy
1
A Siciliano
1
K McGuinness
F Sheng
W Xinyu2
L Shi1
Total
2020
70,000
62,500
55,000
150,000
-
-
337,500
2019
-
12,500
-
50,000
113,115
-
175,615
1. Mr Kennedy, Mr Siciliano, Mr McGuinness and Ms Shi are Non-Executive
2.
Directors of the Company,
During the period, Mr Xinyu agreed to waive the director fees accrued
during the period that he held the position of director of Terramin.
Other related party transactions are disclosed at note 20.
Share Trading Policies
(l)
All Company employees and contractors, Directors and
Executives are subject to the Company’s Share Trading Policy
(available on the Company’s website) with respect to limiting
their exposure to risk in relation to the Company’s securities,
including securities
issued as an element of Executive
remuneration. The Company’s Share Trading Policy requires all
officers, employees and consultants to the Company to notify
the Chairman and Company Secretary of any intention to deal
in the Company’s securities, whether by sale or purchase of
shares on market, or the exercise of options. The notified
dealing is subject to the approval of the Chairman. In addition,
and in accordance with ASX Listing Rule 12, the Company’s
trading policy provides that all Directors, officers and
consultants are prohibited from trading in the Company’s
securities during specific periods.
The Board considers that, in light of the size and structure of
the Company and the absence of a secondary market for the
Company’s securities,
this policy provides adequate
protection against unauthorised dealings by Directors and
specified Executives,
in relation to risk
in particular
mitigation. The current Share trading policy has been
approved by the board on 9 April 2015.
End of Audited Remuneration Report
15
Directors’ Report (continued)
Indemnification of Directors and Officers
Directors’ and Officers’ Liability Insurance has been subscribed to. The Officers of the Company and the Group covered by the
insurance policy includes any person acting in the course of duties for the Company or the Group who is or was a Director, Secretary
or Senior Executive. The contract of insurance prohibits the disclosure of the nature of the liability covered and the amount of the
premium. The Group has not otherwise, during or since the end of the period, indemnified or agreed to indemnify an officer or auditor
of the Group or any related body corporate against a liability incurred as such an officer or auditor.
Non-audit Services
The Company may decide to employ the auditor, Grant Thornton on assignments additional to their statutory audit duties where the
auditor’s expertise and experience with the Company and/or the Group are important. Details of the amounts paid or payable to the
auditor for non‐audit services provided during the year are set out below.
The Board of directors has considered the position, and in accordance with advice received from the Audit and Risk Committee, is
satisfied that the provision of the non‐audit services is compatible with the general standard of independence for auditors imposed
by the Corporations Act 2001. The directors are satisfied that the provision of non‐audit services by the auditor, as set out below, did
not compromise the auditor independence requirements of the Corporations Act 2001 for the following reasons:
-
-
all non‐audit services have been reviewed by the Audit & Risk Committee to ensure they do not impact the impartiality and
objectivity of the auditor;
none of the services undermine the general principles relating to auditor independence as set out in APES 110 Code of Ethics for
Professional Accountants.
During the year the following fees were paid or payable for non‐audit services provided by the auditor of the parent entity, its related
practices and non‐related audit firms:
Non-assurance services
Tax advice and compliance services
Total
Auditor’s independence declaration
2020
$’000
25
25
2019
$'000
34
34
The Auditor’s Independence Declaration for the year ended 31 December 2020 can be found on page 18 and forms part of the
Directors’ Report.
Litigation
As at the date of this report, no person has applied to the Court under section 237 of the Act for leave 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 of all or any part of those proceedings. No proceedings have been brought or intervened in on behalf of the Company
with leave of the Court under section 237 of the Act.
Rounding
The Company is of a kind referred to in ASIC Corporations (Rounding in Financial/Directors’ Reports) Instrument 2016/191 and in
accordance with the instrument, amounts in the financial report have been rounded off to the nearest thousand dollars, unless
otherwise stated.
Signed in Adelaide this 31st day of March 2021 in accordance with a resolution of the Board of Directors.
Feng (Bruce) Sheng
Executive Chairman
Kevin McGuinness
Non-Executive Director
16
Directors’ Declaration
The Directors of the Company declare that:
1.
the financial statements and notes, as set out on pages 23-43, and the remuneration disclosures contained in pages 10-15 of
the Directors’ Report, are in accordance with the Corporations Act 2001, and:
a.
b.
comply with Australian Accounting Standards (including the Australian Accounting Interpretations) and the Corporations
Regulations 2001; and
give a true and fair view of the financial position as at 31 December 2020 and of the performance for the year ended on
that date of the consolidated entity;
2.
the Executive Officer and Finance Manager have each declared that:
a.
b.
c.
d.
the financial records of the Company for the financial year have been properly maintained in accordance with section 286
of the Corporations Act 2001;
the financial statements and notes for the financial year comply with the Accounting Standards;
the declaration is provided in accordance with section 295A of the Corporations Act 2001 and is founded on a sound
system of risk management and internal control and that the system is operating effectively in all material respects in
relation to financial reporting risks; and
the financial statements and notes for the financial year give a true and fair view;
in the Directors’ opinion, there are reasonable grounds to believe that the Company will be able to pay its debts as and when
they become due and payable;
the consolidated financial statements comply with International Financial Reporting Standards as disclosed in note 2(a).
3.
4.
This declaration is made in accordance with a resolution of the Board of Directors.
Feng (Bruce) Sheng
Executive Chairman
31 March 2021
Kevin McGuinness
Non-Executive Director
31 March 2021
17
Auditor’s Independence Declaration
18
Auditor’s Independent Report
19
20
21
Consolidated Statement of Profit or Loss and Other
Comprehensive Income
for the Year Ended 31 December 2020
Revenue
Other Income
Raw materials, consumables and other direct costs
Employee benefits expense
Depreciation and amortization
Exploration and evaluation expensed (Tala Hamza Project)
Exploration and evaluation impairment
Assets held for sale impairment
Mine rehabilitation obligation expense
Share based payments expense
Other expenses
Loss before net financing costs and income tax
Finance income
Finance costs
Net finance costs
Loss before income tax
Income tax benefit
Loss for the year
Attributable to:
Owners of the Company
Non-controlling interest
Loss for the year
Other comprehensive (loss)/income
Items that may be reclassified subsequently to profit or loss:
Foreign currency translation differences for foreign operations
Other comprehensive (loss)/income for the year, net of income tax
Total comprehensive loss for the year attributable to equity holders of the Company
Attributable to:
Owners of the Company
Non-controlling interest
Total comprehensive loss for the year
Earnings per share attributable to the ordinary equity holders of the Company:
Basic earnings/(loss) per share – (cents per share)
Diluted earnings/(loss) per share – (cents per share)
Note
4
4
10
11
10
4
6
6
18
17
Note
27(a)
27(b)
2020
$’000
67
418
(361)
(326)
(481)
(250)
-
(121)
(555)
-
(990)
(2,599)
20
(2,812)
(2,792)
2019
$’000
187
684
(420)
(1,038)
(110)
(590)
(198)
(70)
(187)
(838)
(2,580)
26
(3,057)
(3,031)
(5,391)
(5,611)
-
(5,391)
(5,291)
(100)
(5,391)
(3,074)
(3,074)
(8,465)
(8,365)
(100)
(8,465)
2020
(0.25)
(0.25)
-
(5,611)
(5,399)
(212)
(5,611)
(38)
(38)
(5,649)
(5,437)
(212)
(5,649)
2019
(0.29)
(0.29)
The Consolidated Statement of Profit or Loss and Other Comprehensive Income is to be read in conjunction with the notes to the consolidated financial statements.
22
Consolidated Statement of Financial Position
as at 31 December 2020
Assets
Current Assets
Cash and cash equivalents
Restricted cash on deposit
Trade and other receivables
Non-current assets held for sale
Other assets
Total current assets
Non-current assets
Inventories
Property, plant and equipment
Exploration and evaluation
Total non-current assets
TOTAL ASSETS
Liabilities
Current liabilities
Trade and other payables
Short term borrowings
Provisions
Total current liabilities
Non-current liabilities
Long term borrowings
Provisions
Total non-current liabilities
TOTAL LIABILITIES
NET ASSETS
Equity
Share capital
Reserves
Accumulated losses
Total equity attributable to equity holders of the Company
Non-controlling interest
TOTAL EQUITY
Notes
7
7
9
10
8
10
11
12
13
14
13
14
15
16
17
2020
$'000
105
5,340
50
690
84
6,269
353
7,369
63,252
70,974
77,243
6,375
23,385
89
29,849
14
5,509
5,523
35,372
41,871
2019
$'000
960
5,340
178
-
105
6,583
495
8,601
64,987
74,083
80,666
3,356
181
136
3,673
21,625
4,910
26,535
30,208
50,458
223,931
(9,116)
(186,209)
28,606
13,265
41,871
223,950
(5,939)
(180,918)
37,093
13,365
50,458
The Consolidated Statement of Financial Position is to be read in conjunction with the notes to the consolidated financial statements.
23
Consolidated Statement of Changes in Equity
for the Year Ended 31 December 2020
2020
Balance at 1 January 2020
Total comprehensive income for the period
Loss for the year
Other comprehensive income
Foreign currency translation differences
Total other comprehensive income
Total comprehensive income for the year
Transactions with owners, recorded directly in equity
Contributions by and distributions to owners
Share issue costs
Transfer lapsed options to expense
Total contributions by and distributions to
owners
Share
capital
$'000
223,950
Share based
payments
reserve
$’000
298
Translation
reserve
$'000
(6,237)
Accumulated
losses
$'000
(180,918)
Total
attributable
to owners
$'000
37,093
Non-controlling
interest
$'000
(note 17)
13,365
Total
equity
$'000
50,458
-
-
-
-
(19)
-
(19)
-
-
-
-
-
(103)
(103)
-
(5,291)
(5,291)
(100)
(5,391)
(3,074)
(3,074)
(3,074)
-
-
(5,291)
-
-
-
-
-
-
(3,074)
(3,074)
(8,365)
(19)
(103)
(122)
-
-
(100)
-
-
-
(3,074)
(3,074)
(8,465)
(19)
(103)
(122)
Balance at 31 December 2020
223,931
195
(9,311)
(186,209)
28,606
13,265
41,871
2019
Balance at 1 January 2019
Total comprehensive income for the period
Loss for the year
Other comprehensive income
Foreign currency translation differences
Total other comprehensive income
Total comprehensive income for the year
Transactions with owners, recorded
directly in equity
Contributions by and distributions to
owners
Issue of ordinary shares
Share issue costs
Options Granted
Transfer lapsed options to retained
earnings
Total contributions by and distributions to
owners
Balance at 31 December 2019
Share based
payments
reserve
$'000
136
Share capital
$'000
215,383
Translation
reserve
$'000
(6,199)
Accumulated
losses
$'000
(175,544)
Total
attributable
to owners
$'000
33,776
Non- controlling
interest
$'000
(note 17)
13,577
Total equity
$'000
47,353
-
-
-
-
8,642
(75)
-
-
8,567
-
-
-
-
-
-
187
(25)
162
-
(5,399)
(5,399)
(212)
(5,611)
(38)
(38)
(38)
-
-
(38)
(38)
-
-
(38)
(38)
(5,399)
(5,437)
(212)
(5,649)
-
-
-
-
-
-
-
-
25
25
8,642
(75)
187
-
8,754
-
-
-
-
-
8,642
(75)
187
-
8,754
223,950
298
(6,237)
(180,918)
37,093
13,365
50,458
The Consolidated Statement of Change in Equity is to be read in conjunction with the notes to the consolidated financial statements.
24
Consolidated Statement of Cash Flows
for the Year Ended 31 December 2020
Note
2020
$'000
19
Cash from operating activities:
Receipts from customers
Government Grant Income (including Research and development tax incentive received)
Interest received
Payments to suppliers and employees
Financing costs and interest paid
Total cash (used in) operating activities
Cash flows from investing activities:
Insurance claim proceeds
Proceeds from sale of property, plant and equipment
Exploration and evaluation expenditure
Net cash (used in) investing activities
Cash flows from financing activities:
Proceeds from the issue of share capital
Payment of transaction costs on equity
Proceeds from borrowings
Repayment of borrowings
Net cash from financing activities
Other activities:
Net increase /(decrease) in cash and cash equivalents
Net foreign exchange differences
Cash and cash equivalents at beginning of the year (including restricted cash on deposit)
Cash and cash equivalents at end of the year (including restricted cash on deposit)
7
The Consolidated Statement of Cash Flows is to be read in conjunction with the notes to the consolidated financial statements.
72
226
27
(1,836)
(72)
(1,583)
249
201
(1,422)
(972)
-
(19)
1,830
(110)
1,701
(854)
(1)
6,300
5,445
2019
$'000
264
605
20
(3,049)
(339)
(2,499)
-
-
(1,984)
(1,984)
8,642
(75)
9,300
(7,319)
10,548
6,065
(17)
252
6,300
25
Notes to the Consolidated
Financial Statements
1. Reporting entity
The consolidated financial statements cover the consolidated
entity of Terramin Australia Limited and its controlled entities
(the Group). Terramin Australia Limited is a public company,
listed on the Australian Securities Exchange (ASX). The Group is
primarily involved in the development of, and exploration for,
precious and base metals (in particular gold, zinc and lead) and
other economic mineral deposits.
2. Basis of preparation
(a) Statement of Compliance
The consolidated financial statements are general purpose
financial statements that have been prepared in accordance
with Australian Accounting Standards (including Australian
the Australian
Accounting
Accounting Standards Board (AASB) and the Corporations Act
2001. The consolidated financial statements comply with
International Financial Reporting Standards
(IFRS) and
International Accounting
interpretations adopted by the
Standards Board (IASB).
Interpretations)
issued by
Terramin Australia Limited is a for-profit entity for the purpose
of preparing the financial statements.
Terramin Australia Limited is a public company incorporated
and domiciled in Australia. The address of its registered office
is Unit 7, 202-208 Glen Osmond Road, Fullarton, SA, 5063.
(b) Basis of Measurement
The financial statements are presented in Australian dollars
(AUD), have been prepared on an accruals basis and are based
on historical costs, except for the provision
for mine
rehabilitation measured at the present value of future cash
flows. The Group is of a kind referred to in ASIC Corporations
(Rounding
Instrument
2016/191 and in accordance with the Instrument, amounts in
the financial report have been rounded off to the nearest
thousand dollars, unless otherwise stated.
Financial/Directors’ Reports)
in
(c) Going Concern
The financial statements have been prepared on a going
concern basis, which contemplates continuity of normal
business activities and the realisation of assets and settlement
of liabilities in the ordinary course of business. During 2020, the
Group incurred a loss of $5.4 million, and this brought
accumulated losses to $186.2 million. As at 31 December 2020
the Group’s current liabilities exceeded its current assets by
$23.58 million, however the Group had negative cash operating
and investing cashflows of $2.56 million. The Group had net
assets of $41.9 million.
The financial report has been prepared on a going concern basis
on the expectation that the Group can raise additional debt or
equity as required. The Directors are aware that additional debt
or equity will be required within 12 months, in order to
continue as a going concern. The Group’s ability to raise equity
will rely on investor confidence in the development or sale of
the Bird in Hand Gold Project or investment in the Tala Hamza
Zinc Project or other assets.
The Directors note that the matters outlined above indicate a
material uncertainty, which may cast significant doubt on the
ability of the Group to continue as a going concern and
therefore it may be unable to realise its assets and discharge its
liabilities in the normal course of business. At the date of this
report, the Directors believe that the Group has adequate
resources to continue to explore, evaluate and develop the
Group’s areas of interest and support to date from Asipac will
ensure the Company has sufficient funds to meet
its
obligations. Subject to market conditions the Directors believe
there are reasonable grounds to conclude that the Company
will be able to raise funds by way of debt and/or equity to fund
anticipated activities and meet financial obligations. For the
reasons outlined above, the Board has prepared the Financial
Report on a going concern basis.
(d) Use of Estimates and Judgements
The preparation of the financial statements in accordance with
AASB requires management to make judgements, estimates
and assumptions that affect the application of accounting
policies and the reported amounts of assets, liabilities, income
and expenses. Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an
ongoing basis. Revisions
to accounting estimates are
recognised in the period in which the estimate is revised and in
any future periods affected.
In particular, information about significant areas of estimation
uncertainty and critical judgements in applying accounting
policies that have the most significant effect on the amounts
recognised in the financial statements are described in the
following notes:
Note 3(e) – Property, Plant and Equipment: assessment of
the valuation method
Note 3(i) - Exploration and Evaluation Expenditure:
recoverable amount and ore reserve estimates.
Note 3(k) - Provisions: estimated cost of rehabilitation,
decommissioning and restoration.
Note 3(l) - Share Based Entitlements and Payments:
assumptions are required to be made in respect to
measuring share price volatility, dividend yield, future
option holding period and other inputs to the Black-
Scholes option pricing model fair value calculations.
Note 3(r) - Recognition of tax losses: assessment of the
point in time at which it is deemed probable that future
taxable income will be derived.
26
(e) New and Amended Standards Adopted by the
(e) Property, Plant and Equipment
Group
During the year, there are no new and/or revised Standards and
Interpretations adopted in these Financial Statements that
affect presentation or disclosure and the financial position.
3. Significant accounting policies
(a) Basis of Consolidation
The Group financial statements consolidate those of the Parent
Company and all of its subsidiaries as of 31 December 2020. The
Parent controls a subsidiary if it is exposed, or has rights, to
variable returns from its involvement with the subsidiary and
has the ability to affect those returns through its power over the
subsidiary. All subsidiaries have a reporting date of 31
December. All transactions and balances between Group
including
companies are eliminated on consolidation,
unrealised gains and losses on transactions between Group
companies. Where unrealised losses on intra-group asset sales
are reversed on consolidation, the underlying asset is also
tested for impairment from a Group perspective. Amounts
reported in the financial statements of subsidiaries have been
adjusted where necessary to ensure consistency with the
accounting policies adopted by the Group.
Profit or loss and other comprehensive income of subsidiaries
acquired or disposed of during the year are recognised from the
effective date of acquisition, or up to the effective date of
disposal, as applicable. Non-controlling interests, presented as
part of equity, represent the portion of a subsidiary’s profit or
loss and net assets that is not held by the Group. The Group
attributes total comprehensive income or loss of subsidiaries
between the owners of the parent and the non-controlling
interests based on their respective ownership interests.
(b) Cash and Cash Equivalents
Cash and cash equivalents include cash on hand, deposits held
liquid
at call with banks and other short-term highly
investments with original maturities of four months or less.
inventories
Inventories
(c)
and
Non-current
consumables which are not expected to be used within 12
months. Inventories are valued at lower of cost and net
realisable value.
represent
spare
parts
(d) Trade and Other Receivables
Trade and other receivables are recognised at cost and carried
at original invoice amount less allowances for
impairment
losses.
The group applies the AASB 9 simplified approach to measuring
expected credit losses which uses a lifetime expected loss
allowance for all trade receivables. To measure the expected
credit losses, trade receivables and contract assets have been
grouped based on shared credit risk characteristics and the
days past due. In prior year, impairment of receivables was not
recognised until objective evidence was available that a loss
event had occurred.
Property
Freehold land is measured at cost and buildings are measured
at cost less depreciation and any impairment losses recognised.
Plant and equipment
Plant and equipment are measured on the cost basis less
depreciation and any impairment losses recognised.
The depreciable amount of all property, plant and equipment,
excluding freehold land, is depreciated on a straight line basis
over their useful lives to the Group commencing from the time
the asset is held ready for use down to any residual value, as
determined by the Group.
The depreciation rates used for each class of depreciable asset
is the lesser of the rate determined by the life of the mining
operation and the asset. The assets’ residual values and useful
lives are reviewed, and adjusted if appropriate, at each
reporting date.
Class of Asset
Motor vehicles
Computer and office equipment
Plant and equipment
Leasehold improvements
Buildings and other infrastructure
Depreciation rates
22.5 - 25%
15 - 40%
5 - 33%
20%
5 - 33%
Effective 1 July 2020, the Group recommenced depreciation of
the plant and equipment located at the Angas Zinc Mine. The
it prudent to recommence
Directors have considered
depreciation due to the
last
independent valuation was undertaken to determine scrap
value (2013), and the age of remaining plant prior to
reconditioning works being undertaken.
length of time since the
(f)
Impairment of Assets
Non-financial Assets
At each reporting date, the Group reviews the carrying values
of its non-financial 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 is
determined and compared to the asset’s carrying value. Any
excess of the asset’s carrying value over its recoverable amount
is recognised as an expense in the profit or loss.
Where it is not possible to estimate the recoverable amount of
an individual asset, the Group estimates the recoverable
amount of the cash-generating unit (CGU) to which the asset
belongs. A CGU is the smallest identifiable asset group that
generates cash flows that largely are independent from other
assets and groups. Impairment losses recognised in respect of
CGU’s are allocated first to reduce the carrying amount of any
goodwill allocated to the units and then to reduce the carrying
amount of the other assets in the unit (group of units) on a pro
rata basis. An impairment loss is reversed if the reversal can be
related objectively to an event occurring after the impairment
loss was recognised. An impairment loss is reversed only to the
extent that the asset’s carrying amount does not exceed the
carrying amount that would have been determined, net of.
27
depreciation or amortisation, if no impairment loss had been
recognised, with the exception that any previously impaired
goodwill should not be re-recognised.
share of the output arising from the joint operation, its share of
revenue from the sale of the output by the joint operation and
its expenses (including its share of expenses incurred jointly).
Financial Assets
The Group’s financial assets are subject to AASB 9’s three-stage
expected credit loss model. Each class of financial asset is
considered for impairment based on their credit risk profile (as
disclosed in note 22(2).
Recoverable Amount
In assessing whether the carrying amount of an asset is
impaired, the asset’s carrying value is compared with its
recoverable amount. The recoverable amount of non- financial
assets or cash-generating units (CGU) is the greater of their fair
value or realisable value less costs to sell and value in use. In
assessing fair value, or value in use, estimates and assumptions
including the appropriate rate at which to discount cash flows,
the timing of the cash flows, expected life of the relevant area
of interest, exchange rates, commodity prices, ore reserves,
future capital requirements and future operating performance
are used. The recoverable amount of an asset or CGU will be
impacted by changes in these estimates and assumptions which
could result in an adjustment to the carrying amount of that
asset or CGU.
(g) Ore Reserves
Economically recoverable ore reserves represent the estimated
quantity of product in an area of interest that can be expected
to be profitably extracted, processed and sold under current
and foreseeable economic conditions. The determination of ore
reserves includes estimates and assumptions about a range of
geological, technical and economic factors, including quantities,
grades, production techniques, recovery rates, production
costs, transport costs, commodity demand, commodity prices
and exchange rates. Changes in a project’s ore reserve impacts
the assessment of recoverability of exploration and evaluation
assets, property, plant and equipment and intangible assets, the
carrying amounts of assets depreciated on a units of production
basis, provisions for site restoration and the recognition of
deferred tax assets, including tax losses.
(h) Investments in Associates and Joint Arrangements
Associates are those entities over which the Group is able to
exert significant influence but which are not subsidiaries.
A joint venture is an arrangement that the Group controls
jointly with one or more other investors, and over which the
Group has rights to a share of the arrangement’s net assets
rather than direct rights to underlying assets and obligations for
underlying liabilities. A joint arrangement in which the Group
has direct rights to underlying assets and obligations for
underlying liabilities is classified as a joint operation.
Investments in associates and joint ventures are accounted for
using the equity method. Interests in joint operations are
accounted for by recognising the Group’s assets (including its
share of any assets held jointly), its liabilities (including its share
of any liabilities incurred jointly), its revenue from the sale of its
Any goodwill or fair value adjustment attributable to the
Group’s share in the associate or joint venture is not recognised
separately and is included in the amount recognised as
investment.
The carrying amount of the investment in associates and joint
ventures is increased or decreased to recognise t h e Group’s
share of the profit or loss and other comprehensive income of
the associate and joint venture, adjusted where necessary to
ensure consistency with the accounting policies of the Group.
Unrealised gains and losses on transactions between the Group
and its associates and joint ventures are eliminated to the
extent of the Group’s interest in those entities. Where
unrealised losses are eliminated, the underlying asset is also
tested for impairment.
(i) Exploration and Evaluation Expenditure
Exploration and evaluation costs, including the costs of
acquiring licenses, are capitalised as exploration and evaluation
assets (E&E assets) on an area of interest basis pending
determination of the technical feasibility and commercial
viability of the project. When a license expires and is not
expected to be renewed, is relinquished or a project is
abandoned, the related costs are recognised in the profit or loss
immediately. With respect to the Tala Hamza Zinc Project, all
exploration and evaluation costs incurred from February 2018
(at which time the exploration license was not renewed) have
been expensed.
Tangible and intangible E&E assets that are available for use are
depreciated (amortised) over their estimated useful lives. Upon
commencement of production, 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 reserves.
E&E assets are assessed for impairment if (1) sufficient data
exists to determine technical feasibility and commercial
viability, and (2) facts and circumstances suggest that the
carrying amount exceeds the
recoverable amount (see
impairment note 3(f)). E&E assets are assessed for impairment
when any of the following facts and circumstances exist:
• The term of the exploration license in the specific area of
interest has expired during the reporting period or will
expire in the near future, and not expected to be renewed;
• Substantive expenditure on further exploration for and
evaluation of mineral resources in the specific area are not
budgeted nor planned;
• Exploration for and evaluation of mineral resources in the
specific area have not led to the discovery of commercially
viable quantities of mineral resources and the decision was
made to discontinue such activities in the specified area; or
indicate that, although a
development in the specific area is likely to proceed, the
carrying amount of the exploration and evaluation asset is
• Sufficient data exists to
28
unlikely to be recovered in full from successful development or
by sale.
currency that match, as closely as possible, the estimated future
cash outflows.
E&E assets are transferred to development assets once the
technical feasibility and commercial viability of an area of
interest can be demonstrated. E&E assets are assessed for
impairment, and any impairment loss is recognised prior to
being reclassified.
Pre-licence expenditure and expenditure deemed to be
unsuccessful is recognised in the profit or loss immediately.
(j) Trade and Other Payables
Trade payables and other payables are stated at cost.
(k) Provisions
Provisions are recognised when the Group has a legal or
constructive obligation, as a result of past events, for which it is
probable that an outflow of economic benefits will result and
that outflow can be reliably measured.
is recognised
Site restoration liability
the estimated cost of
A provision
rehabilitation, decommissioning and restoration relating to
areas disturbed during operation of the Angas Zinc Mine up to
reporting date but not yet rehabilitated.
for
The provision is based upon current cost estimates and has
been determined on a discounted basis with reference to
current legal requirements and technology.
As the provision represents the discounted value of the present
obligation, using a pre-tax rate that reflects current market
assessments and the risks specific to the liability, the increase
in value of the provision due to the passage of time will be
recognised as a borrowing cost in the profit or loss in future
periods. The provision is recognised as a non-current liability (in
line with expected timescales for the work to be performed),
with a corresponding asset taken to account and amortised over
the life of the mine. At each reporting date the rehabilitation
liability is reviewed and re-measured in line with changes in
discount rates, timing & the amounts of the costs to be incurred
based on area of disturbance at reporting date. Changes in the
liability relating to the re-assessment of rehabilitation estimates
are recognised directly within the profit or loss.
(l) Employee Benefits
Provision is made for the Group’s liability for employee benefits
arising from services rendered by employees to reporting date.
Employee benefits that are expected to be settled wholly within
one year have been measured at the amounts expected to be
paid when the liability is settled, plus related on-costs.
The liability for long service leave is recognised in the provision
for employee benefits and measured as the present value of
expected future payments to be made in respect of services
provided up to the reporting d a t e . Consideration is given to
levels, experience of employee
future wage and salary
departures and periods of service. Expected future payments
are discounted using market yields at the reporting date on
high quality corporate bonds with terms to maturity and
Share Based Payments
incentives to
The Group uses share options to provide
Directors, employees and consultants. The Board, upon the
recommendation of the Nominations and Remuneration
Committee, has discretion to determine the number of options
to be offered to Eligible Employees (as that term is defined by
the EOP) and the terms upon which they are offered, including
exercise price and vesting conditions. The fair value of options
at grant date is independently determined using an option
pricing model that takes into account the exercise price, the
term of the option, the vesting and performance criteria, the
share price at grant date and expected price volatility of the
underlying share, the expected dividend yield and the risk free
interest rate for the term of the option. Historical volatility has
been the basis for determining expected share price volatility
as it is assumed that this is indicative of future trends, which
may not eventuate. The life of the options is based on the
historical exercise patterns, which may not eventuate in the
future.
The fair value of options granted is recognised as an expense
with a corresponding increase in equity. The fair value is
measured at grant date and recognised as an expense over the
period during which the Directors, employees or consultants
become unconditionally entitled to the options (vesting
period). Upon the exercise of options, the balance of the share
based payments reserve relating to those options is transferred
to share capital.
The Group uses share rights to provide
incentives to
employees. Share rights are valued at grant date and are
expensed to reflect amounts owing. Upon issue of the share
rights an increase in equity is recognised.
(m) Loans and Borrowings
Borrowings are recognised initially at fair value less attributable
transaction costs. Subsequent to initial recognition, loans and
borrowings are stated at amortised cost, with any difference
between cost and redemption value being recognised in the
profit or loss over the period of the borrowings on an effective
interest basis. Loans and borrowings with a determinable
payment due less than twelve months from reporting date are
classified as current liabilities.
(n) Revenue
To determine whether to recognise revenue, the Group follows
a 5-step process:
1. Identifying the contract with a customer,
2. Identifying the performance obligations,
3. Determining the transaction price,
4. Allocating the transaction price to the performance
obligations, and
5. Recognising revenue when/as performance obligation(s)
are satisfied.
Revenue is recognised either at a point in time or over time,
when (or as) the Group satisfies performance obligations by
transferring the promised goods or services to its customers.
29
The Group recognises contract liabilities for consideration
received in respect of unsatisfied performance obligations and
reports these amounts as other liabilities in the statement of
financial position. Similarly, if the Group satisfies a performance
obligation before it receives the consideration, the Group
recognises either a contract asset or a receivable in its
statement of financial position, depending on whether
something other than the passage of time is required before
the consideration is due.
include
(o) Financing Costs
Financing costs
interest payable on borrowings
calculated using the effective interest method, amortisation of
ancillary costs incurred in connection with the arrangement of
borrowings, finance lease charges, and the impact of the
unwind of discount on long-term provisions for site restoration.
Financing costs incurred in relation to the construction of any
qualifying asset are capitalised during the period of time that is
required to complete and prepare the asset for its intended use
or sale. Other financing costs are expensed as incurred.
(p) Foreign Currency Translation
Functional and presentation currency
Items included in the financial statements of each of the
group’s entities are measured using the currency of the primary
economic environment in which the entity operates (‘the
functional currency’). The consolidated financial statements
are presented in Australian Dollars (AUD), which is Terramin’s
functional and presentation currency.
Transactions and balances
Foreign currency transactions are translated into the functional
currency using the exchange rates at the dates of the
transactions. Foreign exchange gains and losses resulting from
the settlement of such transactions and from the translation of
monetary assets and
in foreign
currencies at year end exchange rates are generally recognised
in profit or loss. Foreign exchange gains and losses that relate
to borrowings are presented in the statement of profit or loss,
within finance costs. All other foreign exchange gains and losses
are presented in the statement of profit or loss on a net basis
within other gains / (losses).
liabilities denominated
Non-monetary items that are measured at fair value in a foreign
currency are translated using the exchange rates at the date
when the fair value was determined. Translation differences on
assets and liabilities carried at fair value are reported as part of
the fair value gain or loss. For example, translation differences
on non-monetary assets and liabilities such as equities held at
fair value through profit or loss are recognised in profit or loss
as part of the fair value gain or loss and translation differences
on non-monetary assets such as equities classified as at fair
value through other comprehensive income are recognised in
other comprehensive income.
Group companies
The results and financial position of foreign operations (none of
which has the currency of a hyperinflationary economy) that
have a functional currency different from the presentation
currency are translated into the presentation currency as
follows:
assets and liabilities for each statement of financial position
presented are translated at the closing rate at the reporting
date,
income and expenses for each statement of profit or loss
and statement of comprehensive income are translated at
average exchange rates (unless this is not a reasonable
approximation of the cumulative effect of the rates
prevailing on the transaction dates, in which case income
and expenses are translated at the dates of the
transactions), and
all resulting exchange differences are recognised in other
comprehensive income.
On consolidation, exchange differences arising from the
translation of any net investment in foreign entities, and of
borrowings and other financial instruments designated as
hedges of such
in other
comprehensive income. When a foreign operation is sold or any
borrowings forming part of the net investment are repaid, the
associated exchange differences are reclassified to profit or
loss, as part of the gain or loss on sale.
investments, are recognised
Goodwill and fair value adjustments arising on the acquisition
of a foreign operation are treated as assets and liabilities of the
foreign operation and translated at the closing rate.
(q) Share Capital
Ordinary shares are classified as equity. Qualifying transaction
costs of an equity transaction are accounted for as a deduction
from equity, net of any related income tax benefit.
Income Tax
(r)
The charge for current income tax expenses is based on the
profit for the year adjusted for any non-assessable or
disallowed items. It is calculated using tax rates that have been
enacted or are substantively enacted by the reporting date.
Deferred tax is accounted for using the liability method in
respect of temporary differences arising between the tax bases
of assets and liabilities and their carrying amounts
in the
consolidated financial statements. No deferred income tax will
be recognised from the initial recognition of an asset or liability,
excluding a business combination, where there is no effect on
accounting or taxable profit or loss.
Deferred tax is calculated at the tax rates that are expected to
apply to the period when the asset is realised or liability settled.
Deferred tax is credited in the profit or loss except where it
relates to items that may be credited directly to equity, in which
case the deferred tax is adjusted directly against equity.
Deferred income tax assets are recognised to the extent that it
is probable that future tax profits will be available against which
deductible temporary differences can be utilised.
Determination of future tax profits requires estimates and
assumptions as to future events and circumstances,
in
particular, whether successful development and commercial
exploitation, or alternatively sale, of the respective areas of
includes estimates and
interest will be achieved. This
30
judgements about commodity prices, ore reserves (note 3(g)),
exchange rates, future capital requirements, future operational
performance and the timing of estimated cash flows.
Changes in these estimates and assumptions could impact on
the amount and probability of estimated taxable profits and
accordingly the recoverability of deferred tax assets.
The Company and its Australian subsidiaries are part of an
income tax consolidated group under the Australian Tax Laws.
(s) Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the
amount of GST, except where the amount of GST incurred is not
recoverable from the Australian Taxation Office. In these
circumstances the GST is recognised as part of the cost of
acquisition of the asset or as part of an item of the expense.
Receivables and payables in the statement of financial position
are shown inclusive of GST.
Cash flows are presented in the 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.
(t) Earnings Per Share
The Group presents basic and diluted earnings per share (EPS)
data for its ordinary shares. Basic EPS is calculated by dividing
the profit or loss attributable to ordinary shareholders of the
Company by the weighted average number of ordinary shares
outstanding during the period. Diluted EPS is determined by
adjusting profit or loss attributable to ordinary shareholders
and weighted average number of ordinary shares outstanding
for the effects of all dilutive potential ordinary shares, which
comprises convertible notes and share options granted to
employees, Directors, consultants and other third parties.
(u) Segments
The consolidated entity has identified its operating segments to
be its Australian interests and its Northern African interests,
based on the different geographical regions and the similarity
of assets within those regions. This is the basis on which internal
reports are provided
for assessing
performance and determining the allocation of resources within
the consolidated entity.
to management
A geographical segment is engaged in providing products or
services within a particular economic environment and
is
subject to risks and returns that are different from those
segments operating in other economic environments.
Segment information is presented only in respect of the Group’s
geographical segments, being Australia and Northern Africa,
which is the basis of the Group’s internal reporting.
(v) Financial Risk Management
The Group’s activities expose it to the following risks from the
use of financial instruments:
Credit Risk
The risk of financial loss to the Group if a customer or
counterparty to a financial instrument fails to meet its
contractual obligations. This arises principally from short term
cash investments.
Liquidity Risk
The risk that the Group will not be able to meet its financial
obligations as they fall due. The Group manages this exposure
by targeting to have sufficient cash financing facilities available
on demand to meet planned expenditure for a minimum period
of 45 days (refer note 13 for detail on available financing
facilities).
Market Risk
The risk that changes in foreign exchange rates and interest
rates will affect the Group’s income or value of its holdings of
financial instruments. The Group may enter into commodity
derivatives, foreign exchange derivatives and may also incur
financial liabilities (debt), in order to manage market risks. All
such transactions are carried out within Board approved limits.
The Group’s financial risks are managed primarily by the Chief
Executive Officer, including external consultation advice as
required, as a part of the day-to-day management of the
Group’s affairs. Finance and risk reporting is a standard item in
the report presented at each Board meeting.
Capital Management
The Board seeks to maintain a strong capital base sufficient to
maintain the future development of the Group’s business. The
Board closely monitors the Group’s level of capital so as to
ensure it is appropriate for the Group’s planned level of
activities. There were no changes to the Group’s approach to
capital management during the year.
(w) Government Grants
Government grants relating to costs are deferred and
recognised in profit and loss over the period necessary to match
them with the costs that they are intended to compensate.
(x) Research and Development Tax Incentive
To the extent that research and development costs are eligible
activities, under the “Research and Development Tax Incentive”
programme, a refundable tax offset is available for companies
with annual turnover of less than $20 million. The Group
recognises, where it is possible to reliably estimate, refundable
tax offsets in the financial year as an income tax benefit in profit
or loss, resulting from the monetisation of available tax losses
that otherwise would have been carried forward.
(y) Right-of-use assets
A right-of-use asset is recognised at the commencement date
of a lease. The right-of-use asset is measured at cost, which
comprises the initial amount of the lease liability, adjusted for,
as applicable, any lease payments made at or before the
commencement date net of any lease incentives received, any
initial direct costs incurred, and, except where included in the
cost of inventories, an estimate of costs expected to be
incurred for dismantling and removing the underlying asset,
and restoring the site or asset.
Right-of-use assets are depreciated on a straight-line basis over
the unexpired period of the lease or the estimated useful life of
the asset, whichever is the shorter. Where the consolidated
entity expects to obtain ownership of the leased asset at the
end of the lease term, the depreciation is over its estimated
31
useful life. Right-of use assets are subject to impairment or
adjusted for any remeasurement of lease liabilities.
The consolidated entity has elected not to recognise a right-of-
use asset and corresponding lease liability for short-term leases
with terms of 12 months or less and leases of low-value assets.
Lease payments on these assets are expensed to profit or loss
as incurred.
(z) Lease liabilities
A lease liability is recognised at the commencement date of a
lease. The lease liability is initially recognised at the present
value of the lease payments to be made over the term of the
lease, discounted using the interest rate implicit in the lease or,
if that rate cannot be readily determined, the consolidated
entity's incremental borrowing rate. Lease payments comprise
of fixed payments less any lease incentives receivable, variable
lease payments that depend on an index or a rate, amounts
expected to be paid under residual value guarantees, exercise
price of a purchase option when the exercise of the option is
reasonably certain to occur, and any anticipated termination
penalties. The variable lease payments that do not depend on
an index or a rate are expensed in the period in which they are
incurred.
Lease liabilities are measured at amortised cost using the
interest method. The carrying amounts are
effective
remeasured if there is a change in the following: future lease
payments arising from a change in an index or a rate used;
residual guarantee; lease term; certainty of a purchase option
and termination penalties. When a lease liability is remeasured,
an adjustment is made to the corresponding right-of use asset,
or to profit or loss if the carrying amount of the right-of-use
asset is fully written down.
4. Revenue, Other Income and Expenses
Revenue and other income
Revenue from contracts
Government grant income1
Other income2
Total revenue and other income
1. Represents Cashflow Boost and refundable R&D tax incentive income.
2. Includes insurance proceeds of $248,636.
2020
$000’s
67
150
268
485
2019
$000’s
187
607
77
871
Revenue from contracts
Revenue recognised over time
Total revenue
Revenue from contracts
Revenue recognised over time
Revenue recognised at a point in time
Total revenue
31 December 2020
Service
Income
$000’s
67
67
Data Fee
$000’s
Total
$’000’s
-
-
67
67
31 December 2019
Service
Income
$000’s
96
-
96
Data Fee
$000’s
Total
$’000’s
-
91
91
96
91
187
Other expenses
Corporate Administration and Marketing Costs
Legal, Accounting, Community Relations and Other
Consultants
ASX fees and Share Registry Costs
Other
Total other expenses
5. Auditor’s Remuneration
Grant Thornton Audit Pty Ltd
Audit and review of financial reports
Non-audit services
Total auditor’s remuneration
6. Finance Income and Costs
Finance income
Interest income
Total finance income
Finance costs
Interest on borrowings
Interest on lease liabilities
Unwind of discount on mine rehabilitation provision
Amortisation of borrowing costs
Facility fees
Other borrowing costs
Total finance costs
7. Cash and Cash Equivalents
Cash on hand
Bank balances
Total cash and cash equivalents
Short-term deposits1
2020
$000’s
580
2019
$000’s
464
320
75
15
990
281
92
1
838
2020
$
91,000
25,000
116,000
2019
$
74,000
34,000
129,000
2020
$’000
20
20
2020
$’000
2,665
4
41
15
78
9
2,812
2020
$’000
2
103
105
5,340
2019
$’000
26
26
2019
$’000
2,102
4
117
825
-
9
3,057
2019
$’000
2
958
960
5,340
Restricted cash on deposit
1. Represents restricted cash to support an environmental rehabilitation
5,340
5,340
bonds, office lease and minor credit card facilities.
8. Inventories
Non-current
Raw materials and consumables
Total inventories at the lower of cost and net
realisable value
9. Trade and Other Receivables
Trade receivables
Accrued interest receivable
Research and development tax benefit
Other receivables (including GST refund)
Total trade and other receivables
2020
$’000
2019
$’000
353
353
2020
$’000
17
1
-
32
50
495
495
2019
$’000
-
6
74
98
178
32
10. Property, Plant and Equipment
Assets held for sale - current
At cost
Less impairment
Total assets held for sale
Property, plant and equipment - non-current
Freehold land
At cost
Total freehold land1
Buildings and other infrastructure
At cost
Less accumulated depreciation
Total buildings and other infrastructure1
Right-of-use Assets
At cost
Less accumulated depreciation
Total Right-of-use Assets
Plant and Equipment
At cost
Less accumulated impairment
Less accumulated depreciation
Total plant and equipment1
Total property plant and equipment
2020
$’000
811
(121)
690
2020
$’000
3,460
3,460
126
(124)
2
288
(222)
66
2019
$’000
-
-
-
2019
$’000
4,271
4,271
126
(122)
4
298
(77)
221
57,470
(14,219)
(39,410)
3,841
7,369
57,803
(14,219)
(39,479)
4,105
8,601
1. The Directors have considered the recoverable amount of property, plant and equipment based on available market information for comparable asset and have
taken into account the expected future use of these assets as the Company moves towards approval of a mining licence for the Bird in Hand Gold Project.
Movements in carrying amounts
Property, plant and equipment - non-current
Opening carrying amount 1 Jan 2020
Additions
Disposals
Revaluation (Adelaide Office Lease)
Transfers
Reclassification of Critical Spares
Depreciation and amortization
Foreign currency movement
Carrying amount at 31 Dec 2020
Property, plant and equipment - non-current
Opening carrying amount 1 Jan 2019
Recognition upon first time adoption of AASB 16
Additions
Disposals
Transfers
Depreciation and amortization
Foreign currency movement
Carrying amount at 31 Dec 2019
Freehold
land
$'000
4,271
-
-
-
(811)
-
-
-
3,460
Freehold
land
$'000
4,271
-
-
-
-
-
-
4,271
Buildings & other
infrastructure
$'000
4
-
-
-
-
-
(2)
-
2
Buildings & other
infrastructure
$'000
5
-
-
-
-
(1)
-
4
Plant and
equipment
$'000
4,105
-
-
-
-
136
(389)
(11)
3,841
Plant and
equipment
$'000
4,144
-
-
-
(32)
(7)
4,105
Rights-of-use
Assets
$'000
221
-
-
(55)
-
-
(90)
(10)
66
Construction
in progress
$'000
-
90
207
-
-
(77)
1
221
Total
$'000
8,601
-
-
(55)
(811)
136
(481)
(21)
7,369
Total
$'000
8,420
90
207
-
-
(110)
(6)
8,601
33
11. Exploration and Evaluation Assets
2020
$’000
2019
$’000
Financing facilities
Loan facilities - available
64,987
1,312
-
(3,047)
63,121
2,077
(198)
(13)
Loan facilities - drawn
Less: unamortised transaction costs
Carrying amount at 31 December
Guarantee facility
Guarantee facility – available3
Guarantee facility - undrawn
Guarantee facility - drawn
2020
$’000
23,344
23,344
(12)
23,332
5,315
-
5,315
2019
$’000
21,515
21,515
-
21,515
5,315
-
5,315
Exploration and evaluation
At cost
Additions
Impairment1
Foreign currency movement
Total exploration and evaluation
1.
64,987
Impairment of capitalised exploration represents the value of damages
sustained at the Goldwyn property as a result of the Cudlee Creek Bushfire
in December 2019.
63,252
Exploration and evaluation projects by
location
Tala Hamza Zinc Project (Terramin 65%)
Adelaide Hills (Terramin 100%)1, 2
Bird in Hand Gold (Terramin Exploration 100%)
South Gawler Ranges (Menninnie Metals 100%)3
Total exploration and evaluation
2020
$’000
41,043
2,020
14,509
5,680
63,252
2019
$’000
44,089
1,934
13,291
5,673
64,987
recovery
1. The Company has entered into an agreement with respect to the Kapunda
Project, over which the Company has a current Exploration Licence.
In
December 2019, Environment Copper Recovery Pty Ltd (ECR) can earn, in
two stages, up to 75% of the rights over metals which may be recovered via
in-situ
(ASX
Announcement: (ASX: THR): Kapunda Copper and Gold). During the period,
ECR completed $2.0 million expenditure to earn 50% interest and has
elected to spend a further $4.0 million to earn an additional 25%. The
expenditure by ECR on the project is not reflected in the accounts of the
Company, however will contribute to the minimum expenditure obligations
under the terms of the Exploration License.
the Kapunda deposit
(ISR) contained
in
2. The Company entered
into an earn-in arrangement with Freeport
Exploration Australia Pty Ltd in respect of the Wild Horse project.
3. The Company entered
into an earn-in arrangement with Freeport
Exploration Australia Pty Ltd in respect of the South Gawler Ranges projects.
12. Trade and Other Payables
Trade payables
Other payables and accrued expenses
Payables and accrued interest on borrowings
Total trade and other payables
2020
$’000
676
445
5,254
6,375
2019
$’000
261
532
2,563
3,356
Trade and other payables are normally non-interest bearing
and are settled on 30 days end of month terms.
13. Loans and Borrowings
Current liabilities
Lease liabilities (note 28(d))1
Loans - secured2
Loans - unsecured
Total current borrowings
Non-current liabilities
Lease liabilities (note 28(d))1
Loans – secured2
Total non-current borrowings
2020
$’000
53
23,332
-
23,385
14
-
14
2019
$’000
113
-
68
181
110
21,515
21,625
1.
2.
3.
Under AASB 16 lease liabilities represent finance and operating leases, and
unwind as lease payments are made.
At reporting date, the Group had fully drawn down $23.34 million of two
loan facilities provided by Asipac. Interest is fixed at a base rate of 12%,
payable upon termination date. The facilities have a term expiring 30
April 2021.
The $5.3 million environmental rehabilitation bond required by the South
Australian Government over Mining Lease 6229 continued to be
supported by a cash backed Commonwealth Bank of Australia (CBA)
guarantee.
The carrying value of plant and equipment and mining property
subject to finance loans and hire purchase contracts at 31
December 2020 was $0 (2019: $2,425). Assets under hire
purchase contracts are pledged as security for related finance
loans & hire purchase liabilities.
Under the terms of the $6.0 million BIH facility (BIH Facility) and
$13.34 million Standby facility (Standby Facility) provided to
Terramin Exploration Pty Ltd, the
following first ranking
securities have been granted to Asipac: a real property
mortgage over land acquired at Bird in Hand, a general security
interest over all the assets of Terramin Exploration Pty Ltd and
a specific security over the shares of Terramin Exploration Pty
Ltd. All security interests will be discharged upon repayment of
all amounts due under the BIH Facility.
14. Provisions
Current
Employee benefits
Total current provisions
Non-current:
Employee benefits
Mine rehabilitation
Total non-current provisions
At 1 January 2020
Increases in provisions
Paid during the period
At 31 December 2020
2020
$’000
89
89
33
5,476
5,509
Employee
Benefits
$’000
Mine
rehabilitation
$’000
166
19
(63)
122
4,880
596
-
5,476
2019
$’000
136
136
30
4,880
4,910
Total
$’000
5,046
615
(63)
5,598
is recognised for the
The mine rehabilitation provision
estimated cost of rehabilitation, decommissioning, restoration
and long-term monitoring of areas disturbed during operation
of the Angas Zinc Mine up to reporting date but not yet
rehabilitated.
34
The provision is based on current cost estimates and has been
determined on a discounted basis with reference to current
legal requirements and technology. The provision has been
calculated using a 0.37% risk-free discount rate (2019: 1.23%).
The rehabilitation is expected to occur following the processing
of ore from the Bird in Hand Gold Project (subject to regulatory
approvals).
15. Issued capital
(a) Ordinary shares
The holders of ordinary shares are entitled to one vote per
share at meetings of the Company and participation in
dividends declared. All issued shares are fully paid.
(b) Detailed table of capital issued during the year
2,116,562,720 (2019: 2,116,562,720)
Ordinary shares
Share issue costs
Total issued capital
Type of Share Issue
At 1 Jan 2020
At 31 Dec 2020
Share issue costs
Issued Capital
Type of Share Issue
At 1 Jan 2019
Non-renounceable
Rights Issue
At 31 Dec 2019
Share issue costs
Issued Capital
Date of
Issue
Number of
Ordinary
Shares on issue
2,116,562,720
2,116,562,720
Date of
Issue
Number of
Ordinary
Shares on issue
1,869,601,371
246,961,349
2 Dec 2019
2,116,562,720
2020
$’000
2019
$'000
229,676
229,676
(5,745)
(5,726)
223,931
223,950
Issue
Price
$
Issue
Price
$
0.035
Share
Capital
$'000
223,950
223,950
(19)
223,931
Share
Capital
$'000
215,383
8,642
224,025
(75)
223,950
16. Reserves
(a) Foreign currency translation reserve
Foreign currency translation reserve
2020
$’000
2019
$'000
Balance at the beginning of the year
(6,237)
(6,199)
Adjustment arising on translation into
presentation currency
Balance at the end of the year
(3,074)
(9,311)
(38)
(6,237)
The foreign currency translation reserve is used to record
exchange differences arising from the translation of the
financial statements of foreign subsidiaries.
(b) Share based payments reserve
Share based payments reserve
Balance at the beginning of the year
Options value lapsed during the year
Options value vested during the year
Balance at the end of the year
2020
$'000
298
(103)
-
195
2019
$'000
136
(25)
187
298
Total reserves
(9,116)
(5,939)
The share based payment reserve is used to recognise the value
of equity-settled share-based payment transactions, including
employees and KMP, as part of their remuneration. During the
2020 reporting period the CEO received no options (2019: NIL).
The 10,000,000 options granted to the CEO in 2018 were valued
in accordance with the Black Scholes valuation methodology for
which $0 was recognised as a share based payment expense
during the 2019 reporting period (2018: $187,533).
Mr Richard Taylor stepped down as CEO of the Company in July
2020 prior to tranches 3 and 4 (representing 5,000,000 options)
of Mr Taylor’s 10,000,000 options vesting, which therefore
lapsed.
There were no share rights granted to employees including
KMP’s during the reporting period.
17. Non-controlling Interest
Balance at the beginning of the year
Share of movement in net assets
Balance at the end of the year
2020
$’000
2019
$'000
13,365
13,577
(100)
(212)
13,265
13,365
Movement in non-controlling interest in 2020 relates to the
35% minority interest (ENOF 32.5% and ORGM 2.5%) in
exploration and evaluation costs for the Tala Hamza Zinc
Project funded directly by the Group through
its 65%
shareholding
in WMZ. During 2020, the Group funded
approximately $0.3 million (2019: $0.6 million) of exploration
and evaluation costs in WMZ, of which ENOF and ORGM are
entitled to $0.1 million (2019: $0.2 million) being (35%). The
remainder of the movement is in relation to foreign exchange
changes. A total of 35% of all assets contributed to WMZ by the
Group effectively accrue to ENOF and ORGM for nil
consideration (other than forming part of the Group’s 65%
earn-in) and has therefore been included in movement in net
assets attributable to the non-controlling interest. Refer to note
23 for further disclosures with respect to material non-
controlling interests.
18. Income Tax Expense
Prima facie tax benefit on loss before income tax
at 30% (2019: 30%)
Decrease in income tax benefit due to:
(Deductible)/non-deductible items
Deferred tax asset not brought to account
Research and development tax concession received1
Adjustment to prior year tax losses
Unused tax losses for which no deferred tax asset
has been recognised
Potential tax benefit
The applicable weighted average effective tax rates
for the reporting period are:
2020
$'000
2019
$'000
(1,617)
(1,865)
65
258
(1,552)
(1,607)
-
-
-
(7,376)
176,734
171,261
53,020
51,378
29%
26%
1. Refundable Research and Development Tax Incentive is recognised in
Other Income (reported at Government Grant income (Note 4))..
The Company is part of an Australian Tax Consolidated Group.
35
The Australian Tax Consolidated Group has potential deferred
tax assets of $53.0 million (2019: $51.4 million). These have not
been brought to account because the Directors do not consider
the realisation of the deferred tax asset as probable. The
benefit of these tax losses will be obtained if:
a. the Australian Tax Consolidated Group derives
future
assessable income of a nature and of an amount sufficient
to enable the benefits to be realised;
b. the Australian Tax Consolidated Group can comply with the
conditions for deductibility imposed by tax legislation; and
c. no changes in the income tax legislation adversely affect the
Australian Tax Consolidated Group in realising the benefit
from the deduction of the loss.
In order to utilise the benefit of the tax losses, an assessment
will need to be undertaken with regards to the continuity of
ownership or same business tests.
19. Cash Flow Information
Reconciliation of cash flow from operations with loss from
ordinary activities after income tax:
Loss for the period
Adjustment for:
Depreciation and amortisation
Non-cash inventory movements
Share-based payment transactions (other)
Amortisation of borrowing costs
Impairment of non-current assets
Mine rehabilitation provision - change in
assumptions (including discount unwind and cost
revision)
Change in operating assets and liabilities: As
Decrease/(increase) in trade and other receivables
Decrease/(increase) in prepayments
(Decrease)/increase in payables and accruals
(Decrease)/increase in provisions
Cashflow (used in) operating activities
20. Related Parties
2020
$’000
(5,391)
2019
$'000
(5,611)
481
-
(103)
15
121
596
110
-
187
826
198
187
(342)
309
2,775
(44)
(1,583)
(11)
(1)
1,662
(46)
(2,499)
(a) Key management personnel compensation
Summary of Key Management Personnel (KMP)
compensation:
Short-term employee benefits
Long-term employee benefits
Post-employment benefits
Termination benefits
Share-based payments
Total KMP compensation
2020
$
673,123
(19,591)
37,507
-
(103,489)
2019
$
644,688
(1,912)
38,804
-
187,533
587,550
869,113
The amounts disclosed in the table are the amounts recognised
as an expense during the reporting year related to KMP.
Amounts paid to KMP from prior years have been excluded from
this table.
(b) Other transactions with related parties
The following table provides the total amount of transactions
that have been entered into with related parties for the relevant
financial year.
Entities with significant influence over the Group
At 31 December 2020, Asipac owned 39.07% of the ordinary
shares in Terramin (2019: 39.07%) and is controlled by Mr Sheng
who is the Executive Chairman of the Company. Mr Siciliano is
the Chief Financial Officer of Asipac. Asipac has had the
following transactions in the year:
Asipac Group
Borrowings as at 1 January
Loans advanced during the year
Loan repayments in the year
Borrowings as at 31 December
Related Party Transactions
Loan facility fees paid
Loan facility fees incurred
Interest paid
Interest incurred
Related Party Balance
Amounts owed at year end
2020
$’000
21,515
1,830
-
23,344
-
28
-
5,205
2019
$’000
17,250
9,300
(5,036)
21,515
(1,230)
1,230
(970)
3,513
5,233
2,543
Terms and conditions of transactions with related parties
The transactions with related parties are made on terms
equivalent to those that prevail in arm’s length transactions.
During the previous reporting period, the Company and its
subsidiary Terramin Exploration Pty Ltd entered
into an
agreement with major shareholder Asipac Group Pty Ltd to
restructure its Facility Agreements. Under this agreement
refinancing and marketing fees were waived, along with the
waiver of the right to negotiate an offtake agreement for BiH, in
return for a 3% NSR royalty on gold production from BiH. In the
event that BiH production is less than 500koz the royalty shall
extend to Terramin’s wholly owned South Australian gold
tenements until a total of 500koz is reached. The term of the
facilities were also extended to 30 April 2021.
21. Financial Instruments
The Group is exposed to market risk in the form of commodity
price risk, foreign currency exchange risk and interest rate risk.
The carrying value of the financial assets and liabilities of the
Group, together with the equity and profit or loss impact during
the period (if any), that are affected by market risk are
categorised as follows:
Financial Instruments
Note
2020
$'000
2019
$'000
Current
Cash and cash equivalents
Trade and other receivables
Trade and other payables
Financial liabilities at amortised cost
Total current financial instruments
7
9
12
13
5,445
50
(6,375)
(23,344)
6,300
178
(3,356)
(21,515)
(24,224)
(18,393)
Fair value
The fair values of the financial assets and liabilities of the Group
are equal to the carrying amount in the accounts (as detailed
previously). In the case of loans and borrowings it is considered
that the variable rate debt and associated credit margin is in line
with current market rates and therefore is carried in the
accounts at fair value.
36
22. Financial Risk Management
The Group’s principal financial liabilities comprise loans and
trade and other payables. The main purpose of these financial
instruments is to finance the Group’s operations. The Group
has various financial assets such as accounts receivable and
cash and short-term deposits, which arise directly from
operations.
The Group manages its exposure to key financial risks in
accordance with the Group’s risk management policy. The
objective of the policy is to support the delivery of the Group’s
financial targets while protecting future financial security. The
main risks that could adversely affect the Group’s financial
assets, liabilities or future cash flows are market risks,
comprising commodity price risk, currency risk, interest rate
risk, credit risk and liquidity risk.
The Group’s senior management oversees the management of
financial risks. The Group’s senior management is supported by
the Audit, Risk and Compliance Committee that advises on
financial risks and the appropriate financial risk governance
framework for the Group. The Audit, Risk and Compliance
Committee provides assurance
the Group’s senior
management that the Group’s financial risk-taking activities are
governed by appropriate policies and procedures and that
financial risks are identified, measured and managed in
accordance with Group policies and the Group’s risk appetite.
to
All derivative activities for risk management purposes are
carried out by management that have the appropriate skills,
experience and supervision. It is the Group’s policy that no
trading
in derivatives for speculative purposes shall be
undertaken. At this stage, the Group does not currently apply
any form of hedge accounting.
The Board of Directors reviews and agrees policies for managing
each of these risks which are summarised below.
1. Market Risk
Market risk is the risk that the fair value of future cash flows of
a financial instrument will fluctuate because of changes in
market prices. Market prices comprise three types of risk:
commodity price risk, interest rate risk and currency risk.
Financial instruments affected by market risk include loans and
borrowings, deposits, accounts receivable, accounts payable,
accrued liabilities and derivative financial instruments. The
Company currently has no commodity price risk.
(a) Currency risk
The Group is exposed to foreign currency risk on purchases and
cash at bank which are denominated in a currency other than
AUD. The currencies giving rise to this are primarily USD, Euros
(EUR) and Algerian Dinar (DZD). The Group does not enter into
derivative financial instruments to hedge such transactions
denominated in a foreign currency. No amount was recognised
in the statement of profit or loss and other comprehensive
income during the current year (2019:$nil).
The Group’s exposure to foreign currency risk at reporting date
was as follows:
In AUD thousand
equivalent
Cash at bank
Trade receivables
Trade payables
Gross exposure
31 December 2020
EUR
USD
-
-
-
-
(29)
(40)
(29)
(40)
DZD
-
-
-
-
31 December 2019
EUR
USD
-
-
-
-
-
-
-
-
DZD
1
6
(74)
(67)
following exchange rates applied
The
Consolidated Statement of Financial Position:
for
the Group
Currency Exchange Rates
Year-end rates used for the
consolidated statement of financial
position, to translate the currencies
into AUD, are:
Currency
2020
2019
USD
EUR
DZD
0.77
0.62
100.91
0.70
0.62
83.10
Sensitivity Analysis
Sensitivity to fluctuations in foreign currency rates is based on
outstanding monetary items at 31 December 2020 which are
denominated in a foreign currency.
Holdings exposed to currency risk at the end of the period are
minimal.
(b) Interest rate risk
The Group has an exposure to future interest rates on
investments
in variable-rate securities and variable-rate
borrowings.
The Group does not use derivatives to mitigate these
exposures.
The Group’s exposure to interest rate risk and effective
weighted average interest rates are as follows:
Net Financial Assets
(Liabilities)
2020
Cash1
Restricted cash
Short-term deposits1
Finance lease liabilities
Loans1
Total (Net)
Effective
interest
rate
0.00%
0.00%
0.14%
14.50%
12.00%
Total
$’000
105
5
5,335
-
(23,344)
(17,899)
Net Financial Assets
(Liabilities)
2019
Cash1
Restricted cash
Short-term deposits1
Finance lease liabilities
Loans2
Total (Net)
Total
$’000
960
5
5,335
(2)
(21,515)
(15,217)
Includes AUD and USD denominated balances.
Effective
interest
rate
1.20%
0.00%
1.20%
14.50%
12.00%
Floating
Int rate
$’000
105
5
5,335
-
-
5,445
Floating
Int rate
$’000
960
5
5,335
-
-
6,300
Fixed
interest
rate
-
-
-
(23,344)
(23,344)
Fixed
interest
rate
-
-
(2)
(21,515)
(21,517)
1.
2. The facilities currently have an expiry date of 30 April 2021. The interest
rate is 12%.
Sensitivity analysis
The Group has interest bearing liabilities with the Asipac Group
which may be varied.
The following table
interest
repayments to a reasonably possible change in interest of +/-
1% (2019: +/- 1%):
illustrates the sensitivity of
.
Interest Rate Sensitivity
Loans - 31 December 2020
Loans - 31 December 2019
$’000
+1%
(233)
(215)
$’000
-1%
233
215
37
2. Credit risk
The carrying amount of the Group’s financial assets represents
the maximum credit exposure. The Group’s maximum exposure
to credit risk at the reporting date was:
Credit risk exposure - assets
Note
Trade and other receivables
Cash assets
Total financial assets
9
7
2020
$’000
50
5,445
5,495
2019
$’000
178
6,300
6,478
The Group’s maximum exposure to credit risk for loans and
receivables at the reporting date by geographic region was:
Credit risk exposure – loans and
receivables
Australia
USA
Other
Total trade and other receivables
Note
9
2020
$’000
50
-
-
50
2019
$’000
172
-
6
178
3. Liquidity risk
The contractual maturities of financial liabilities, including estimated interest payments:
2020
Non-derivative financial liabilities
Trade and other payables
Loans - secured
Finance lease liabilities
Total non-derivative financial liabilities
2019
Non-derivative financial liabilities
Trade and other payables
Loans - secured
Loans - unsecured
Finance lease liabilities
Note
12
13
28(b)
Note
12
13
13
28(b)
Carrying
amount1
$'000
Contractual
cash flows2
$'000
6 months
or less3
$'000
6-12
Months3
$'000
1-2 years3
$'000
2-5 years3
$'000
More than 5
years3
$'000
6,375
(6,375)
(6,375)
23,344
(28,577)
(28,577)
-
-
-
29,719
(34,952)
(34,952)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Carrying
amount1
$'000
Contractual
cash flows2
$'000
6 months
or less3
$'000
6-12
Months3
$'000
1-2 years3
$'000
2-5 years3
$'000
More than 5
years3
$'000
3,356
21,515
-
2
(3,356)
(3,356)
(24,129)
-
(2)
-
-
(1)
-
-
-
(1)
-
(24,129)
-
-
-
-
-
-
-
-
-
-
-
-
(27,487)
Total non-derivative financial liabilities
1. Represents amounts reflected in the statement of financial position as at 31 December.
2. Represents total loan principal, accrued interest and accrued fees payable as at 31 December.
3. Represents schedule of payments of loan principal, accrued interest and accrued fees in accordance with specified time bands.
23. Controlled Entities
(3,357)
24,873
(1)
(24,129)
Country of incorporation
2020
2019
Percentage
Name
Parent Entity
Terramin Australia Limited
Subsidiaries of parent entity
Menninnie Metals Pty Ltd
Western Mediterranean Zinc Spa
Terramin Spain S.L.
Terramin Exploration Pty Ltd
Australia
Australia
Algeria
Spain
Australia
100%
65%
100%
100%
Subsidiary with material non-controlling interests
The Group includes one subsidiary, Western Mediterranean Zinc Spa, with material Non-Controlling Interests (‘NCI’):
Name
Proportion of Ownership Interests
& Voting Rights held by the NCI
Profit/(Loss) Allocated to NCI
Accumulated NCI
Western Mediterranean Zinc Spa
35%
35%
(100)
(212)
13,265
13,365
31-Dec-20
31-Dec-19
31-Dec-20
31-Dec-19
31-Dec-20
31-Dec-19
100%
65%
100%
100%
38
Summarised financial information for Western Mediterranean Zinc Spa, before intragroup eliminations, is set out below:
Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
Revenue
Loss for the year
Other comprehensive income for the year (all attributable to owners of the parent)
Total comprehensive loss for the year
Net cash (used in) operating activities
Net cash used in investing activities
Net cash from financing activities
Net cash (outflow)
Cash Balance as at 31 December
24. Segment Reporting
2020
$'000
10
41,104
41,114
88
10
98
2020
$'000
-
(280)
-
(280)
(226)
201
-
(25)
3
2019
$'000
9
44,207
44,216
108
45
153
2019
$'000
-
(608)
-
(608)
(433)
-
403
(30)
1
For management purposes, the Group is organised into business units based on geography and has two reportable operating
segments:
a. Australia - explores, develops and mines zinc, lead and gold deposits
b. Northern Africa - developing a zinc deposit
No operating segments have been aggregated to form the above reportable operating segments.
Australia
Northern Africa
Consolidated
Other Income
External customers
Total Other Income
Results
Raw materials, consumables and other direct costs
Employee benefits & share based payments expense
Depreciation and amortisation
Exploration and evaluation expensed
Assets held for sale impairment
Mine rehabilitation obligation expense
Other expenses
Net finance costs
(Loss) before income tax
Income tax expense
(Loss) for the year for the operating segment
(Loss) for the year attributable to non-controlling interest
(Loss) for the year attributable to equity holders of the Company
Operating assets
Operating liabilities
Other disclosures
Capital expenditure1
2020
$'000
485
485
(361)
(326)
(451)
-
(121)
(555)
(990)
(2,792)
(5,111)
-
(5,111)
-
(5,111)
36,129
35,274
2019
$'000
871
871
(420)
(1,225)
(92)
(198)
-
(70)
(838)
(3,031)
(5,003)
-
(5,003)
-
(5,003)
36,450
30,055
1,311
2,077
2020
$'000
2019
$'000
2020
$'000
2019
$'000
-
-
-
-
-
-
-
-
(30)
(250)
(18)
(590)
-
-
-
-
(280)
-
(280)
(100)
(180)
-
-
-
-
(608)
-
(608)
(212)
(396)
41,114
44,216
153
98
-
485
485
(361)
(326)
(481)
(250)
(121)
(555)
(990)
(2,792)
(5,391)
-
(5,391)
(100)
(5,291)
77,243
35,372
871
871
(420)
(1,225)
(110)
(788)
-
(70)
(838)
(3,031)
(5,611)
-
(5,611)
(212)
(5,399)
80,666
30,208
1. Capital expenditure consists of additions of property, plant and equipment, and exploration and evaluation assets.
Management monitors the operating results of its business units separately for the purpose of making decisions about resource
allocation and performance assessment. Segment performance is evaluated based on operating profit or loss and is measured
consistently with operating profit or loss in the consolidated financial statements.
There are no transactions other than cash funding between reportable segments.
39
-
1,311
2,077
25. Share Based Entitlements and Payments
The Group uses share options and share rights to provide incentives to Directors, employees and consultants. The Board, upon the
recommendation of senior management, has discretion to determine the number of options to be offered to Eligible Employees (as
that term is defined by the EOP) and the terms upon which they are offered, including exercise price and vesting conditions.
During the calendar year 2018, 10,000,000 options were granted to the Group’s CEO. Details of the options granted to the CEO are
summarised in the notes that follow. No options were granted to KMP’s during the calendar year 2019. Mr Richard Taylor stepped
down as CEO of the Company during the year prior to tranches 3 and 4 (representing 5,000,000 options) of Mr Taylor’s 10,000,000
options vesting, and therefore lapsed. The options outstanding at 31 December 2019 have a weighted average contractual life of 3.0
years (2019: 3.4 years). A balance of 5,000,000 options were outstanding for the Group at 31 December 2020.
(a) Number and weighted average exercise prices of share options
Outstanding at 1 January
Granted during the period
Exercised during the period
Lapsed during the year
Outstanding at 31 December
Exercisable at 31 December
Weighted average
exercise price 2020
$0.293
Number of
options 2020
10,000,000
Weighted average
exercise price 2019
Number of
options 2019
$0.293
10,000,000
$0.00
$0.00
$0.360
$0.225
$0.225
-
-
(5,000,000)
5,000,000
5,000,000
$0.00
$0.00
$0.00
$0.293
$0.225
-
-
-
10,000,000
5,000,000
(b) Options exercised during the year
There were not options exercised during the reporting period (2019: Nil).
(c) Table of share options movement for the Group at 31 December 2020
Expiry Date
Opening balance 1 January 2020
Granted during the period
Lapsed during the period
Closing balance 31 December 2020
Number of
options
10,000,000
-
(5,000,000)
5,000,000
(d) Table of share options movement for the Group at 31 December 2019
Expiry Date
Opening balance 1 January 2019
Granted during the period
Lapsed during the period
Closing balance 31 December 2019
Number of
options
10,000,000
-
-
10,000,000
Options expense
this year
$'000
298
-
(103)
195
Options expense
this year
$'000
111
187
-
298
Total option
value
$'000
371
-
(176)
195
Total option
value
$'000
371
-
-
371
40
26. Employee Option Plan
(a) Current Options
No options were granted, no options were exercised and
5,000,000 options lapsed during the reporting period.
(b) Employee Incentive Plan
Terramin has established an Employee Incentive Plan. Shares
are allotted to employees under this Plan at the Board’s
discretion.
The following options are currently on issue:
Balance as at 1 January 2020
Granted during the financial year1
Balance as at 31 December 2020
Lapsed during the financial year
Balance as at 31 December 2020
No. of
Options
on issue
10,000,000
-
10,000,000
(5,000,000)
5,000,000
Exercise
Price
$0.2932
$0.00
$0.293
$0.360
$0.2252
Fair
Value
$’000
370,750
-
370,750
(175,750)
195,000
1.
2.
Share Based Payments expense is recognised over the vesting period on
a pro-rata basis from the grant date.
Represents the weighted average exercise price
Tranche A
Vested
Dec-20
$104,750
Tranche B
Vested
Dec-20
$90,250
Tranche C
Lapsed
Dec-20
$88,250
Tranche D
Lapsed
Dec-20
$87,500
2,500,000
2,500,000
2,500,000
2,500,000
$0.20
80%
3 years
2.10%
$0.25
80%
3 years
2.10%
$0.32
80%
3.5 years
2.20%
$0.40
80%
4 years
2.20%
Total fair value at
grant date1
Number of
securities issued
Exercise price
Volatility
Term
Risk free rate
1. Options were granted on 2 August 2018. The lapsed options represent
$175,750 of the total fair value of options of $370,750.
The fair value of options issued is calculated using the Black-
Scholes Option Pricing Model.
27. Earnings per Share
(a) Basic earnings per share
The calculation of basic earnings per share at 31 December
2020 was based on the net loss attributable to owners of the
Company of $5.3m (2019: $5.4m) and a weighted average
number of ordinary shares outstanding during the year ended
31 December 2020 of 2,116,562,720 (2019: 1,889,222,958),
calculated as follows:
Net loss for the year attributable to
the owners of the Company
Ordinary shares on issue
Weighted average number of shares
2020
$’000
(5,291)
2019
$’000
(5,399)
2,116,562,720
2,116,562,720
2,116,562,720
1,889,222,958
Basic earnings per share (cents)
(0.25)
(0.29)
(b) Diluted earnings per share
The calculation of diluted earnings per share does not include
potential ordinary shares on issue as to do so would have the
effect of reducing the amount of the loss per share. Therefore
the diluted earnings per share equates to the ordinary earnings
per share.
28. Commitments and Contingencies
There are contractual commitments at the reporting date as
follows:
(a) Minimum expenditure on exploration tenements
of which the Group has title
In order to maintain current rights of tenure to exploration
tenements, the Company is required to perform minimum
exploration work to meet minimum expenditure requirements.
These obligations are subject to renegotiation and may be
farmed out or relinquished. These obligations are not provided
for in the parent entity financial statements.
Adelaide Hills fold belt tenements have an amalgamated
minimum expenditure of $2.32 million over 1 year expiring on
30 June 2021 and represents a portion of the total minimum
expenditure. The 12 month Covid-19 Exploration Expenditure
Waiver announced by the Minister for Energy and Mining on 2
April 2020 reduces this commitment to $0.58 million, on a pro-
rate basis ($2.32 million x 25%). The Wild Horse and Ulooloo
tenements are excluded from the Adelaide Hills fold belt
amalgamated minimum expenditure arrangement.
The minimum expenditure for the Wild Horse tenement is
$75,000 over 1 year expiring on 8 September 2021.
The minimum expenditure for the Ulooloo tenement
is
$100,000 over 2 years expiring on 18 December 2020. A
renewal application was submitted on 18 November 2020 and
remains outstanding at the reporting date.
South Gawler project tenements have an amalgamated
minimum expenditure of $1.5 million over 2 years expiring on
3 July 2021 and represents a portion of the total minimum
expenditure.
The minimum expenditure on a tenement is subject to change
at the end of a five year term from when the tenement was
granted.
(b) Lease commitments
Within 1 year
Longer than 1 year and not longer than 5
years
Minimum lease payments
Less: future finance charges
Total lease liabilities
Representing
Current
Non-current
Total lease liabilities
2020
$’000
2019
$'000
-
-
-
-
-
-
-
-
2
-
2
-
2
2
-
2
All finance leases were fully repaid during the reporting period.
The interest rate implicit in the lease was 14.5%.
41
(c) Other commitments and contingencies
Tala Hamza Zinc Project
In February 2006, the Group signed a joint venture agreement
in respect of the Tala Hamza Zinc Project with ENOF, an Algerian
Government company involved in exploration and mining
activities. The Company agreed to manage and finance the joint
venture until a decision to mine is made.
Bird in Hand acquisition
Terramin Exploration Pty Ltd agreed to purchase the Bird in
Hand Gold Project from Maximus Resources Limited. Pursuant
to a tenement sale and purchase agreement two further
payments of $1 million each may become payable following
approval of the Programme for Environmental Protection and
Rehabilitation in respect of the Bird in Hand deposit and
following the first shipment of mined gold respectively. A net
smelter royalty will also become payable following the first
shipment of mined gold.
Consultancy fee
Under the Technical Cooperation Agreement entered into with
NFC up to an additional 8 million ordinary shares will be issued
upon the Board of WMZ taking a decision to mine.
Finder’s Fee
A second tranche of a finder’s fee is payable to a non-related
party and
linked to the commencement of commercial
production from the first producing mine established on the
Oued Amizour tenement covered by the Algerian joint venture
agreement with ENOF. The amount payable will be US$62,500
which will be converted into the Australian Dollar equivalent at
the time of the contingent payment in the future, as well as
100,000 unlisted options exercisable at 25 cents each within 3
years of date of issue.
Asipac Royalty
On 28 October 2019, the Company and its subsidiary Terramin
Exploration Pty Ltd entered into an agreement with major
shareholder Asipac Group Pty Ltd to restructure its Facility
Agreements. Under this agreement refinancing and marketing
fees are waived, along with the waiver of the right to negotiate
an offtake agreement for BiH, in return for a 3% NSR royalty on
gold production from BiH. In the event that BiH production is
less than 500koz the royalty shall extend to Terramin’s wholly
owned South Australian gold tenements until a total of 500koz
is reached.
Properties held for sale in Strathalbyn, South Australia
At the reporting date, the Company had entered into contracts
for the sale of two properties adjacent to the Angas Zinc Mine
that are outside the Mine Area. Since the reporting date, one
property has settled whilst a new contract has been signed for
the sale of the other property.
Bank Guarantees - Angas Zinc Mine
As at 31 December 2020, the Company had bank guarantees
with a face value of $5.3 million lodged with the South
Australian (SA) Government.
During the year, the SA
Department for Energy and Mining formally reviewed AZM’s
rehabilitation obligations and applied a $360,000 CPI increase.
This increase to the bank guarantees is due in 2021.
Litigation
During the reporting period, the Company concluded its
pursuit of litigation in South Australia regarding a non-
complying planning approval of a neighbouring property and
two cases related to land access under the Mining Act 1971.
29. Events After the Reporting Date
There are no other matters or circumstances that have arisen
since the end of the year that have significantly affected or may
significantly affect either the entities operations or state of
affairs in future years or the results of those operations in
future years.
30. Parent Entity Disclosures
As at, and throughout, the financial year ending 31 December
2020 the parent Company of the Group was Terramin Australia
Limited.
Result of the parent entity
Loss for the period
Other comprehensive income
2020
$’000
2019
$'000
(8,465)
(5,649)
-
-
Total comprehensive income for the period
(8,465)
(5,649)
Financial position of parent entity
Current assets
Total assets
Current liabilities
Total liabilities
Total equity of the parent entity comprising of:
Share capital
Reserves
Accumulated losses
Total equity
6,234
68,947
21,564
27,076
6,533
73,022
2,073
22,564
223,931
223,950
195
298
(182,255)
(173,790)
41,871
50,458
Parent entity capital commitments for acquisition of
property plant and equipment
There are no capital commitments for acquisition of property,
plant and equipment as at 31 December 2020.
Parent entity guarantees
subsidiaries
The parent entity has not entered into a deed of Cross
Guarantee with respect to its subsidiaries.
in respect of debts of
its
42
Tenement Information
Terramin Australia Limited
Tenement listing
Title name and locations
Angas - South Australia
Bremer - South Australia
1
1
Cambrai - South Australia
1
Pfeiffer - South Australia
1
Tepko - South Australia
Licence number
ML 6229
EL 5924
EL 6540
EL 6228
EL 6267
Wild Horse - South Australia3
EL 5846
Terramin Exploration Pty Ltd (100% Terramin)
Tenement listing
Title name and locations
Licence number
Licence
area
87.97ha
348km2
89km2
154km2
778km2
462km2
Licence
area
Bird in Hand Mineral Claim
1
Kapunda - South Australia
1
Lobethal - South Australia
Mount Barker - South Australia
1
Mount Pleasant - South Australia
1
Mount Torrens - South Australia
1
EL 6447
EL 6198
MC 4473 194.78ha
547km2
221km2
118km2
301km2
93km2
103km2
EL 6154
EL 6319
EL 5805
Ulooloo – South Australia
Western Mediterranean Zinc Spa (65% Terramin)
EL 6293
Expiry date
Interest Minimum expenditure
16/08/2026
100% Not applicable
26/10/2021
100%
$1,680,000 over 3 years
20/07/2022
100%
$120,000 over 3 years
21/11/2022
100%
$270,000 over 3 years
7/10/2023
100%
$630,000 over 3 years
8/09/2021
100%
$75,000 over 1 year
Expiry date
Interest Minimum expenditure
-
100% Not applicable
27/04/2023
100%
$1,080,000 over 3 years
31/08/2021
100%
$800,000 over 2 years
24/02/2023
100%
$480,000 over 3 years
29/03/2021
100%
$900,000 over 3 years
24/02/2021
100%
$640,000 over 2 years
18/12/2020
100%
$100,000 over 2 years
Application for renewal
of licence lodged
Application for renewal
of licence lodged
22/12/2020
15/01/2021
18/11/2020
Tenement listing
Title name and locations
Licence number
Licence
area
Expiry date
WMZ
Interest
Minimum expenditure
Oued Amizour - Algeria
Menninnie Metals Pty Ltd (100% Terramin)
6911 PEM
12,276ha
31/01/2018
100%
Not applicable
Tenement listing
Title name and locations
Kolendo - South Australia
2, 3
Menninnie - South Australia
2, 3
Mt Ive - South Australia
2, 3
Mt Ive South - South Australia3
Mulleroo - South Australia
2, 3
Nonning - South Australia
2, 3
Peltabinna – South Australia3
Tanner - South Australia3
Taringa - South Australia
2, 3
Thurlga - South Australia3
2, 3
Unalla - South Australia
Licence number
EL 6413
EL 5949
EL 6200
EL 6412
EL 5855
EL 5925
EL 6290
EL 6414
EL 5816
EL 6479
EL 6179
Licence
area
208km2
101km2
214km2
394km2
210km2
312km2
637km2
354km2
988km2
951km2
155km2
Expiry date
MMPL
Interest
Minimum expenditure
Application for renewal
of licence lodged
26/07/2021
100%
$400,000 over 2 years
26/10/2021
100%
$960,000 over 3 years
20/06/2023
100%
$300,000 over 3 years
19/06/2021
100%
$280,000 over 2 years
19/09/2021
100%
$150,000 over 3 years
30/11/2021
100%
$720,000 over 3 years
11/12/2020
100%
$180,000 over 2 years
6/11/2020
31/07/2021
100%
$260,000 over 2 years
20/02/2021
100%
$750,000 over 3 years
2/09/2020
27/11/2021
100%
$480,000 over 2 years
6/06/2023
100%
$270,000 over 3 years
1.
2.
Subject to an amalgamated expenditure arrangement with the Department for Energy and Mining (DEM) (see note 28(b)) encompassing the Adelaide Hills
tenements.
Subject to an amalgamated expenditure arrangement with the Department for Energy and Mining (DEM)) (see note 28(b)) encompassing the Menninnie Metals
tenements.
3. The Wild Horse and Menninnie Metals (South Gawler Ranges) tenements are subject to an earn-in agreement with Freeport Exploration Australia Pty Ltd
43
Reserves and Resources
Terramin’s Mineral Resource and Ore Reserve estimates as at 31 December 2019 and 31 December 2020 are listed below. The Mineral
Resource estimates are reported inclusive of Ore Reserve estimates. The totals and average of some reports may appear inconsistent
with the parts, but this is due to rounding of values to levels of reporting precision commensurate with the confidence in the
respective estimates.
The complete JORC Code reports, including JORC Code Table 1 checklists, which detail the material assumptions and technical
parameters for each estimate, can be found at https://www.terramin.com.au/ under the menu ‘ASX Announcements'. The JORC
Code Competent Person statements for the 31 December 2020 estimates are included on pages 9 and 46 of this Annual Report.
Terramin’s public reporting governance for mineral resources and ore reserves includes a chain of assurance measures. Firstly,
Terramin ensures that the Competent Persons responsible for public reporting:
are current members of a professional organisation that is recognised in the JORC Code framework;
have sufficient mining industry experience that is relevant to the style of mineralisation and reporting activity, to be considered
a Competent Person as defined in the JORC Code;
have provided Terramin with a written sign-off on the results and estimates that are reported, stating that the report agrees
with supporting documentation regarding the results or estimates prepared by each Competent Person; and
have prepared supporting documentation for results and estimates to a level consistent with normal industry practices – which
for JORC Code 2012 resources includes Table 1 Checklists for any results and/or estimates reported.
The following tables set out the current Resource and Reserve position for the Company.
Table of Resources – Lead Zinc
Measured Resource
Indicated Resource
Inferred Resource
Total Resources
Terramin
Interest (%)
Tonnes
(Mt)
Zn
(%)
Pb
(%)
Tonnes
(Mt)
Zn
(%)
Pb
(%)
Tonnes
(Mt)
Zn
(%)
Pb
(%)
Tonnes
(Mt)
Zn
(%)
Pb
(%)
2019
Tala Hamza
Angas
Sunter
Menninnie Dam
Total (100%)
Total (Terramin share 2018)
2020
Tala Hamza1, 2
Angas4, 5
Sunter4, 6
Menninnie Dam7, 8
Total (100%)
Total (Terramin share)
65
100
100
100
65
100
100
100
Table of Resources – Gold
44.2
0.66
0.13
44.99
29.53
44.2
0.66
0.13
44.99
29.53
5.54
4.68
5.70
5.53
5.20
5.54
4.68
5.70
5.53
5.20
1.44
1.81
2.31
1.45
1.45
1.44
1.81
2.31
1.45
1.45
8.9
0.25
0.24
7.7
17.09
13.98
8.9
0.25
0.24
7.7
17.09
13.98
4.0
2.8
2.9
3.1
2.16
3.46
4.0
2.8
2.9
3.1
2.16
3.46
0.7
1.3
1.2
2.6
1.57
1.77
0.7
1.3
1.2
2.6
1.57
1.77
53.0
0.91
0.38
7.7
61.99
43.44
53.0
0.91
0.38
7.7
61.99
43.44
5.3
4.2
3.8
3.1
4.62
4.87
5.3
4.2
3.8
3.1
4.62
4.87
1.3
1.7
1.6
2.6
1.47
1.54
1.3
1.7
1.6
2.6
1.47
1.54
Indicated Resource
Terramin
Interest (%)
Tonnes
(Kt)
2019
100
Bird in Hand
-
Total (100%)
Total (Terramin share 2018) -
2020
Bird in Hand9, 10
Total (100%)
Total (Terramin share)
100
-
-
432
432
432
432
432
432
Au
(g/t)
14.4
14.4
14.4
14.4
14.4
14.4
Ag
(g/t)
7.56
7.56
7.56
7.56
7.56
7.56
Inferred Resource
Tonnes
(Kt)
Au
(g/t)
Ag
(g/t)
Total Resources
Tonnes
(Kt)
Au
(g/t)
Au
(kOz)
Ag
(g/t)
Ag
(kOz)
220
220
220
220
220
220
9.2
9.2
9.2
9.2
9.2
9.2
2.4
2.4
2.4
2.4
2.4
2.4
650
650
650
650
650
650
12.6
12.6
12.6
12.6
12.6
12.6
265
265
265
265
265
265
5.8
5.8
5.8
5.8
5.8
5.8
122
122
122
122
122
122
44
Reserves and Resources (continued)
Table of Resources – Copper
Terramin
Interest (%)
Indicated Resource
Cu
Tonnes
(%)
(Mt)
Inferred Resource
Tonnes
(Mt)
2019
Kapunda
Total (100%)
Total (Terramin share)
2020
Kapunda11, 12, 13
Total (100%)
Total (Terramin share)
100
-
-
100
-
-
Table of Reserves – Lead Zinc
Terramin
Interest (%)
Probable Reserve
Zn
(%)
Tonnes
(Mt)
2019
Tala Hamza
Tatal (100%)
Total (Terramin share 2018)
2020
Tala Hamza2, 3
Total (100%)
Total (Terramin share)
65
-
-
65
-
-
25.9
25.9
16.8
25.9
25.9
16.8
6.3
6.3
6.3
6.3
6.3
6.3
47.4
47.4
47.4
47.4
47.4
47.4
Pb
(%)
1.8
1.8
1.8
1.8
1.8
1.8
Cu
(%)
0.25
0.25
0.25
0.25
0.25
0.25
Tonnes
(Mt)
25.9
25.9
16.8
25.9
25.9
16.8
Total Resources
Tonnes
(Mt)
Cu
(%)
47.4
47.4
47.4
47.4
47.4
47.4
Total Reserve
Zn
(%)
6.3
6.3
6.3
6.3
6.3
6.3
0.25
0.25
0.25
0.25
0.25
0.25
Pb
(%)
1.8
1.8
1.8
1.8
1.8
1.8
1. Resources for Tala Hamza (JORC 2004) are estimated at a cut off of 3% ZnEq. The Zinc Equivalence formula for Tala Hamza is %ZnEq = %Zn + 0.856 x %Pb and is based on long term
predicted prices of Pb USD2,400/t and Zn USD2425/t and metal recoveries of Pb 62% and Zn 88%.
2. Tala Hamza Resources as at January 2018. The reserve is as at 29 August 2018. The reserve is based on the Underhand Drift and Fill mining method. Resources are inclusive of Reserves.
3. Reserve cut off grade at Tala Hamza is 4.5% ZnEq (JORC 2012).
4. Resources for Angas and Sunter (JORC 2004) are estimated at a cut off of 2% Pb+Zn.
5. Angas Resources as at 1 Jan 2013. Resources exclude oxide and transitional material.
6. Sunter Resources as at 29 November 2011. Resources exclude oxide and transitional material.
7. Resources for Menninnie Dam (JORC 2004) are estimated at a cut off of 2.5% Pb+Zn.
8. Menninnie Dam Resources as at 15 February 2011. Resources exclude oxide and transitional material.
9. Resources for Bird in Hand (JORC 2012) are estimated at a cut off of 1g/t Au.
10. Bird in Hand Resources as at 30 October 2018.
11. Resource for Kapunda (JORC 2012) estimated at a cut off of 0.05% Cu. Resource excludes primary sulphide material.
12. Kapunda Resource as at 12 February 2018.
13. Subject to terms of JV with Environmental Copper Recovery Pty Ltd announced 2 August 2017.
JORC Competent Person Statement
The information in this report that relates to Exploration Results and Mineral Resources is based on information compiled by Mr Eric Whittaker (Tala Hamza, Menninnie, Angas and Kapunda
Resources and Exploration Results) and Mr Dan Brost (Bird in Hand Resource), both being Competent Persons who are Members of The Australasian Institute of Mining and Metallurgy
(AusIMM). Mr Whittaker was employed as the Regional Exploration Manager of Terramin Australia Limited and Mr Brost is a geologist consulting to Terramin. Mr Whittaker and Mr Brost
have sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person(s) as
defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr Whittaker and Mr Brost consent to the inclusion in the
report of the matters based on their information in the form and context in which it appears. The information in this report that relates to Ore Reserves is based on information compiled or
reviewed by Mr Luke Neesham, a Competent Person who is a Member of the Australasian Institute of Mining and Metallurgy (AusIMM). Mr Neesham is Principal Mining Engineer for GO
Mining Pty Ltd a consulting firm engaged by Terramin Australia Limited to prepare mining designs and schedules for the Tala Hamza Feasibility Study. Mr Neesham has sufficient experience
that is relevant to the style of mineralization and type of deposit under consideration and to the activity 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’. Mr Neesham consents to the inclusion in the report of the matters based on his information
in the form and context in which it appears.
45
Additional Securities Exchange Information
Equity Securities on Issue
Fully paid ordinary shares
As at 26 February 2021, there were 2,436 holders of a total of 2,116,562,720 ordinary fully paid shares in the capital of the Company.
All ordinary fully paid shares in the capital of the Company are listed for quotation on the ASX.
Unlisted options
As at 26 February 2021, there was 1 holder of a total of 5,000,000 options over fully paid ordinary shares in the capital of the
Company.
Shareholder Voting Rights
At a general meeting of shareholders, on a show of hands, each person who is a member or sole proxy has one vote. On a poll, each
shareholder is entitled to one vote for each fully paid share.
Unlisted options carry no voting rights.
Distribution Schedule as at 26 February 2021
Number of securities
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 – and over
Total
Fully paid ordinary shares
Unlisted options
478
658
298
711
291
2,436
0
0
0
0
1
1
As at 26 February 2021, there were 1,461 shareholdings of less than a marketable parcel.
Substantial Shareholders
As at 26 February 2021, the following shareholders were substantial shareholders, as disclosed in substantial shareholder notices
given to the Company:
Shareholder
Asipac Group Pty Ltd
Citycorp Nominees Pty Limited
BNP Paribas Noms Pty Ltd
HSBC Custody Nominees (Australia) Limited
Number of shares
% Issued capital
827,023,014
289,242,843
208,605,725
147,276,993
39.07
13.67
9.86
6.96
46
Additional Securities Exchange Information (continued)
List of 20 Largest Shareholders
The names of the twenty largest shareholders as shown in the Company’s register at 26 February 2021 are:
Shareholder
Asipac Group Pty Ltd
Citycorp Nominees Pty Limited
BNP Paribas Noms Pty Ltd
HSBC Custody Nominees (Australia) Limited
J P Morgan Nominees Australia Pty Limited
China Non-Ferrous Metals Industry’s Foreign Engineering and Construction
New Asia Wealth Investment Holding (SG) Pte Ltd
Fly Wealth Investment Pty Ltd
Mr Jing Wang
BMYG Capital Pty Ltd
Mr Julian Paul Leach
Auway Finance Group Pty Ltd
Ms Er Xu
BNP Paribas Nominees Pty Ltd
Silver Springs Investment Pty Ltd
HSBC Custody Nominees (Australia) Limited
Enterprise Flourishing Pty Ltd
Huge Field Investment Ltd
BMYG Capital Pty Ltd
Mr Peter Joseph McGuire
Total
Additional Information
Number of shares
% Issued capital
827,023,014
289,242,843
208,605,725
147,276,993
77,402,953
67,800,000
57,185,513
35,800,000
35,399,949
18,747,243
18,685,187
17,857,143
17,511,817
16,028,910
15,580,967
11,382,954
10,000,000
10,000,000
8,919,047
8,000,000
39.07
13.67
9.86
6.96
3.66
3.20
2.70
1.69
1.67
0.89
0.88
0.84
0.83
0.76
0.74
0.54
0.47
0.47
0.42
0.38
1,898,450,258
89.69
Unquoted equity securities
The following persons were the holders of 20% or more of the equity securities in an unquoted class as at 26 February 2021:
Class of unquoted securities
Unlisted options
Richard Taylor
On-Market Share Buy-Back
There is no current on-market buy-back in place.
Number of securities held
% of securities in class
5,000,000
100.00
Corporate Governance Principles and Recommendations
The Corporate Governance Principles and Recommendations can be found on the Company’s website.
47
Terramin Australia Limited
Unit 7, 202 – 208 Glen Osmond Road
Fullarton, South Australia, 5063
T: +61 8 8213 1415
F: +61 8 8213 1416
E: info@terramin.com.au
W: www.terramin.com.au