Annual Report
2021
CONTENTS
01
Our Company
02
Highlights 2021
04
Chairman’s Review
06
Chief Executive Officer’s Report
08
Reserves and Resources
09
Notes to reserves and resources
10
Operations Review
16
Sustainability Overview
21
Financial Report
Forward Looking Statement
This document contains certain forward-looking statements. The words
‘expect’, ‘anticipate’, ‘estimate’, ‘intend’, ‘believe’, ‘guidance’, ‘should’,
‘could’, ‘may’, ‘will’, ‘predict’, ‘plan’, ‘targets’, and other similar
expressions are intended to identify forward looking statements.
Indications of, and guidance on, future earnings and financial position
and performance are also forward-looking statements. Forward looking
statements, opinions and estimates provided in this document are based
on assumptions and contingencies which are subject to change without
notice, as are statements about market and industry trends, which are
based on interpretations of current market conditions. Forward looking
statements are provided as a general guide only and should not be
relied upon as an indication or guarantee of future performance. This
document contains such statements that are subject to risk factors
associated with the mineral and resources exploration, development
and production industry. It is believed that the expectations reflected
in these statements are reasonable, but they may be affected by a
range of variables which could cause actual results or trends to differ
materially, including but not limited to the following risks: dependence
on commodity prices, availability of funding, impact of inflation on costs,
exploration risks, including the risks of obtaining necessary licenses
and diminishing quantities or grades of reserves, risks associated with
remoteness, environmental regulation risk, currency and exchange rate
risk, political risk, war and terrorism and global economic conditions,
as well as earnings, capital expenditure, cash flow and capital structure
risks and general business risks. No representation, warranty or
assurance (express or implied) is given or made in relation to any
forward looking statement by any person (including the Company). In
particular, no representation, warranty or assurance (express or implied)
is given that the occurrence of the events expressed or implied in any
forward-looking statements in this document will actually occur. Actual
results, performance or achievement may vary materially from any
projections and forward-looking statements and the assumptions on
which those statements are based. The forward-looking statements in
this document speak only as of the date of this document. Subject to
any continuing obligations under applicable law or any relevant ASX
listing rules, the Company disclaims any obligation or undertaking to
provide any updates or revisions to any forward-looking statements in
this document to reflect any change in expectations in relation to any
forward-looking statements or any change in events, conditions or
circumstances on which any such statement is based. Nothing in this
document will under any circumstances create an implication that there
has been no change in the affairs of TIG since the date of this document.
ABN 50 146 732 561
Tigers Realm Coal
Annual Report 2021
OUR COMPANY
Tigers Realm Coal Limited (Tigers Realm Coal, TIG, or the Company) is an
ASX-listed company producing coking and thermal coal from its operations
in the Chukotka Autonomous Okrug (District) on Russia’s east coast.
TIG’s aim is to become a significant producer
of coking coal supplying the seaborne
markets in Asia. The Company is focused on
the further exploration and development of
its high-quality coking coal deposits and is
committed to creating sustainable benefits
for the communities and region in which
it operates.
The Company is developing two coking
coal projects. The Amaam North project has
been operational for five years supplying
unwashed coal products to the North Asian
steel and thermal coal markets through
our own port at Beringovsky, some 35km
from the mining operation. The immediately
adjacent Amaam project remains in a
pre-development stage. The Amaam basin
contains significant resources of quality
coking coal and adjoins the site of a potential
new deep-water port which, if constructed
would allow an extended shipping season
together with the direct loading of coal cargo
to cape sized vessels.
In 2021, the Company further increased
annual production to 1,025kt (2020: 792kt)
and annual sales to 911kt (2020: 775kt).
TIG also increased transshipment volumes
to 885kt, an increase of 125kt over the
tonnage achieved in 2020 and a record
for the Beringovsky port.
Transshipment was carried out using
TIG’s four 500-tonne barges. In addition
to achieving record loading volumes, TIG
further reduced transshipment costs.
Despite supply chain logistics challenges
and adverse weather conditions the
construction of the first processing module
of the CHPP was almost completed in 2021.
Strong operational performance was
supported by a significant resurgence of
the international coal market. The improved
market conditions and further increase in
sales volumes more than doubled revenue
growth for the period.
During 2022 TIG will be primarily focused
on the commissioning of the first processing
module of the CHPP and shipment of our
first cargoes of semi–hard coking coal
(“SHCC”) during the 2022 shipping season.
TIG expects to receive the 5th 500t barge
on site by the start of the 2022 shipping
season, that will further increase TIG’s
annual loading capacity.
The Company’s registered office is located
in Melbourne, Australia. Management is
principally located in our offices in Moscow
and on site in Chukotka.
Our Values
Four core values underpin everything we do:
• Respect – treating our people,
communities and stakeholders with
respect and understanding.
• Care – for our people and the
environment. An overriding commitment to
ensuring our people finish work each day
without suffering injury or harm. Minimising
our impact on the environment.
• Integrity – being honest and open in the
way we communicate and work. Doing
what we say we will do.
• Delivery – Empowering our people
to excel. Consistently delivering on
our plans and goals.
Tigers Realm Coal Annual Report 2021
0101
Annual Report 2021Tigers Realm Coal HIGHLIGHTS 2021
Notwithstanding many logistics challenges and unusually
adverse weather conditions, the CHPP equipment was fully
installed in 2021, and the main building was completed and
winterized in the March quarter. Completing the CHPP is central
to the next phase of our development strategy. TIG expects
it to come fully online in the June quarter.
02
Tigers Realm Coal
Annual Report 2021
Mining Volumes
Sales Volumes
Total Reportable Injury
Frequency Rate (TRIFR)
2.58
29%
Total Reportable Injury Frequency
Rate (“TRIFR”) decreased from
3.08 to 2.58
Mining volumes increased year-on-
year by 29% from 792kt to 1,025kt
17.5%
Sales volumes increased by 17.5%
from 775kt to 911kt. The significant
increase in mining volumes was
enabled as a result of increased
production capacity and lower
stripping ratio.
TIG Loaded
Decrease Mining Costs1
Transshipment Costs2
885kt
TIG loaded 885kt with our own
500-tonne barges. This volume
represents a historical record for
Beringovsky port and an increase
of 21.8% over the previous year
A$41.58/t
(US$30.43/t)
With the stripping ratio decreasing
from 6.1 bcm/t in 2020 to 4 bcm/t
in 2021, TIG managed to further
decrease mining costs from
A$43.68/t (US$31.57/t) in 2020 to
A$41.58/t (US$30.43/t) in 2021
A$6.65/t
Transshipment Costs per tonne
continued to decrease coming down
by 5%, from A$6.95/t to A$6.65/t
EBITDA
Net Income
A$46.9m
A$38.0m
EBITDA improved from
negative A$3.8 million to
a record A$46.9 million
Outstanding production and sales
results translated into a record
Net Income of A$38.0 million
1. The average cost per tonne of coal mined
includes all costs to mine and haul coal to
the stockpile.
2. Transshipment costs include costs incurred
to transship coal from the stockpile to bulker.
Tigers Realm Coal
Annual Report 2021
03
CHAIRMAN’S
REVIEW
2021 was a transformational year for the Company
in that several production and shipping records were
set, whilst at the same time the construction of the
much-anticipated CHPP was undertaken.
Although a combination of logistical
and weather-related issues prevented
us from achieving our goal of 2021
commissioning of the CHPP, the
erection of the plant and its subsequent
cladding, insulation and winterization
has been achieved with an outstanding
safety record. We are now set for an
imminent commissioning whereafter
we expect to be producing a washed
product for export into the SHCC
market, enabling better returns
on our export of coals.
Operating within the continuing
constraints of COVID-19 rules over
our operations and the restrictions
transport of both men and materials
certainly complicated the year, but
the Company’s management team
continued to do us proud in both their
attitude and ability to cope with this
challenge. Their contribution to the
success of managing the virus within
the entirety of the Chukotka Province
has been acknowledged by the
authorities and regional government.
The safety of our employees and
local communities is a core element
within the Board’s objectives and I am
particularly pleased that our safety
record continues to improve at site,
which is illustrative of an ongoing
emphasis by the senior team on our
core values of care and respect.
The Company continues to monitor
the situation arising out of the conflict
between Russia and Ukraine. Whilst
mining operations and port preparation
for the shipping season have continued
as per plan, TIG has needed to deal
with some challenges, not only with the
commissioning of the CHPP but also
with respect to certain supply chain
constraints on equipment and spares.
The Company is still assessing the
extent, if any, to which these issues
may impact mining and sales results
for the current year.
We are very pleased to have appointed
Mitch Jakeman to the Board as an
independent Non-Executive Director.
Mitch has extensive experience in the
coal mining sector and his experience
and insights will be of great benefit to
us as we continue on our growth path.
I would also wish to thank the recently
resigned board member, Mr Valerie
Doronin, for his contributions to the
company over the past year.
I would like to thank all our employees
and stakeholders, the senior
management team as well as our
Board, for their perseverance and
resilience during 2021. I look forward
to the continued delivery of growth,
profitability and transformative coal
processing infrastructure during 2022.
Craig Wiggill
Chairman
04
Annual Report 2021Tigers Realm Coal The safety of our employees and local
communities is a core element within the Board’s
objectives and I am particularly pleased that
our safety record continues to improve at site,
which is illustrative of an ongoing emphasis
by the senior team on our core values of
care and respect.
Tigers Realm Coal
Annual Report 2021
05
CHIEF EXECUTIVE
OFFICER’S REPORT
We are proud of the results TIG posted in 2021,
including record mining and sales volumes of 1Mt
and 911kt which translated into a record EBITDA
of A$46.9 million and Net Income of A$38.0 million.
We achieved these results while also
bringing our TRIFR down to 2.58 from
3.08 in 2020 and dealing with the
challenges of the COVID-19 pandemic
as it continued into 2021.
the potential to be disruptive to TIG’s
business. At present, however, we
have not experienced a material,
direct impact on our business relations
and operations.
CHPP commissioning was
unfortunately delayed, due to both
unusual logistics challenges and the
extreme weather conditions that TIG
encountered in 2021. The equipment
was fully installed, and the main
building has now been insulated and
winterized ready for commissioning.
Derek Parnaby Cyclones International
Ltd (DCPI) will participate remotely
in support of CHPP commissioning.
We expect to complete commissioning
during the June quarter.
The ongoing geopolitical tensions
and the various sanctions enacted
with respect to Russia, many significant
industrial groups and banks in Russia
and many specific individuals, has
I would like to express my gratitude
to our shareholders for your continued
support, and to the TIG team for all
their professionalism which enabled
us to achieve excellent results in 2021
and which will enable us to address
the enormous challenges we will
face in 2022.
Dmitry Gavrilin
Chief Executive Officer
06
Annual Report 2021Tigers Realm Coal With a 16% increase over the previous year
of loading volumes to a record level of 885kt
and further decrease of transshipment costs
TIG’s port performance continued to improve
remarkably during the second full year during
which TIG operated the port itself.
Tigers Realm Coal
Annual Report 2021
07
RESERVES AND RESOURCES
Coal Resources for Amaam North – Project F (100% basis)
Resource Category
MeasuredC – Coking
IndicatedB – Coking
InferredA – Coking
IndicatedB – Thermal
InferredA – Thermal
Total (Mt)
Open Pit (Mt)
22.6
18.5
20.2
1.5
0.7
63.5
Underground (Mt)
1.2
5.8
14.1
-
-
21.1
Tonnage (Mt)
85.6
Relative
Density
1.39
Ash
(%)
17.32
NB: Coal qualities on an air-dried basis.
Inherent
Moisture
(%)
1.42
Volatile Matter
(%)
Gross
Calorific Value
(kcal/kg)
27.15
6,820
Total (Mt)
23.8
24.3
34.3
1.5
0.7
84.6
Total
Sulphur
(%)
0.29
The Amaam North (Project F) Coal Resources are based on a Coal Resource Estimate prepared by Measured Group
in October 2020.
Coal ReservesE for Amaam North – Project F (100% basis)
Coal Type
Coking
Thermal
Total (Mt)
Recoverable Reserves (Mt)
Marketable Reserves (Mt)
Proved
12.8
1.2
14.0
Probable
8.1
0.7
8.8
Total
20.9
1.9
22.8
Proved
7.8
1.0
8.8
Probable
5.0
0.6
5.6
Total
12.8
1.6
14.4
The Amaam North (Project F) Coal Reserves are based on a Coal Reserve Estimate prepared by Optimal Mining Solutions
in November 2020 adjusted for depletion.
Coal Resources for Amaam (100% basis)
Resource Category
MeasuredC – Coking
IndicatedB – Coking
InferredA – Coking
Total (Mt)
Open Pit (Mt)
3
89
336
428
Underground (Mt)
-
2
91
93
Tonnage (Mt)
521
Relative
Density
1.62
NB: Coal qualities on an air-dried basis.
Ash
(%)
33.6
Inherent
Moisture
(%)
1.69
Volatile
Matter
(%)
23.3
Fixed
Carbon
(%)
39.1
Gross
Calorific
Value
(kcal/kg)
5,114
Total (Mt)
3
91
427
521
Total
Sulphur
(%)
0.84
The Amaam Coal Resource Estimate was prepared by Resolve Coal in July 2015.
Exploration TargetsD for Amaam and Amaam North (100% basis)
Amaam North (Mt)
90 to 370
Amaam (Mt)
25 to 40
Total (Mt)
115 to 410
08
Annual Report 2021Tigers Realm Coal NOTES TO RESERVES AND RESOURCES
The company is not aware of any new
information or data that materially affects the
information included in this report and at the
time of this report all material assumptions
and technical parameters underpinning the
estimates continue to apply and have not
materially changed. Coal Resources and Coal
Reserves are reported in 100 percent terms
(unless otherwise stated). Coal Resources are
reported inclusive of the Coal Resources that
have been converted to Coal Reserves (i.e. Coal
Resources are not additional to Coal Reserves)
Competent Persons Statement – Amaam
The information compiled in this announcement
relating to exploration results, exploration targets
or Coal Resources at Amaam is based on
information provided by TIG and compiled by
Neil Biggs, who is a member of the Australasian
Institute of Mining and Metallurgy and has
sufficient experience which is relevant to the
style of mineralisation and type of deposit
under consideration and to the activity he
is undertaking 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’.
Neil Biggs consents to the inclusion in the report
of the matters based on his information in the
form and context in which it appears.
Competent Persons Statement
– Amaam North
The Amaam North Project F Coal Resources are
based on a Coal Resource Estimate prepared
by Measured Group in October 2020.
The information presented in this report relating
to Coal Resources is based on information
compiled by Marcus Trost, Principal Geologist
(MAusIMM) and modelled by Lyon Barrett,
Principal Geologist (MAusIMM) of Measured
Group and reviewed by Peter Handley, Principal
Geologist (MAusIMM) of Measured Group.
Marcus Trost has worked as a geologist and
manager in the coal industry for over 15 years
and has sufficient experience relevant to the
style of mineralisation and type of deposit
under consideration and to the activity he
is undertaking 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’.
Lyon Barrett has worked as a geologist and
manager in the coal industry for over 20 years
and has sufficient experience relevant to the
style of mineralisation and type of deposit
under consideration and to the activity he
is undertaking 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’.
Lyon Barrett and Marcus Trost consent to
the inclusion in the report of the matters based
on information in the form and context in which
it appears.
The information in this report relating to
the Project F Reserve Estimate is based
on information compiled by Tony O’Connell,
Director of Optimal Mining Solutions Pty Ltd
and a Competent Person who is a member
of the Australasian Institute of Mining and
Metallurgy (AusIMM). Tony O’Connell is a
full-time employee of Optimal Mining Solutions
and has sufficient experience that is relevant
to the style of mineralisation, 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’.
Tony O’Connell consents to the inclusion in the
report of the matters based on his information
in the form and context in which it appears.
Note A – Inferred Resources
According to the commentary accompanying
the JORC Code an ‘Inferred Mineral Resource’
is that part of a Mineral Resource for which
quantity and grade (or quality) are estimated
on the basis of limited geological evidence and
sampling. Geological evidence is sufficient to
imply but not verify geological and grade (or
quality) continuity. It is based on exploration,
sampling and testing information gathered
through appropriate techniques from locations
such as outcrops, trenches, pits, workings and
drill holes. An Inferred Mineral Resource has a
lower level of confidence than that applying to
an Indicated Mineral Resource and must not be
converted to an Ore Reserve. It is reasonably
expected that the majority of Inferred Mineral
Resources could be upgraded to Indicated
Mineral Resources with continued exploration.
Note B – Indicated Resources
According to the commentary accompanying
the JORC Code an ‘Indicated Mineral Resource’
is that part of a Mineral Resource for which
quantity, grade (or quality), densities, shape
and physical characteristics are estimated with
sufficient confidence to allow the application of
modifying factors in sufficient detail to support
mine planning and evaluation of the economic
viability of the deposit. Geological evidence is
derived from adequately detailed and reliable
exploration, sampling and testing gathered
through appropriate techniques from locations
such as outcrops, trenches, pits, workings and
drill holes, and is sufficient to assume geological
and grade (or quality) continuity between
points of observation where data and samples
are gathered. An Indicated Resource may be
converted to a Probable Ore Reserve
Note C – Measured Resources
According to the commentary accompanying
the JORC Code a ‘Measured Mineral Resource’
is that part of a Mineral Resource for which
quantity, grade (or quality), densities, shape,
and physical characteristics are estimated with
confidence sufficient to allow the application
of Modifying Factors to support detailed mine
planning and final evaluation of the economic
viability of the deposit. Geological evidence is
derived from detailed and reliable exploration,
sampling and testing gathered through
appropriate techniques from locations such
as outcrops, trenches, pits, workings and drill
holes, and is sufficient to confirm geological
and grade (or quality) continuity between points
of observation where data and samples are
gathered. A Measured Mineral Resource has
a higher level of confidence than that applying
to either an Indicated Mineral Resource or an
Inferred Mineral Resource. It may be converted
to a Proved Ore Reserve or under certain
circumstances to a Probable Ore Reserve.
Note D – Exploration Target
According to the commentary accompanying
the JORC Code an Exploration Target is a
statement or estimate of the exploration potential
of a mineral deposit in a defined geological
setting where the statement or estimate, quoted
as a range of tonnes and a range of grade (or
quality), relates to mineralisation for which there
has been insufficient exploration to estimate
a Mineral Resource. Any such information
relating to an Exploration Target must be
expressed so that it cannot be misrepresented
or misconstrued as an estimate of a Mineral
Resource or Ore Reserve. The terms Resource
or Reserve must not be used in this context.
Note E – Reserves
According to the commentary accompanying
the JORC Code a ‘Reserve’ is the economically
mineable part of a Measured and/or Indicated
Mineral Resource. It includes diluting materials
and allowances for losses, which may occur
when the material is mined or extracted and is
defined by studies at Pre-Feasibility or Feasibility
level as appropriate that include application of
Modifying Factors. Such studies demonstrate
that, at the time of reporting, extraction could
reasonably be justified.
09
Annual Report 2021Tigers Realm Coal
OPERATIONS REVIEW
Overview of TIG’s
Operations
Tigers Realm Coal Ltd’s (ASX:
TIG) strategy is set to become a
significant supplier of coking coal to the
seaborne market via the progressive
development of the Amaam Coking
Coal Field.
The Amaam Coking Coal Field
comprises two large coal resource
deposits in the Far East of the
Russian Federation:
• Amaam North (TIG 100% interest):
a large coal basin, of which
Fandyushkinskoye Field is currently
in the production expansion phase.
In December 2019, Rosnedra, the
Russian natural resource licencing
authority, approved a Mining and
Excavation Plan (“TPRM”) for the
integrated development of the
Fandyushkinskoye and Zvonkoye
licence areas. Consequently, future
references to Amaam North will refer
to the unified development of both
license areas.
• Amaam Coal Deposit (TIG interest
80%) a potentially large-scale
coking coal project, which has the
potential for TIG to increase overall
production to 5Mtpa. Expansion to
this production level will, however,
require significant investment in
infrastructure.
The Amaam and Amaam North
licences cover an area of about 709
sq. km in the Chukotka Autonomous
Okrug (District) of Russia. Our current
operations are located approximately
230km south of the regional capital of
Anadyr and approximately 35km to the
south east of Beringovsky township
and TIG’s wholly owned coal terminal
and port infrastructure.
Amaam North is comprised of:
• Exploration Licence No. AND
01203 TP (Levoberezhny “Left
Bank” Licence), being the broader
exploration licence from which the
following Exploration and Extraction
(Mining) Licences have been carved
out to date;
• Mining Licence No. AND 15813 TE
(Fandyushkinskoye Field); and
• Mining Licence No AND 01314 TE
(“Zvonkoye”), issued in 2018 for a
20-year term.
TIG operates its own infrastructure
with coal haulage along its own
35km, all-season pit to port road and
Beringovsky coal terminal, fully owned
and operated by TIG with our four
500-tonne and two 100-tonne barges.
South
Yakutsk
Basin
~ 35km to port
TIG Project
British
Columbia
Kuzbass
Basin
2,000 – 5,000km
railroads to ports
North Asian
Market
8 days
8 days
shipping
shipping
1,100 km
railroads to ports
1,100km railroads to ports
1,100km railroads to ports
and 14 days shipping
and 14 days shipping
115 – 250km railroads to ports
115 – 250km railroads to ports
and 13 days shipping
and 13 days shipping
Bowen
Basin
Major coking coal basins
Railroad directions
Sea directions
TIG projects
LEGEND
10
Tigers Realm Coal
Annual Report 2021
Strategy
TIG’s strategy with respect to
developing the Amaam Coking
Coal Field is currently envisaged
in three stages:
Stage 1: Development of Amaam
North up to a 1.5+Mtpa primarily
coking coal operation shipped
through the Beringovsky Port,
split into 2 phases:
• Phase One: up to 0.75Mtpa utilizing
existing infrastructure and mining and
haulage fleet (completed);
• Phase Two: 1.5+Mtpa, with 225kt
oxidised and 1.275Mt through CHPP
to get 830kt of washed coal with 65%
yield, an upgrade of mine and port
infrastructure, and increasing mining
and haulage fleet capacity.
Stage 2: Amaam North production
increases up to 2Mtpa
Stage 3: Development of Amaam
TIG has successfully completed Phase
One of Stage 1 and is working on
implementing Phase Two to increase
Amaam North coal production and
sales volumes. In order to achieve this
next strategic objective at the Amaam
North deposit, TIG is focused on
installing the processing capacity to
enable the Company to sell a higher-
value product of consistent quality into
the Semi-Hard coking coal (SHCC)
markets. This SHCC product will allow
TIG to achieve significantly higher
average prices than those currently
being achieved for a basket
of unwashed coal products.
In October 2020 TIG signed a contract
for supply of a modular coal handling
and preparation plant (“CHPP”) with
UK-based Derek Parnaby Cyclones,
Inc. (DPCI). Despite supply chain
logistics challenges and adverse
weather conditions the construction
of the first processing module of the
CHPP was almost completed in 2021.
TIG expects to complete testing and
commissioning procedures and begin
running at nominal capacity in the
June quarter.
Management is optimistic that a
material increase in production is
achievable. In order to obtain sufficient
geological evidence of the additional
mineable coal required to increase
production, TIG will need to perform
further drilling & exploration works.
The ability to optimally integrate the
Amaam project into the overall Amaam
Coking Coal Field development
and maximise the extent to which
investment is made both in processing
capacity and logistics infrastructure
is currently under review.
159kt
5kt
100kt
TIG mined 159kt in September
2021 – a monthly historical
maximum
Maximum truck haulage per
day reached 5kt in 2021
Chattering and loading of a 100kt
geared ice class vessel set a new
record for both vessel and cargo
size at Beringovsky port
15.5kt pwwd
500t
340
A record loading rate of
15.5ktpwwd achieved on 12 July
2021 in the Beringovsky port
The 5th 500t barge acquired and
is expected to be on-site by the
start of 2022 shipping season
The number of employees
increased by 20% from 283
in 2020 to 340 in 2021
Tigers Realm Coal
Annual Report 2021
11
OPERATIONS REVIEW CONTINUED
Operations Update
Licensing & Exploration Activities
The Company is in compliance with its licence obligations.
As at 31 December 2021, TIG had the following licences in effect:
Licence Holder
Amaam North
BPU1
BPU
BPU
Amaam
NPCC2
NPCC
NPCC
Site
Licence No.
Licence Type
Expiry Date
Amaam North
‘Fandyushkinskoye’
Amaam North ‘Zvonkoye’
Alkatvaam – Levoberezhny
AND 15813 TE
Mining
Dec 2034
AND 01314 TE
AND 01203 TP
Mining
Exploration
Sep 2038
Dec 2025
‘Zapadny’
‘Nadezhny’
‘Area 4’
AND 01278 TE (formerly AND 01225 TE)
AND 01288 TE
AND 01379 TP (formerly AND 01277 TP)
Mining
Mining
Exploration
Mar 2033
July 2037
Jun 2027
1. LLC Beringpromugol (‘BPU’), wholly owned TIG subsidiary.
2. JSC Northern Pacific Coal Company (‘NPCC’), 80% beneficially owned by TIG.
Amaam North Snapshot
Mining volumes increased year-on-year by 29% from 792kt to 1,025kt and comprised of 601kt of thermal coal (22% increase
from last year’s 494kt) and 424kt of metallurgical coal (42% increase from 298kt in 2020).
Mining Operations
During 2021 TIG has significantly increased its mining capacity by adding a 100t bulldozer, 5x dump trucks, a 7m3 excavator
and a 70t bulldozer.
The average stripping ratio for 2021 amounted to 4.0:1, a significant decrease from 6.1:1 in 2020, which was due to focussing
our mining activities on Seam 3, which material will be sent for further processing with CHPP in 1H 2022. The increase of the
quarterly average stripping ratio in the March quarter to 6.2:1 was due to concentrating our mining activities at Seam 4 instead
of Seam 3. The coal mined at Seam 4 is lower ash and appropriate for selling without processing. As such, it was trucked
to port to be sold during the first half of the navigational season.
In September TIG mined 159kt – a monthly historical maximum.
ROM coal mined
Coal delivered to Beringovsky Port
Coal sold
Total coal stocks
Waste mined
ROM strip ratio
kt
kt
kt
kt
kbcm
bcm:t
Q1
208
62
6
655
777
3.7
Q2
175
186
169
661
1,093
6.2
Q3
339
429
539
461
1,172
3.5
Q4
303
249
197
567
1,021
3.4
2021
Total
1,025
926
911
567
4,063
4.0
12
Annual Report 2021Tigers Realm Coal Haulage Operations
Haulage operations based on our fleet
of 21 Scania trucks. Three road haul
trucks for coal transportation were
acquired in 2021 and two were written
off. Our total fleet capacity increased
by 1 truck in 2021.
Coal haulage to port increased to
926kt in 2021, a 47% increase over
2020. Maximum truck haulage per day
reached 5kt.
The Company continued to improve
the condition of the road and its fleet
management practices, the emphasis
being on road safety culture and driving
conditions to minimise traffic related
incidents. TIG carried out construction
works to improve safety and haulage
efficiency and reduce environmental
impact. Construction of road culverts
continued.
Sales and Marketing
During 2021, TIG delivered 15 cargoes
with a total of 898kt of coal. This
consisted of 778kt of thermal and 120kt
of semi-soft coking coal (“SSCC”).
Domestic Market – total 13kt.
Throughout the year TIG’s sales were
supported by exceedingly strong
demand in the Asian market, especially
out of China. As a result of this in
Q2 TIG has taken the opportunity of
selling excess low quality thermal coal
cargoes at attractive coal prices. In Q3
taking into account exceptionally strong
demand for our products, as well as
robust mining and port performance
for the first nine months, TIG raised its
full-year 2021 sales guidance from 700
– 800kt to 800 – 850kt, that was slightly
outperformed by the year end.
The chartering and subsequent loading
of a 100kt geared ice class vessel set
a new record for both vessel and cargo
size at our port of Beringovsky.
The positive impact of improved market
conditions was partially offset by a
dramatic rise in bulk cargo shipping
costs. The shipping market was
extremely tight during the year due
to a strong recovery in demand for
most commodities and a lack of new
shipping capacity. The net result was
an effective doubling of our seaborne
coal transportation costs (from c. A$27
(US$20)/t in 2020 to c. A$53 (US$$40)/t
in 2021), which directly affected the net
price achieved by TIG for its products.
TIG continued to focus on quality
control and building long-term
customer relations. As a result of our
focus on quality, we experienced no
quality-related claims during the year
while continuing to ship increased
volumes to several key customers with
whom we have developed a robust and
beneficial working relationship.
The strong resurgence in coal prices
during the first nine months of 2021
undertook a downward correction
in October 2021 as a result of the
government intervention in the Chinese
market. Additionally, Chinese steel
demand fell heavily through October to
December, on the back of a significant
downturn in the Chinese construction
sector.
The Asian coking coal market
strengthened markedly during first
three quarters of 2021 with CFR prices
for hard coking coal (HCC) on the
Chinese spot market reaching $400/t in
Q3. However, in the December quarter
the Asian coking coal market changed
significantly, driven by restricted supply
from Australia and strong demand from
India and North East Asia. China, which
had been a strong market for most of
the year, was significantly impacted
by a downturn in the residential
construction market in China. The
impact on steel demand has been
material, with coke makers operating
at less than 50% of capacity.
2021 Beringovsky Port
Operations
With loading volumes of 885kt (2020:
760kt) – a 16% increase over the
previous year and the maximum annual
volume achieved in the port’s history
– TIG’s port performance continued to
improve remarkably during the second
full year during which TIG operated
the port itself. Beyond the increased
volumes, transshipment costs per
tonne continued to decrease coming
down by 5%, from A$6.95/t to A$6.65/t.
Preparations for the 2021 shipping
season included maintenance of the
conveyor and loading system in the
port, initial dredging works as well as
the necessary minor repairs on the fleet
and cranes.
TIG chartered a 100kt ice class geared
bulk vessel as the first for the season
and the availability of this vessel in turn
enabled TIG to start loading on May
28th – the earliest start of the shipping
season in TIG’s history.
Key figures for TIG port operations are set out in the table below:
Coal trans-shipped
Barges in use
Weather working days per month
kt
units
days
May
June
18
4
3
179
4
18.3
July
237
4
18.5
Aug
182
4
19.9
Sept
114
4
24.1
Oct
95
4
14.9
Nov
60
4
9.7
Total
885
108.4
13
Annual Report 2021Tigers Realm Coal
OPERATIONS REVIEW CONTINUED
During 2021 TIG’s average loading
rate increased to 8.2kt per weather
working day (“pwwd”) compared to
6.5kt pwwd in 2020. A record loading
rate of 15.5kt pwwd was achieved
on 12 July 2021.
As TIG’s port has a limited navigational
season with weather conditions,
particularly toward the end of the
season, which can be unpredictable,
it is critical to maximize loading when
weather allows. Multiple factors impact
average loading rates, among these
are effective scheduling of bulker
arrivals, pre-season & intra-season
dredging so that barges are able to
work with maximum loads and proper
planning of inter-season maintenance.
Capital investments in the port
infrastructure during 2021 included
general repair and maintenance
projects, water runoff management
infrastructure completion and one
more 500t barge acquisition.
The building of the 5th 500t barge is in
progress and TIG expects to receive
the barge on site by the start of the
2022 shipping season. This additional
barge will further increase TIG’s annual
loading capacity and it has also been
configured for multi-functional purpose
with a front-access ramp to enable
better handling of incoming equipment
and spares than the currently utilized
100t barges.
Coal Handling and Process
Plant (CHPP) Project
In the first half of the year TIG
encountered significant supply-chain
issues, especially with respect to
domestic logistics. As a result of
these issues, certain supplies arrived
at Beringovsky later than planned.
These delays, in turn, led to delays in
completing CHPP winterization and
commissioning.
Very poor weather conditions adversely
affected the CHPP construction
works, especially during December.
Nonetheless, the CHPP equipment
is now fully installed, and the plant
cladding and winterization was
completed in March 2022. Derek
Parnaby Cyclones International
Ltd (DCPI) will effect final CHPP
commissioning and delivery by
remote means as a consequence
of travel difficulties arising out of the
current crisis in Ukraine. TIG expects
commissioning to be completed
during the June quarter.
Once commissioning is completed,
the Company will be positioned to sell
a higher-value product of a consistent
quality into the semi–hard coking
coal (“SHCC”) markets. This SHCC
product should achieve significantly
higher prices than those currently
being achieved for the unwashed coal
products being sold into thermal and
semi-soft coking coal markets.
Amaam Overview
TIG holds an 80% interest in the
Amaam tenement with its licences
covering an area of 231km2, located
30km from the Bering Sea coast.
The Amaam Project is a multi-seam,
moderate dipping deposit within a
synclinal basin. Coal is in the Middle
Chukchi coal formation and is divided
into four main areas by north-west
trending faults.
With the company’s primary focus on
Amaam North, there was no operational
activity during 2021 at Amaam other
than preparatory geological and project
work being performed as part of future
drilling activities.
• A Project Feasibility Study completed
on 5.0 Mtpa open pit operation
producing a high vitrinite content
(>90%) coking coal with excellent
coking properties
• The total Resource is 521 Mt
comprising 3 Mt Measured, 91 Mt
Indicated, and 427 Mt Inferred
Corporate Activities
As part of the Entitlement Offer
launched on 16 December 2020, a
shortfall bookbuild was completed
on 11 January 2021. The bookbuild
process was managed and fully
underwritten by CLSA Australia Pty
Ltd and sub-underwritten by Dr. Bruce
Gray. Pursuant to his sub-underwriting
agreement, 2.7 billion shares were
issued to Dr. Gray, increasing his
overall shareholding in the TIG
to 59.95%. In total TIG raised
A$43.5 (US$32) million.
Proceeds from the entitlement offer
were used to fund the construction and
commissioning of the CHPP, working
capital and transaction costs, as
follows:
• A$27 million (US$20 million) for the
development of the CHPP, as follows:
– Design works – A$1.2 million
(US$0.9 million);
– Civil works – A$8.8 million
(US$6.5 million);
– Equipment supply and
construction – A$14.7 million
(US$10.8 million); and
– Contingency – A$2.3 million
(US$1.8 million)
• A$15 million (US$11 million)
for working capital
• A$1.5 million (US$1 million) of
transaction and other costs.
On 16 April TIG announced that Non-
Executive Director Tagir Sitdekov has
resigned from the Board, effective
14 April 2021.
On 27 April Valery Doronin was
appointed as a Non-Executive Director.
As a result of his resignation from
RDIF Valery Doronin resigned from
the Board, effective 3 February 2022.
RDIF does not currently have a director
on the board of TIG.
14
Annual Report 2021Tigers Realm Coal On 9 June BV Mining Holding Limited
(BVMHL) notified TIG that it had
terminated the strategic review process
it had initiated during 2020. In providing
this advice BVMHL reiterated its
intention to continue cooperative efforts
with TIG to build a sustainable growth
business which increases shareholder
value and provides investor returns.
In June 2021, 616,000 options lapsed
and were removed from the Company’s
option register.
On 17 January 2022 Tigers Realm
Coal appointed Mr. Mitch Jakeman as
a non-executive Director to the Board.
Mitch is a well credentialed and
highly experienced mining executive
having held senior operational and
management roles with various mining
companies in Australia.
15
Annual Report 2021Tigers Realm Coal Strong response to COVID-19
During 2021, TIG’s Directors and
Management maintained a strong
focus on achieving a comprehensive
response to the COVID-19 pandemic.
The Group’s top priority has always
been and continues to be protecting
the health, safety and wellbeing of
our people and the communities that
host our business. TIG maintained
during 2021 a number of measures
implemented in 2020 to ensure
normal operating activities, including
remote working for employees
based in Moscow as recommended
by regulatory authorities, extensive
testing of all employees arriving at the
Chukotka operational site, ensuring the
availability of self-isolation facilities in
Beringovsky, and providing employees
with necessary personal protective
equipment, such as gloves, masks,
glasses, and sanitizers. Management
has been engaging with the relevant
government agencies and bodies
on all COVID-19 related measures.
Approximately 70% of all employees
have been vaccinated with the
Sputnik-V vaccine.
SUSTAINABILITY OVERVIEW
TIG places a strong emphasis on developing sustainable and effective
operational performance, sustainability being pursued both through
awareness of and striving for the achievement of high-performance
standards in all aspects of its operations.
Health & Safety
Safety
Care for our people is one of our core values, with the health and safety of all
employees and contractors at site being at the forefront of our considerations.
TRIFR (Per Million Hours Worked)
2021
2020
2019
2018
As a result of TIG’s HSE-related
activities cumulative Total Reportable
Injury Frequency Rate (“TRIFR”)
decreased for the second year in a
row to 2.58 per million hours worked
in 2021. There was 1 Lost Time Injury
case (“LTI”) in 2021.
Since the start of its operations TIG has
developed a solid system of Health
& Safety management, including
continuous improvement and support
of workplace safety culture, HSE risk
assessments and incident follow-up
procedures. Main measures to ensure
safe working conditions throughout
our operations, include but are not
limited to:
• HSE inductions for all new employees
in addition to supplementary HSE
reviews for existing employees;
• Road safety culture and traffic
management measures taking into
account the effect of weather and
road conditions, driver health and
well-being, equipment condition
and incident follow-up actions:
continuous driver training programs,
road signage upgrade, improvement
of traffic management controls;
• Ongoing improvement of road
conditions to further enhance safety
of haulage operations;
2.58
3.08
4.00
3.70
• Staff well-being promotion: the role of
staff scheduling, rest and the effects
of fatigue and diet;
• Workplace organisation and safety
regular inspections;
• Guidance and awareness promotion:
Weekly safety briefings, cautioning
and informative signage on all
objects;
• The continued evolution of mine
rescue team operational guidelines
and trainings; and
• Safety passports maintained to
ensure active awareness of the
importance which safety plans in
the execution of daily activities.
The Company is committed to
continuously improve its safety systems
and performance via the development
of a site safety culture that puts controls
in place for potential hazards.
Development and management of
the Company’s Risk Register is also
a significant tool to enhance the
Health & Safety programme. Since
2020 professional risks maps for all
production-related activities are in
place being constantly monitored
and regularly updated. According
to Russian legislation all of the
Company’s production-related
activities are referred to an insignificant
degree of risk.
16
Tigers Realm Coal
Annual Report 2021
Human Capital
People are core to realizing TIG’s strategy and achieving its plans and
targets. Being at the active operations growth stage each year TIG significantly
increases its headcount creating new working places in the region. The number
of employees increased by 20% from 283 in 2020 to 340 in 2021. Female employee
representation increased from 15% in 2020 to 19% in 2021.
Water Management
TIG continued developing water
management programs covering the
camp, pit and haulage road to make
sure no waste escapes into local rivers
and sea. TIG’s operational sites are
equipped with the following wastewater
treatment facilities:
Number of Employees
2021
2020
2019
2018
We place a great focus on selecting
and recruiting the most knowledgeable
and skilled specialists and on
improving their qualifications. Apart
from safety and environment protection
trainings and inductions TIG provides
its staff with training programs to
receive new qualifications or upgrade
existing ones. Average number of
training hours per employee nearly
doubled from 38 in 2020 to 73 in 2021.
In August 2021 TIG conducted a
celebration devoted to the 10th
anniversary of TIG’s IPO (initial
public offering). The event was held
in Moscow and was attended by
three of our directors, including the
Chairman and Chairman of the Audit,
Risk & Compliance Committee, senior
management, many of our long-time
employees as well as key suppliers,
financial institutions, and several former
employees who had made significant
contributions to TIG’s development.
On August 27-28 in Chukotka TIG
celebrated Miners’ Day (a professional
holiday celebrated throughout the
coal industry in Russia) organizing a
performance of a music band for the
Company’s employees in Beringovsky.
340
• At the port: sewage facility/sediment
pond with 525 m2 capacity was
built to clean intermediate stockpile
site tailings with cartridge-filter
technology;
• At the mine-site: facilities for
pit waters treatment by storage
for further discharge has been
reconstructed and CHPP technology
without sediment ponds has been
chosen to minimize impact on natural
water systems;
• In the camp: biological wastewater
treatment plant has been installed
and commissioned in 2021.
283
282
4.00
208
3.70
Environmental Stewardship
TIG operates in compliance with
Russian environmental legislation
and pursues identification and
implementation of the best known and
available practices and technologies
to minimize any negative impact of
its activity on environment.
Apart from fulfilling a broad range of
obligatory requirements of Russian
environmental authorities, such as
conducting ecological studies of
development projects or regular
monitoring of air and water quality,
TIG expands its environmental
stewardship with a number of eco-
initiatives involving local community:
• Since 2019 TIG’s Beringovsky office
staff during ‘Eco-patrol’ initiatives
helps monitoring seacoast from
waste and disposals and is cleaning
the Lakhtin lagoon together with
the eco-activists of Beringovsky
(«K’orgav» project);
• In 2020 the Company created hotline
for enquiries regarding mining and
environment issues in Beringovsky;
• With care for environment being
one of our core values we have
developed and are constantly
improving our environment
management programs for
the camp, mine, and port;
17
Annual Report 2021Tigers Realm Coal
SUSTAINABILITY OVERVIEW CONTINUED
Some examples of TIG’s recycling
efforts include, but are not limited to:
• worn tyres are used on the barge
fleet as protectors;
• oil used by our mobile fleet is used
for heating;
• mining waste was utilised in
maintenance and enhancement
of the pit to port road infrastructure,
as well as by the local administration
for municipal purposes in 2018.
In September 2021 TIG brought to site
an incineration unit to ensure the safe
disposal of non-mining waste. The
start of active operation of the unit is
planned for the summer period of 2022.
On a monthly basis, soils under and
around the coal stockpiles and waste
dumps are tested in order to monitor
environmental regulation compliance.
All production waste was recycled
in accordance with regulatory
requirements.
In 2019 and 2020 the Company
transferred ferrous scrap to specialist
organisation for recycle and reuse.
Taking into account increasing volumes
of ferrous scrap a decision was
made to launch TIG’s own recycling
operations. Hence, in 2021 ferrous
scrap was stored at the Company’s
sites for further recycling when
appropriate facilities are ready.
To improve the safety and overall
quality of the local environment in
2021 TIG’s staff continued clean-up
of old legacy scrap metal and industrial
garbage at the port and within all areas
of operational footprint.
Waste and ROM Coal Mined Growth (Thousand Tonnes)
2021
2020
2019
2018
1,025
792
750
576
1,900
Waste mined
ROM coal mined
4,063
4,804
3,501
The effectiveness of water management
programs is regularly monitored
through monthly independent
laboratory testing. According to the
research results of sanitary-biological,
chemical and radiological laboratory
studies of the quality of water from the
well supplying the port operations
carried out in 2021, the water from the
well meets the sanitary and hygienic
standards and is suitable for
consumption.
The Company monitors water usage
from natural sources. Total fresh well-
water intake in 2021 was 2,400km3.
After taking a full control over the
port operations TIG secured all
necessary documentation and works
to commission a fresh water well in the
Beringovsky port in the third quarter of
2021. The well-water intake in the port
in 2021 amounted to 700 m3.
In 2021 TIG installed water gauges to
measure household water discharge in
the camp. Total water discharge in the
camp in 2021 was 2,500 m3. According
to the plans of water management
and protection measures approved by
the regulatory authorities in 2020 total
annual water discharge at the mine-site
(Fandyushkin Stream) and at the port
(the Bering Sea) is limited to 31,500m3
and 29,000m3, respectively.
Waste Management
TIG’s goal is to reduce the volume
of waste produced and to manage
it in a safe and efficient way. We aim
to minimise waste generation by
improving technological processes
and increasing the share of reused
and recycled waste. We regularly
assess waste products to identify
recycling opportunities. For waste that
cannot be recycled, we either organize
environmentally safe decontamination
and disposal, or transfer it to specialist
companies.
18
Annual Report 2021Tigers Realm Coal
Air Management and Dust Control
TIG’s activity in the area of air
management is targeted at minimizing
emission of pollutants into the
atmosphere. Throughout 2021 regular
laboratory studies of atmospheric air
in coal mine and camp were carried
out. According to the test reports,
the concentration of pollutants in the
air does not exceed the maximum
permissible values.
The Company uses a set of measure
to control dust at its operation sites:
• Dust covers are deployed to control
coal dust at the stockpiles;
• Mobile dust control unit was acquired
and delivered to Beringovsky in 2021;
• Reactive chemicals are used to cover
stockpiles with crust to lay coal dust.
Biodiversity and Rehabilitation
The Company works with specialised
organisations to assess the state of
biodiversity during engineering and
environmental surveys at pre-design
and design stages. The results undergo
state environmental impact assessment
and are included in materials for public
hearings and deposit development
projects.
In the first quarter of 2021 an
assessment was made of the impact
on aquatic biological resources and
their habitat due to port activity. The
assessment indicates a short-term
indirect negative impact in the form
of increased noise level and vibration,
but the activity will not cause direct
damage to aquatic biological resources
and their habitat.
TIG does not operate in natural
reserve areas.
Energy Consumption and Efficiency
TIG receives electrical supply from
diesel generators. Heating is provided
by coal-fired boilers.
The Company is currently at the active
development stage and its energy
consumption increases in line with
production growth. Constant work
is underway to optimise diesel fuel
consumption, including installing boiler
facilities, improving the pit-to-port road
conditions, motivating and training
employees in fuel saving methods,
reducing idle downtime and mileage.
Improving energy efficiency at its
facilities is one of the TIG’s key
priorities with respect to lowering
our environmental impact.
Community Relationships
Our operations are located in a remote
part of the Russian Federation, and
our activities need to complement the
requirements of local communities
and their future plans and aspirations.
We are committed to make a positive
and sustainable contribution to the
economic and social aspects of
people’s lives in the region.
Local Community
We place a priority on attracting
employees from the local community
whenever possible and providing them
with training opportunities.
Apart from creating working places,
TIG plays a leading role in a number
of events and initiatives aimed at
supporting the local community.
In 2021 the Company continued its
support for local schools:
• In the third quarter TIG congratulated
local schoolchildren with the
beginning of new school year and
presented backpacks and stationery;
• In July TIG financed purchase
of stacks and showcases for the
Alkatvaam school’s ethnography
museum;
• TIG continued to provide nutritional
supplements to children in the
Beringovsky in order to improve
the health and welfare of local
community;
• In the fourth quarter TIG held
a New Year celebration for the
schoolchildren of Beringovsky
and Alkatvaam.
TIG provides continuous support
to local administration by financing
projects of high social importance.
After restoring Beringovsky church in
2020 TIG committed to build a soccer
field in the township. In April 2021 at
the request of local administration the
Company sponsored participation
of Berengovsky schoolchildren in a
basketball tournament.
19
Annual Report 2021Tigers Realm Coal
SUSTAINABILITY OVERVIEW CONTINUED
One more way of TIG’s contribution to
local community is providing support
to local small businesses through
outsourcing and charitable assistance.
TIG regularly informs local community
on its activity and development plans.
In April 2021 the Company organised
public hearings in Beringovsky
regarding the construction of CHPP.
TIG’s General Manager Sergey
Efanov presented CHPP design plans
and answered all the questions of
local representatives demonstrating
openness to their feedback and future
cooperation.
Indigenous People
Since signing the first cooperation
agreement with the Association of
Indigenous People of Chukotka (the
Association) in 2018, TIG takes an
active part in the life of local indigenous
community:
In March 2021 TIG was invited by
Governor Roman Kopin to the VI
Congress of the Indigenous People of
Chukotka. TIG’s CEO Dmitry Gavrilin
made a presentation on the social and
environmental partnership between
the Company and the region. TIG
detailed its production volumes and
plans, social projects & environmental
responsibility, and fulfillment of the
clauses of the Agreement with the
Association. The event was extensively
covered in the regional press and
social media.
Throughout the year regular meetings
with local and indigenous communities
were held in Beringovsky. In December
2021 TIG and the Association selected
a number of community projects for
mutual support in 2022.
Projects receiving TIG’s continuous
support since 2019:
• Conducting regular meetings with the
representatives of the Association
and indigenous communities;
• “K’ergav” children and adult folk
groups;
• Annual local festival “Einev”;
• Supporting the local administration
• Voluntary eco-project “K’orgav”.
of the Association;
• Financing local projects in
cooperation with the Association;
• Organising site-visits to the
Company’s operations;
• Taking part in the regional and
municipal initiatives;
• Responding to community requests.
In 2021 TIG organized and funded
a trip to the village of Khatyrka for
representatives of the Association to
celebrate the 265th anniversary of the
village and the festival “Einev-2021”.
20
Government relations
The Federal and Chukotka Provincial
Governments continued with their
positive support of our projects and
the economic development of the
Far East of Russia in general.
The Company’s projects reside
within the Beringovsky Advanced
Development Zone (ADZ), established
by the Russian Government in order
to promote the development of and
investment in the Russian Far East.
During production, the Company
is benefiting from advantageous
customs and employment regulations,
in addition to exemptions and
reductions in various taxes for
the first 10 years of operations.
TIG’s Russian Management Team
has well established relationships
with the Provincial Government and
extensive experience in working
within the regulatory environment and
understanding the relevant approval
processes.
In 2021 TIG’s government relationship
initiatives resulted in a number of
activities and achievements:
• During the Eastern Economic Forum
in Vladivostok, on September 3,
2021, Tigers Realm Coal signed
cooperation MOU with Corporation
for the Development of the Far East
and the Arctic;
• TIG was included in the list of key
projects of the Russian Federation
under the personal control of the
supervising Deputy Prime Minister
of the Russian Federation;
• At the annual Star of the Far East
award ceremony sponsored by
Presidential Administration, TIG
received an award in the category
of Best Foreign Investor;
• TIG was included in the working
group for the implementation of
the federal project “Clean Arctic”;
• A report on the modernization of
the port of Beringovsky was sent
to the Government of the Russian
Federation. Such reporting forms
part of our reporting obligations
arising from the port’s status as
a strategically important asset.
Annual Report 2021Tigers Realm Coal FINANCIAL REPORT
Directors’ Report
Corporate Governance Statement
Consolidated Statement of Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to the Consolidated Financial Statements
Directors’ Declaration
Auditor’s Independence Declaration
Independent Auditor’s Report
Shareholder Information
Corporate Directory
22
44
51
52
53
54
55
95
96
97
102
104
21
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Directors’ report
For the year ended 31 December 2021
The Directors present their report together with the financial report of the Group, being Tigers Realm Coal Limited (the
“Company” or “TIG”) and its subsidiaries, for the year ended 31 December 2021.
1.
Directors, Alternate Director and Company Secretary
The Directors of the Company at any time during or since the end of the financial year are:
Name
qualifications and
independence
status
Experience, special responsibilities and other directorships
Mr Craig
Wiggill
Independent
Chairman
BSc Eng.
Mr Wiggill was appointed Independent Chairman on 1 October 2015. Mr Wiggill has served as a Non-
Executive Director of the Company since being appointed 20 November 2012. Mr Wiggill joined the
Nomination and Remuneration Committee commencing 10 December 2015. Mr Wiggill has extensive
experience in the global mining industry including over 30 years in the coal sector, the majority of his
experience being within the Anglo-American Plc group. Mr Wiggill is currently the Chairman (non-executive)
at Buffalo Coal Corp (CVE: BUF) which has its operating entities in South Africa. In addition, he is the
Chairman (non-executive) of globalCOAL, a company registered in London, the principal activities of which
are the development of standardised contracts for the international coal market and the provision and
management of screen based brokerage services for the trading of physical and financial coal contracts. His
most recent executive role was as Chief Executive Officer (“CEO”) – Coal Americas at Anglo Coal, where he
established and developed the Peace River operation in Canada and co-managed joint venture projects at
Cerrejón and Guasare. He has also held leadership roles covering commercial, trading and marketing
responsibilities, corporate strategy and business development for Anglo American. He holds no other
directorships with ASX listed entities.
Dr Bruce Gray
Non-executive
Director
MB, BS, MS,
PhD, FRACS
Dr Gray was appointed as a Non-Executive Director of the Company on 1 October 2015. Prior to this, Dr Gray
had been appointed as a Non-Executive Director of the Company on 25 October 2013, resigning on 28 March
2014. Dr Gray established and operated two highly successful start-up businesses in the medical sector. Prior
to that he was Professor at the University Western Australia and has held numerous administrative positions
with regional, national and international organisations. He has published more than 200 articles in the global
scientific press and has received numerous awards for contributions in the medical field and for Australian
entrepreneurship. Dr Gray currently manages a private investment fund. Dr Gray has been a member of the
Nomination and Remuneration Committee since 8 September 2016. He holds no other directorships with ASX
listed entities.
Mr Owen
Hegarty
Independent
Non-executive
Director
BEc(Hons),
FAusIMM
Mr Hegarty was appointed a Non-Executive Director of the Company on 8 October 2010. Mr Hegarty has
more than 40 years’ experience in the mining industry. He had 24 years with the Rio Tinto Group, then founded
and led Oxiana Ltd, now OZ Minerals Limited, for 12 years. He is a founder of Tigers Realm Coal Ltd. He
also founded and is currently Executive Chairman of EMR Capital, a mining private equity firm. Through to
the end of 2016, he was Vice Chairman and Non-Executive Director of Fortescue Metals Group Ltd. Mr
Hegarty has received a number of awards recognising his service to the mining industry and presently serves
on a number of Government and industry advisory groups. He is the Chairman of 29Metals Limited (ASX:
29M).
22
4
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Directors’ report (continued)
For the year ended 31 December 2021
1.
Directors, Alternate Director and Company Secretary
Name,
qualifications and
independence
status
Experience, special responsibilities and other directorships
Mr Tagir
Sitdekov
Non-executive
Director
MBA
(resigned 14 April
2021)
Mr Sitdekov was appointed a Non-Executive Director on 1 April 2014 and resigned on 14 April 2021. Mr
Sitdekov was a First Deputy General Director of Russia Direct Investment Fund (“RDIF”) and has been
involved in the Russian private equity market for the last 10 years. Mr Sitdekov’s most recent executive role
was as Managing Director at A-1, a direct investment arm of Alfa Group, Russia’s largest private
conglomerate. Mr Sitdekov has participated in a number of landmark private equity transactions across a
range of industries. From 2003 to 2005 he was CFO at power generating company OJSC Sochi TES (a
subsidiary of RAO Unified Energy System of Russia) and prior to that role he was a Senior Consultant at
Creditanstalt Investment Bank for 2 years. Mr Sitdekov holds an MBA (University of Chicago Booth School
of Business, London). Mr Sitdekov was a member of the Audit, Risk and Compliance Committee.
Mr David Swan
Independent
Non-executive
Director
BComm, FCA
(ICAANZ &
ICAEW)
David Swan was appointed as an Independent Non-Executive Director on 26 August 2020. He is the Chairman
of the Audit, Risk and Compliance Committee and of the Nomination and Remuneration Committee. David
has extensive experience across the natural resources sector and held a number of senior finance, management
and consulting roles, mostly with resource companies in both United Kingdom and Australia with projects in
Central Asia, Africa, and USA. David holds a Bachelor of Commerce from the University of WA and is a
Fellow of both the Institute of Chartered Accountants in Australia and New Zealand (‘ICAANZ’) and the
Institute of Chartered Accountants in England and Wales (‘ICAEW’). David is a non-executive director and
audit committee chairman of London AIM Listed company Central Asia Metals plc. He holds no other
directorships with ASX listed entities.
Mr Valery
Doronin
Non-executive
Director
(appointed 27
April 2021,
resigned 3
February 2022)
Mr Mitch
Jakeman
Independent
Non-executive
Director
BE, ME
(appointed 17
January 2022)
Mr Valery Doronin was appointed a Non-Executive Director on 27 April 2021 and resigned on 3 February
2022. Mr Doronin was a Director of RDIF and has held a number of senior management and Board positions
in Russian companies over the past 20 years. During that time he has gained considerable experience in
investment, portfolio management and private equity. This experience includes numerous transactions across
a number of industries including financial services, construction materials, resources and energy. Mr Doronin
was a member of the Audit, Risk and Compliance Committee.
Mr Mitch Jakeman was appointed as an Independent Non-Executive Director on 17 January 2022. He is a
well credentialed and highly experienced mining executive having held a number of operational and
management roles with various mining companies including Shell Coal Australia, Anglo Coal Australia and
Stanmore Coal. More recently Mitch has been involved in a number of start – up businesses in addition to
operating his own consulting practice. Mr Mitch Jakeman holds a BE Mining Degree from the University of
New South Wales, a Diploma in Mineral Economics from Macquarie University and ME (Hons) Mining
under Stored Waters and Dams from the University of Wollongong. He holds no other directorships with
ASX listed entities.
The Directors have all been in office since the start of the financial year to the date of this report unless otherwise stated.
Alternate Director
Mr Nikolay
Ishmetov
Alternate
Director
MSc in Finance
(resigned 14 April
2021)
Mr Ishmetov was appointed as an alternate director to Tagir Sitdekov on 1 July 2017 and resigned on 14 April
2021. Mr Ishmetov is currently a Senior Vice-President at RDIF and has been involved in the Russian private
equity market for over 9 years. Mr Ishmetov has been serving for over 6 years as an alternate director on the
Board of Directors of MD Medical Group, a leading healthcare operator in Russia. Prior to joining RDIF, Mr
Ishmetov worked in the M&A department of Societe Generale, where he participated in a number of cross
border M&A deals in various sectors.
5
23
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Directors’ report (continued)
For the year ended 31 December 2021
Company Secretary
Mr Forsyth was appointed Company Secretary on 8 October 2010. Mr Forsyth has over 40 years’ experience
in engineering, project development and mining. His most recent position was with Oxiana Ltd, now OZ
Minerals Limited, where he was Company Secretary and Manager Administration from 1996 to 2008.
Mr David
Forsyth
Company
Secretary
FGIA, FCIS,
FCPA
2.
Directors’ meetings
The number of Directors' meetings (including meeting of committees of Directors) and number of meetings attended by each of the
Directors of the Company during the financial year are:
Directors’ meetings
Meetings of committees of Directors
Nomination and
Remuneration
Audit, Risk &
Compliance
A
8
8
8
8
2
5
2
B
8
7
6
8
2
4
2
A
4
4
4
4
-
-
-
B
4
4
2
4
-
-
-
A
7
-
7
7
3
3
3
B
7
-
5
7
3
1
3
Mr Craig Wiggill
Dr Bruce Gray
Mr Owen Hegarty
Mr David Swan
Mr Tagir Sitdekov
Mr Valery Doronin
Mr Nikolay Ishmetov*
A = Number of meetings held B = Number of meetings attended
* The number of meetings attended by the Alternate Director in his capacity as a standing invitee. Mr Ishmetov is not obliged to attend.
3.
Principal activities
The principal activities of the Group are the identification, exploration, development, mining and sale of coal from deposits in the
Far East of the Russian Federation.
4.
Review of Operations
Business Strategies and Group Objectives
The Group’s objectives encompass the development of the Amaam Coking Coal Deposits, comprising its two, well-located, large
coking coal projects in the Far East of the Russian Federation.
• Amaam North: a low-cost starter project providing a fast track to production and earnings, utilising existing infrastructure
and supporting development of the entire Amaam Coking Coal Field; and
• Amaam: a large coal resource which will enable scaling TIG production up to 5 million tonnes per annum (“Mtpa”) from
dedicated new infrastructure.
Amaam North
Development of Amaam North started with development of the Fandyushkinsky Field licence AND 15813 TE area (“Project F”), a
part of Amaam North. A Project F Feasibility Study Update was completed in April 2016, subsequent to which the Group raised
funds via a non-renounceable rights issuance, the primary use of proceeds being on the development of Project F. After completing
the necessary initial construction works in the second half of 2016, commercial mining commenced in January 2017.
24
6
Tigers Realm Coal Limited
Directors’ report (continued)
For the year ended 31 December 2020
4.
Review of operations
Business Strategies and Group Objectives (continued)
Amaam
Amaam is a potential long-life project of the Group with capacity to enable TIG to increase production up to 5Mtpa of high-
quality coking coal product over an estimated 20-year life of mine. The Company currently holds an Exploration Licence over the
Amaam deposit and two long-term (20 year) Extraction and Exploration Licences over parts of the deposit. Further details on the
current status of the Group’s licences are disclosed below in Significant Business Risks: Licenses, Permits and Titles.
Amaam Coking Coal Field– World Location Map
Key Operating Indicators for the year ended 31 December 2020 (“2020”) and 2019 (“2019”):
(rounded to the nearest thousand tonnes, unless otherwise stated)
Operating Performance
Operating Indicators
Coal mined
Overburden removed
Stripping ratio
Total saleable coal stocks at 31 December
Total coal sales*, of which:
- Thermal coal sales
- Semi soft coal sales
Employees as at 31 December**
**Full time equivalent staff.
*Including 15kt thermal coal sold domestically without shipment (Year ended 31 December 2019: 4kt).
Results for 2020
Results for 2019
792
4,804 bcm
6.1:1 bcm/t
750
3,501 bcm
4.7:1 bcm/t
308
775
617
158
283
291
581
388
193
282
7
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Directors’ report (continued)
For the year ended 31 December 2021
4.
Review of operations
Business Strategies and Group Objectives (continued)
In September 2018, TIG was granted Exploration and Mining licence No AND 01314 TE over the Zvonkoye deposit, geographically
located next to an eastern extension of Project F. In 2019 TIG applied for a Mining and Excavation Plan (“TPRM”) for the integrated
development of the Fandyushkinskoe Field and Zvonkoye license areas, which was approved in December 2019. Consequently,
future references to Amaam North will refer to the unified development of both license areas.
Further development of Amaam North, which includes an upgrade of mine site infrastructure, the Beringovsky Port and Coal
Terminal and to be supplemented by the construction of a coal handling and preparation plant (“CHPP”), will enable the Group to
produce and sell higher-value coal and is expected to increase coal sales up to 1.4Mtpa. All CHPP equipment is now installed, and
Tigers Realm Coal Limited
civil works primarily related to winterization and power supply are nearly complete. TIG expects to complete commissioning
procedures during the March quarter 2022. As discussed below TIG encountered significant supply-chain issues in 2021, especially
Directors’ report (continued)
with respect to domestic logistics. As a result of these issues, certain supplies arrived at Beringovsky later than planned. These
For the year ended 31 December 2020
delays, in turn, led to delays in completing CHPP winterization and commissioning. Once commissioning is completed, the
Company will be positioned to sell a higher-value product of a consistent quality into the semi–hard coking coal (“SHCC”) markets.
This SHCC product should achieve significantly higher prices than those currently being achieved for the unwashed coal products
4.
being sold into thermal and semi-soft coking coal markets.
Review of operations
Business Strategies and Group Objectives (continued)
Amaam
Amaam
Amaam is a potential long-life project of the Group with capacity to enable TIG to increase production up to 5Mtpa of high-quality
Amaam is a potential long-life project of the Group with capacity to enable TIG to increase production up to 5Mtpa of high-
coking coal product over an estimated 20-year life of mine. The Company currently holds an Exploration Licence over the Amaam
quality coking coal product over an estimated 20-year life of mine. The Company currently holds an Exploration Licence over the
deposit and two long-term (20 year) Extraction and Exploration Licences over parts of the deposit. Further details on the current
Amaam deposit and two long-term (20 year) Extraction and Exploration Licences over parts of the deposit. Further details on the
status of the Group’s licences are disclosed below in Significant Business Risks: Licenses, Permits and Titles.
current status of the Group’s licences are disclosed below in Significant Business Risks: Licenses, Permits and Titles.
Amaam Coking Coal Field– World Location Map
Amaam Coking Coal Field– World Location Map
Operating Performance
Key Operating Indicators for the year ended 31 December 2020 (“2020”) and 2019 (“2019”):
Operating Indicators
(rounded to the nearest thousand tonnes, unless otherwise stated)
Results for 2020
Results for 2019
Coal mined
Overburden removed
Stripping ratio
Total saleable coal stocks at 31 December
Total coal sales*, of which:
- Thermal coal sales
- Semi soft coal sales
Employees as at 31 December**
**Full time equivalent staff.
792
4,804 bcm
6.1:1 bcm/t
750
3,501 bcm
4.7:1 bcm/t
7
25
308
775
617
158
283
291
581
388
193
282
7
*Including 15kt thermal coal sold domestically without shipment (Year ended 31 December 2019: 4kt).
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Directors’ report (continued)
For the year ended 31 December 2021
Operating Performance
Key Operating and Financial Indicators for the year ended 31 December 2021 (“2021”) and 2020 (“2020”):
Operating Indicators
(rounded to the nearest thousand tonnes, unless otherwise stated)
Coal mined
Overburden removed
Stripping ratio
Total saleable coal stocks at 31 December
Total coal sales*, of which:
- Thermal coal sales
- Semi soft coal sales
Employees as at 31 December**
Results for 2021
Results for 2020
1,025
4,063 kbcm
4:1 bcm/t
792
4,804 kbcm
6.1:1 bcm/t
567
911
791
120
340
308
775
617
158
283
*Including 13kt thermal coal sold domestically without shipment (Year ended 31 December 2020: 15kt).
**Full time equivalent staff.
Key Financial Indicators
(in A$‘000 unless otherwise stated)
Revenue from coal sales
Cost of coal sold
Gross margin on coal sold
EBITDA*
Adjusted EBITDA**
Net profit / (loss) before tax
Results for 2021
Results for 2020
103,944
(59,398)
44,546
46,852
44,313
37,956
47,889
(48,216)
(327)
(3,835)
2,161
(15,625)
Average free on board (“FOB”) coal sales price per tonne
A$105.79 (US$77.41)
A$53.30(US$38.53)
Average cost of coal mined and sold per tonne
A$41.58 (US$30.43)
A$43.68 (US$31.57)
Average cost of port handling and stevedoring costs per tonne sold
A$6.52 (US$4.77)
A$6.95 (US$5.03)
Total FOB cost of coal sold***
A$54.75 (US$40.06)
A$53.45 (US$38.64)
*Earnings before interest tax, depreciation and amortisation (“EBITDA”) is calculated as the result before net finance costs and income tax expense,
adjusted for depreciation of property, plant and equipment.
**Adjusted EBITDA is EBITDA excluding non-cash expenses such as royalty expense, write-off of property, plant and equipment, change in
provisions for inventories and share based payments.
***Includes other costs of coal sold of A$6.65 per tonne in 2021 (A$2.82 per tonne in 2020). Does not include freight which is part of cost of coal
sold.
EBITDA and adjusted EBITDA are not defined by AASB and are non-statutory measures. These non-financial measures have not been audited by
Deloitte.
26
8
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Directors’ report (continued)
For the year ended 31 December 2021
The following table summarises the key reconciling items between the Group’s EBITDA, adjusted EBITDA and its profit/(loss)
before income tax:
in A$‘000
Profit/(loss) before income tax
Add: Net finance costs
Add: Depreciation
EBITDA
Add: Royalty expense
Add: Write-off of property, plant and equipment
Add: Change in provisions for inventories
Add: Share based payments
Adjusted EBITDA
Results for 2021
Results for 2020
37,956
2,596
6,300
46,852
189
235
(2,963)
-
44,313
(15,625)
3,440
8,350
(3,835)
5,690
254
-
52
2,161
During the year ended 31 December 2021, the Company achieved a production level of 1,025 thousand tonnes (“kt”), of which
804kt were delivered to Beringovsky Port and Coal Terminal (792kt and 632kt, respectively in 2020). During the year ended 31
December 2021, the Group sold 911kt (775kt in 2020) and generated A$103.944 million in total revenue from the sale and shipment
of coal (2020: A$47.889 million).
The Group had A$23.204 million net cash inflow from operations for the year ended 31 December 2021 (2020: A$11.304 million
net cash outflow). Cash outflows of A$26.242 million on investing activities were incurred for the year ended 31 December 2021
(A$9.244 million was incurred for the year ended 31 December 2020). The Group’s net profit for the year ended 31 December 2021
was A$37.902 million (2020: net loss of A$15.642 million).
During 2021, TIG’s Directors and Management maintained a strong focus on achieving a comprehensive response to the COVID–
19 pandemic. The Group’s top priority has always been and continues to be protecting the health, safety and wellbeing of our people
and the communities that host our business. TIG maintained during 2021 a number of measures implemented in 2020 to ensure
normal operating activities, including remote working for employees based in Moscow as recommended by regulatory authorities,
extensive testing of all employees arriving at the Chukotka operational site, ensuring the availability of self-isolation facilities in
Beringovsky, and providing employees with necessary personal protective equipment, such as gloves, masks, glasses, and sanitizers.
Management has been engaging with the relevant government agencies and bodies on all COVID-19 related measures.
Approximately 70% of all employees have been vaccinated with the Sputnik-V vaccine.
The international coal market experienced a significant resurgence during 2021. The improved market conditions and a 17.5%
increase in sales volumes, drove an increase in revenue for the period of 117%. The positive impact of improved market conditions
was partially offset by a dramatic rise in bulk cargo shipping costs. The shipping market was extremely tight during the year due
to a strong recovery in demand for all commodities, both hard and soft, and a lack of new fleet builds. The net result was an effective
doubling of seaborne coal transportation costs (from c. A$27 (US$20)/t in 2020 to c. A$53 (US$$40)/t in 2021), which directly
affected the net price achieved by TIG for its products.
During 2021 TIG built on the previous year’s operational improvements to drive increased mining volumes and significant
improvements in port operations. Our pre-season dredging efforts and intra-season maintenance program, especially with respect
to the main conveyor, combined with the increased experience of our barge crews enabled a 21.8% increase in trans-shipment
volumes to 960kt, a record for the Beringovsky port. Trans-shipment costs per tonne decreased by 5%, from A$6.95/t to A$6.65/t.
With the stripping ratio decreasing from 6.1 bcm/t in 2020 to 4 bcm/t in 2021, TIG managed to decrease mining costs from A$43.68/t
(US$31.57/t) in 2020 to A$41.58/t (US$30.43/t).
The primary challenge faced during the year related to supply chain logistics. TIG ships the vast majority of its materials and
equipment from Vladivostok to Beringovsky on Russian domestic cargo vessels. A number of factors combined during the 2021
shipping season which resulted in a shortage of domestic shipping capacity available to the Company. These factors include some
vessels coming back online after off-season maintenance in Chinese wharfs, due mostly to COVID-related restrictions, increased
overall demand due to increased investment from multiple commodity producers in the Russian Far East and some pent-up demand
related to shipments that were delayed in the previous year, again mostly due to COVID-related issues. As a result of the shortage
in domestic shipping capacity, several shipments of equipment and supplies to Beringovsky experienced significantdelay. This
caused a knock-on effect on CHPP construction and required TIG to significantly increase air cargo deliveries to Beringovsky in
order to partially mitigate construction delays.
9
27
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Directors’ report (continued)
For the year ended 31 December 2021
4.
Review of operations (continued)
Operating Performance (continued)
The combined effect of above factors resulted in a positive gross margin of A$44.546 million for the year ended 31 December 2021
(2020: A$(0.327) million).
The average margin per tonne of coal sold during the year ended 31 December 2021 was A$48.90/t (US$35.78/t) (2020: A$(0.42/t)
(US$(0.31/t))), the weighted average FOB sales price per tonne (“FOB/t”) being A$105.79/t (US$77.41/t) (2020: A$53.30/t
(US$38.53/t)).
Significant investments in coal processing, mining and port assets totalling A$27.384 million during the year ended 31 December
2021 included:
➢ CHPP equipment
➢ CHPP-related civil works, primarily for winterization & power supply;
➢ Additional mining equipment both to replace aging equipment and to increase capacity; and
➢ Acquisition of additional 500t barge
During 2021, TIG also began re-assessing supply chain challenges which it faced during the year and which will likely continue
into 2022 and potentially beyond. In addition to issues related to domestic shipping capacity to transport supplies to Beringovsky
as discussed above, lead times for purchasing mining equipment and some parts have also increased. These issues have affected
numerous companies globally. The Company is addressing these issues by improving coordination with our key business partners,
placing orders earlier than in prior periods and expanding our logistics footprint in Vladivostok.
Financial Position
Cash balances
The Group’s cash balance increased by A$14.632 million over the year to A$33.511 million at 31 December 2021. This increase
arose primarily from operating cash inflows and from the December 2020 Entitlement Offer (“2020 Entitlement Offer”), offset by
further investment in the Company’s mining, processing and logistics infrastructure.
Inventory on hand
The carrying amount of the Group’s inventories on hand at 31 December 2021 is A$48.235 million (31 December 2020: A$23.129
million), including A$18.902 million of coal stocks, A$8.159 million in fuel and oils and A$21.174 million of other consumables.
Fuel inventory increased by A$6.788 million primarily due to changing fuel suppliers. In the previous year, TIG purchased fuel from
a state-owned wholesale supplier which held the fuel on its balance sheet and sold it to TIG as needed. Pursuant to the terms of the
most recent fuel supply contract, TIG acquired the fuel upfront. The increase in consumables was partially driven by the purchase of
magnetite and flocculants.
Management performs a regular review of the recoverability of inventories, including coal stocks, to assess the Company’s ability
to recover the cost of coal inventories on hand. As a result of a significant increase in realisable prices for thermal coal a previous
write-down to net realisable value of coal stockpiled at the interim coal stockpile amounting to A$2.963 million was reversed.
Non-current assets
The Company performs a bi-annual review for the existence of conditions indicating either the necessity to perform an impairment
review or to consider the necessity to reverse previously recognised write-downs. Refer to Note 9 to the consolidated financial
statements for further details.
Two CAT 740B dump trucks, two scanias, a crusher, an excavator, a snow removal machine, and telecommunications equipment
with a carrying value of A$0.235 million were written off during the year ended 31 December 2021 as a result of damage for which
repairs to restore it to its previous operational condition were assessed as not economically justifiable (For the year ended 31
December 2020: а CAT D10 bulldozer with the carrying value of A$0.254 million was written off).
Leases
During the year ended 31 December 2021, the Group concluded lease agreements for additional mining and haulage equipment.
The Group recognised a right-of-use asset of A$11.834 million and a corresponding lease liability, after advance payments of
A41.924 million, of A$9.910 million with respect to these lease arrangements.
28
10
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Directors’ report (continued)
For the year ended 31 December 2021
4.
Review of operations (continued)
Financial Position (continued)
Shareholder loan
On 2 January 2020, following the issuance of shares to BV Holding Limited, substantial shareholder of TIG, the loan payable to
BV Holding Limited of A$14.776 million was settled in full. On 2 January 2020, A$13.138 million out of A$14.641 million loan
payable to Dr Bruce Gray was settled, following the issuance of shares to Dr Bruce Gray, the Group’s director and substantial
shareholder.
On 10 July 2020, a supplemental deed to the loan agreement with Dr Bruce Gray was signed, extending the loan maturity date to
31 December 2020 and lowering the interest rate from 20% to 12% starting 24 June 2020.
On 4 February 2021, the outstanding loan payable to Dr Bruce Gray and interest accrued thereon of A$1.864 million was settled in
full.
Royalty Agreement liability
After the assessment of the provision for the obligations under the royalty agreements at 31 December 2021, the Group recognized
an increase in the royalty liability of A$0.354 million, of which A$0.189 million relates to changes arising from the passage of time
and changes in the assumptions, A$1.110 million relates to changes in foreign exchange rates, offset by payments of A$0.945
payments. As at 31 December 2021 the provision amounted to A$18.418 million (At 31 December 2020: A$18.063 million). Refer
to Note 21 to the consolidated financial statements for further details.
Share Capital
The 2020 Entitlement Offer closed on 14 January 2021, as a result of which the Group raised A$43.512 million. The Institutional
entitlement offer closed on 17 December 2020 raising gross proceeds of approximately A$17.151 million with the Company’s
largest shareholder Dr. Bruce Gray taking up his full entitlement. The remaining A$26.361 million was raised in January 2021. The
retail component of the offer was completed on 4 January 2021 with very good support from a number of shareholders taking up
full and partial entitlements. The Bookbuild process was managed and fully underwritten by CLSA Australia Pty Ltd and sub-
underwritten by Dr. Bruce Gray. Pursuant to his sub-underwriting agreement, 2.7 billion additional shares were issued to Dr. Gray,
increasing his overall shareholding in the TIG to 59.95%.
Options
During the year ended 31 December 2021, no options were granted, and 1,905,000 options lapsed or were forfeited and have been
removed from the Company’s option register. Total number of options as at 31 December 2021 is 8,002,000.
Significant Business Risks
The Group’s operations and annual budget are subject to a range of business risks, assumptions and expectations all of which contain
various levels of uncertainty and outcome. TIG has adopted a Risk Policy through which a risk management framework identifies,
analyses, mitigates and monitors the risks applicable to the Group. Identified risks are entered into a risk register which is maintained
by a committee of senior management and staff. Significant risks are presented at least twice annually to the Audit, Risk and
Compliance Committee and, following each review, are formally reported and discussed by the Board.
Detailed below are risk areas identified as at the date of the Directors’ Report which may affect TIG’s future operating and financial
performance.
Country Risk
TIG’s projects are located in Russia. Operating in this jurisdiction may expose TIG to a range of significant country specifi c risks
including general economic, regulatory, legal, social and political conditions. These and other country specific risks may affect
TIG’s ability wholly or in part to operate its business in the Russian Federation.
During the course of 2021, public statements made by representatives of the governments of the United States, various European
countries and the Russian Federation have led to a broad perception that relations between the United States and various European
countries, on the one hand, and the Russian Federation, on the other, have deteriorated with both the United States and European
countries making public threats to enact further economic sanctions against the Russian Federation. The threatened economic
sanctions vary but have included the potential for restrictions on the export to the Russian Federation of some types of technology,
the ability of Russian banks to utilize the SWIFT payments system for international payments as well as sanctions specific to Russian
banks. It is not clear to what extent any additional sanctions would impact the Group’s business and operations.
11
29
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Directors’ report (continued)
For the year ended 31 December 2021
4.
Review of operations (continued)
COVID-19 Pandemic
The COVID-19 pandemic has made a profound impact on global economic activity. To a large degree, the global economy
experienced a significant recovery during 2021, and this recovery, in part, led to a sharp rebound in demand for both metallurgical
and thermal coal and, consequently, a substantial increase in coal prices. Mutations of the COVID-19 virus have been observed, but
preliminary indications, particularly with respect to what is referred to as the OMICRON variant of COVID-19, are that virus has
become less threatening than previously. Furthermore, vaccines which at least appear to mitigate the severity of symptoms on those
infected have been broadly distributed in large parts of the world. Many countries have begun to relax restrictions on economic
activity initially put in place to mitigate the impact of the pandemic, but it is too early to assess how the pandemic will continue to
evolve and how it may impact TIG’s business going forward.
Uncertainty in estimation of Mineral Resources and Reserves
Estimating the quantity and quality of Mineral Resources is an inherently uncertain process and the Mineral Resources and Reserves
stated, as well as any Mineral Resources or Reserves TIG states in the future, are and will be estimates, and may not prove to be an
accurate indication of the quantity of coal that TIG has identified or that it will be able to extract.
In November 2020 TIG announced the results of a new JORC report with respect to Amaam North – Project F. Compared to the
previously reported coal reserves TIG’s Recoverable Reserves increased by 2.8 million tonnes (“Mt”) to 23.8Mt (15.0Mt proved
and 8.8Mt probable) while Marketable Reserves decreased by 0.34Mt to 15.4Mt (9.8mt proved and 5.6mt probable). TIG’s Amaam
North Resources decreased by 23.4Mt to 85.6Mt.
Project Assessment and Development Risk
The process of further developing and constructing Amaam North (including the CHPP enhancement) will be subject to many
uncertainties, including the timing and cost of construction, the receipt of required government permits and the availability of
financing for the projects. There is a risk that unexpected challenges or delays will arise, or that coal quality and quantity results
will differ from the estimates on which TIG’s cost estimates are based, increasing the costs of production and/or resulting in lower
sales.
Mining and development operations can be affected by force majeure circumstances, environmental considerations and cost
overruns for unforeseen events. Any event that impacts on the production rates potentially may reduce the quantity of coal mined
and thereby reduce the amount of coal available for sale.
Events that could adversely impact on production rates include, but are not limited to geotechnical and geological conditions;
equipment availability, utilisation rates and failure; development rates at which relevant coal seams are exposed; weather (including
flooding) and natural disasters; unexpected maintenance or technical problems; depletion of TIG’s reserves; increased or unexpected
reclamation costs; and interruptions due to transportation delays; interruptions to supplies of required materials and services; and
the actions of potential contractors engaged by TIG to operate its projects (including any breach of contract or other action outside
TIG’s control).
TIG is at the preliminary stage of determining the economic and technical viability of the Amaam Licence. To date TIG has
completed a Preliminary Feasibility Study (PFS) and subsequent resource updates on the Amaam project. There is a risk that the
more detailed studies in relation to the Amaam project may disprove assumptions or conclusions reached in the PFS, may reveal
additional challenges or complexities and may indicate the cost estimates are incorrect. In addition, TIG must proceed through a
number of steps before making a final investment decision with respect to the projects, conducting definitive feasibility studies,
converting Resources to Reserves, obtaining government approvals and permits and obtaining adequate financing.
Operational Risks
The Group’s projects may be subject to operational, technical or other difficulties, including those arising as a result of unforeseen
events outside the control of the Company, any or all of which may negatively impact the amount of coal produced, delay coal
deliveries or increase the estimated cost of production, which may have an adverse impact on the Company’s business and financial
condition. These risks include:
•
Political Risks: As discussed above, the relationship between the Unites States and various European countries, on the
one hand, and the Russian Federation, on the other, are broadly perceived to have deteriorated over the past year with the
deterioration focussing on an array of issues related to the Ukraine and security concerns voiced by the Russian Federation.
As a result of these issues, the Russian Federation could be subject to more restrictive economic sanctions enacted by the
United States and/or various European countries. It is not clear to what extent, any additional sanctions would impact the
Group’s business and operations.
30
12
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Directors’ report (continued)
For the year ended 31 December 2021
4.
Review of operations (continued)
• General Economic Risks: TIG’s ability to obtain funding for the projects, financial performance and ability to execute its
business strategy will be impacted by a variety of global economic, political, social, stock market and business conditions.
Deterioration or an extended period of adversity in any of these conditions could have an adverse impact on TIG’s
financial position and/or financial performance.
•
• Coal Market and Demand: TIG intends to earn future profits from the production and sale of coal and a decline in prices
or lower demand for coal than expected by TIG may adversely impact the feasibility of the Company’s development and
mine plans, and the economic viability of the projects. The Company faces commodity price risk when valuing its projects,
having adopted long-term sales price estimates in accordance with independent third-party external forecasts, validated
against long-term market expectations.
Exchange Rate Variations: Significant changes in the Australian / US Dollar, US Dollar / Russian Rouble and the
Australian Dollar / Russian Rouble exchange rates may have a significant impact on TIG’s ability to fund the capital
expenditure required to construct these projects.
• Climate-related risks: The introduction of new and/or more stringent carbon pricing mechanisms in Russia, and/or the
Group’s key coal importing countries such as China and Japan may reduce the cost competitiveness of coal as an energy
source. Further, changes in government policy relating to either coal consumption or energy generation in large Asian
economies could impact the longer-term outlook for global coal demand. Changes in the longer-term global coal demand
outlook could have an impact on the Group’s future coal revenues and the recoverability of undeveloped coal reserves.
Refer below for further details.
Climate-related risks
TIG identifies the need to address climate-related risks as integral to the achieving the Group’s key objectives and continues to
develop its assessment of the potential impact of climate change and the transition to a low carbon economy on its operations over
the short, medium, and long-term perspectives.
TIG’s current climate change approach focuses on supporting emissions reductions, assessing the impact on our business of evolving
global regulatory frameworks and managing climate-related risks and opportunities.
TIG divides climate-related risks into two major categories: risks related to the transition to a lower-carbon economy and risks
related to the physical impacts of climate change.
Transition risks arise from policy, regulatory, legal, technological, market and other responses to the challenges posed by climate
change and the transition to a low carbon economy. Below are the examples of the key identified transitional risks:
•
Legislative and policy changes focusing on climate change may impact TIG’s ability to operate and/or extend the life of
existing mining assets as well as develop new mines;
• Changes in government policy relating to either coal consumption or energy generation, such as introduction of new
and/or more stringent carbon pricing mechanisms in Russia, and/or the Company’s key export markets may reduce the
cost competitiveness of coal as an energy source;
• Changes in the longer-term global coal demand outlook driven by the transition to a lower carbon economy and
substitution of thermal coal as an energy source could have an impact on the Company’s future coal revenues and the
recoverability of undeveloped coal reserves.
• Climate related considerations of capital providers could limit access to capital and insurance markets significantly
•
increasing the cost of capital;
Failure to achieve and maintain acceptance on climate related issues may lead to impaired business reputation and
stakeholder exclusion.
Physical risks refer to acute risks that are event-driven, including increased severity of extreme weather events, and chronic risks
resulting from longer-term changes in climate patterns that potentially could have material impact on the Company’s operations.
As an example, a sharp drop in overall temperatures could shorten TIG’s port’s navigational season and affect loading rates, while
global warming of the ocean waters could on the contrary prolong the shipping season creating additional opportunity to maximize
loading in Beringovsky Port. There is not enough data currently to determine and assess the impact of physical risks on TIG’s
operations.
TIG’s Board of Directors and management take into account climate risks when discussing strategic initiatives and believe that
there is also opportunity for TIG to play a positive and effective role during transition to a low carbon economy.
Initiatives to reduce TIG’s carbon footprint include optimisation of fuel use and electricity consumption, investigating technologies
that would improve energy efficiency of TIG’s operations, including renewable energy sources, and commissioning CHPP that will
significantly decrease the share of thermal coal in TIG’s product mix.
13
31
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Directors’ report (continued)
For the year ended 31 December 2021
4.
Review of operations (continued)
Capital Management
The nature of the Group’s mining operations is such that coal production continues throughout the winter season, whilst sales are
only realised during the Beringovsky Port shipping season. The shipping season historically commences in June and port operations
may continue as late as November. The length of the shipping season is limited, resulting in the necessity of engaging vendors in
the first half of the calendar year prior to the generation of operating cashflows from coal sales. This seasonality significantly
impacts both on the nature, level and timing of required funding.
The Group, therefore, must ensure that its liquidity levels are managed during the period between shipping seasons. Consideration
is also required of the extent and timing of capital expenditures and the related forward funding commitments necessary to achieve
the Group’s expected development levels.
The Group had cash balances of A$33.511 million at 31 December 2021. Directors have concluded that cash balances at year end
provide TIG with sufficient liquidity, given projected expenditures during the first six months of 2022 and anticipated sales
arrangements.
TIG’s Amaam project is at the pre-development stage and will require additional drilling, evaluation and feasibility study work
prior to a development decision. Should TIG proceed to develop the Amaam project upon completion of further definitive studies,
significant capital expenditure will be required.
Licenses, Permits and Titles
TIG requires certain licenses, permits and approvals to develop the Amaam North and Amaam projects. There are three main
approvals required to commence the construction and operation of a mining project in Russia. These are a) an Exploration and
Extraction Licence (Mining Licence); b) a Construction Permit; and c) a Commissioning Permit. Due to the current stage of the
Amaam project, the Company has not yet applied for the majority of the required licences, permits and approvals to construct and
operate the mine. Amaam exploration license AND 01379 TP (former AND 01277 TP) renewal was completed in June 2020.
For Project F Amaam North, the Mining Licence was granted in December 2014 and work has been completed in obtaining all
relevant Construction and Commissioning Permits. In 2019 Rosnedra, the Russian natural resource licensing authority, approved a
Mining and Excavation Plan (“TPRM”) for the integrated development of the Fandyushkinskoe and Zvonkoye license areas.
In addition to specific mining-related approvals, other approvals are required for the development of Amaam North. Such approvals
relate to the CHPP, road development from the Amaam North mine site to Beringovsky Port and Coal Terminal and for the capital
upgrades to be completed at the Beringovsky Port and Coal Terminal.
There are also a number of conditions and regulatory requirements that TIG must satisfy with respect to its tenements to maintain
its interests in those tenements in good standing, including meeting specified drilling and reporting commitments. There is a risk
that TIG may not be able to complete all drilling requirements due to equipment availability, delays caused by suppliers or
contractors or weather.
There is a risk that TIG may fail to obtain or be delayed in obtaining the licences, permits and approval, or meet the conditions
required to maintain its interests in the tenements. In the event that TIG fails to obtain, or delays in obtaining such licenses, permits
and approvals occur, and there arises a failure to meet tenement licence commitments, such events may adversely affect TIG’s
ability to proceed with the projects as currently planned.
Feasibility Studies of the Amaam deposit development for licence areas АНД 01278 (Zapadny) and АНД 01288 (Nadezhny) were
completed and approved in 2019. Following this approval, TIG will develop and have approved a Mining and Excavation Plan
(“TPRM”) for Zapadny licence area, outlining the expected mining approach and volumes from the licence area.
5.
Significant changes in the state of affairs
In the opinion of the Directors, except as disclosed in the review of operations, there were no further significant changes in the
Group’s state of affairs during the year ended 31 December 2021 not otherwise reflected in the accompanying consolidated financial
statements.
6.
Events subsequent to reporting date
In January 2022, the Company entered into purchase agreements amounting to A$9.638 million for the delivery of mining equipment
during the first half of 2022.
7.
Dividends paid or recommended
The Directors do not recommend the payment of a dividend and no amount has been paid or declared by way of a dividend to the
date of this report.
32
14
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Directors’ report (continued)
For the year ended 31 December 2021
8.
Likely developments
TIG expects to complete commissioning procedures and begin processing coal during the March quarter 2022.
Ongoing enhancements of port, road and other mine infrastructure will continue during 2022. The Group will place an emphasis on
progressing exploration and appraisal activities at both Amaam and Amaam North.
9.
Environmental regulation
The Group’s exploration, development and mining activity in Russia is subject to Federal and Regional Environmental regulation.
The Group is committed to meeting or exceeding its regulatory requirements and has systems in place to ensure compliance with
the relevant Environmental regulation. The Directors are not aware of any breach of these regulations during the period covered by
this report.
10.
Directors’ interests
The relevant interest of each Director and Alternate Director in the shares or options over such instruments issued by the companies
within the Group and other related bodies corporate, as notified by the directors to the ASX in accordance with S205G (1) of the
Corporations Act 2001, at the date of this report is as follows:
C Wiggill
B Gray
O Hegarty
D Swan
M Jakeman
11.
Share Options
Tigers Realm Coal Limited
Ordinary shares
5,100,000
7,825,877,288
66,412,029
-
-
Options over ordinary shares
-
-
-
-
-
Options granted to directors, executives and employees of the Company
The option plan offers individuals the opportunity to acquire fully paid ordinary shares in the Company. Share options granted under
the plan carry no dividend or voting rights. When exercised, each option is convertible into one ordinary share subject to satisfying
vesting conditions and performance criteria. The shares when issued rank pari passu in all respects with previously issued fully paid
ordinary shares. Option holders cannot participate in new issues of capital which may be offered to shareholders prior to exercise.
During the year ended 31 December 2021, there were no options issued and 1,905,000 options lapsed, bringing options issued over
ordinary shares in the Company to 8,002,000 at 31 December 2021 (For the year ended 31 December 2020: no options issued and
6,976,000 options lapsed and 11,463,000 options forfeited, thus bringing the options issued over ordinary shares in the Company to
9,907,000).
Unissued shares under options
Unissued shares under options as of the date of this report are detailed in Note 24 to the consolidated financial statements.
15
33
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Directors’ report (continued)
For the year ended 31 December 2021
12.
Remuneration report – audited
This remuneration report, which forms part of the directors’ report, sets out the remuneration information for Tigers Realm Coal
Limited’s non-executive directors and other key management personnel (“KMP”) for the financial year ended 31 December 2021.
(a)
Details of key management personnel
Name
Directors
Craig Wiggill
Bruce Gray
Owen Hegarty
Valery Doronin
Tagir Sitdekov
Nikolay Ishmetov
David Swan
Senior Executives
Dmitry Gavrilin
Dale Bender
Scott Southwood
Sergey Efanov
David Forsyth
Position
Commencement Date
Chairman (Non-Executive)
Director (Non-executive)
Director (Non-executive)
Director (Non-executive)
Director (Non-executive)
Alternate Director for Mr Sitdekov
Director (Non-executive)
Chief Executive Officer
Chief Financial Officer
General Manager Marketing
General Manager Operations
Company Secretary
20 November 2012
1 October 2015
8 October 2010
27 April 2021
1 April 2014
1 July 2017
26 August 2020
1 June 2018
1 October 2018
13 October 2013
15 November 2017
8 October 2010
(b)
Changes to key management personnel
Directors
On 14 April 2021 Tagir Sitdekov resigned as Non – Executive Director of The Company.
On 27 April 2021 Valery Doronin was appointed as Non – Executive director of the Company.
On 26 August 2020 Ralph Morgan resigned as Non – Executive Director of The Company.
On 26 August 2020 David Swan was appointed as Non – Executive director of the Company.
Executives
There were no changes to Executives during 2021 and 2020.
34
16
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Directors’ report (continued)
For the year ended 31 December 2021
12.
(c)
Remuneration report – audited (continued)
Principles used to determine the nature and amount of remuneration
KMP are those persons having authority and responsibility for planning, directing and controlling the Group’s activities and include
the Company’s Directors and Senior executives.
The Board is committed to clear and transparent disclosure of the Company’s remuneration arrangements. The Company’s
remuneration policy is designed to ensure that it enables the Company to attract and retain valued employees and motivate senior
executives to pursue the long-term growth and success of the Company, demonstrate a clear relationship between performance and
remuneration and have regard for prevailing market conditions.
(d)
Consequence of performance on shareholder wealth
The Directors are committed to developing and maintaining a remuneration policy and practices that are targeted at the achievement
of corporate values and goals and the maximisation of shareholder value.
When determining compensation for KMP, the Nomination and Remuneration Committee and the Board have regard to financial
funding, resource development, project advancement and development, and other objectives, based on goals set by the Nomination
and Remuneration Committee and the Board throughout the year. In addition, the Board has regard to the following financial indices
in respect of the financial year and previous four financial years.
2021
2020
2019
2018
2017
Net profit/(loss) attributable to equity
holders of the parent (A$ million)
$37.923
$(15.616)
$(18.715)
$10.959
$(6.213)
Closing share price (A$)
$0.02
$0.01
$0.01
$0.04
$0.057
(e)
Remuneration policy and structure for senior executives
The objective of the Group’s executive remuneration policy is to ensure the reward for performance is market competitive and
appropriate for the results delivered. The structure aligns executive reward with achievement of strategic objectives and the creation
of wealth for shareholders and conforms to market practice for delivery of reward. The structure provides a mix of fixed and variable
remuneration and for the variable, or “at-risk”, remuneration a blend of short-term and long-term incentives. As executives gain
seniority within the Group, the balance of this mix shifts to a higher proportion of “at-risk” rewards.
The Company’s remuneration policy and structure for its senior executives comprises three main components:
•
•
•
Fixed Remuneration, which is the total base salary and includes employer superannuation contributions. The fixed
remuneration reflects the job level, role, responsibilities, knowledge, experience and accountabilities of the individual
executive and is set at a level which is competitive, aligned with the business needs and based on current market conditions
in the mining industry and countries in which the Company does business.
Compensation levels are reviewed each year by the Nomination and Remuneration Committee to take into account cost-of-
living changes, any change in the scope of the role performed by the senior executive and any changes required to meet the
principles of the remuneration policy. The review process considers individual and overall performance of the Group.
Short-Term Incentive (“STI”), which is at-risk remuneration. This is an annual incentive award based on the achievement
of pre-determined Company and individual objectives. These short-term incentives are available to executives and other
eligible participants and are at the discretion of the Board. The STI is an at-risk bonus, which is payable subsequent to Board
ratification of recommendations made by the Remuneration and Nomination Committee each year.
Long-Term Incentive (“LTI”) Program is at-risk remuneration. Under the LTI Program which was effective before 2021,
employees, at the discretion of the Board, are offered options over ordinary shares in the Company under the Company’s
Option Plan. In 2021 the Company approved new LTI program. The Program establishes a range of potential bonus payouts
to the CEO, COO and CFO in 2024 in the event that earnings and environmental, social and corporate governance (“ESG”)
targets for the preceding three years were met. The earnings component and ESG component are weighted 75% and 25%,
respectively. The earnings component is aggregated earnings before taxes, depreciation & amortisation (“AEBTDA”).
AEBTDA differs from the commonly-used metric of EBITDA in that it is aggregated over three years and interest expenses
are included. The target AEBTDA and the level required to achieve maximum bonus for the earnings component of the
LTIP are US$70.8 million and US$100.8 million, respectively. The ESG component is at the discretion of TIG’s Board of
Directors and will be based on the Directors’ assessment of the degree to which the Group’s ESG goals were met. The target
and maximum potential bonus payouts equal, respectively, 2.5 times and 5 times average annual base pay.
17
35
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Directors’ report (continued)
For the year ended 31 December 2021
12.
(e)
Remuneration report – audited (continued)
Remuneration policy and structure for senior executives (continued)
For the LTI element of remuneration, any options granted under the Company’s Option Plan, are approved by the Board in advance.
Further details of the Option Plan are included in Note 24 to the consolidated financial statements. The Company may make initial
grants of options to certain senior executives as part of their individual employment contracts. It is a vesting condition that the
holder of options remains an employee or director at the time of vesting.
For the STI element of remuneration, a performance framework has been developed for KMP and other senior executives under the
STI programme. Key Performance Indicators (“KPIs”) are developed for each individual, which are reassessed regularly to ensure
they remain current and applicable as the Group’s operations develop.
Individual performance against these KPIs is assessed annually by the individual’s manager or the CEO and is subject to Board
discretion. The performance framework develops individual KPIs for KMP other than CEO, CFO and the GM Operations in the
following proportions:
•
•
30% Group related KPIs, (these are Health, Safety & Environmental specific, Project, and Corporate objectives); and
70% Individual KPIs tailored to the role and objectives of each senior executive.
For CEO, CFO and the GM Operations the proportion is 50% Group related KPIs and 50% Individual KPIs
Employment contracts contain no termination benefits other than payments in lieu of notice and redundancy payments. The notice
periods and redundancy payments vary for the individuals and depending upon the period of service.
The remuneration and other terms of employment for key management personnel are formalised in their employment contracts and
services contracts.
(f)
Employment contracts
The Group has entered into employment arrangements with each senior executive, other than the General Manager Marketing, who
is engaged on an external contractor basis, which are open-ended contracts with no expiry date. The contracts may be terminated
immediately on the basis of serious misconduct. The senior executives are also entitled to receive on termination of employment
their statutory and contractual entitlements of accrued annual and long service leave, together with any superannuation benefits.
The employment contracts provide for the payment of performance-related bonuses under both STI and LTI programmes and
participation, where eligible, in the Company Option Plan under the LTI Program. The maximum bonus payable under the STI
programme is up to 128% of total remuneration for CEO and 75% for CFO and the GM Operations. The Group can elect to pay
these bonuses in cash or by means of issuance of shares.
The employment contract outlines the components of compensation but does not prescribe how compensation levels are modified
year to year. The Nomination and Remuneration Committee reviews and makes any recommendations to the Board annually on
compensation levels, assessing the necessity or otherwise of any changes required so as to meet the principles of the Group’s
compensation policy.
(g)
Remuneration of Executive and Non-Executive Directors
On appointment to the Board, Non-executive Directors enter into service agreements with the Company in the form of a Letter of
Appointment. The letter summarises the Board Policies and terms, including compensation, relevant to the office of Director. The
employment contracts with Directors have no fixed term.
Non-executive Director remuneration is reviewed annually by the Board. Non-executive Directors are eligible for a fixed base fee
for being a Director and may receive additional fees for either chairing or being a member of a Board committee, working on special
committees, and / or serving on special committees and / or special boards. Non-executive Directors’ fees are determined within an
aggregate Directors’ fee pool limit, which has been established at A$1,500,000.
In addition to being eligible for a fixed base fee, all non-executive Directors are entitled to 9.50 per cent in superannuation
contributions. No retirement or other long-term benefits are provided to any Director other than superannuation. Non-Executive
Directors can claim reimbursement of out-of-pocket expenses incurred on behalf of the Company. During the year ended 31
December 2021, the base fee for Directors was $30,000 per annum. The Chairman is entitled to A$100,000 per annum and a per
diem of the AUD equivalent of British Pounds Sterling (“GBP”) 1,000 is payable whilst travelling in respect of the Group’s business.
In addition to the base fee, A$20,000 per annum is also payable to the Director who performs the duties of Chairman of the Audit,
Risk and Compliance Committee. With the exception of the independent Chairman and Chairman of the Audit, Risk and Compliance
Committee, all directors waived their director fee entitlements for the year ended 31 December 2021.
36
18
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Directors’ report (continued)
For the year ended 31 December 2021
12.
(h)
Remuneration report – audited (continued)
Details of the remuneration of the Group’s key management personnel
Details of the nature and amount of each major element of remuneration of each Director of the Company, and the key management
personnel (as defined in AASB 124 Related Party Disclosures) are set out in the following tables.
Short – term
Post-
employment
Cash
Salary and
fees
A$
Non-
Monetary
Benefits
(1)
A$
STI
bonus
(2)
A$
Super-
annuation
A$
LTI (3)
A$
Total
Remun-
eration
A$
Proportion
of remun-
eration
comprising
options
%
Name
2021
Non-executive Directors
C Wiggill
B Gray
O Hegarty
V Doronin
T Sitdekov
D Swan
Sub total
Other key management personnel
D Gavrilin
D Bender
S Southwood
D Forsyth
S Efanov
Sub total
Total key management
Personnel
100,000
-
-
-
-
53,270
153,270
422,691
263,291
234,778
114,164
354,366
1,389,290
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
9,500
-
-
-
-
5,060
14,560
-
-
-
-
-
-
109,500
-
-
-
-
58,330
167,830
352,292
126,331
68,026
-
136,455
683,104
-
-
-
-
-
-
346,118
1,121,101
202,312
-
-
218,525
591,934
302,804
114,164
709,346
766,955
2,839,349
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
1,542,560
-
683,104
14,560
766,955
3,007,179
Includes the value of fringe benefits and other allowances.
In respect of 2021.
1.
2.
3. During 2020 all the options granted under the previous LTI programme vested. 2021 remuneration includes cash bonuses accrued under
new LTI program.
During the year ended 31 December 2021, other than the remuneration detailed above, key management personnel were neither
entitled to nor did they receive loans or other benefits.
19
37
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Directors’ report (continued)
For the year ended 31 December 2021
12.
(h)
Remuneration report – audited (continued)
Details of the remuneration of the Group’s key management personnel
Short – term
Cash
Salary
and fees
A$
Non-
Monetary
Benefits
(1)
A$
STI
bonus
(2)
A$
Post-
employment
Share -
based
payments
Super-
annuation
A$
LTI (3)
A$
Total
Remun-
eration
A$
Proportion
of remun-
eration
comprising
options
%
115,380
-
-
-
-
18,274
133,654
449,685
284,948
167,704
189,196
326,392
1,417,925
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
144,830
86,898
43,450
-
130,348
405,526
10,961
-
-
-
-
1,736
12,697
-
-
-
-
-
-
-
-
-
-
-
-
-
-
6,060
4,669
8,869
126,341
-
-
-
-
20,010
146,351
594,515
371,846
217,214
193,865
465,609
19,598
1,843,049
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
2.79%
2.41%
1.90%
Name
2020
Non-executive Directors
C Wiggill
B Gray
O Hegarty
R Morgan
T Sitdekov
D Swan
Sub total
D Bender
S Southwood
D Forsyth
S Efanov
Sub total
Total key management
Personnel
Other key management personnel
D Gavrilin
1,551,579
-
405,526
12,697
19,598
1,989,400
1.
2.
3.
Includes the value of fringe benefits and other allowances.
In respect of 2020. Part of the 2020 bonuses is planned to be paid in TIG’s shares.
In accordance with the requirements of Accounting Standards, remuneration includes a proportion of the fair value of equity c ompensation
granted or outstanding during the year (i.e. options granted under the LTI programme that remained unvested during 2020). The fair value of
equity instruments is determined at the grant date and is progressively allocated over the vesting period. The amount included as remuneration
is not necessarily related to or indicative of the benefit (if any) that senior executives may ultimately realise should the equity instruments vest.
The fair value of the options at the date of their grant has been determined in accordance with AASB 2 Share-based Payments. All options
granted under the LTI programme are equity settled.
38
20
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Directors’ report (continued)
For the year ended 31 December 2021
12.
(i)
Remuneration report – audited (continued)
Analysis of performance related elements of remuneration
The following table shows the relative proportions of remuneration packages of the Executive Directors and KMP during the year
ended 31 December 2021, that are linked to performance and those that are fixed. The STI and LTI components of each of the
Senior Executive’s remuneration are contingent upon the achievement of the performance criteria.
Name
2021
Other key management personnel
Dmitry Gavrilin, CEO
Dale Bender, CFO
Scott Southwood, General Manager Marketing
David Forsyth, Company Secretary
Sergey Efanov, General Manager Project F
2020
Other key management personnel
Dmitry Gavrilin, CEO
Dale Bender, CFO
Scott Southwood, General Manager Marketing
David Forsyth, Company Secretary
Sergey Efanov, General Manager Project F
Fixed Annual
Remuneration
(including
superannuation
contributions)
%
At Risk - STI
as percentage
of Total
Remuneration
%
At Risk - LTI
as percentage
of Total
Remuneration
(1)
%
At Risk -
Total
as percentage
of Total
Remuneration
%
37.70
44.48
77.53
100.00
49.96
75.64
76.63
77.21
97.59
70.10
31.43
21.34
22.47
-
19.23
24.36
23.37
20.00
-
28.00
30.87
34.18
-
-
30.81
-
-
2.79
2.41
1.90
62.30
55.52
22.47
-
50.04
24.36
23.37
22.79
2.41
29.9
1
For LTI provided by way of options, the percentages disclosed also reflect the value of remuneration consisting of options, based on the
value of options expensed during the year.
The Options Scheme prohibits executives from entering into arrangements to protect the value of unvested LTI Plan awards. The
prohibition includes entering into contracts to hedge their exposure to options awarded as part of their remuneration package.
21
39
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Directors’ report (continued)
For the year ended 31 December 2021
12.
(j)
Remuneration report – audited (continued)
Analysis of bonuses included in remuneration
During and in respect of the years ended 31 December 2021 and 2020, there were A$683,104 and A$405,526, respectively, in short-
term incentive (STI) cash bonuses awarded as remuneration to key management personnel.
(k)
Share Options granted as remuneration
During the year ended 31 December 2021 and 2020, there were no options granted to key management personnel. Further details
of the Option Plan are included in Note 24 to the consolidated financial statements.
During the year ended 31 December 2021, no options over ordinary shares vested (For the year ended 31 December 2020
5,281,000 options over ordinary shares vested) as follows:
Number of
options
vested
during year Grant date
Fair value
of option at
grant date
A$
Exercise
price per
option
A$
Vesting
date
Start
Vesting date
finish
Expiry
date
2020
Other key management personnel
S Southwood
D Forsyth
S Efanov
1,633,000
1,258,000
2,390,000
18/10/2017
18/10/2017
18/10/2017
0.031
0.031
0.031
0.08
0.08
0.08
18/10/2017 18/10/2020 18/10/2022
18/10/2017 18/10/2020 18/10/2022
18/10/2017 18/10/2020 18/10/2022
40
22
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Directors’ report (continued)
For the year ended 31 December 2021
12.
(k)
Remuneration report – audited (continued)
Analysis of Movement in Share Options
The movement during the reporting period in the number of options over ordinary shares of Tigers Realm Coal Limited shares held
directly, indirectly, or beneficially by the key management personnel and their related entities are set out below.
Grante
d as
remu
n-
eratio
n
Exerci
-sed
during
year
Forfeited/
Lapsed
during
year
Held at 31
December
Vested at 31 December
Total
Exercisable
Not
exer-
cisabl
e
Name
Held at
1 January
2021
Non-executive Directors
C Wiggill
B Gray
O Hegarty
V Doronin
T Sitdekov
D Swan
-
-
-
-
-
-
Other key management personnel
-
-
1,906,000
2,475,000
3,621,000
D Gavrilin
D Bender
D Forsyth
S Southwood
S Efanov
2020
Non-executive Directors
C Wiggill
B Gray
O Hegarty
R Morgan
T Sitdekov
D Swan
1,500,000
-
1,500,000
500,000
500,000
-
Other key management personnel
D Gavrilin
D Bender
D Forsyth
S Southwood
S Efanov
-
-
2,670,000
3,975,000
3,621,000
-
-
-
-
-
-
-
-
-
-
-
(1,500,000)
-
(1,500,000)
(500,000)
(500,000)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,906,000
2,475,000
3,621,000
1,906,000
2,475,000
3,621,000
1,906,000
2,475,000
3,621,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(764,000)
(1,500,000)
-
1,906,000
2,475,000
3,621,000
1,906,000
2,475,000
3,621,000
1,906,000
2,475,000
3,621,000
23
41
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Directors’ report (continued)
For the year ended 31 December 2021
12.
Remuneration report – audited (continued)
(m) Analysis of Movement in Share Options, by value
The movement during the reporting period, by value, of options over ordinary shares in the Company held by each key management
person.
Value of options
granted during year
A$
Value of options
exercised during year
A$
Value of options
lapsed during year
A$
Remuneration
consisting of options
for the year
%
2021
Non-executive Directors
C Wiggill
B Gray
O Hegarty
V Doronin
T Sitdekov
D Swan
Other Key Management Personnel
D Forsyth
S Southwood
S Efanov
2020
Non-executive Directors
C Wiggill
B Gray
O Hegarty
R Morgan
T Sitdekov
D Swan
Other Key Management Personnel
D Forsyth
S Southwood
S Efanov
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(38,500)
-
(38,500)
(17,500)
(17,500)
-
(42,020)
(82,500)
-
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
2.41%
2.79%
1.90%
For details on the valuation of options, including models and assumptions used, refer to Note 24 to the consolidated financial
statements.
(n) Analysis of options over equity instruments granted as compensation
Option vesting profiles over the Company’s ordinary shares granted as remuneration to each KMP and executive are detailed below:
Options granted
Number
Grant date
Vested during
year
Forfeited/ Lapsed
during year
Vesting date
Start
Vesting date
Finish
Executives
D Forsyth
S Southwood
S Efanov
648,000
1,258,000
842,000
1,633,000
1,231,000
2,390,000
18/10/17
18/10/17
18/10/17
18/10/17
18/10/17
18/10/17
-
-
-
-
-
-
-
-
-
-
-
-
18/10/19
18/10/20
18/10/19
18/10/20
18/10/19
18/10/20
18/10/22
18/10/22
18/10/22
18/10/22
18/10/22
18/10/22
42
24
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Directors’ report (continued)
For the year ended 31 December 2021
13.
Indemnification and insurance of Officers and Auditors
The Company provides insurance to cover legal liability and expenses for the Directors and Executive Officers of the Company.
The Directors and Officers Liability Insurance provides cover against all costs and expenses that may be incurred in defending civil
or criminal proceedings that fall within the scope the indemnity and that may be brought against the Officers in their capacity as
Officers. Disclosure of the nature of the liability cover and the amount of the premium is subject to a confidentiality clause under
the insurance policy.
The Company has not provided any insurance or indemnity for the auditor of the Company.
14.
Rounding and ASIC relief
The Company is of a kind referred to in ASIC Corporations (Rounding in Financials/Directors’ Reports) Instrument 2016/191, dated
24 March 2016, and in accordance with that Corporations Instrument amounts in the Directors’ Report have been presented in
Australian dollars and rounded to the nearest thousand dollars, unless otherwise indicated.
15.
Audit and non-audit services
The Company may decide to employ the auditor on assignments additional to their statutory audit duties where the auditor’s
expertise and experience with the Company are important. Details of the amounts paid or payable to Deloitte, the Group’s auditor,
for audit and non-audit services provided during the year are outlined in Note 34 to the consolidated financial statements.
The Board of Directors has considered the position and, in accordance with the advice received from the Audit, Risk and Compliance
Committee, is satisfied that the provision of the non-audit services is compatible with the general standard of independence imposed
by the Corporations Act 2001. The Directors are satisfied that the provision of non-audit services by the auditor, as set out in Note
34, did not compromise the auditor independence requirements of the Corporations Act 2001 for the following reasons:
• all non-audit services have been reviewed and approved by the Board to ensure they do not impact the integrity and
objectivity of the auditor; and
• none of the services undermine the general principles relating to auditor independence as set out in APES 110 ‘Code of
Ethics for Professional Accountants’.
16.
Proceedings on behalf of the Company
No person has applied for leave of any Court to bring proceedings on behalf of the Company or intervene in any proceedings to
which the Company is a party for the purpose of taking responsibility on behalf of the Company for all or any part of those
proceedings.
17.
Auditor’s Independence Declaration
The auditor’s independence declaration is included on page 78 and forms part of the Directors’ report for the year ended 31
December 2021.
This report is made in accordance with a resolution of the Directors
Dated at Melbourne this 24th day of February 2022.
Signed in accordance with a resolution of the Directors:
__________________________________
Craig Wiggill
Director
25
43
Annual Report 2021Tigers Realm Coal Tigers Realm Coal Limited
Directors’ report (continued)
For the year ended 31 December 2021
Corporate governance statement
The Board of Directors are responsible for the Company’s corporate governance. The Board guides and monitors the business affairs
of the Company on behalf of the shareholders by whom they are elected and to whom they are accountable. The Company has
adopted systems of control and accountability as the basis for administration of corporate governance. The Board is committed to
administering the policies and procedures with openness and integrity, pursuing the highest standards of corporate governance
commensurate with the Company’s needs. To the extent that they are appropriate and applicable the Company has adopted the
Principles of Good Corporate Governance Recommendations (“Recommendations”) as published by the ASX Corporate
Governance Council. As the Company’s activities develop in size, nature and scope, the Board will consider on an ongoing basis
its corporate governance policies and whether they are sufficient given the Company’s size and nature of operations.
This Corporate Governance Statement is current as at 25 February 2022 and has been approved by the Board. A description of the
Group’s corporate governance practices are set out below. Where changes have occurred during the 2021 year the dates of these
changes are shown. These corporate governance practices have been in place since the Company was listed on the ASX on 29
August 2011. Copies of the corporate governance documents mentioned in this statement are available on the Company’s website.
Principle 1: Lay solid foundations for management and oversight
Role of the Board
The Board’s primary role is the protection and enhancement of long-term shareholder value. To fulfil this role, the Board is
responsible for the overall corporate governance of the Group. The Board exercises its powers and performs its obligations in
accordance with the provisions of the Company’s constitution and the Corporations Act 2001.
The Board is responsible for:
•
charting the direction, policies, strategies and financial objectives of the Company and ensuring appropriate resources are
available;
•
•
•
•
•
monitoring the implementation of these policies and strategies and the achievement of financial objectives;
monitoring compliance with control and accountability systems, regulatory requirements and ethical standards;
ensuring the preparation of accurate financial reports and statements;
reporting to shareholders and the investment community on the performance and state of the Company; and
reviewing on a regular and continuing basis:
o
o
executive succession planning; and
executive development activities.
Day to day management of the Group’s affairs and the implementation of the corporate strategy and policy initiatives are formally
delegated by the Board to the CEO and senior executives as set out in the Group’s Delegation Policy, which is available on the
Company’s website. These delegations of authority are reviewed on a regular basis.
Board Committees
The Board had established two committees to assist in the execution of its duties and to allow detailed consideration of complex
issues. Current committees of the Board are the Nomination and Remuneration Committee and the Audit, Risk and Compliance
Committee. The necessity for and structures and memberships of the respective committees are reviewed regularly.
Each committee has its own written charter setting out its role and responsibilities, composition, structure, and meeting requirements.
These charters are subject to regular review and are available on the Company website. All matters determined by committees are
submitted to the full Board as recommendations for Board decisions.
Minutes of committee meetings are tabled at subsequent board meetings. Additional requirements for specific reporting by the
committees to the Board are addressed in the charter of the individual committee.
Management Performance Evaluation
The Board, in conjunction with the Nomination and Remuneration Committee, is responsible for approving the performance
objectives and measures for the CEO and other senior executives and providing input into the evaluation of performance against
them.
44
26
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Directors’ report (continued)
For the year ended 31 December 2021
Corporate Governance Statement (continued)
Principle 2: Structure of the Board
Composition of the Board
The names of the Company’s Directors in office at the date of this report, specifying which are independent, are set out in the
Directors’ report. At the date of this report, the Board consists of four Non-Executive Directors and one Non-Executive Chairman.
The composition of the Board is determined in accordance with the following principles outlined in the Board Charter:
•
a minimum of three Directors;
•
•
the intention that as the Group develops the majority of Directors will be independent; and
the requirement for the Board is to undertake an annual performance evaluation and consider the appropriate mix of skills
required by the Board to maximise its effectiveness and its contribution to the Group.
The Board considers the mix of skills and diversity of Board members when assessing the composition of the Board.
At the date of this report the Board meets the Good Corporate Governance Recommendations in that the majority of Directors
should be independent. Currently four of the five Directors are independent: Craig Wiggill, David Swan, Owen Hegarty and Mitch
Jakeman.
Given the developmental nature of the Company and the experience of the Directors, the Board considers the composition of the
Board to be appropriate at this time. In due course, consideration will be given to increasing the number of independent Directors
on the Board.
Board Skills
The Nomination and Remuneration Committee is responsible for developing and implementing processes to identify and assess
necessary and desirable competencies and characteristics for Board members.
The Board considers that collectively the Directors have the necessary skills, knowledge and experience to direct the Company as
outlined in the following Skills Matrix.
Experience and Competencies
Professional Qualifications
Coal Industry Experience
Engineering
Strategy, leadership and risk management
Finance/Economics
Commercial, trading and marketing Accounting
Financial analysis and capital markets experience
Corporate Governance and regulatory
Project development and construction
Stakeholder communication and engagement
Safety, environment and social responsibility
Director Independence
The Board has adopted specific principles in relation to Directors’ independence. These state that when determining independence,
a Director must be non-executive and the Board should consider whether the Director:
•
is a substantial shareholder of the Company or an officer of, or otherwise associated directly with, a substantial shareholder
of the Company;
•
•
•
•
is or has been employed in an executive capacity by the Company of any other Group member, within three years before
commencing to serve on the Board;
within the last three years has been a principal of a material professional advisor or a material consultant to the Company or
any other Group member, or an employee materially associated with the service provided;
is a material supplier or customer of the Company or any other Group member, or an officer of or otherwise associated
directly or indirectly with a material supplier or customer; and
has a material contractual relationship with the Company or other Group member other than a Director of the Company.
Family ties and cross-directorships may be relevant in considering interests and relationships which may compromise independence
and should be disclosed by Directors to the Board.
27
45
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Directors’ report (continued)
For the year ended 31 December 2021
Corporate Governance Statement (continued)
The Board regularly reviews the independence of each Director in light of interests disclosed and will disclose any change to the
ASX, as required by the ASX Listing Rules.
Independent Professional Advice
All Directors may obtain independent professional advice, at the Company’s cost, in carrying out their duties and responsibilities.
Prior approval from the Chairman or the Board is required before seeking independent professional advice.
Chairman
The Board elects one of its Non-Executive Directors to be the Chairman. The Chairman is responsible for leading the Board,
ensuring Directors are properly briefed in all matters relevant to their role and responsibilities, facilitating Board di scussions and
managing the Board’s relationship with the Company’s senior executives. The Recommendations note that the Chairman should be
an independent Director. The current Chairman, Mr Craig Wiggill satisfies the independence recommendation. The role of the
Chairman is separate from that of the CEO. The CEO is responsible for implementing Group strategies and policies.
Orientation Program
The orientation program provided to new Directors and senior executives enables them to actively participate in Board decision
making as soon as possible. It ensures that they have a full understanding of the Group’s financial position, strategies oper ations,
culture, values and risk management policies. Directors have the opportunity to visit the Group’s business operations and meet with
management to gain a better understanding of the Group’s operations. The Group also supports Directors to undertake continuing
education relevant to the discharge of their obligations as Directors of the Group.
Nomination and Remuneration Committee
The Nomination and Remuneration Committee consists of three Non-Executive Directors and the Chairman, who is independent.
The Committee has a documented charter, approved by the Board which is available on the Company’s website. Details of the
qualifications of members of the Nomination and Remuneration Committee and their attendance at meetings of the Committee are
set out in the Directors’ Report. The Chairman of the Committee is Mr David Swan.
The Nomination and Remuneration Committee operates in accordance with its charter, and the main responsibilities of the
nomination activities of the Committee are to:
•
review and make recommendations to the Board relating to the remuneration of the Directors and the CEO;
•
•
•
•
•
•
assess the necessary and desirable competencies of Board members;
review Board succession planning;
make recommendations to the Board regarding the appointment and re-election of Directors and the CEO;
oversee succession planning, selection and appointment practices for management and employees of the Group;
develop a process for the evaluation of the performance of the Board, its committees and Directors; and
consider strategies to address Board diversity and the Company’s performance in respect of the Company’s Diversity Policy.
The Committee is also responsible for considering and articulating the time needed to fulfil the role of Chairman and Non-Executive
Directors.
A last performance evaluation of the Board, its committees and the Directors was performed in 2021. The outcomes of the evaluation
were discussed and considered by all the Directors and specific performance goals were agreed upon for the coming year.
Principle 3: Promote ethical and responsible decision making
Code of Conduct
The Company has developed a Code of Conduct which has been endorsed by the Board and applies to all Directors, employees and
contractors. The Code of Conduct is regularly reviewed and updated as necessary to ensure it reflects the highest standards of
behaviour, professionalism and business ethics necessary to maintain confidence in the Group’s integrity.
In summary, the Code of Conduct requires that all Group personnel at all times act with utmost integrity, objectivity and in
compliance with the letter and the spirit of the law and Group policies.
46
28
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Directors’ report (continued)
For the year ended 31 December 2021
Corporate Governance Statement (continued)
Principle 3: Promote ethical and responsible decision making (continued)
Whistleblowers’ Policy
The Company’s Whistleblowers’ Policy encourages employees and contractors to report concerns in relation to illegal, unethical or
improper conduct without fear of reprisal if it is reported in good faith. The Company commits to absolute confidentiality and
fairness in all matters raised.
Securities Trading
Directors and employees are allowed to purchase and sell shares in the Group provided they comply with the provisions of the
Group’s Securities Trading Policy. The trading policy prohibits Directors and employees and their associates from trading in Group
securities when they are in possession of price sensitive information which is not publicly available or during “blackout” periods.
Directors and restricted employees must seek prior written approval before undertaking any trading in Company securities. The
Directors and employees must also advise the Company Secretary if they intend to enter into, or have entered into, a margin lending
or other security arrangement affecting Company securities. The Company Secretary will advise the ASX of any transactions
conducted by Directors in relation to the Company securities. A register of interests is maintained which record security holdings
in the Company by Directors and employees.
Workplace Diversity
The Board is committed to having an appropriate blend of diversity on the Board, and in the Group’s senior executive positions.
The Group values diversity and recognises the benefits it can bring to the Group’s ability to achieve its goals. The Group has adopted
a diversity policy which outlines the Group’s diversity objectives in relation to gender, age, cultural background and ethnicity. The
Group has not established specific measurable gender and diversity objectives due to the start-up nature of its situation in the
exploration and development of coking coal projects. However, the Group remains committed to recruiting the best candidates for
roles at all levels within the Group at every operation. As at 31 December 2021, women comprised 19% (31 December 2020: 15%)
of employees throughout the Group. There are currently no female members of the Board.
Copies of the Code of Conduct, Whistleblowers’ Policy, the Diversity Policy and the Securities Trading Policy are available on the
Company’s website.
Principle 4: Safeguard integrity in financial reporting
Audit, Risk and Compliance Committee
The Audit, Risk and Compliance Committee currently consists of four Non-Executive Directors, three of which are also
independent, including the Chairman. The membership of the Committee meets the Good Corporate Governance Recommendations
in that the Committee consists of a majority of independent Directors. Given the size of the Group and the Board, and straight
forward structure of the Group, the Directors consider that the Audit, Risk and Compliance Committee is of sufficient size,
independence and technical expertise to discharge its mandate effectively.
All members of the Committee are financially literate and have an appropriate understanding of the mining industry. The Chairman,
Mr David Swan has relevant qualifications with a Bachelor of Commerce from the University of WA, being a Fellow of the Institute
of Chartered Accountants in Australia and New Zealand and a Fellow of the Institute of Chartered Accountants in England and
Wales (‘ICAEW’) and relevant experience gained through being a current and past non-executive director and audit committee
chairman of London AIM Listed companies. Mr Owen Hegarty has relevant qualifications with a Bachelor of Economics (Hons)
and experience by virtue of being a director on other ASX listed companies.
Mr Mitch Jakeman holds a BE Mining Degree from the University of New South Wales, a Diploma in Mineral Economics from
Macquarie University and ME (Hons) Mining under Stored Waters and Dams from the University of Wollongong.
Mr Craig Wiggill has extensive experience in the global mining industry including over 30 years in the coal sector, the majority of
his experience being within the Anglo-American Plc group.
29
47
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Directors’ report (continued)
For the year ended 31 December 2021
Corporate Governance Statement (continued)
Principle 4: Safeguard integrity in financial reporting (continued)
Audit, Risk and Compliance Committee
The Audit, Risk and Compliance Committee has a documented charter approved by the Board. All members should be Non-
Executive Directors, and the Chairman should be independent. Details of the qualifications of members of the Audit, Risk and
Compliance Committee and their attendance at meetings of the Committee are set out in the Directors’ report. The Charter is
available on the Company website and includes requirements for the Committee to consider the selection and appointment of the
external auditor, and for the rotation of external audit engagement partners.
The main responsibilities of the Committee are to:
•
review, assess and make recommendations to the Board on annual and half-year financial reports and all other financial
information released to the market;
assist the Board in reviewing the effectiveness of the Group’s internal control environment covering;
o
o
o
oversee the effective operation of the risk management framework;
effectiveness and efficiency of operations;
reliability of financial reporting; and
compliance with applicable laws and regulations.
recommend to the Board the appointment, removal and remuneration of the external auditors, and review the terms of their
engagement, the scope and quality of the audit and assess the performance of the auditor;
consider the independence and competence of the external auditor on an ongoing basis; and
review and approve the level of non-audit services provided by the external auditors and ensure that they do not adversely
impact on auditor independence.
•
•
•
•
•
In fulfilling its responsibilities, the Audit, Risk and Compliance Committee:
•
receives regular reports from management and the external auditor;
•
•
•
•
meets with the external auditor at least twice a year without management being present, or more frequently if necessary;
reviews the processes in place to support the CEO and CFO certification to the Board;
reviews any significant disagreements between the auditors and management, irrespective of whether any have been
resolved; and
provides the external auditors with a clear line of direct communication at any point in time to either the Chair of the Audit,
Risk and Compliance Committee or the Chairman of the Board.
The Committee has authority, within the scope of its responsibilities, to seek any information it requires from any employee or
external party.
CEO and CFO certification
The Chief Executive Officer and the Chief Financial Officer have declared in writing to the Board in accordance with Section 295
of the Corporations Act 2001 that the financial records of the Company for the financial year have been properly maintained, and
that the Company’s financial reports for the financial year ended 31 December 2021, comply with accounting standards and present
a true and fair view of the Company’s financial condition and operational results. The statement is required both annually and semi-
annually.
The Board has received and is satisfied with certification provided by the CEO and CFO that the Group’s risk management and
internal control systems are sound and operated effectively in all material aspects in relation to financial report ing risks for the
financial year ended 31 December 2021.
48
30
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Directors’ report (continued)
For the year ended 31 December 2021
Corporate Governance Statement (continued)
Principle 4: Safeguard integrity in financial reporting (continued)
External auditor
The role of the external auditor is to provide an independent opinion that the financial reports are true and fair and comply with
applicable accounting standards.
The Company and the Committee policy is to appoint external auditors who clearly demonstrate quality and independence. Deloitte
has provided an independence declaration to the Board for the financial year ended 31 December 2021. The Committee has
considered the nature of the non–audit and assurance related services provided by the external auditor during the year and determined
that services provided and the amount paid for those services are compatible with the general standard of independence for auditors
imposed by the Corporations Act 2001. The Committee has examined detailed material provided by the external auditor and by
management and has satisfied itself that the standards of auditor independence and associated issues have been fully complied with.
The roles of lead partner and audit quality review partner are rotated every five years.
The external auditor will attend the annual general meeting and will be available to answer shareholder questions about the conduct
of the audit and the preparation and content of the audit report.
Principle 5: Make timely and balanced disclosure
The Company has established written policies and procedures on information disclosure that focus on continuous disclosure of any
information concerning the Group that a reasonable person would expect to have a material effect on the price of the Company’s
securities. All information disclosed to the ASX is posted on the Company’s website as soon as it is disclosed to the ASX.
The Company Secretary is responsible for communications with the ASX and compliance with the continuous disclosure
requirements in the ASX Listing Rules. The Company also has in place a policy to monitor media sources. This role also oversees
and coordinates information disclosure to shareholders, media and to the general public.
The Company’s continuous disclosure policy is available on the Company’s website.
Principle 6: Shareholder communications
The Company places a high priority on communications with shareholders and aims to provide all shareholders with comprehensive,
timely and equal access to balanced information about Group activities so that they can make informed investment decisions and
provide undivided support to the Group. Principal communications to investors are through the provision of the annual report,
financial statements, and market announcements.
The Company website enables users to provide feedback and has an option for shareholders to register their email address for direct
email updates on Group matters.
The Company’s communications policy is available on the Company’s website.
Principle 7: Recognise and manage risk
The Board is responsible for satisfying itself that management has developed and implemented a sound system for risk management
and internal control. The Board regards managing the risks that affect the Group’s businesses as a fundamental activity, as they
influence the Group’s performance, reputation and success. Detailed work on the management of risk is delegated to the Audit, Risk
and Compliance Committee and reviewed by the Board. The Committee recommends any actions it deems necessary to the Board
for its consideration.
The Committee is responsible for ensuring that there are adequate policies in relation to risk management, compliance and internal
control systems. The Committee monitors the Company’s risk management by overseeing management’s actions in the evaluation,
management, monitoring and reporting of material operational, corporate, compliance and strategic risks. The Board and the
Committee receive regular reports from management on the effectiveness of the Group’s management of material business risks.
The Company has adopted a Risk Management Policy which is available on the Company’s website.
In relation to risk management the Committee regularly reviews the adequacy and effectiveness of the Company’s risk management
framework including assessment of any material exposure to economic, environmental and social sustainability risks, how it
manages or intends to manage and plans for managing each identified risk. It also reviews the processes it employs for evaluating
and continually improving the effectiveness of its risk management and internal control processes.
31
49
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Directors’ report (continued)
For the year ended 31 December 2021
Corporate Governance Statement (continued)
Principle 8: Remunerate fairly and responsibly
The Nomination and Remuneration Committee operates in accordance with its charter which is available on the Company website.
The Nomination and Remuneration Committee advises the Board on remuneration and incentive policies and practices generally
and makes specific recommendations on remuneration packages and other terms of employment for executive Directors, other
senior executives and Non-Executive Directors.
The Nomination and Remuneration Committee is chaired by a Non-Executive Director and has four members, three being the
recommended size. Three of the four members are independent.
The structure of the remuneration of Non-Executive Directors is distinguished from that of executive Directors and senior
executives, however, Board members are entitled to options as set out in this Annual Financial Report having regard to the size of
the Company’s management team and the minimal fees paid.
The Nomination and Remuneration Committee also assumes responsibility for overseeing succession planning.
Further information on Directors’ and executives’ remuneration, including principles used to determine remuneration, is set out in
the Remuneration Report which forms a part of the Directors’ report. Details of the qualifications of members of the Nomination
and Remuneration Committee and their attendance at meetings of the Committee are set out in the Directors’ report.
50
32
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Consolidated statement of comprehensive income
For the year ended 31 December 2021
Note
31 December
2021
A$’000
31 December
2020
A$’000
Revenue from coal sales
Mining and related costs of coal sold
Transhipment and other port costs
Gross margin on coal sold
Administrative and other operating expenses
Share based payments
Exploration and evaluation expenses
Change in provisions for inventories
Change in provisions for expected credit losses
Write off of property, plant and equipment
Royalty expense
Other income
Results from operating activities
Net foreign exchange loss
Finance costs
Net finance costs
Profit/(Loss) before income tax
Income tax expense
Net Profit/(Loss)
Other comprehensive income/ (loss)
Items that may subsequently be reclassified to the profit or
loss
Foreign currency translation differences for foreign operations
Total comprehensive income/ (loss) for the period
Net Profit/ (Loss) is attributable to:
Owners of the Company
Non-controlling interest
Net Profit/ (Loss) for the period
Total comprehensive income/(loss) attributable to:
Owners of the Company
Non-controlling interest
Total comprehensive income/(loss) for the period
Earnings/ (Loss) per share (cents per share)
basic
diluted
7
8
24
15
16
21
10
11
11
103,944
(37,880)
(21,518)
44,546
(7,054)
-
(106)
2,963
(306)
(235)
(189)
933
40,552
(697)
(1,899)
(2,596)
37,956
(54)
37,902
4,612
42,514
37,923
(21)
37,902
42,535
(21)
42,514
0.29
0.29
47,889
(33,850)
(14,366)
(327)
(6,027)
(52)
(159)
-
-
(254)
(5,690)
324
(12,185)
(655)
(2,785)
(3,440)
(15,625)
(17)
(15,642)
(15,435)
(31,077)
(15,616)
(26)
(15,642)
(31,051)
(26)
(31,077)
(0.22)
(0.22)
The notes on pages 37 to 76 are an integral part of these consolidated financial statements.
33
51
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Consolidated statement of financial position
As at 31 December 2021
Note
31 December
2021
A$’000
31 December
2020
A$’000
Current Assets
Cash and cash equivalents
Trade and other receivables
Inventories
Prepayments
Total current assets
Non-current assets
Inventories
Property, plant and equipment
Total non-current assets
Total assets
Current Liabilities
Trade and other payables
Lease liability
Loans payable
Royalty liability
Other financial liabilities
Employee benefits
Total current liabilities
Non-current liabilities
Trade and other payables
Lease liability
Royalty liability
Other financial liabilities
Provision for site restoration
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
12
14
15
15
16
17
20
18
21
22
19
17
20
21
22
23
33,511
17,072
46,055
2,421
99,059
2,180
64,470
66,650
165,709
7,483
5,206
-
1,439
667
3,678
18,473
137
9,842
16,979
1,022
562
28,542
47,015
118,694
272,980
14,889
(149,393)
138,476
(19,782)
118,694
18,879
9,844
20,275
1,363
50,361
2,854
32,545
35,399
85,760
3,879
2,407
1,830
922
605
1,437
11,080
115
5,522
17,141
1,612
496
24,886
35,966
49,794
246,594
10,277
(187,316)
69,555
(19,761)
49,794
The notes on pages 37 to 76 are an integral part of these consolidated financial statements.
52
34
Annual Report 2021Tigers Realm Coal
5
3
0
0
0
’
$
A
l
a
t
o
T
0
0
0
’
$
A
t
s
e
r
e
t
n
I
0
0
0
’
$
A
l
a
t
o
T
g
n
i
l
l
o
r
t
n
o
c
-
n
o
N
r
e
h
t
O
e
v
r
e
s
e
R
0
0
0
’
$
A
0
0
0
’
$
A
e
v
r
e
s
e
R
e
v
r
e
s
e
R
0
0
0
’
$
A
)
s
e
s
s
o
L
0
0
0
’
$
A
n
o
i
t
a
l
s
n
a
r
T
s
t
n
e
m
y
a
P
d
e
t
a
l
u
m
u
c
c
A
(
e
r
a
h
S
l
a
t
i
p
a
C
0
0
0
’
$
A
e
t
o
N
n
g
i
e
r
o
F
y
c
n
e
r
r
u
C
d
e
s
a
b
e
r
a
h
S
3
3
3
,
7
)
5
3
7
,
9
1
(
8
6
0
,
7
2
9
0
3
,
6
0
5
0
,
2
1
1
0
3
,
7
)
0
0
7
,
1
7
1
(
8
0
1
,
3
7
1
0
2
0
2
y
r
a
u
n
a
J
1
t
a
s
a
e
c
n
a
l
a
B
)
2
4
6
,
5
1
(
)
5
3
4
,
5
1
(
)
7
7
0
,
1
3
(
2
5
0
8
3
,
5
7
)
4
9
8
,
1
(
)
6
2
(
-
)
6
2
(
-
)
6
1
6
,
5
1
(
)
5
3
4
,
5
1
(
)
1
5
0
,
1
3
(
2
5
0
8
3
,
5
7
)
4
9
8
,
1
(
-
-
-
-
-
)
5
3
4
,
5
1
(
)
5
3
4
,
5
1
(
-
-
-
)
6
1
6
,
5
1
(
-
)
6
1
6
,
5
1
(
-
2
5
-
-
-
-
-
0
8
3
,
5
7
)
4
9
8
,
1
(
4
2
d
o
i
r
e
p
e
h
t
r
o
f
s
s
o
l
e
v
i
s
n
e
h
e
r
p
m
o
c
l
a
t
o
T
e
m
o
c
n
i
e
v
i
s
n
e
h
e
r
p
m
o
c
r
e
h
t
O
s
s
o
l
t
e
N
s
e
r
a
h
s
y
r
a
n
i
d
r
o
f
o
e
u
s
s
I
y
t
i
u
q
e
g
n
i
s
i
a
r
f
o
s
t
s
o
C
s
t
n
e
m
y
a
p
d
e
s
a
b
e
r
a
h
S
4
9
7
,
9
4
)
1
6
7
,
9
1
(
5
5
5
,
9
6
9
0
3
,
6
)
5
8
3
,
3
(
3
5
3
,
7
)
6
1
3
,
7
8
1
(
4
9
5
,
6
4
2
1
2
0
2
y
r
a
u
n
a
J
1
t
a
e
c
n
a
l
a
B
2
1
6
,
4
2
0
9
,
7
3
4
1
5
,
2
4
)
6
0
1
(
2
9
4
,
6
2
-
)
1
2
(
)
1
2
(
-
2
1
6
,
4
3
2
9
,
7
3
5
3
5
,
2
4
)
6
0
1
(
2
9
4
,
6
2
-
-
-
-
-
-
2
1
6
,
4
2
1
6
,
4
-
-
-
-
-
-
-
-
-
-
3
2
9
,
7
3
3
2
9
,
7
3
-
-
-
)
6
0
1
(
2
9
4
,
6
2
d
o
i
r
e
p
e
h
t
r
o
f
e
m
o
c
n
i
e
v
i
s
n
e
h
e
r
p
m
o
c
l
a
t
o
T
e
m
o
c
n
i
e
v
i
s
n
e
h
e
r
p
m
o
c
r
e
h
t
O
t
i
f
o
r
p
t
e
N
s
e
r
a
h
s
y
r
a
n
i
d
r
o
f
o
e
u
s
s
I
y
t
i
u
q
e
g
n
i
s
i
a
r
f
o
s
t
s
o
C
4
9
6
,
8
1
1
)
2
8
7
,
9
1
(
6
7
4
,
8
3
1
9
0
3
,
6
7
2
2
,
1
3
5
3
,
7
)
3
9
3
,
9
4
1
(
0
8
9
,
2
7
2
1
2
0
2
r
e
b
m
e
c
e
D
1
3
t
a
e
c
n
a
l
a
B
y
t
i
u
q
e
n
i
s
e
g
n
a
h
c
f
o
t
n
e
m
e
t
a
t
s
d
e
t
a
d
i
l
o
s
n
o
C
1
2
0
2
r
e
b
m
e
c
e
D
1
3
d
e
d
n
e
r
a
e
y
e
h
t
r
o
F
d
e
t
i
m
L
i
l
a
o
C
m
l
a
e
R
s
r
e
g
i
T
.
s
t
n
e
m
e
t
a
t
s
l
a
i
c
n
a
n
i
f
d
e
t
a
d
i
l
o
s
n
o
c
e
s
e
h
t
f
o
t
r
a
p
l
a
r
g
e
t
n
i
n
a
e
r
a
6
7
o
t
7
3
s
e
g
a
p
n
o
s
e
t
o
n
e
h
T
53
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Consolidated statement of cash flows
For the year ended 31 December 2021
Cash flows from operating activities
Cash receipts from customers
Cash paid to suppliers and employees
Exploration and evaluation expenditure
Interest and financing costs paid
Royalties paid
Income taxes paid
Net cash used in operating activities
Cash flows from investing activities
Acquisition of property, plant and equipment
Net cash used in investing activities
Cash flows from financing activities
Proceeds from issue of shares
Repayment of lease liabilities
Repayment of other financial liabilities
Repayment of borrowings
Net cash generated by financing activities
Net movement in cash and cash equivalents
Cash and cash equivalents at beginning of the period
Effects of exchange rate changes on cash and cash equivalents
Cash and cash equivalents at the end of the period
Note
31 December
2021
A$’000
31 December
2020
A$’000
103,177
(76,926)
(139)
(1,858)
(945)
(105)
23,204
(26,242)
(26,242)
25,513
(5,789)
(650)
(1,864)
17,210
14,172
18,879
460
33,511
47,792
(55,916)
(85)
(2,451)
(330)
(314)
(11,304)
(9,244)
(9,244)
42,272
(3,870)
(653)
-
37,749
17,201
4,716
(3,038)
18,879
13
12
Non-cash operating/financing activities for the year ended 31 December 2021: Short-term incentive (“STI”) bonuses
In March 2021, a portion of 2020 STI bonuses amounting to A$0.131 million was paid in TIG’s shares.
Non-cash investing activities for the year ended 31 December 2021 and 2020: Leasing transactions
During the year ended 31 December 2021, the Group concluded lease agreements in relation to various equipment (31 December 2020:
the Group conclude a lease agreement with equipment vendor for the acquisition of 100kt barge). The additions to the property, plant &
equipment under these arrangements were A$12.321 million (2020: A$0.319 million).
Non-cash financing activities for the year ended 31 December 2020: Shareholder loans
On 2 January 2020, the loans payable to BV Holding Limited and Dr B Gray, substantial shareholders of the Company, in the amount of
A$14.776 million and A$13.138 million, respectively, were settled against the shares issued to them as part of the Entitlement Offer.
The notes on pages 37 to 76 are an integral part of these consolidated financial statements.
54
36
Annual Report 2021Tigers Realm Coal Tigers Realm Coal Limited
Consolidated statement of cash flows
For the year ended 31 December 2021
Cash flows from operating activities
Cash receipts from customers
Cash paid to suppliers and employees
Exploration and evaluation expenditure
Interest and financing costs paid
Royalties paid
Income taxes paid
Net cash used in operating activities
Cash flows from investing activities
Acquisition of property, plant and equipment
Net cash used in investing activities
Cash flows from financing activities
Proceeds from issue of shares
Repayment of lease liabilities
Repayment of other financial liabilities
Repayment of borrowings
Net cash generated by financing activities
Net movement in cash and cash equivalents
Cash and cash equivalents at beginning of the period
Effects of exchange rate changes on cash and cash equivalents
Cash and cash equivalents at the end of the period
Note
31 December
31 December
2021
A$’000
2020
A$’000
103,177
(76,926)
(139)
(1,858)
(945)
(105)
23,204
(26,242)
(26,242)
25,513
(5,789)
(650)
(1,864)
17,210
14,172
18,879
460
33,511
47,792
(55,916)
(85)
(2,451)
(330)
(314)
(11,304)
(9,244)
(9,244)
42,272
(3,870)
(653)
-
37,749
17,201
4,716
(3,038)
18,879
13
12
Non-cash operating/financing activities for the year ended 31 December 2021: Short-term incentive (“STI”) bonuses
In March 2021, a portion of 2020 STI bonuses amounting to A$0.131 million was paid in TIG’s shares.
Non-cash investing activities for the year ended 31 December 2021 and 2020: Leasing transactions
During the year ended 31 December 2021, the Group concluded lease agreements in relation to various equipment (31 December 2020:
the Group conclude a lease agreement with equipment vendor for the acquisition of 100kt barge). The additions to the property, plant &
equipment under these arrangements were A$12.321 million (2020: A$0.319 million).
Non-cash financing activities for the year ended 31 December 2020: Shareholder loans
The notes on pages 37 to 76 are an integral part of these consolidated financial statements.
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
1.
Reporting entity
Tigers Realm Coal Limited (the “Company” or “TIG”) is a company domiciled in Australia. During the year ended 31 December
2021, the Company’s registered office was 151 Wellington Parade South, East Melbourne, 3002, Australia and its principal office
during the period to 31 March 2021 was 12A Aviakonstruktora Mikoyana, Moscow, 125167, Russian Federation and starting
from 1 April 2021, 37 Leningradskiy prospect, Moscow, 125167, Russian Federation. The consolidated financial statements as
at and for the year ended 31 December 2021 comprise the Company and its subsidiaries (together referred to as the “Group”).
The Group is a for-profit entity and primarily is involved in coal exploration and evaluation, mining, port and sales activities.
2.
(a)
Basis of preparation
Statement of compliance
These consolidated financial statements are general purpose financial statements which have been prepared in accordance with
Australian Accounting Standards and Interpretations issued by the Australian Accounting Standards Board (AASB) and the
Corporations Act 2001. The consolidated financial statements comply with International Financial Reporting Standards (IFRSs)
adopted by the International Accounting Standards Board (IASB).
The consolidated financial statements were authorised for issue by the Board of Directors on 24th February 2022.
(b)
Basis of preparation
The consolidated financial statements have been prepared on the historical cost basis except for certain financial instruments
which are carried at fair value and share based payment expenses which are recognised at fair value. Historical cost is based on
the fair values of the consideration given in exchange for goods and services.
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market
participants at the measurement date, regardless of whether that price is directly observable or estimated using another valuation
technique. Further details on how the Group estimates fair values of an asset or a liability are included in Note 5.
The Company is of a kind referred to in ASIC Corporations (Rounding in Financials/Directors’ Reports) Instrument 2016/191,
dated 24 March 2016, and in accordance with that Corporations Instrument amounts in these consolidated financial statements
have been presented in Australian dollars and rounded to the nearest thousand dollars, unless otherwise indicated.
(c)
Significant accounting judgements, estimates and assumptions
The application of the Group’s accounting policies, which are described in Note 3, requires management to make judgements,
estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources.
The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant.
Actual results may differ from these estimates.
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.
Information about assumptions that have the most significant effect on the amounts recognised in the financial statements and
estimation uncertainties that have a significant risk of resulting in a material adjustment within the next financial period are
described in the following notes:
•
•
•
Note 3 – Going concern basis of accounting
Note 9 – Carrying value of non-current assets
Note 21 – Royalty liability
On 2 January 2020, the loans payable to BV Holding Limited and Dr B Gray, substantial shareholders of the Company, in the amount of
A$14.776 million and A$13.138 million, respectively, were settled against the shares issued to them as part of the Entitlement Offer.
3.
Significant accounting policies
The accounting policies set out below and in the related notes, have been applied consistently to all periods presented in these
consolidated financial statements and consistently throughout the Group.
(a)
Going concern basis of accounting
The consolidated financial statements have been prepared on the going concern basis, which assumes continuity of normal
business activities and the realisation of assets and the settlement of liabilities in the ordinary course of business.
For the year ended 31 December 2021, the Group had a net profit of A$37.902 million (2020: net loss of A$15.642 million) and
had net cash inflows from operating activities of A$23.204 million (2020: net cash outflows from operating activities of A$11.304
million).
36
37
55
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
Significant accounting policies (continued)
(a)
Going concern basis of accounting
As at 31 December 2021, the Group had cash and cash equivalents of A$33.511 million (31 December 2020: A$18.879 million)
and net current assets of A$80.874 million (31 December 2020 net current assets of A$39.281 million).
Based on the Group’s cash flow forecasts, the Group will have a surplus of liquidity throughout the twelve-month period from
the date of signing these consolidated financial statements. The cash flow forecasts are dependent, inter alia, upon the successful
implementation of the forecast coal production, pit to port haulage, shipping and coal loading, sales and other key assumptions
applied in determining the Group’s expected future cashflows, which include but are not limited to the following:
• Actual quality of coal mined and processed being consistent with that indicative quality identified in mine planning
and testing performed to date and incorporated into the sales budget and commensurately actual coal prices achieved
are at or in excess of those prices utilised in management forecasting;
• Actual mining, production and processing levels being achieved and implemented within the expected cost levels,
structure and timing;
• Coal shipments being realised within the forecast scheduling parameters, which are subject to a number of factors
including but not limited to barge availability, transhipment efficiency and weather conditions;
• Compliance with ongoing drilling obligations in accordance with the terms of the Amaam and Amaam North licences;
and
• Macroeconomic factors including commodity (specifically coal) prices and exchange rates.
After making enquiries, and considering the uncertainties described above, the Directors are of the view that the continued
application of the going concern basis of accounting is appropriate due to the following factors:
•
The quality of coal required to realise the volume of production and sales contemplated in the Group’s forecasts is
sufficiently verified for its reasonableness by coal mining activities conducted to date. This, in conjunction with
contracted to date and forecast thermal and coking coal prices, provides management with a reasonable basis to
conclude that receipts from sales of coal will meet those expectations reflected in the cash flow forecast;
• Commercial mining operations continue in line with expectations. There have been no indicators in the coal production
process to date, which would suggest coal qualities and volumes and the cost of production would be materially
different from those assumptions utilised in the cash flow forecast;
• Coal shipments have been forecasted after consideration of actual historic port operating performance and those
climactic and other conditions which would be reasonably expected to occur and influence the Group’s shipping
capabilities; and
•
Licence Compliance obligations for both the Amaam and Amaam North tenements have been planned for and are
expected to be achieved with minimal risk of non-compliance with licence terms and conditions. There is, therefore, a
reasonable expectation that the Group will continue to be compliant with licence drilling obligations.
Accordingly, the Directors have determined that it is appropriate for the Group to continue to adopt the going concern basis in
preparing these consolidated financial statements.
(b)
Basis of consolidation
(i)
Subsidiaries
Subsidiaries are entities controlled by the Group. The Group controls an entity when it is exposed to, or has rights to, variable
returns from its involvement with the entity and has the ability to affect those returns through power over the entity. The financial
statements of subsidiaries are included in the consolidated financial statements of the Group from the date that control commences
until the date that control ceases.
The accounting policies of subsidiaries have been changed when necessary to align them with the policies adopted by the Group.
Losses applicable to the non-controlling interests (NCI) in a subsidiary are allocated to the non-controlling interests even if doing
so reduces the non-controlling interests below zero.
All intra-group balances and transactions, and any unrealised gains and losses arising from intra-group transactions, are
eliminated in preparing the consolidated financial statements.
56
38
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
Significant accounting policies (continued)
(a)
Going concern basis of accounting
As at 31 December 2021, the Group had cash and cash equivalents of A$33.511 million (31 December 2020: A$18.879 million)
and net current assets of A$80.874 million (31 December 2020 net current assets of A$39.281 million).
Based on the Group’s cash flow forecasts, the Group will have a surplus of liquidity throughout the twelve-month period from
the date of signing these consolidated financial statements. The cash flow forecasts are dependent, inter alia, upon the successful
implementation of the forecast coal production, pit to port haulage, shipping and coal loading, sales and other key assumptions
applied in determining the Group’s expected future cashflows, which include but are not limited to the following:
• Actual quality of coal mined and processed being consistent with that indicative quality identified in mine planning
and testing performed to date and incorporated into the sales budget and commensurately actual coal prices achieved
are at or in excess of those prices utilised in management forecasting;
• Actual mining, production and processing levels being achieved and implemented within the expected cost levels,
• Coal shipments being realised within the forecast scheduling parameters, which are subject to a number of factors
including but not limited to barge availability, transhipment efficiency and weather conditions;
• Compliance with ongoing drilling obligations in accordance with the terms of the Amaam and Amaam North licences;
structure and timing;
and
• Macroeconomic factors including commodity (specifically coal) prices and exchange rates.
After making enquiries, and considering the uncertainties described above, the Directors are of the view that the continued
application of the going concern basis of accounting is appropriate due to the following factors:
•
The quality of coal required to realise the volume of production and sales contemplated in the Group’s forecasts is
sufficiently verified for its reasonableness by coal mining activities conducted to date. This, in conjunction with
contracted to date and forecast thermal and coking coal prices, provides management with a reasonable basis to
conclude that receipts from sales of coal will meet those expectations reflected in the cash flow forecast;
• Commercial mining operations continue in line with expectations. There have been no indicators in the coal production
process to date, which would suggest coal qualities and volumes and the cost of production would be materially
different from those assumptions utilised in the cash flow forecast;
• Coal shipments have been forecasted after consideration of actual historic port operating performance and those
climactic and other conditions which would be reasonably expected to occur and influence the Group’s shipping
capabilities; and
•
Licence Compliance obligations for both the Amaam and Amaam North tenements have been planned for and are
expected to be achieved with minimal risk of non-compliance with licence terms and conditions. There is, therefore, a
reasonable expectation that the Group will continue to be compliant with licence drilling obligations.
Accordingly, the Directors have determined that it is appropriate for the Group to continue to adopt the going concern basis in
preparing these consolidated financial statements.
(b)
Basis of consolidation
(i)
Subsidiaries
Subsidiaries are entities controlled by the Group. The Group controls an entity when it is exposed to, or has rights to, variable
returns from its involvement with the entity and has the ability to affect those returns through power over the entity. The financial
statements of subsidiaries are included in the consolidated financial statements of the Group from the date that control commences
until the date that control ceases.
The accounting policies of subsidiaries have been changed when necessary to align them with the policies adopted by the Group.
Losses applicable to the non-controlling interests (NCI) in a subsidiary are allocated to the non-controlling interests even if doing
so reduces the non-controlling interests below zero.
All intra-group balances and transactions, and any unrealised gains and losses arising from intra-group transactions, are
eliminated in preparing the consolidated financial statements.
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
3.
(b)
(ii)
Significant accounting policies (continued)
Basis of consolidation
Business combinations
Business combinations are accounted for using the acquisition method. The consideration transferred in a business combination
is measured at fair value, which is calculated as the sum of the acquisition-date fair values of assets transferred by the Group,
liabilities incurred by the Group to the former owners of the acquiree and the equity instruments issued by the Group in exchange
for control of the acquiree. Acquisition-related costs are recognised in profit or loss as incurred. The Group measures goodwill
at the acquisition date as:
•
•
•
•
the fair value of the consideration transferred; plus
the recognised amount of any non-controlling interests in the acquiree; plus
if the business combination is achieved in stages, the fair value of the existing equity interest in the acquiree; less
the net recognised amount (generally fair value) of the identifiable assets acquired and liabilities assumed.
When the difference is negative, a bargain purchase gain is recognised immediately in profit or loss.
The consideration transferred does not include amounts related to the settlement of pre-existing relationships. Such amounts are
generally recognised in the profit or loss.
Where settlement of any part of cash consideration is deferred, the amounts payable in the future are discounted to their present
value as at the date of exchange. The discount rate used is the Group’s incremental borrowing rate, being the rate at which a
similar borrowing could be obtained from an independent financier under comparable terms and conditions.
Any contingent consideration payable is recognised at fair value at the acquisition date. If the contingent consideration is
classified as equity, it is not re-measured, settlement being accounted for in equity. Otherwise, subsequent changes to the fair
value of the contingent consideration are recognised in profit or loss.
Subsequent to acquisition date, transactions with non-controlling interests that do not result in a loss of control are accounted for
as transactions with equity owners of the Group. Any difference between the amount of the adjustment to the non-controlling
interest and any consideration paid or received is recognised as a separate reserve within equity.
The assets, liabilities and contingent liabilities recognised at the acquisition date are recognised at fair value. In determining fair
value, the consolidated entity has utilised valuation methodologies including discounted cash flow analysis. The assumptions
made in performing this valuation include assumptions as to discount rates, foreign exchange rates, commodity prices, the timing
of development, capital costs, and future operating costs. Any significant change in key assumptions may cause the acquisition
accounting to be revised including recognition of goodwill or a discount on acquisition. Additionally, the determination of the
acquirer and the acquisition date also require significant judgements to be made by the Group.
(iii) Non-controlling interests
For each business combination, the Group elects to measure any NCI in the acquiree either:
•
•
at fair value; or
at their proportionate share of the acquiree’s identifiable net assets, which are generally at fair value.
Changes in the Group’s interest in a subsidiary that do not result in a loss of control are accounted for as transactions with owners
in their capacity as owners and are recorded in an equity reserve called “Other Reserve”. Adjustments to non-controlling interests
are based on a proportionate amount of net assets of the subsidiary. No adjustments are made to goodwill and no gain or loss is
recognised in profit or loss.
(iv)
Loss of control
When the Group loses control over a subsidiary, it derecognises the assets and liabilities of the subsidiary, and any related NCI
and other components of equity. Any resulting gain or loss is recognised in profit or loss. Any interest retained in the former
subsidiary is measured at fair value when control is lost.
(c)
Foreign currency
(i)
Functional and presentation currency
These consolidated financial statements are presented in Australian dollars, which is the Company’s functional currency. Each
entity in the Group determines its own functional currency and the items included in the financial statements of each entity are
measured using that functional currency.
38
39
57
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
3.
Significant accounting policies (continued)
(c)
Foreign currency
(ii)
Foreign currency transactions
Transactions in foreign currencies are translated to the respective functional currencies of Group entities at exchange rates at the
dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the reporting date are retranslated
to the functional currency at the exchange rate at that date.
Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value are retranslated to the
functional currency at the exchange rate at the date that the fair value was determined. Non-monetary items in a foreign currency
that are measured in terms of historical cost are translated using the exchange rate at the date of the transaction.
Foreign currency differences arising on the retranslation are recognised in profit or loss.
(iii)
Foreign operations
For the purpose of presenting these consolidated financial statements, the assets and liabilities of foreign operations, including
goodwill and fair value adjustments arising on acquisition, are translated to the Company’s functional currency at exchange rates
at the reporting date. The income and expenses of foreign operations are translated to Australian dollars at average exchange
rates for the period, unless exchange rates fluctuated significantly during that period, in which case the exchange rates at the dates
of the transactions are used.
Foreign currency differences are recognised in other comprehensive income and presented in the foreign currency translation
reserve in equity. However, if the operation is a non-wholly-owned subsidiary, then the relevant proportional share of the
translation difference is allocated to the non-controlling interests. When a foreign operation is disposed of such that control is
lost, the cumulative amount in the translation reserve related to that foreign operation is reclassified to profit or loss as part of the
gain or loss on disposal. When the Group disposes of only part of its interest in a subsidiary that includes a foreign operation
while retaining control, the relevant portion of the cumulative amount is reattributed to non-controlling interests.
When the settlement of a monetary item receivable from or payable to a foreign operation is neither planned nor likely in the
foreseeable future, foreign exchange gains and losses arising from such a monetary item are considered to form part of a net
investment in a foreign operation and are recognised in other comprehensive income and are presented in the translation reserve
in equity.
(d)
Financial instruments
Financial assets and financial liabilities are recognised in the Group’s statement of financial position when the Group becomes a
party to the contractual provisions of the instrument.
Financial assets and financial liabilities are initially measured at fair value, except for trade receivables that do not have a
significant financing component which are measured at transaction price. Transaction costs that are directly attributable to the
acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value
through profit or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate,
on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair
value through profit or loss are recognised immediately in profit or loss
(i)
Financial assets
All regular way purchases or sales of financial assets are recognised and derecognised on a trade date basis. Regular way
purchases or sales are purchases or sales of financial assets that require delivery of assets within the time frame established by
regulation or convention in the marketplace. All recognised financial assets are measured subsequently in their entirety at either
amortised cost or fair value, depending on the classification of the financial assets.
The Group has the following financial assets:
•
Trade and other receivables.
Trade and other receivables are financial assets held within a business model whose objective is to hold financial assets
in order to collect contractual cash flows; and the contractual terms of the financial asset give rise on specified dates to
cash flows that are solely payments of principal and interest on the principal amount outstanding. Trade and other
receivables are measured subsequently at amortised cost. Refer to Note 14 for details of trade and other receivables.
58
40
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
3.
Significant accounting policies (continued)
(c)
Foreign currency
(ii)
Foreign currency transactions
Transactions in foreign currencies are translated to the respective functional currencies of Group entities at exchange rates at the
dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the reporting date are retranslated
to the functional currency at the exchange rate at that date.
Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value are retranslated to the
functional currency at the exchange rate at the date that the fair value was determined. Non-monetary items in a foreign currency
that are measured in terms of historical cost are translated using the exchange rate at the date of the transaction.
Foreign currency differences arising on the retranslation are recognised in profit or loss.
(iii)
Foreign operations
For the purpose of presenting these consolidated financial statements, the assets and liabilities of foreign operations, including
goodwill and fair value adjustments arising on acquisition, are translated to the Company’s functional currency at exchange rates
at the reporting date. The income and expenses of foreign operations are translated to Australian dollars at average exchange
rates for the period, unless exchange rates fluctuated significantly during that period, in which case the exchange rates at the dates
of the transactions are used.
Foreign currency differences are recognised in other comprehensive income and presented in the foreign currency translation
reserve in equity. However, if the operation is a non-wholly-owned subsidiary, then the relevant proportional share of the
translation difference is allocated to the non-controlling interests. When a foreign operation is disposed of such that control is
lost, the cumulative amount in the translation reserve related to that foreign operation is reclassified to profit or loss as part of the
gain or loss on disposal. When the Group disposes of only part of its interest in a subsidiary that includes a foreign operation
while retaining control, the relevant portion of the cumulative amount is reattributed to non-controlling interests.
When the settlement of a monetary item receivable from or payable to a foreign operation is neither planned nor likely in the
foreseeable future, foreign exchange gains and losses arising from such a monetary item are considered to form part of a net
investment in a foreign operation and are recognised in other comprehensive income and are presented in the translation reserve
in equity.
(d)
Financial instruments
Financial assets and financial liabilities are recognised in the Group’s statement of financial position when the Group becomes a
party to the contractual provisions of the instrument.
Financial assets and financial liabilities are initially measured at fair value, except for trade receivables that do not have a
significant financing component which are measured at transaction price. Transaction costs that are directly attributable to the
acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value
through profit or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate,
on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair
value through profit or loss are recognised immediately in profit or loss
(i)
Financial assets
All regular way purchases or sales of financial assets are recognised and derecognised on a trade date basis. Regular way
purchases or sales are purchases or sales of financial assets that require delivery of assets within the time frame established by
regulation or convention in the marketplace. All recognised financial assets are measured subsequently in their entirety at either
amortised cost or fair value, depending on the classification of the financial assets.
The Group has the following financial assets:
•
Trade and other receivables.
Trade and other receivables are financial assets held within a business model whose objective is to hold financial assets
in order to collect contractual cash flows; and the contractual terms of the financial asset give rise on specified dates to
cash flows that are solely payments of principal and interest on the principal amount outstanding. Trade and other
receivables are measured subsequently at amortised cost. Refer to Note 14 for details of trade and other receivables.
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
3.
Significant accounting policies (continued)
(d)
Financial instruments
(i)
Financial assets
Cash and cash equivalents
Cash and cash equivalents comprise cash balances and call deposits with an original maturity of three months or less
from the acquisition date that are subject to insignificant risk of changes in their fair value and are used by the Group in
the management of its short-term commitments.
The Group derecognises a financial asset when the contractual rights to the cash flows from the asset expire, or it transfers the
rights to receive the contractual cash flows on the financial asset in transactions in which substantially all the risks and rewards
of ownership of the financial asset are transferred. Any interest in transferred financial assets that is created or retained by the
Group is recognised as a separate asset or liability.
(ii)
Financial liabilities
All financial liabilities are measured subsequently at amortised cost using the effective interest method or at fair value through
profit or loss. The Group has the following financial liabilities:
•
Trade and other payables
Liabilities are recognised for amounts to be paid in the future for goods and services provided to the Group prior to the
end of the reporting period and are stated at amortised cost. The amounts are unsecured and are usually paid within 30
days of recognition.
•
Leases
Leases to be paid in accordance with a payment schedule based on the contractual agreements.
The Group derecognises financial liabilities when, and only when, the Group’s obligations are discharged, cancelled or have
expired. The difference between the carrying amount of the financial liability derecognised and the consideration paid and
payable is recognised in profit or loss.
Financial assets and liabilities are offset, the net amount presented in the statement of financial position when, and only when,
the Group has a legal right to offset the amounts and intends either to settle on a net basis or to realise the asset and settle the
liability simultaneously.
(e)
Share capital
Ordinary shares
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of ordinary shares are recognised as a
deduction from equity, net of any tax effects.
(f)
(i)
Intangible assets
Mineral Rights
Acquired mineral rights comprise identifiable exploration and evaluation assets including mineral reserves acquired as part of a
business combination and are recognised at fair value at the date of acquisition. The mineral rights will be reclassified as mine
property and development from commencement of development and amortised when commercial production commences on a
unit of production basis over the estimated economic reserve of the mine.
The mineral rights are subject to impairment testing in accordance with the Group’s policy for exploration, evaluation and
development assets. In the year ended 31 December 2015, all existing mineral rights were written-off. Details of the policy on
assessing the carrying value of non-current assets are disclosed in Note 9.
40
41
59
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
3.
(ii)
Significant accounting policies (continued)
Goodwill
Goodwill that arises upon the acquisition of subsidiaries is included in intangible assets. For the measurement of goodwill at
initial recognition refer Note 3(b)(ii) (business combinations).
Goodwill is measured at cost less accumulated impairment losses. Goodwill is not amortised, however its carrying value is
assessed annually against its recoverable amount, as explained below in Note 3(g) Impairment. Gains and losses on the disposal
of an entity include the carrying amount of goodwill relating to the entity sold. Goodwill is allocated to cash-generating units for
the purpose of impairment testing. In the year ended 31 December 2015, all existing goodwill was written-off. Details of the
policy on assessing the carrying value of non-current assets are disclosed in Note 9.
(iii) Other intangible assets
Other intangible assets that are acquired by the Group and have finite useful lives are measured at cost less accumulated
amortisation and accumulated impairment losses.
Subsequent expenditure
Subsequent expenditure is capitalised only when it increases the future economic benefits embodied in the specific asset to which
it relates. All other expenditure is recognised in profit or loss as incurred.
Amortisation
(iv)
(v)
Except for goodwill and mineral rights, intangible assets are amortised on a straight-line basis in profit or loss over the estimated
useful lives, from the date they are available for use. The estimated useful life for computer software is three to five years.
Amortisation methods, useful lives and residual values are reviewed at each reporting date and adjusted if appropriate.
(g)
Impairment of financial assets (including receivables)
The Group recognises a loss allowance for expected credit losses on investments in debt instruments that are measured at
amortised cost or at fair value through other comprehensive income, trade receivables, as well as contract assets. The amount of
expected credit losses is updated at each reporting date to reflect changes in credit risk since initial recognition of the respective
financial instrument.
The Group always recognises lifetime expected credit losses (ECL) for trade receivables and contract assets. The expected credit
losses on these financial assets are estimated using a provision matrix based on the Group’s historical credit loss experience,
adjusted for factors that are specific to the debtors, general economic conditions and an assessment of both the current as well as
the forecast direction of conditions at the reporting date, including time value of money where appropriate.
For all other financial instruments, the Group recognises lifetime ECL when there has been a significant increase in credit r isk
since initial recognition. However, if the credit risk on the financial instrument has not increased significantly since initial
recognition, the Group measures the loss allowance for that financial instrument at an amount equal to 12-month ECL. Lifetime
ECL represents the expected credit losses that will result from all possible default events over the expected life of a finan cial
instrument. In contrast, 12-month ECL represents the portion of lifetime ECL that is expected to result from default events on a
financial instrument that are possible within 12 months after the reporting date.
The measurement of expected credit losses is a function of the probability of default, loss given default (i.e. the magnitude of the
loss if there is a default) and the exposure at default. The assessment of the probability of default and loss given default is based
on historical data adjusted by forward-looking information as described above. As for the exposure at default, for financial assets,
this is represented by the assets’ gross carrying amount at the reporting date. For financial assets, the expected credit loss is
estimated as the difference between all contractual cash flows that are due to the Group in accordance with the contract and all
the cash flows that the Group expects to receive, discounted at the original effective interest rate.
If the Group has measured the loss allowance for a financial instrument at an amount equal to lifetime ECL in the previous
reporting period, but determines at the current reporting date that the conditions for lifetime ECL are no longer met, the Group
measures the loss allowance at an amount equal to 12-month ECL at the current reporting date, except for assets for which the
simplified approach was used. The Group recognises an impairment gain or loss in profit or loss for all financial instruments with
a corresponding adjustment to their carrying amount through a loss allowance account.
60
42
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
Significant accounting policies (continued)
3.
(ii)
Goodwill
Goodwill that arises upon the acquisition of subsidiaries is included in intangible assets. For the measurement of goodwill at
initial recognition refer Note 3(b)(ii) (business combinations).
Goodwill is measured at cost less accumulated impairment losses. Goodwill is not amortised, however its carrying value is
assessed annually against its recoverable amount, as explained below in Note 3(g) Impairment. Gains and losses on the disposal
of an entity include the carrying amount of goodwill relating to the entity sold. Goodwill is allocated to cash-generating units for
the purpose of impairment testing. In the year ended 31 December 2015, all existing goodwill was written-off. Details of the
policy on assessing the carrying value of non-current assets are disclosed in Note 9.
Other intangible assets that are acquired by the Group and have finite useful lives are measured at cost less accumulated
(iii) Other intangible assets
amortisation and accumulated impairment losses.
(iv)
Subsequent expenditure
Subsequent expenditure is capitalised only when it increases the future economic benefits embodied in the specific asset to which
it relates. All other expenditure is recognised in profit or loss as incurred.
(v)
Amortisation
Except for goodwill and mineral rights, intangible assets are amortised on a straight-line basis in profit or loss over the estimated
useful lives, from the date they are available for use. The estimated useful life for computer software is three to five years.
Amortisation methods, useful lives and residual values are reviewed at each reporting date and adjusted if appropriate.
(g)
Impairment of financial assets (including receivables)
The Group recognises a loss allowance for expected credit losses on investments in debt instruments that are measured at
amortised cost or at fair value through other comprehensive income, trade receivables, as well as contract assets. The amount of
expected credit losses is updated at each reporting date to reflect changes in credit risk since initial recognition of the respective
financial instrument.
The Group always recognises lifetime expected credit losses (ECL) for trade receivables and contract assets. The expected credit
losses on these financial assets are estimated using a provision matrix based on the Group’s historical credit loss experience,
adjusted for factors that are specific to the debtors, general economic conditions and an assessment of both the current as well as
the forecast direction of conditions at the reporting date, including time value of money where appropriate.
For all other financial instruments, the Group recognises lifetime ECL when there has been a significant increase in credit r isk
since initial recognition. However, if the credit risk on the financial instrument has not increased significantly since initial
recognition, the Group measures the loss allowance for that financial instrument at an amount equal to 12-month ECL. Lifetime
ECL represents the expected credit losses that will result from all possible default events over the expected life of a finan cial
instrument. In contrast, 12-month ECL represents the portion of lifetime ECL that is expected to result from default events on a
financial instrument that are possible within 12 months after the reporting date.
The measurement of expected credit losses is a function of the probability of default, loss given default (i.e. the magnitude of the
loss if there is a default) and the exposure at default. The assessment of the probability of default and loss given default is based
on historical data adjusted by forward-looking information as described above. As for the exposure at default, for financial assets,
this is represented by the assets’ gross carrying amount at the reporting date. For financial assets, the expected credit loss is
estimated as the difference between all contractual cash flows that are due to the Group in accordance with the contract and all
the cash flows that the Group expects to receive, discounted at the original effective interest rate.
If the Group has measured the loss allowance for a financial instrument at an amount equal to lifetime ECL in the previous
reporting period, but determines at the current reporting date that the conditions for lifetime ECL are no longer met, the Group
measures the loss allowance at an amount equal to 12-month ECL at the current reporting date, except for assets for which the
simplified approach was used. The Group recognises an impairment gain or loss in profit or loss for all financial instruments with
a corresponding adjustment to their carrying amount through a loss allowance account.
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
3.
Significant accounting policies (continued)
(h)
Provisions
A provision is recognised if, as a result of a past event, the Group has a present legal or constructive obligation that can be
estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. The probability
of an outflow of economic benefits is one of the key criteria in determining the recognition and measurement of legal and
constructive obligations:
•
•
•
If the likelihood of an outflow of economic resources is remote, neither disclosure of a contingency nor the
recognition of a provision is made;
If the likelihood of an outflow of economic resources is possible, a contingent liability is disclosed in the financial
statements, unless the acquisition method of accounting for business combinations in Note 3(b)(ii) are applied and a
liability equivalent to the fair value of the future outflows of economic benefits is able to be determined; or
If the likelihood of an outflow of economic resources is probable, a provision is recognised.
Provisions are determined by assessing the present value of the expected future outflow of economic benefits. The discounting
of the expected (probable) future cash flows reflects the current market assessments of the time value of money and the time
value of money and the risks specific to the liability. The unwinding of the discount is recognised as a finance charge.
(i)
Leases
For short-term leases (defined as leases with a lease term of 12 months or less) and leases of low value assets, the Group
recognises the lease payments as an operating expense on a straight-line basis over the term of the lease unless another systematic
basis is more representative of the time pattern in which economic benefits from the leased assets are consumed.
(j)
Exploration and evaluation costs
Exploration and evaluation expenditure comprises costs directly attributable to:
•
•
•
•
•
Research and analysing exploration data;
Conducting geological studies, exploratory drilling and sampling;
Examining and testing extraction and treatment methods;
Compiling pre-feasibility and definitive feasibility studies; and
Exploration and evaluation costs, including the costs of acquiring licences.
For both Amaam and Amaam North areas of interest, exploration and evaluation expenditure is charged against profit and loss
as incurred, except for expenditure incurred after a decision to proceed to development is made, in which case the expenditure is
capitalised as an asset.
(k)
Goods and services tax
Revenue, expenses and assets are recognised net of the amount of goods and services and similar value added taxes (VAT in
Russia and GST in Australia), except where the amount of VAT/GST incurred is not recoverable from the taxation authority. In
these circumstances, the VAT/GST is recognised as part of the cost of acquisition of the asset or as part of the expense.
Receivables and payables are stated excluding the amount of VAT/GST included. The net amount of VAT/GST recoverable
from, or payable to, the relevant tax authorities is included as a current asset or liability in the balance sheet. Cash flows are
included in the statement of cash flows on a gross basis. The VAT/GST components of cash flows arising from investing and
financing activities which are recoverable from, or payable to, the relevant tax authorities are classified as operating cash flows.
(l)
Other significant accounting policies
Significant accounting policies that summarise the measurement and recognition basis used and which are relevant to an
understanding of the consolidated financial statements are provided throughout the notes to the consolidated financial statements.
42
43
61
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
4.
Application of new and revised accounting standards
(a)
New and amended standards adopted
The Group has adopted all the following new and revised Standards and Interpretations issued by the Australian Accounting
Standards Board (the AASB) that are relevant to its operations and effective for an accounting period that begins on or after 1
January 2021:
AASB 2020-8 Amendments to Australian Accounting Standards – Interest Rate Benchmark Reform – Phase 2
The application of above amendment has had no impact on the Group’s consolidated financial statements.
The Group has not early adopted any standard, interpretation or amendment that has been issued but is not yet effective
(b)
Standard and interpretations in issue not yet adopted
A number of new standards, amendments to standards and interpretations are issued but not yet effective for annual periods
beginning after 1 January 2021 and have not been applied in preparing these consolidated financial statements.
Standard/Interpretation
AASB 2021-3 Amendments to Australian Accounting Standards – Covid-19-
Related Rent Concessions beyond 30 June 2021
Effective for annual reporting periods
beginning on or after
Applicable to annual reporting periods
beginning on or after 1 April 2021
AASB 2014-10 Amendments to Australian Accounting Standards – Sale or
Contribution of Assets between an investor and its Associate or Joint Venture;
AASB 2015-10 Amendments to Australian Accounting Standards – Effective
Date of Amendments to AASB 10 and AASB 128, AASB 2017-5 Amendments to
Australian Accounting Standards – Effective Date of Amendments to AASB 10
and AASB 128 and Editorial Corrections
Applicable to annual reporting periods
beginning on or after 1 January 2022
AASB 2020-3 Amendments to Australian Accounting Standards – Annual
Improvements 2018-2020 and Other Amendments
Applicable to annual reporting periods
beginning on or after 1 January 2022
AASB 17 Insurance Contracts and AASB 2020-5 Amendments to Australian
Accounting Standards – Insurance Contracts
Applicable to annual reporting periods
beginning on or after 1 January 2023
AASB 2020-1 Amendments to Australian Accounting Standards – Classification
of Liabilities as Current or Non-current and AASB 2020-6 Amendments to
Australian Accounting Standards – Classification of Liabilities as Current or Non-
current – Deferral of Effective Date
Applicable to annual reporting periods
beginning on or after 1 January 2023
AASB 2021-2 Amendments to Australian Accounting Standards – Disclosure of
Accounting Policies and Definition of Accounting Estimates
Applicable to annual reporting periods
beginning on or after 1 January 2023
AASB 2021-5 Amendments to Australian Accounting Standards – Deferred Tax
related to Assets and Liabilities arising from a Single Transaction
Applicable to annual reporting periods
beginning on or after 1 January 2023
The Directors of the Company do not anticipate that the application of these standards and amendments will have a material
impact on the Group's consolidated financial statements.
62
44
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
4.
Application of new and revised accounting standards
(a)
New and amended standards adopted
The Group has adopted all the following new and revised Standards and Interpretations issued by the Australian Accounting
Standards Board (the AASB) that are relevant to its operations and effective for an accounting period that begins on or after 1
January 2021:
The application of above amendment has had no impact on the Group’s consolidated financial statements.
The Group has not early adopted any standard, interpretation or amendment that has been issued but is not yet effective
(b)
Standard and interpretations in issue not yet adopted
A number of new standards, amendments to standards and interpretations are issued but not yet effective for annual periods
beginning after 1 January 2021 and have not been applied in preparing these consolidated financial statements.
Standard/Interpretation
AASB 2021-3 Amendments to Australian Accounting Standards – Covid-19-
Related Rent Concessions beyond 30 June 2021
Effective for annual reporting periods
beginning on or after
Applicable to annual reporting periods
beginning on or after 1 April 2021
AASB 2014-10 Amendments to Australian Accounting Standards – Sale or
Contribution of Assets between an investor and its Associate or Joint Venture;
AASB 2015-10 Amendments to Australian Accounting Standards – Effective
Date of Amendments to AASB 10 and AASB 128, AASB 2017-5 Amendments to
beginning on or after 1 January 2022
Australian Accounting Standards – Effective Date of Amendments to AASB 10
and AASB 128 and Editorial Corrections
Applicable to annual reporting periods
AASB 2020-3 Amendments to Australian Accounting Standards – Annual
Improvements 2018-2020 and Other Amendments
Applicable to annual reporting periods
beginning on or after 1 January 2022
AASB 17 Insurance Contracts and AASB 2020-5 Amendments to Australian
Applicable to annual reporting periods
Accounting Standards – Insurance Contracts
beginning on or after 1 January 2023
AASB 2020-1 Amendments to Australian Accounting Standards – Classification
of Liabilities as Current or Non-current and AASB 2020-6 Amendments to
Applicable to annual reporting periods
Australian Accounting Standards – Classification of Liabilities as Current or Non-
beginning on or after 1 January 2023
current – Deferral of Effective Date
AASB 2021-2 Amendments to Australian Accounting Standards – Disclosure of
Applicable to annual reporting periods
Accounting Policies and Definition of Accounting Estimates
beginning on or after 1 January 2023
AASB 2021-5 Amendments to Australian Accounting Standards – Deferred Tax
related to Assets and Liabilities arising from a Single Transaction
Applicable to annual reporting periods
beginning on or after 1 January 2023
The Directors of the Company do not anticipate that the application of these standards and amendments will have a material
impact on the Group's consolidated financial statements.
AASB 2020-8 Amendments to Australian Accounting Standards – Interest Rate Benchmark Reform – Phase 2
•
When measuring the fair value of an asset or liability, the Group uses market observable data as far as possible. Fair values are
categorised into different levels in a fair value hierarchy based on inputs used in valuation techniques as follows:
•
•
Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly
(i.e. as prices) or indirectly (i.e. derived from prices).
Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
5.
Determination of fair values
A number of the Group’s accounting policies and disclosures require the determination of fair value for financial assets and
liabilities.
If the inputs used to measure the fair value of an asset or liability might be categorised in different levels of the fair value
hierarchy, then the fair value measurement is categorised in its entirety in the same level of the fair value hierarchy as the lowest
level input that is significant to the entire measurement.
The Group recognises transfers between levels of the fair value hierarchy at the end of the reporting period during which the
change occurred.
(a)
Financial assets and liabilities
Fair value is calculated based on the present value of future principal and interest cash flows, discounted at the market rate of
interest at the reporting date. Fair value is determined at initial recognition and, for financial assets and financial liabilities that
are not measured at fair value, but for which fair value disclosures are required, at each annual reporting date.
Further information about the assumptions made in measuring fair values is included in Note 25.
44
45
63
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
6.
Segment reporting
The Group has two reportable segments, as described below, which are the Group’s main mineral mining and exploration projects.
The Group has identified these segments based on the internal reports used and reviewed by the Group’s Chief Executive Officer
(the Chief Operating Decision Maker), in assessing performance and determining the allocation of resources.
The accounting policies used by the Group in reporting segments internally are the same as the Group accounting policies. For
the year ended 31 December 2021, the activities of the Group are managed in two reportable operating segments outlined below,
consistent with how they were managed in the prior periods:
Amaam North Project
Amaam Project
Other
The Amaam North Project is located in the Bering Basin in the Chukotka province,
Russia and consists of the Amaam North tenement. The Project also includes
infrastructure assets associated with the Beringovsky Port and Coal Terminal.
The Amaam Project is in the Bering Basin in the Chukotka province, Russia and
consists of the Amaam tenement.
Consists of corporate and office expenses primarily incurred at the Group’s
Moscow and Melbourne offices. This is not a reportable segment.
Management monitors the expenditure outlays of each segment for the purpose of cost control and making decisions about
resource allocation. The Group’s administration and financing functions are managed on a group basis and are included in
“Other”, which is not a reportable segment.
31 December 2021
Revenue from the shipment and sale of
coal
Cost of coal sold
Change in provisions for inventories
Change in provisions for bad debt
Exploration and evaluation expenses
Royalty expense
Finance costs
Other segment expenses
Segment result
Segment assets
Segment liabilities
31 December 2020
Revenue from the shipment and sale of
coal
Cost of coal sold
Exploration and evaluation expenses
Royalty expense
Finance costs
Other segment expenses
Segment result
Segment assets
Segment liabilities
Amaam North
Project
A$’000
Amaam
Project
A$’000
Total
Reportable
Segments
A$’000
Other
A$’000
Total
A$’000
103,944
(59,398)
2,963
(306)
(100)
(189)
(1,899)
(1,889)
43,126
165,444
(46,888)
47,889
(48,216)
(104)
(5,690)
(2,785)
(1,856)
(10,762)
85,643
(35,847)
-
-
-
-
(6)
-
-
(100)
(106)
26
(127)
-
-
(55)
-
-
(76)
(131)
30
(119)
103,944
(59,398)
2,963
(306)
(106)
(189)
(1,899)
(1,989)
43,020
165,470
(47,015)
47,889
(48,216)
(159)
(5,690)
(2,785)
(1,932)
(10,893)
85,673
(35,966)
-
-
-
-
-
-
-
(5,064)
(5,064)
239
-
-
-
-
-
-
(4,732)
(4,732)
87
-
103,944
(59,398)
2,963
(306)
(106)
(189)
(1,899)
(7,053)
37,956
165,709
(47,015)
47,889
(48,216)
(159)
(5,690)
(2,785)
(6,664)
(15,625)
85,760
(35,966)
64
46
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
6.
Segment reporting (continued)
Geographical information
The Group manages its business on a worldwide basis but primarily holds non-current assets in one geographic segment, being
Russia.
2021
2020
Revenues
A$’000
Non-current
assets
A$’000
Revenues
A$’000
Non-current
assets
A$’000
101,965
1,979
103,944
-
66,650
66,650
43,188
4,701
47,889
-
35,399
35,399
Asia
Russia
Total
Customer information
Included in revenues from the sale and shipment of coal are revenues of A$92.351 million (2020: A$39.373 million) which arose
from sales to major customers who individually contributed at least 10% of total revenues from sales and shipment of coal.
Revenue
7.
Revenue from thermal coal sales
Revenue from semisoft coal sales
Revenue from shipment of coal
31 December
2021
A$’000
31 December
2020
A$’000
78,119
18,253
7,572
103,944
28,101
13,204
6,584
47,889
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
6.
Segment reporting
The Group has two reportable segments, as described below, which are the Group’s main mineral mining and exploration projects.
The Group has identified these segments based on the internal reports used and reviewed by the Group’s Chief Executive Officer
(the Chief Operating Decision Maker), in assessing performance and determining the allocation of resources.
The accounting policies used by the Group in reporting segments internally are the same as the Group accounting policies. For
the year ended 31 December 2021, the activities of the Group are managed in two reportable operating segments outlined below,
consistent with how they were managed in the prior periods:
Amaam North Project
Amaam Project
Other
The Amaam North Project is located in the Bering Basin in the Chukotka province,
Russia and consists of the Amaam North tenement. The Project also includes
infrastructure assets associated with the Beringovsky Port and Coal Terminal.
The Amaam Project is in the Bering Basin in the Chukotka province, Russia and
consists of the Amaam tenement.
Consists of corporate and office expenses primarily incurred at the Group’s
Moscow and Melbourne offices. This is not a reportable segment.
Management monitors the expenditure outlays of each segment for the purpose of cost control and making decisions about
resource allocation. The Group’s administration and financing functions are managed on a group basis and are included in
“Other”, which is not a reportable segment.
Amaam North
Project
A$’000
Amaam
Project
A$’000
Total
Reportable
Segments
A$’000
Other
A$’000
Total
A$’000
31 December 2021
Revenue from the shipment and sale of
coal
Cost of coal sold
Change in provisions for inventories
Change in provisions for bad debt
Exploration and evaluation expenses
Royalty expense
Finance costs
Other segment expenses
Segment result
Segment assets
Segment liabilities
31 December 2020
Revenue from the shipment and sale of
coal
Cost of coal sold
Exploration and evaluation expenses
Royalty expense
Finance costs
Other segment expenses
Segment result
Segment assets
Segment liabilities
103,944
(59,398)
2,963
(306)
(100)
(189)
(1,899)
(1,889)
43,126
165,444
(46,888)
47,889
(48,216)
(104)
(5,690)
(2,785)
(1,856)
(10,762)
85,643
(35,847)
-
-
-
-
-
-
-
-
-
-
(6)
(100)
(106)
26
(127)
(55)
(76)
(131)
30
(119)
103,944
(59,398)
2,963
(306)
(106)
(189)
(1,899)
(1,989)
43,020
165,470
(47,015)
47,889
(48,216)
(159)
(5,690)
(2,785)
(1,932)
(10,893)
85,673
(35,966)
-
-
-
-
-
-
-
-
-
-
-
-
(5,064)
(5,064)
239
-
(4,732)
(4,732)
87
-
103,944
(59,398)
2,963
(306)
(106)
(189)
(1,899)
(7,053)
37,956
165,709
(47,015)
47,889
(48,216)
(159)
(5,690)
(2,785)
(6,664)
(15,625)
85,760
(35,966)
46
47
65
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
7.
Revenue (continued)
Recognition and measurement: Revenue
Revenue from the sale of coal is recognised when all the following conditions have been satisfied:
(a) the parties to the contract have approved the contract (in writing, orally or in accordance with other customary business practices) and are
committed to perform their respective obligations;
(b) the Group can identify each party’s rights regarding the goods or services to be transferred;
(c) the Group can identify the payment terms for the goods or services to be transferred;
(d) the contract has commercial substance (ie the risk, timing or amount of the entity’s future cash flows is expected to change as a result of
the contract); and
(e) it is probable that the Group will collect the consideration to which it will be entitled in exchange for the goods or services that will be
transferred to the customer. In evaluating whether collectability of an amount of consideration is probable, the Group considers only the
customer’s ability and intention to pay that amount of consideration when it is due. The amount of consideration to which the Group will be
entitled may be less than the price stated in the contract if the consideration is variable because a price concession may be offer ed to the
customer.
Revenue is recognised when (or as) the Group satisfies a performance obligation by transferring a promised good or service to a customer.
An asset is transferred when (or as) the customer obtains control of that asset.
Revenue is measured at the fair value of the consideration received or receivable, reflecting contractually defined terms of payment and
excluding taxes, levies or duties collected on behalf of the government/ other statutory bodies.
Coal products are sold in accordance with internationally recognised shipping terms (INCO), primarily o n either free on board (“FOB”),
Beringovsky Port or cost and freight (“CFR”) terms. For sales made on FOB basis there is only one performance obligation, which arise from
the delivery of coal on board the vessel. Sales made in accordance with CFR terms differ to FOB as the Company is obliged to pay for the
cost of shipping and other costs necessary to bring the product to the destination port. Accordingly, in CFR sales contracts the performance
obligations arise from the delivery of coal on board the vessel and the provision of shipping services to the customer. For sales are made on
both FOB and CFR basis, the satisfaction of the performance obligation in respect of coal delivery is achieved after the time the goods have
been delivered on board the vessel. Satisfaction of the performance obligation in respect of coal shipping is achieved at the point of delivery
on shore at the destination port.
Preliminary volume and quality of coal shipped are independently measured upon loading the vessel at the Beringov sky Port. Coal sales
contracts include terms in accordance with which the sales price is defined with reference to the initial coal quality parameters, as adjusted
for the results of coal quality tests performed upon delivery of the product to the destination port. If coal does not meet minimum standards,
the shipment may be either rejected or an adjustment made up or down to the initial contract price. Accordingly, in rare circumstances, if the
Group cannot objectively determine that the coal provided to the customer is in accordance with the agreed-upon specifications in the contract,
the Group recognises revenue on coal sales only when the coal quality tests at the destination port affirm both the mass and quality
characteristics.
8.
Administrative and other operating expenses
Wages, salaries and other personnel costs
Legal fees and compliance costs
Accounting and audit fees
Taxes and charges
Insurance
ASX listing fees
Contractors and consultants’ fees
Other
66
31 December
2021
A$’000
31 December
2020
A$’000
(3,800)
(423)
(410)
(382)
(253)
(237)
(204)
(1,345)
(7,054)
(3,152)
(527)
(283)
(214)
(119)
(112)
(309)
(1,311)
(6,027)
48
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
7.
Revenue (continued)
Recognition and measurement: Revenue
Revenue from the sale of coal is recognised when all the following conditions have been satisfied:
(a) the parties to the contract have approved the contract (in writing, orally or in accordance with other customary business practices) and are
committed to perform their respective obligations;
(b) the Group can identify each party’s rights regarding the goods or services to be transferred;
(c) the Group can identify the payment terms for the goods or services to be transferred;
(d) the contract has commercial substance (ie the risk, timing or amount of the entity’s future cash flows is expected to change as a result of
(e) it is probable that the Group will collect the consideration to which it will be entitled in exchange for the goods or services that will be
transferred to the customer. In evaluating whether collectability of an amount of consideration is probable, the Group considers only the
customer’s ability and intention to pay that amount of consideration when it is due. The amount of consideration to which the Group will be
entitled may be less than the price stated in the contract if the consideration is variable because a price concession may be offer ed to the
the contract); and
customer.
Revenue is recognised when (or as) the Group satisfies a performance obligation by transferring a promised good or service to a customer.
An asset is transferred when (or as) the customer obtains control of that asset.
Revenue is measured at the fair value of the consideration received or receivable, reflecting contractually defined terms of payment and
excluding taxes, levies or duties collected on behalf of the government/ other statutory bodies.
Coal products are sold in accordance with internationally recognised shipping terms (INCO), primarily o n either free on board (“FOB”),
Beringovsky Port or cost and freight (“CFR”) terms. For sales made on FOB basis there is only one performance obligation, which arise from
the delivery of coal on board the vessel. Sales made in accordance with CFR terms differ to FOB as the Company is obliged to pay for the
cost of shipping and other costs necessary to bring the product to the destination port. Accordingly, in CFR sales contracts the performance
obligations arise from the delivery of coal on board the vessel and the provision of shipping services to the customer. For sales are made on
both FOB and CFR basis, the satisfaction of the performance obligation in respect of coal delivery is achieved after the time the goods have
been delivered on board the vessel. Satisfaction of the performance obligation in respect of coal shipping is achieved at the point of delivery
on shore at the destination port.
Preliminary volume and quality of coal shipped are independently measured upon loading the vessel at the Beringov sky Port. Coal sales
contracts include terms in accordance with which the sales price is defined with reference to the initial coal quality parameters, as adjusted
for the results of coal quality tests performed upon delivery of the product to the destination port. If coal does not meet minimum standards,
the shipment may be either rejected or an adjustment made up or down to the initial contract price. Accordingly, in rare circumstances, if the
Group cannot objectively determine that the coal provided to the customer is in accordance with the agreed-upon specifications in the contract,
the Group recognises revenue on coal sales only when the coal quality tests at the destination port affirm both the mass and quality
characteristics.
8.
Administrative and other operating expenses
Wages, salaries and other personnel costs
Legal fees and compliance costs
Accounting and audit fees
Taxes and charges
Insurance
ASX listing fees
Contractors and consultants’ fees
Other
31 December
31 December
2021
A$’000
2020
A$’000
(3,800)
(423)
(410)
(382)
(253)
(237)
(204)
(1,345)
(7,054)
(3,152)
(527)
(283)
(214)
(119)
(112)
(309)
(1,311)
(6,027)
48
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
9.
Carrying value of non-current assets
Amaam North Project CGU
During the year ended 31 December 2021, the carrying value of non-current assets of Amaam North Project CGU, net of
accumulated depreciation, increased by A$31.925 million to A$64.470 million (As of 31 December 2020 A$32.545 million)
(refer to Note 16 for details).
As at 31 December 2021, the Group concluded that due to:
•
•
Production and sales volumes achieved to date; and
Progress in the development of the CHPP project during 2021
there is no necessity to recognise further impairment losses for the Amaam North Project CGU.
Impairment recognised in prior periods primarily relates to the mining equipment which is either written-off or fully depreciated,
therefore there is no necessity for the reversal of impairment losses recognised in prior periods.
Amaam Project CGU
During the year ended 31 December 2021, there were minimal activities undertaken at the Amaam Project CGU, there being no
additions to the carrying value of non-current assets, their carrying value remaining at $Nil as at 31 December 2021. As the
development of the Amaam Project is not expected in the foreseeable future, as at 31 December 2021, the Group concluded that
there are no indications that asset write-downs recognised in prior periods for the Amaam Project CGU require reversal.
The carrying amounts of the Group’s non-financial assets excluding goodwill are reviewed at each reporting date to determine
whether there is any indication of impairment. If any such indication exists, the asset’s recoverable amount is estimated. F or
goodwill the recoverable amount is estimated at each reporting date.
Recognition and measurement: Non-current assets
The recoverable amount of an asset or cash generating unit is the greater of its value in use and its fair value less costs t o sell. In
assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that
reflects current market assessments of the time value of money and the risks specific to the asset. For the purpose of impair ment
testing, assets are grouped together into the smallest groups of assets that generate cash inflows from continuing use that are largely
independent of the cash inflows of other assets or groups of assets (the “cash-generating unit”). The goodwill acquired in a business
combination, for the purpose of impairment testing, is allocated to cash-generating units that are expected to benefit from the
synergies of the combination.
An impairment loss is recognised if the carrying amount of an asset exceeds its recoverable amount. Impairment losses recognised
in respect of cash-generating units are allocated first to reduce the carrying value of any goodwill allocated to the cash generating
units and then to reduce the carrying amount of the other assets in the cash generating unit (group of units) on a pro rata b asis.
An impairment loss in respect of goodwill is not reversed. In respect of other assets, impairment losses recognised in prior periods
are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed
if there has been a change in the estimates used to determine the recoverable amount. 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 depreciation
or amortisation, if no impairment loss had been recognised.
49
67
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
10.
Income tax expense
A reconciliation between tax expense and accounting profit multiplied by Australia’s domestic tax rate for the years ended 31
December 2021 and 2020 is set out below:
Income/(Loss) before tax
Income tax benefit using the domestic
corporation tax rate of 30%
Changes in income tax expense due to:
Effect of different tax rates of subsidiaries operating in
foreign jurisdictions
Non-deductible loss resulting from change in royalty
agreement liability
Non-deductible expenses/(non-assessable income)
Current period tax losses for which no deferred tax asset was
recognised
Total income tax expense
Current tax expense
Deferred tax expense/(benefit)
Total income tax expense
Deferred tax assets have not been recognised in respect to following items:
Tax losses
Other deductible temporary differences
31 December
2021
A$’000
31 December
2020
A$’000
37,956
11,387
(12,005)
(20)
160
532
54
(15,625)
(4,688)
1,792
670
1,991
252
17
31 December
2021
A$’000
31 December
2020
A$’000
54
-
54
17
-
17
31 December
2021
A$’000
31 December
2020
A$’000
128,606
7,487
136,093
124,843
7,463
132,306
As at 31 December 2021 and 2020, no deferred tax assets have been recognised for carried forward tax losses and other
deductible temporary differences as it is not probable that future taxable profit and/or capital gains will be available against
which the Group can utilise the benefits. Tax losses do not expire under current tax legislation of both Australia and the Russian
Federation.
Income tax expense comprises current and deferred tax. Current and deferred tax is recognised in profit or loss except to the extent
that it relates to a business combination, or items recognised directly in equity, or in comprehensive income.
Recognition and measurement: Income taxes
Current tax
Current tax is the expected tax payable on the taxable income or loss for the year, using tax rates enacted or substantively enacted
at the reporting date, and any adjustment to tax payable in respect of previous years.
68
50
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
10.
Income tax expense (continued)
Deferred tax
Recognition and measurement: Income taxes (continued)
Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities for fin ancial
reporting purposes and the amounts used for taxation purposes.
The measurement of deferred tax reflects the tax consequences that would follow the manner in which the Group expects, at the end
of the reporting period, to recover or settle the carrying amount of its assets and liabilities.
Deferred tax is measured at the tax rates that are expected to be applied to the temporary differences when they reverse, based on
the laws that have been enacted or substantively enacted by the reporting date. Deferred tax assets and liabilities are offse t if there
is a legally enforceable right to offset current tax liabilities and assets and they relate to income taxes levied by the same tax authority
on the same taxable entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a n et basis or their
tax assets and liabilities will be realised simultaneously.
A deferred tax asset is recognised for unused tax losses, tax credits and deductible temporary differences, to the extent tha t it is
probable that future taxable profits will be available against which the temporary difference can be utilised. Deferred ta x assets are
reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realised.
Tax exposure
In determining the amount of current and deferred tax, the Group takes into account the impact of uncertain tax positions and whether
additional taxes and interest may be due. The Group believes that its accruals for tax liabilities are adequate for all open tax years
based on its assessment of many factors, including interpretations of tax law and prior experience. This assessment relies on estimates
and assumptions and may involve a series of judgements about future events. New information may become available that causes
the Group to change its judgement regarding the adequacy of existing tax liabilities; such changes to tax liabilities will impact tax
expense in the period that such a determination is made.
Tax consolidation
The Company and its wholly-owned Australian resident entity are part of a tax consolidated group. As a consequence, all members
of the tax consolidated group are taxed as a single entity. The head entity within the tax consolidated group is Tigers Realm Coal
Limited.
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
10.
Income tax expense
A reconciliation between tax expense and accounting profit multiplied by Australia’s domestic tax rate for the years ended 31
December 2021 and 2020 is set out below:
31 December
31 December
2021
A$’000
2020
A$’000
Income/(Loss) before tax
Income tax benefit using the domestic
corporation tax rate of 30%
Changes in income tax expense due to:
Effect of different tax rates of subsidiaries operating in
foreign jurisdictions
agreement liability
Non-deductible loss resulting from change in royalty
Non-deductible expenses/(non-assessable income)
Current period tax losses for which no deferred tax asset was
recognised
Total income tax expense
Current tax expense
Deferred tax expense/(benefit)
Total income tax expense
Deferred tax assets have not been recognised in respect to following items:
37,956
11,387
(12,005)
(20)
160
532
54
54
-
54
(15,625)
(4,688)
1,792
670
1,991
252
17
17
-
17
31 December
31 December
2021
A$’000
2020
A$’000
31 December
31 December
2021
A$’000
2020
A$’000
128,606
7,487
136,093
124,843
7,463
132,306
Tax losses
Other deductible temporary differences
As at 31 December 2021 and 2020, no deferred tax assets have been recognised for carried forward tax losses and other
deductible temporary differences as it is not probable that future taxable profit and/or capital gains will be available against
which the Group can utilise the benefits. Tax losses do not expire under current tax legislation of both Australia and the Russian
Federation.
Income tax expense comprises current and deferred tax. Current and deferred tax is recognised in profit or loss except to the extent
Recognition and measurement: Income taxes
that it relates to a business combination, or items recognised directly in equity, or in comprehensive income.
Current tax
Current tax is the expected tax payable on the taxable income or loss for the year, using tax rates enacted or substantively enacted
at the reporting date, and any adjustment to tax payable in respect of previous years.
50
51
69
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
11. Earnings/(Loss) per share
Earnings/(Loss) per share
Basic earnings/(loss) per share – cents
Diluted earnings/(loss) per share – cents
31 December
2021
Cents
31 December
2020
Cents
a
b
0.29
0.29
(0.22)
(0.22)
Basic earnings/(loss) per share
(a)
The calculation of basic loss per share at 31 December 2021 was based on the profit attributable to ordinary equity holders of the
Company of A$37.923 million (At 31 December 2020: loss of A$15.616 million) and a weighted average number of ordinary
shares outstanding during the period ended 31 December 2021 of 12,947,151,981 (For the year ended 31 December 2020:
6,967,457,740).
Diluted profit/(loss) per share
(b)
The calculation of diluted profit/(loss) per share at 31 December 2021 and 2020 is the same as basic profit/(loss) per share. As at
31 December 2021, the Company had 8,002,000 outstanding options over ordinary shares (31 December 2020: 9,907,000
options), which have been excluded from the calculation of diluted earnings per share because they are anti-dilutive for the
reporting period.
12. Cash and cash equivalents
Bank balances
Cash and cash equivalents
All cash and cash equivalents are available for use by the Group.
31 December
2021
A$’000
31 December
2020
A$’000
33,511
33,511
18,879
18,879
13. Reconciliation of profit/(loss) for the year to net cash flows from operating activities
Cash flows from operating activities
Profit/ (Loss) for the period
Adjustments for:
Foreign exchange loss
Share based payments
Royalty expense
Depreciation expense
Change in provisions for inventories
Change in provisions for expected credit losses
Write off of property, plant and equipment
Income tax expense
Movements in working capital
Change in trade and other receivables
Change in inventory
Change in prepayments
Change in employee provisions
Change in trade and other payables
Net cash generated/(used) in operating activities
70
31 December
2021
A$’000
31 December
2020
A$’000
24
21
10
37,902
697
-
189
6,300
(2,963)
306
235
54
42,720
(1,013)
(20,884)
(1,742)
2,170
1,953
23,204
(15,642)
655
52
5,690
8,350
-
-
254
17
(624)
(2,040)
(1,083)
869
(470)
(7,956)
(11,304)
52
Annual Report 2021Tigers Realm Coal
The calculation of diluted profit/(loss) per share at 31 December 2021 and 2020 is the same as basic profit/(loss) per share. As at
31 December 2021, the Company had 8,002,000 outstanding options over ordinary shares (31 December 2020: 9,907,000
options), which have been excluded from the calculation of diluted earnings per share because they are anti-dilutive for the
Bank balances
Cash and cash equivalents
All cash and cash equivalents are available for use by the Group.
13. Reconciliation of profit/(loss) for the year to net cash flows from operating activities
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
11. Earnings/(Loss) per share
Earnings/(Loss) per share
Basic earnings/(loss) per share – cents
Diluted earnings/(loss) per share – cents
(a)
Basic earnings/(loss) per share
6,967,457,740).
(b)
Diluted profit/(loss) per share
reporting period.
12. Cash and cash equivalents
Cash flows from operating activities
Profit/ (Loss) for the period
Adjustments for:
Foreign exchange loss
Share based payments
Royalty expense
Depreciation expense
Change in provisions for inventories
Change in provisions for expected credit losses
Write off of property, plant and equipment
Income tax expense
Movements in working capital
Change in trade and other receivables
Change in inventory
Change in prepayments
Change in employee provisions
Change in trade and other payables
Net cash generated/(used) in operating activities
31 December
31 December
2021
Cents
0.29
0.29
2020
Cents
(0.22)
(0.22)
a
b
31 December
31 December
2021
A$’000
2020
A$’000
33,511
33,511
18,879
18,879
31 December
31 December
2021
A$’000
2020
A$’000
(15,642)
24
21
10
37,902
697
-
189
6,300
(2,963)
306
235
54
42,720
(1,013)
(20,884)
(1,742)
2,170
1,953
23,204
655
52
5,690
8,350
-
-
254
17
(624)
(2,040)
(1,083)
869
(470)
(7,956)
(11,304)
52
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
14. Trade and other receivables
VAT and GST receivable
Trade and other receivables
Provision for expected credit losses
31 December
2021
A$’000
31 December
2020
A$’000
10,795
6,583
(306)
17,072
3,956
5,888
-
9,844
The calculation of basic loss per share at 31 December 2021 was based on the profit attributable to ordinary equity holders of the
Company of A$37.923 million (At 31 December 2020: loss of A$15.616 million) and a weighted average number of ordinary
shares outstanding during the period ended 31 December 2021 of 12,947,151,981 (For the year ended 31 December 2020:
As of 31 December 2021 there was A$0.306 million provision for expected credit losses. (At 31 December 2020: A$Nil). In
January 2022 TIG received A$5,291 million of past due receivables.
15.
Inventories
Coal inventories at cost (At 31 December 2020: net of provision of
A$2.963 million for recognition of inventories at the lower of cost and
their net realisable value)
Fuel at cost
Other consumables: net of provisions of A$0.314 million (At 31
December 2020 A$0.298 million)
Current
Non-current
Total
31 December
2021
A$’000
31 December
2020
A$’000
18,902
8,159
21,174
48,235
46,055
2,180
48,235
11,095
1,370
10,664
23,129
20,275
2,854
23,129
Management performs a regular review of the recoverability of inventories, including coal stocks, to assess the Company’s ability
to recover the cost of inventories on hand. In 2021, following a significant increase in realisable prices for coal, a previous write-
down to net realisable value of coal stockpiled at the interim coal stockpile amounting to A$2.963 million was reversed.
Non-current inventories represented by coal inventories which are not expected to be realized within the next twelve-month
period from the reporting date.
Inventories are valued at the lower of cost and net realisable value and upon initial recognition on the weighted average cos t basis.
Recognition and measurement: Inventories
The cost of raw materials and consumable stores is the purchase price. The cost of partly-processed and saleable products is
generally the cost of production, including:
•
•
•
labour costs, materials and contractor expenses which are directly attributable to the extraction and processing of ore;
the depreciation of mining properties and leases and of property, plant and equipment used in the extraction and processing
of ore; and
production overheads.
Net realisable value represents the estimated selling price for inventories less all estimated costs of completion and costs necessary
to make the sale.
Inventories are periodically assessed for the existence of slow moving and obsolete stocks and adjustments to the recoverable
amount recognised as necessary.
Inventories which are planned to be realized later than in 12 months from the year end are classified as non-current.
The amount of inventories recognised as an expense during the year ended 31 December 2021 was A$38.556 million (2020:
A$34.376 million).
53
71
Annual Report 2021Tigers Realm Coal
4
5
-
0
6
6
,
9
)
1
8
1
(
2
1
3
,
5
5
1
2
0
,
1
5
7
7
6
,
6
3
)
0
7
7
,
3
1
(
-
)
1
9
(
2
6
7
,
3
9
6
3
,
1
9
3
)
4
5
2
(
2
4
4
,
4
)
5
3
4
,
8
(
)
2
1
2
,
4
1
(
6
2
)
0
3
0
,
7
(
)
6
7
4
,
8
1
(
)
5
3
2
(
)
4
8
1
,
1
(
)
9
9
8
,
6
2
(
0
7
4
,
4
6
5
4
5
,
2
3
7
1
1
1
6
)
8
(
7
4
)
0
4
(
7
7
1
0
3
)
1
(
5
1
7
8
1
8
0
4
)
6
6
(
)
6
4
(
3
-
1
2
)
8
8
(
)
5
7
(
1
-
)
6
(
)
8
6
1
(
0
4
2
9
8
-
5
0
4
8
1
9
,
5
3
7
3
7
,
3
)
2
5
0
,
9
(
8
0
0
,
1
3
1
)
6
2
(
1
5
5
,
8
4
1
9
,
1
8
4
4
,
1
4
)
5
1
8
,
9
(
)
1
5
7
,
6
(
-
)
4
5
2
(
1
6
1
,
3
)
7
6
3
,
5
(
)
9
5
6
,
3
1
(
5
2
)
3
9
1
(
)
4
7
8
(
)
8
6
0
,
0
2
(
0
8
3
,
1
2
9
4
3
,
7
1
-
-
-
1
6
1
,
7
4
4
4
,
5
)
7
1
7
1
(
,
8
-
0
5
3
1
7
7
,
1
3
7
5
,
7
)
9
8
4
,
3
(
)
3
5
3
,
1
(
-
-
3
0
0
,
1
)
9
3
8
,
3
(
)
1
5
1
,
1
(
-
-
)
3
4
2
(
)
3
3
2
,
5
(
0
4
3
,
2
5
0
6
,
1
1
-
8
8
6
,
2
-
0
9
3
)
2
9
6
(
7
8
3
,
2
3
3
6
1
2
2
7
2
7
,
2
8
6
9
,
5
)
2
4
8
(
)
5
8
2
(
-
-
7
3
2
)
0
9
8
(
)
7
3
4
(
-
-
)
1
6
(
)
8
8
3
,
1
(
0
8
5
,
4
7
9
4
,
1
8
2
4
,
9
3
9
1
,
9
)
3
7
1
(
)
4
7
1
,
4
(
)
9
6
2
,
2
(
5
0
0
,
2
1
5
0
0
,
6
3
)
4
6
(
2
6
2
,
1
2
7
9
,
5
3
)
6
3
2
,
3
1
(
-
-
-
-
-
-
-
-
-
)
2
4
(
)
2
4
(
0
3
9
,
5
3
5
0
0
,
2
1
s
e
t
a
r
e
g
n
a
h
c
x
e
n
i
t
n
e
m
e
v
o
m
f
o
t
c
e
f
f
E
1
2
0
2
y
r
a
u
n
a
J
1
t
a
s
A
0
2
0
2
y
r
a
u
n
a
J
1
t
a
s
A
t
s
o
C
s
n
o
i
t
i
d
d
A
s
l
a
s
o
p
s
i
D
s
r
e
f
s
n
a
r
T
s
e
t
a
r
e
g
n
a
h
c
x
e
n
i
t
n
e
m
e
v
o
m
f
o
t
c
e
f
f
E
d
o
i
r
e
p
e
h
t
r
o
f
e
g
r
a
h
c
n
o
i
t
a
i
c
e
r
p
e
D
t
n
e
m
r
i
a
p
m
i
d
n
a
n
o
i
t
a
i
c
e
r
p
e
D
1
2
0
2
r
e
b
m
e
c
e
D
1
3
t
a
s
A
0
2
0
2
y
r
a
u
n
a
J
1
t
a
s
A
s
e
t
a
r
e
g
n
a
h
c
x
e
n
i
t
n
e
m
e
v
o
m
f
o
t
c
e
f
f
E
1
2
0
2
y
r
a
u
n
a
J
1
t
a
s
A
d
o
i
r
e
p
e
h
t
r
o
f
e
g
r
a
h
c
n
o
i
t
a
i
c
e
r
p
e
D
s
e
t
a
r
e
g
n
a
h
c
x
e
n
i
t
n
e
m
e
v
o
m
f
o
t
c
e
f
f
E
1
2
0
2
r
e
b
m
e
c
e
D
1
3
t
a
s
A
s
l
a
s
o
p
s
i
D
f
f
o
e
t
i
r
W
s
l
a
s
o
p
s
i
D
f
f
o
e
t
i
r
W
s
n
o
i
t
i
d
d
A
s
l
a
s
o
p
s
i
D
s
r
e
f
s
n
a
r
T
1
2
0
2
r
e
b
m
e
c
e
D
1
3
t
A
:
e
u
l
a
v
k
o
o
b
t
e
N
0
2
0
2
r
e
b
m
e
c
e
D
1
3
t
A
0
0
0
’
$
A
0
0
0
’
$
A
0
0
0
’
$
A
s
0
0
0
’
$
A
l
a
t
o
T
s
g
n
i
t
t
i
F
&
s
e
r
u
t
x
i
F
t
n
e
m
p
i
u
q
E
&
t
n
a
l
P
e
r
u
t
c
u
r
t
s
a
r
f
n
i
e
n
i
M
&
d
n
a
L
s
g
n
i
d
l
i
u
B
0
0
0
’
$
A
n
o
i
t
c
u
r
t
s
n
o
c
n
i
s
t
e
s
s
A
0
0
0
’
$
A
s
t
n
e
m
e
t
a
t
s
l
a
i
c
n
a
n
i
f
d
e
t
a
d
i
l
o
s
n
o
c
e
h
t
o
t
s
e
t
o
N
1
2
0
2
r
e
b
m
e
c
e
D
1
3
d
e
d
n
e
r
a
e
y
e
h
t
r
o
F
d
e
t
i
m
L
i
l
a
o
C
m
l
a
e
R
s
r
e
g
i
T
t
n
e
m
p
i
u
q
e
d
n
a
t
n
a
l
p
,
y
t
r
e
p
o
r
P
.
6
1
72
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
16.
Property, plant and equipment (continued)
During the year ended 31 December 2021, two CAT 740B dump trucks, two scanias, crusher station, excavator hd-
1500, snow removing machine K-703, telecommunications equipment with the carrying value of A$0.235 million
was written-off due to its present condition (2020: CAT D10 bulldozer with a carrying value of A$0.254 million
was written-off).
As disclosed in Note 20, the Group leases various mining equipment and port infrastructure and equipment. The
carrying value of these right-of-use assets as at 31 December 2021 is A$19.162 million (2020: A$11.076 million)
including A$1.037 million in land & buildings, A$13.644 million in plant& equipment and A$4.481 million in
assets under construction. For the year ended 31 December 2021 the depreciation charge relating to right-of-use
asset amounted to A$4,144 million (2020: A$5.010 million), including A$0.040 million and A$4.104 million in
relation to right-of-use assets included in land & buildings and plant& equipment, respectively.
Recognition and measurement: Property, plant and equipment
Items of property, plant and equipment are measured at cost less accumulated depreciation and cumulative impairment
losses. Cost includes expenditure that is directly attributable to the acquisition or construc tion of an asset.
Once an undeveloped mining project has been determined as commercially viable and approval to mine has been given,
expenditure other than that on land, buildings, fixtures and fittings, plant and equipment and capital work in progress is
capitalised under “Mine Infrastructure”. Development costs incurred after the commencement of production are
capitalised to the extent they are expected to give rise to a future economic benefit.
Subsequent costs
The cost of replacing part of an item of property, plant and equipment is recognised in the carrying amount of the item if
it is probable that the future economic benefits embodied within the part will flow to the Group and its cost can be
measured reliably. The carrying amount of the replaced part is derecognised. The costs of the day-to-day servicing of
property, plant and equipment are recognised in profit or loss as incurred.
Depreciation
Property, plant and equipment is depreciated over the lesser of its useful life or over the remaining life of the mine where
there is no reasonable alternative use for the asset. The useful lives and residual values for material assets and categories
of assets are reviewed annually and changes are reflected prospectively. Depreciation commences when an asset is
available and ready for its intended use. The major categories of property, plant and equipment are depreciated on a
straight-line basis, except for mining assets, which are depreciated on a units of production basis.
Straight-line basis
Assets within operations for which production is not expected to fluctuate significantly from one year to another or which
have a physical life shorter than the related mine are depreciated on a straight-line basis.
The estimated useful lives are as follows:
•
•
•
Buildings
Plant & equipment
Fixtures & fittings
Units of production basis
10 – 20 years
3 – 10 years
3 – 10 years
For mining assets, consumption of the economic benefits of the asset is linked to production. These assets are depreciated
on the lesser of the respective assets’ useful lives and the life of the ore body in respect of which the assets are being used.
Where the useful life of the assets is greater than the life of the ore body for which they are being utilised, depreciation is
determined on a units of production basis. In applying the units of production method, depreciation is normally calculated
based on production in the period as a percentage of total expected production in current and future period s based on ore
reserves and other mineral resources.
55
73
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
Recognition and measurement: Property, plant and equipment (continued)
Stripping Costs
In open pit mining operations, overburden and other waste materials must be removed to access ore from which minerals can
be extracted economically. The process of removing overburden and waste materials is referred to as stripping. Stripping cost s
during the development of a mine (or pit), before production commences, are generally expensed as incurred except when
capitalised as part of the cost of construction of the mine (or pit) and subsequently amortised over the life of the mine (or pit)
on a units of production basis only where the below criteria are all met:
•
•
•
it must be probable that there will be an economic benefit in a future accounting period because the stripping activity
has improved access to the ore body;
it must be possible to identify the “component” of the orebody for which access has been improved; and
it must be possible to reliably measure the costs that relate to the stripping activity.
Production phase stripping can give rise to two benefits: the extraction of ore in the current period and improved access to ore
which will be extracted in future periods. When the cost of stripping which has a future benefit is not distinguishable from the
cost of producing current inventories, the stripping cost is allocated to each of these activities based on a relevant produc tion
measure using a life-of-component strip ratio. The ratio divides the tonnage of waste mined for the component for the period
either by the quantity of ore mined for the component or by the quantity of minerals contained in the ore mined for the
component. Stripping costs for the component are deferred to the extent that the current period ratio exceeds the life of
component ratio.
17. Trade & other payables
Trade payables and accrued expenses
Taxes payable
Current
Non-current
Total
31 December
2021
A$’000
31 December
2020
A$’000
7,564
56
7,620
7,483
137
7,620
3,941
53
3,994
3,879
115
3,994
74
56
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
18. Loans payable
Shareholders’ loans payable
Opening balance of loans
Borrowings during the year
Repayment of borrowings
Offset against shares issued
Other changes
Net effect of movement in exchange rates
Total loans at end of the year
31 December
2021
A$’000
31 December
2020
A$’000
-
-
31 December
2021
A$’000
1,830
-
(1,864)
-
16
18
-
1,830
1,830
31 December
2020
A$’000
29,393
-
-
(27,914)
280
71
1,830
Shareholders’ loans
On 18 December 2019, the Group launched an entitlement offer. Both Dr Bruce Gray and BV Holding Limited
agreed to take part in this entitlement offer, and in accordance with the terms of their respective loan agreements,
elected to set-off outstanding principal and interest amounts against their obligations to pay for the shares received
by fully taking up their Entitlements. On 2 January 2020, following the issue of shares to BV Mining Holdings
Limited, the loan payable to BV Mining Holdings Limited in the amount of A$14.776 million was settled in full.
On 2 January 2020, A$13.138 million out of A$14.641 million loan payable to Dr Bruce Gray was settled, following
the issuance of shares to Dr. Gray. On 4 February 2021, the balance of the outstanding loan payable and interest
accrued thereon was settled in full.
Recognition and measurement: Employee benefits
Liabilities for employee benefits for wages, salaries and annual leave that are expected to be settled within twelve months o f the
reporting date represent obligations resulting from employee’s services provided to reporting date and are calculated at undiscounted
amounts based on remuneration wage and salary rates that the Company expects to pay as at the reporting date, including re lated
on-costs, such as workers’ compensation insurance and payroll tax.
A liability is recognised for the amount expected to be paid under short-term incentive bonus plans if the Group has a present legal
or constructive obligation to pay this amount resulting from past service provided by the employee, and the obligation can be
estimated reliably.
19. Employee Benefits
Provision for annual leave
Provision for bonuses
Provision for salary and related costs payable
Provision for other employment benefits
31 December
2021
A$’000
31 December
2020
A$’000
1,098
1,792
742
46
3,678
678
546
168
45
1,437
57
75
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
20. Lease Liability
Maturity analysis:
Payable not later than one year
Payable later than one year, not later than five years
Payable later than five years
Less: future interest
Total lease liabilities
Current
Non-current
Movement in lease liabilities are as follows:
Opening balance of lease liability
New lease agreements entered during the year
Lease payments
Net effect of movement in exchange rates
Total lease liability recognised at end of year
31 December
2021
A$’000
31 December
2020
A$’000
6,640
10,724
5,430
22,794
(7,746)
15,048
5,206
9,842
15,048
3,601
6,396
2,762
12,759
(4,830)
7,929
2,407
5,522
7,929
31 December
2021
A$’000
31 December
2020
A$’000
7,929
10,397
(5,171)
1,893
15,048
14,431
319
(3,191)
(3,630)
7,929
The Group leases directly from vendors, Russian banking institutions and Russian financing companies various
mining and port equipment.
During the year ended 31 December 2021, the Group concluded lease agreements with equipment vendors for the
lease a bulldozers, crane, excavators, and damp trucks. The Group recognised a right-of-use asset of A$11.834
million and a corresponding lease liability, after advance payments of A$1.924 million, of A$9.910 million with
respect to these lease arrangements.
In 2019 the Group recognised right of use of assets and a related lease liability in respect of the port infrastructure
lease agreement with Rosmorport expiring in 2067 (included in other lease liabilities in the table below). In 2021,
the lease payment schedule were amended, which resulted in recognition of additional right of use of assets and a
related lease liability of A$0.487 million.
The key terms of the lease arrangements are as follows:
Vendor lease liabilities
Banking institution lease liabilities
Russian Financing Company lease liabilities
Other lease liabilities
Currency
Effective
interest rate
Year of
maturity
RUB
RUB
RUB
RUB
10.15-22.63%
2021-2026
12.23-15.55%
9.67-30.30%
15.2%
2024
2026
2067
76
58
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
20. Lease Liability (continued)
Recognition and measurement: Leases
The Group assesses whether a contract is or contains a lease, at inception of the contract. The Group recognises a right-of-use
asset and a corresponding lease liability with respect to all lease arrangements in which it is the lessee , except for short-term
leases (defined as leases with a lease term of 12 months or less) and leases of low value assets. The lease liability is initially
measured at the present value of the lease payments that are not paid at the commencement date, disco unted by using the rate
implicit in the lease. If this rate cannot be readily determined, the Group uses its incremental borrowing rate
The lease liability is presented as a separate line in the consolidated statement of financial position. The lease liability is
subsequently measured by increasing the carrying amount to reflect interest on the lease liability (using the effective inter est
method) and by reducing the carrying amount to reflect the lease payments made
The right-of-use assets comprise the initial measurement of the corresponding lease liability, lease payments made at or before
the commencement day, less any lease incentives received and any initial direct costs. They are subsequently measured at cost
less accumulated depreciation and impairment losses
Right-of-use assets are depreciated over the shorter period of lease term and useful life of the right-of-use asset. If a lease
transfers ownership of the underlying asset or the cost of the right-of-use asset reflects that the Group expects to exercise a
purchase option, the related right-of-use asset is depreciated over the useful life of the underlying asset. The depreciation starts
at the commencement date of the lease. The right-of-use assets are presented within property, plant and equipment line in the
consolidated statement of financial position.
21. Royalty Liability
Gross royalty liability, in US$ dollars
Gross royalty liability, in A$ dollars
Effect of discounting
Opening balance of royalty liability
Royalty expense arising from:
-
-
-
the passage of time
the change in discount rate
the change in other assumptions
Payments made during the year
Effect of movement in exchange rates
Closing balance of royalty liability
Current
Non-current
31 December
2021
A$’000
31 December
2020
A$’000
23,457
32,329
(13,911)
18,418
24,168
31,379
(13,316)
18,063
31 December
2021
A$’000
31 December
2020
A$’000
18,063
1,987
(2,735)
937
(945)
1,111
18,418
1,439
16,979
18,418
13,986
1,538
-
4,152
(330)
(1,283)
18,063
922
17,141
18,063
59
77
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
21. Royalty Liability (continued)
The Group entered into a number of royalty agreements as part of obtaining interests in the Amaam North and
Amaam projects. These royalty agreements are dependent upon the performance of a number of conditions
precedent, the realisation of which may result in royalty payments of between 1.5 and 3% of the coal sales revenue
by the Amaam North and Amaam projects, respectively. Total royalty payments in relation to the Amaam North
Project is capped to US$25 million.
Amaam North Royalty Liability
Following the commencement of coal production on Project F, Amaam North, the Group concluded it is probable
that an outflow of resources embodying economic benefits will be required to settle royalty obligations and
accordingly a provision was required for the obligations under existing royalty agreements. The provision was
estimated based on total royalty payments of US$25 million discounted using a post-tax real discount rate of 9% at
31 December 2021.
While the amount of provision recognised represents the best estimate of the expenditure required to settle the
obligations under existing royalty agreements, this estimate is based on estimates of possible outcomes and financial
effect, which were determined by the application of management’s judgement on a number of key assumptions
used in determining the amount of provision, including:
•
•
•
•
the discount rate used;
the probability of revenue cash flows;
timing of coal sales and
the likelihood of achieving forecast coal sales prices.
Amaam Royalty Liability
No liability was recognised at 31 December 2021 (31 December 2020: Nil) in relation to Amaam Project royalty
arrangements as the development of the Amaam Project is not expected in the foreseeable future.
The Group, from time to time, enters into legal agreements with various parties as a result of which there will be future outflows of
economic benefits, including obligations which arise from the execution and realisation of sales agreements (“Royalty Agreement”).
Recognition and measurement: Royalty liabilities
In applying the recognition and measurement criteria outlined above in respect of provisions in Note 3(h) to royalty agreements,
management perform an assessment of the probability of the outflow of economic benefits, which it has deemed to be influenced by the
following factors and circumstances, when assessing the disclosure, recognition and measurement of Royalty Agreement obligations:
•
•
•
•
•
•
Existence of a licence which provides the legal capacity to mine and sell product which is the subject of Roya lty Agreements;
The performance of a feasibility study or other similar project assessment which provides an indication of the economic benef its
accruing to the Group from implementing a project or part thereof, incorporating the consideration of macroecon omic factors
and project specific assumptions on income and expenditures;
General macroeconomic conditions (including but not limited to financial and commodity markets -specifically the market for
coal);
Economic resources are in place which enable the realisation of a plan to extract and sell ore, as defined in a feasibility study
(as amended and updated). Economic resources include both financial, human & other resources necessary to realise strategic
plans;
Board approval to commence those activities necessary to develop and mine ore with the view of commencing commercial
production; and
Actual operations confirm those assumptions upon which the decision made to commence mining operations were made
(including the ability to realise any sales agreements executed).
As noted above, where the likelihood of an outflow of economic benefits is deemed to be remote, no disclosures are made. Where possible,
disclosure is made of a contingent liability and where probable a provision is recognised and measured.
78
60
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
22. Other financial liabilities
Current other financial liabilities
Non – current other financial liabilities
Movement other financial liabilities are as follows
Opening balance of other financial liabilities
Payments
Net effect of movement in exchange rates
Total other financial liabilities recognised at end of year
31 December
2021
A$’000
667
1,022
1,689
31 December
2020
A$’000
605
1,612
2,217
31 December
2021
A$’000
31 December
2020
A$’000
2,217
(618)
90
1,689
3,668
(679)
(772)
2,217
In 2019, the Group entered into a sale and lease-back agreement with Universal Leasing Company for its two 500
tonne barges. As the Group has a substantive repurchase option with respect to the underlying asset under these
agreements, the Group concluded these transactions represent, in substance, a financing arrangement. Accordingly,
all amounts received from Universal Leasing Company were included in other financial liabilities.
The key terms of the arrangement are as follows:
Currency
Effective
interest rate
Year of
maturity
Universal Leasing Company
RUB
18.11%
2024
Recognition and measurement: Sale and leaseback transactions
The Group, from time to time, enters into legal agreements with various parties whereby it transfers an asset to another entity
(the buyer-lessor) and leases that asset back.
The Group applies the requirements for determining when a performance obligation is satisfied in AASB 15 “Revenue from
Contracts with Customers” to determine whether the transfer of an asset is accounted for as a sale of t hat asset.
If the transfer of an asset by the Group satisfies the requirements of AASB 15 to be accounted for as a sale of the asset, then the
Group measures the right-of-use asset arising from the leaseback at the proportion of the previous carrying amount of the asset
that relates to the right of use retained by the seller-lessee. The Group recognises the amount of any gain or loss that relates to
the rights transferred to the buyer-lessor.
If the transfer of an asset by the Group does not satisfy the requirements of AASB 15 to be accounted for as a sale of the asset,
the Group continues to recognise the transferred asset and recognises a financial liability equal to the transfer proceeds.
23.
Share capital
Share Capital
Costs of raising equity
31 December
2021
A$’000
290,069
(17,089)
272,980
31 December
2020
A$’000
263,577
(16,983)
246,594
61
79
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
(i) Movements in shares on issue:
No of shares
Issue price
A$
A$’000
Opening balance at 1 January 2020
1,791,669,870
188,197
Movements in 2020
Issue of ordinary shares – Entitlement Offer 2019
5,822,927,078
0.01
58,229
Issue of ordinary shares – Entitlement Offer 2020
Opening balance at 1 January 2021
2,143,895,694
9,758,492,642
0.008
Movements in 2021
Issue of ordinary shares – Entitlement Offer 2020
Issue of ordinary shares – STI bonuses paid
Closing balance at 31 December 2021
3,295,102,126
13,107,600
13,066,702,368
0.008
0.01
17,151
263,577
26,361
131
290,069
The Company does not have authorised capital or par value in respect of its issued shares. All issued shares are
fully paid. All shares rank equally with regard to the Company’s residual assets. The holders of ordinary shares are
entitled to receive dividends as declared from time to time and are entitled to one vote per share at meetings of the
Company.
(ii) Movements in options on issue
During the year ended 31 December 2021, no options were granted, and 1,905,000 options lapsed or were forfeited
and have been removed from the Company’s option register. Total number of options issued over ordinary shares
in the Company as at 31 December 2021 is 8,002,000 (For the year ended 31 December 2020: no options issued
and 6,976,000 options lapsed and 11,463,000 options forfeited, thus bringing the options issued over ordinary
shares in the Company to 9,907,000).
(iii) Entitlement offer
On 16 December 2020, the Group launched a fully underwritten 1 for 1.4 pro-rata accelerated renounceable
entitlement offer at a price of A$0.008 per share to raise up to A$43.512 million. The institutional entitlement offer
closed on 17 December 2020 raising gross proceeds of A$17.151 million with the Company’s largest shareholder
Dr. Bruce Gray taking up his full entitlement. The retail component of the offer opened on 21 December 2020 and
was completed on 4 January 2021. The retail offer raised A$3.684 million. On 11 January 2021 the arising Shortfall
Bookbuild was completed. The Bookbuild process was managed and fully underwritten by CLSA Australia Pty
Ltd and sub-underwritten by Dr. Bruce Gray. Pursuant to his sub-underwriting agreement, 2.7 billion shares were
issued to Dr. Gray, increasing his overall shareholding in the Company to 59.95%. In total the Group raised
A$43.512 million.
24.
(a)
80
Share based payments
Recognised share-based payment expense
Expense arising from equity settled share-based payment transactions
-
52
62
31 December
2021
A$’000
31 December
2020
A$’000
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
(b)
Description of share-based payment arrangements
In 2010, the Company established the Staff Option Plan as part of the Group’s Long-Term Incentive Plan to assist
in the attraction, motivation and retention of senior executives and employees and to encourage their personal
commitment to the Company. The plan forms a necessary part of the competitive packages offered by the Company
in light of the markets in which it operates. The plan also creates an ownership mindset among participants and
ensures business decisions and strategic planning has regard to the Company’s long-term performance and growth.
There are a number of different performance hurdles, exercise prices and vesting conditions dependent on the
individual’s position held. It is a vesting condition that the holder of options remains an employee or director at the
time of vesting. There have been no cancellations or modification to the Staff Option Plan since it was established
in 2010.
(b)
Description of share-based payment arrangements
The Staff Option Plan offers individuals the opportunity to acquire options over fully paid ordinary shares in the
Company. Share options granted under the plan for no consideration and carry no dividend or voting rights. When
exercised, each option is convertible into one ordinary share subject to satisfying vesting conditions and
performance criteria. The shares when issued rank pari passu in all respects with previously issued fully paid
ordinary shares. Option holders cannot participate in new issues of capital which may be offered to shareholders
prior to exercise.
The fair value of these options is assessed at the grant date using a Monte Carlo simulation model in accordance
with AASB2 Share-based Payments. The options vest and expire at dates set out in the terms of the grant. The
options cannot be transferred and are not quoted on the ASX.
(c)
Summary of options granted under the Option Plan
The options outstanding at 31 December 2021 have an exercise price in the range of A$0.08 to A$0.013 (2020:
A$0.08 to A$0.013). The weighted average remaining contractual life for options outstanding at 31 December 2021
is 0.8 years (31 December 2020: 1.8 years). There were no options granted during the year ended 31 December
2021 (year ended 31 December 2020: Nil). There are 8,002,000 vested and exercisable options at 31 December
2021 (31 December 2020: 9,907,000). There were no options exercised during the years ended 31 December 2021
and 31 December 2020.
Movements in outstanding options
2021
Balance at the beginning of the year
Granted
Forfeited/lapsed
Exercised
Balance at the end of the year
Vested and exercisable at year end
Number of
Options
Weighted
Average
Exercise Price
A$
9,907,000
-
(1,905,000)
-
8,002,000
8,002,000
0.113
-
0.113
-
0.113
0.113
2020
Number of
Options
Weighted
Average
Exercise Price
A$
28,346,000
-
(18,439,000)
-
9,907,000
9,907,000
0.158
-
0.182
-
0.113
0.113
63
81
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
24.
Share based payments (continued)
(c)
Summary of options granted under the Option Plan
Details of share options outstanding at 31 December 2021 are detailed below:
Date of issue
17 April 2015
17 April 2015
11 June 2015
11 June 2015
18 October 2017
18 October 2017
Balance at the end of the year
Number
of Options
-
-
-
-
2,721,000
5,281,000
8,002,000
2021
Average
Exercise Price
A$
-
-
-
-
0.080
0.130
0.113
2020
Number of
Options
Average
Exercise Price
-
-
-
-
3,368,000
6,539,000
9,907,000
A$
-
-
-
-
0.080
0.130
0.105
During the year to 31 December 2021, no options were issued, 1,905,000 options lapsed and no options forfeited
and exercised, bringing the options issued over ordinary shares in the Company to 8,002,000 as at 31 December
2021.
(d)
Inputs for the measurement of grant date fair values
The grant date fair values of the options granted through the Staff Option Plan utilised assumptions underlying the
Black-Scholes methodology to produce a Monte Carlo simulation model which allows for incorporation of the
performance hurdles that must be met before the share-based payment vests to the holder. Expected volatility is
estimated by considering historic average share price volatility. The expected dividend yield used in the valuation
process has been nil. The early exercise provision has been measured using a sell multiple of two times the exercise
price. The post-vesting withdrawal rate used in the valuation of the options is nil. The risk-free rate is derived from
the yield on Australian Government Bonds of appropriate terms.
The inputs used in the measurement of the fair values at the grant date of the options granted under the Staff Option
Plan and outstanding at 31 December 2021 are outlined below:
Option Grant
Date
18 Oct 2017
18 Oct 2017
Fair value
at grant
date (A$)
Share price
at grant
date (A$)
Exercise
price
Perfor-
mance
hurdle
Perfor-
mance
period
Expiry date
Risk free
interest rate
$0.031
$0.030
$0.060
$0.060
$0.080
$0.130
A
B
C
D
18 Oct 2022
18 Oct 2022
2.32%
2.32%
A.
B.
C.
D.
Performance hurdle: options vest 24 months after grant date.
Performance hurdle: options vest 36 months after grant date.
Performance period: 36 months after grant date.
Performance period: 24 months after grant date
Equity-based compensation is recognised as an expense in respect of the services received.
Recognition and measurement: Share based payments
The fair value of options granted is recognised as an asset or expense with a corresponding increase in equity. The fair val ue
is measured at the grant date and recognised over the period during which the employees became unconditionally entitle d to
the options. The fair value at the grant date is independently determined using an option pricing model that takes into account
the exercise price, the term of the options, the vesting and performance criteria, the impact of dilution, the non -tradable nature
of the option, the share price at grant date and expected volatility of the underlying share, the expected dividend yield and
the risk-free interest rate for the term of the option.
82
64
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
25. Risk management and financial instruments
(a)
Risk management framework
The Board of Directors has overall responsibility for the establishment and oversight of the risk management
framework. The Board has established the Audit, Risk and Compliance Committee (ARCC), which is responsible
for overseeing the development and monitoring the Group’s risk management policies by the Company. A Risk
Committee consisting of senior management and staff report regularly to the ARCC. Significant risks which cannot
be appropriately and adequately mitigated are reported and reviewed by the Board of Directors.
The Group has established a Risk Management Policy to provide a framework for the management of risk within
the Group. The Group’s risk management policies are established to identify and analyse the risks faced by the
Group, to set appropriate risk limits and controls, and to monitor risks and adherence to limits.
The Group has exposure to the following risks from its operations and use of financial instruments:
•
•
•
•
Credit risk
Liquidity risk
Market risk
Operational risk
This note presents information about the Group’s exposure to each of the above risks, its objectives, policies and
processes for measuring and managing risk, and the management of capital. Further quantitative disclosures are
included throughout these consolidated financial statements.
(i)
Credit risk
Credit risk is the risk of financial loss to the Group if a counterparty to a financial instrument fails to meet
its contractual obligations and arises principally from the Group’s receivables from customers.
Liquidity risk
(ii)
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due.
The Group’s approach to managing liquidity is to ensure, as far as possible, that it will always have
sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without
incurring unacceptable losses or risking damage to the Group’s reputation.
(iii) Market risk
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates,
commodity prices and equity prices will affect the Group’s income or the value of its holdings of financial
instruments. The objective of market risk management is to manage and control market risk exposures
within acceptable parameters, while optimising the return. For the Group currency risk arises from
transactions in foreign currencies, predominantly US Dollars (USD), and Russian Roubles (RUB). For the
Group interest rate risk arises from the exposure to Australian cash deposit rates relating to cash and cash
equivalents. For the Group commodity price risk affects the valuation of the Royalty Agreement Liability.
(iv) Operational risk
Operational risk is the risk of direct or indirect loss arising from a wide variety of causes associated with
the Group’s processes, personnel, technology and infrastructure and from external factors other than credit,
liquidity and market risks such as those arising from legal and regulatory requirements and generally
accepted standards of corporate behaviour. Operational risks arise from all of the Group’s operations.
The Group’s objective is to manage operational risk so as to balance the avoidance of financial losses and
damage to the Group’s reputation with overall cost effectiveness. The primary responsibility for the
development and implementation of controls to address operational risk is assigned to the Group’s senior
management. This responsibility is supported by the development of the Group Policies and Code of
Conduct.
65
83
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
25. Risk management and financial instruments (continued)
(b)
Capital management
The Company and Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a
going concern, so as to maintain a strong capital base sufficient to maintain future exploration, evaluation and
development of its projects. In order to maintain or adjust the capital structure, the Group may return capital to
shareholders, or issue new shares. The Group’s focus historically has been to raise sufficient funds through equity
to fund its exploration and evaluation activities and expansion. In 2021 the Group conducted two entitlement offers
detailed further in Note 23.
The Board has not set a target for employee ownership of the Company’s ordinary shares.
The Board has not yet set a debt to capital target for the Group.
Russian Law provides that Russian subsidiaries in the Group need to maintain a level of net assets higher than their
charter capital. Management closely monitor this requirement and act accordingly when required.
Neither the Company nor remaining subsidiaries are subject to any externally imposed capital requirements.
(c)
Financial instruments
The Group holds the following financial instruments:
Financial assets
Cash and cash equivalents
Trade and other receivables
Financial liabilities
Trade and other payables
Leases liabilities
Loans payable
Other financial liabilities
31 December
2021
A$’000
31 December
2020
A$’000
33,511
6,277
39,788
7,620
15,048
-
1,689
24,357
18,879
5,888
24,767
3,994
7,929
1,830
2,217
15,970
84
66
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
25. Risk management and financial instruments (continued)
(d)
Accounting classifications and fair values
The following table shows the carrying amounts of financial assets and liabilities.
31 December 2021
Financial assets not measured at fair value
Cash and cash equivalents
Trade and other receivables
Financial liabilities not measured at fair value
Trade and other payables
Loans payable
Lease liabilities
Other financial liabilities
31 December 2020
Financial assets not measured at fair value
Cash and cash equivalents
Trade and other receivables
Financial liabilities not measured at fair value
Trade and other payables
Loans payable
Lease liabilities
Other financial liabilities
Loans &
Receivables
Carrying amount
Other financial
liabilities
A$’000
Total
33,511
6,277
39,788
-
-
-
-
-
-
-
-
7,620
-
15,048
1,689
24,357
33,511
6,277
39,788
7,620
-
15,048
1,689
24,357
Loans &
Receivables
Carrying amount
Other financial
liabilities
A$’000
Total
18,879
5,888
24,767
-
-
-
-
-
-
-
-
3,994
1,830
7,929
2,217
15,970
18,879
5,888
24,767
3,994
1,830
7,929
2,217
15,970
(e)
Credit risk
Exposure to credit risk
Management monitors the exposure to credit risk on an ongoing basis. The maximum exposure to credit risk on
financial assets is the carrying amount of the respective recognised financial assets as stated in the consolidated
statement of financial position. For trade and other receivables, the Group does not have significant credit risk
exposure to any single counterparty or any group of counterparties having similar characteristics. The Group defines
counterparties as having similar characteristics if they are related entities.
The Group has treasury policies in place for deposit transactions to be conducted with financial institutions with
high credit-ratings assigned by international credit-rating agencies. At the reporting date, cash is held with reputable
financial institutions which all meet the Group’s minimum credit rating required by the approved treasury policy.
Cash and cash equivalents
Trade and other receivables
Carrying amount
2021
A$’000
33,511
6,277
39,788
2020
A$’000
18,879
5,888
24,767
67
85
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
25. Risk management and financial instruments (continued)
Geographical information
The Group’s maximum exposure to credit risk for Trade and other receivables at the reporting date by
geographical region was:
Asia and the Russian Federation
Australia
Carrying amount
2021
A$’000
6,277
-
6,277
Counterparty information
The Group’s maximum exposure to credit risk for Trade and other receivables at the reporting date by type of
counterparty was:
Coal customers
Other
2021
A$’000
6,277
-
6,277
2020
A$’000
5,888
-
5,888
2020
A$’000
5,888
5,888
Impairment losses
The ageing of the Group’s Trade and other receivables at the reporting date was:
Impaired
2021
A$’000
Gross
2021
A$’000
Gross
2020
A$’000
Impaired
2020
A$’000
Not past due
Past due 0-30 days
Past due 31-120 days
Past due 121 days to one year
More than one year
-
6,277
-
306
-
6,583
-
-
-
(306)
-
(306)
5,888
-
-
-
-
5,888
-
-
-
-
-
-
As of 31 December 2021 there was A$0.306 million provision for expected credit losses. (At 31 December 2020:
A$Nil). In January 2022 TIG received A$5,291 million of past due receivables.
86
68
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
25. Risk management and financial instruments (continued)
(f)
Liquidity risk
Exposure to liquidity risk
Management monitors the exposure to liquidity risk on an on-going basis. Prudent liquidity risk management
implies maintaining sufficient cash reserves to meet the on-going operational requirements of the business. It is the
Group’s policy to maintain sufficient funds in cash and cash equivalents. Furthermore, the Group monitors its cash
requirements and raises appropriate funding as and when required to meet such planned expenditure.
The following are the contractual maturities of financial liabilities.
31 December 2021
Non-derivative financial
liabilities
Trade and other payables
Lease liabilities
Other financial liabilities
31 December 2020
Non-derivative financial
liabilities
Trade and other payables
Loans payable
Lease liabilities
Other financial liabilities
Contractual cashflows
Carrying
amount
A$’000
Total
A$’000
6 months
or less
A$’000
6-12
months
A$’000
1-2 years
A$’000
2-5 years
A$’000
7,620
15,048
1,689
24,357
7,620
22,795
2,150
32,565
3,994
1,830
7,929
2,217
15,970
3,994
1,864
12,760
3,011
21,629
7,483
2,029
162
9,674
3,879
1,864
1,229
193
7,165
-
4,611
781
5,392
-
-
2,372
781
3,153
-
5,725
862
6,587
137
5,000
344
5,481
-
-
3,425
894
4,319
115
-
2,971
1,143
4,229
More
than 5
years
A$’000
-
5,430
-
5,430
-
-
2,763
-
2,763
It is not expected that the cash flows included in the maturity analysis could occur significantly earlier, or at
significantly different amounts.
(g) Market risk
(i) Currency risk
Exposure to currency risk
Management monitors the exposure to currency risk on an ongoing basis. The Group operates internationally and
is exposed to foreign exchange risk arising from various currencies, primarily with respect to the US Dollar
(“USD”) and the Russian Rouble (”RUB”).
The Group’s exposure to foreign currency risk was as follows:
Cash and cash equivalents
Trade and other receivables
Trade and other payables
Loans payable
Lease liabilities
Other financial liabilities
Net exposure
USD
2021
A$’000
RUB
2021
A$’000
USD
2020
A$’000
RUB
2020
A$’000
401
5,113
(681)
-
-
-
4,833
32,348
11,959
(6,939)
-
(15,048)
(1,689)
20,631
8,376
3,966
(721)
(1,830)
-
-
9,791
1,466
5,878
(3,273)
-
(7,929)
(2,217)
(6,075)
69
87
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
25. Risk management and financial instruments (continued)
(g) Market risk
(i) Currency risk
Exchange rates used
The following significant exchange rates were applied during the year relative to one Australian dollar:
Average rate
2021
1.3307
0.0181
2020
1.4483
0.0200
Reporting date
spot rate
2021
1.3780
0.0185
2020
1.2984
0.0177
USD
RUB
Sensitivity analysis
A weakening of the AUD, as indicated, against the USD and RUB at 31 December 2021 would have the impact in
equity and profit or loss by the amounts shown below. This analysis is based on foreign currency exchange rate
variances that the Group considered to be reasonably possible at the end of the reporting period. The analysis
assumes that all other variables, in particular interest rates, remain constant.
Strengthening
Weakening
Equity
A$’000
Profit or
loss
A$’000
Equity
A$’000
Profit or
loss
A$’000
537
2,292
1,088
(675)
537
2,292
1,088
(675)
(439)
(1,876)
(890)
552
(439)
(1,876)
(890)
552
31 December 2021
USD (10% movement)
RUB (10% movement)
31 December 2020
USD (10% movement)
RUB (10% movement)
(i) Commodity price risk
Commodity price risk in the Group primarily arises from price fluctuations of coal. Management monitors the
exposure to commodity price risk on an on-going basis.
(ii) Interest rate risk
Exposure to interest rate risk
Management monitors the exposure to interest rate risk on an ongoing basis. The Group’s exposure to interest rate
risk is minimal as the Group borrows funds at fixed rates. At the reporting date the interest rate profile of the
Group’s interest-bearing financial instruments was:
Fixed rate instrument
Financial assets
Financial liabilities
Variable rate instruments
Financial assets
Financial liabilities
Carrying amount
2021
A$’000
2020
A$’000
-
(16,737)
(16,737)
776
-
776
-
(11,976)
(11,976)
17,037
-
17,037
88
70
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
26. Expenditure commitments
Exploration expenditure commitments
In order to maintain current rights of tenure to exploration tenements, the Group is required to perform minimum
exploration work to meet its licence obligations. In the Russian Federation, this minimum exploration work is
defined by the performance of a minimum number of drilling metres over the life of each exploration licence. These
obligations are expected to be fulfilled in the normal course of operations. Mining interests may be relinquished or
joint ventured to reduce this amount. The various country and state governments have the authority to defer, waive
or amend the minimum expenditure requirements. As of and for the year ended 31 December 2021, the Group is
in compliance with those exploration obligations defined in the respective licences.
Other commitments
Other commitments of A$3.886 million are primarily comprised of A$1.025 million commitment for a new 500t
barge, A$0.587 million commitments to DPCI for CHPP equipment and A$0.660 million for CHPP construction
(At 31 December 2020: A$9.050 million comprised primarily of A$1.898 million in commitments to Chukotsnab
and A$5.123 million commitments to DPCI for the supply of diesel and CHPP equipment respectively).
27. Contingencies
Deed of cross guarantee
Under the terms of the ASIC Corporations (Wholly-owned Companies) Instrument 2016/785, the Company has
entered into an approved deed of cross guarantee of liabilities with the subsidiary identified in Note 32.
Tax contingencies in the Russian Federation
Russian tax legislation is subject to varying interpretations and changes, which can occur frequently. Management’s
interpretation of such legislation as applied to the transactions and activities of the Group may be challenged by the
relevant regional and federal authorities. Management believes that the Group has adequately provided for tax
liabilities based on its interpretation of the applicable tax legislation. However, the relevant authorities may have
differing interpretations, and the effect on the financial report could be significant if such interpretations are
realised.
28. Related parties’ disclosure
(a)
Identity of related parties
Balances and transactions between the company and its subsidiaries, which are related parties, have been eliminated
on consolidation and are not disclosed in this note. The remuneration of key management personnel is disclosed
in Note 29.
As disclosed in Note 18, On 4 February 2021 outstanding loan payable to Dr Bruce Gray and interest accrued
thereon was settled in full.
There were no transactions with other related parties during the years ended 31 December 2021 and 2020.
It is the Group’s policy that where transactions are undertaken with related parties, they are done so on an arm’s
length basis.
29. Key Management Personnel Disclosures
(a)
Compensation of key management personnel
The key management personnel compensation included in “Administration expenses” (see Note 8) and “Share-
based payments” (see Note 24) is as follows:
Short-term employee benefits
Long-term employee benefits
Post-employment benefits
Share-based payments
2021
A$
2,225,664
766,955
14,560
-
3,007,179
2020
A$
1,957,105
-
12,697
19,598
1,989,400
71
89
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
(b)
Key management personnel compensation disclosures
Information regarding individual Directors’ and executives, compensation and some equity instrument disclosures
as permitted by Corporation Regulation 2M.3.03 and 2M.6.04 is provided in the Remuneration Report in Section
12 of the Directors’ Report.
The movement in the number of Tigers Realm Coal Limited shares held directly, indirectly, or beneficially by the
key management personnel and their related entities are set out below.
Balance at
1 January
Acquisitions
Sales
Other
Changes
Balance at
31 December
2021
Directors
C Wiggill
B Gray
O Hegarty
T Sitdekov
D Swan
V Doronin
2020
Directors
C Wiggill
B Gray
O Hegarty
R Morgan
T Sitdekov
D Swan
5,100,000
-
5,145,349,665
2,680,527,623
60,412,029
6,000,000
-
-
-
-
-
-
-
-
Other key management personnel
S Southwood
D Forsyth
D Gavrilin
D Bender
21,867,673
7,246,377
-
601,297
9,141,792
-
(c)
Movements in shares
Balance at
1 January
Acquisitions
Sales
1,200,000
3,900,000
404,246,361
4,741,103,304
30,412,029
30,0000,000
-
-
-
-
-
-
-
-
Other key management personnel
S Southwood
D Forsyth
D Gavrilin
D Bender
19,267,673
-
-
2,600,000
7,246,377
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Other
Changes
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
5,100,000
7,825,877,288
66,412,029
-
-
-
-
22,468,970
16,388,169
-
Balance at
31 December
5,100,000
5,145,349,665
60,412,029
-
-
-
-
21,867,673
7,246,377
-
90
72
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
30. Group entities
Significant subsidiaries
Parent entity
Tigers Realm Coal Limited
Subsidiaries
TR Coal International Limited
Tigers Realm Coal (Cyprus) Pty Ltd
Greaterbay Larnaca Finance (Cyprus) Pty Ltd
Eastshore Coal Holding Limited
Telofina Holdings Ltd
Rosmiro Investments Limited
Anadyrsky Investments Limited
Northern Pacific Coal Company
Beringpromugol LLC
Port Ugolny LLC
Bering Ugol Investments LLC
Country of
Incorporation
Ownership Interest
2020
2021
Australia
Australia
Cyprus
Cyprus
Cyprus
Cyprus
Cyprus
Cyprus
Russia
Russia
Russia
Russia
100%
100%
100%
80%
100%
100%
100%
80%
100%
100%
100%
100%
100%
100%
80%
100%
100%
100%
80%
100%
100%
100%
31. Parent entity disclosures
As at and throughout the financial year ended 31 December 2020, the parent entity of the Group was Tigers Realm
Coal Limited. Information relating to the parent entity follows:
Results of parent entity
Loss for the period
Total comprehensive loss
Financial position of parent entity
Current assets
Non-current assets
Total assets
Current liabilities
Total liabilities
Net Assets
Total equity of the parent entity comprising
Share capital
Reserves
(Accumulated deficit)
Total equity
Contingent liabilities of the parent entity
31 December
2021
A$’000
31 December
2020
A$’000
-
-
776
130,024
130,800
-
-
130,800
272,980
7,353
(149,533)
130,800
(52)
(52)
17,037
87,377
104,414
-
-
104,414
246,594
7,353
(149,533)
104,414
The parent entity has contingent liabilities arising from its guarantees to each creditor of TR Coal International
Limited under the Deed of Cross Guarantee as discussed in Note 32.
Capital commitments of the parent entity
As at 31 December 2021 and 2020, capital commitments comprised of A$1.552 million and A$5.123 million
commitments to DPCI for the CHPP equipment.
73
91
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
32. Deed of cross guarantee
Pursuant to ASIC Corporations (Wholly-owned Companies) Instrument 2016/785, the wholly-owned subsidiary
listed below is relieved from the Corporations Act 2001 requirements for preparation, audit and lodgement of
financial reports, and directors’ reports.
It is a condition of a Class Order that the Company and the subsidiary enter into a Deed of Cross Guarantee. The
effect of the Deed is that the Company guarantees to each creditor payment in full of any debt in the event of
winding up of the subsidiary under certain provisions of the Corporations Act 2001. If a winding up occurs under
other provisions of the Act, the Company will only be liable in the event that after six months any creditor has not
been paid in full. The subsidiary has also given similar guarantees in the event that the Company is wound up.
The entities subject to the Deed of Cross Guarantee are:
•
•
Tigers Realm Coal Limited; and
TR Coal International Limited.
The Deed of Cross Guarantee was established on 22 November 2012.
A consolidated statement of comprehensive income and consolidated statement of financial position, comprising
the Company and controlled entity which are a party to the Deed, after eliminating all transactions between parties
to the Deed of Cross Guarantee for the year ended 31 December 2021 is set out below.
Statement of comprehensive income and retained earnings
Share based payments
Administrative expenses
Results from operating activities
Net foreign exchange gain/(loss)
Finance expense
Finance income
Net finance expense
Profit before income tax
Income tax expense
Net Profit
Other comprehensive income
Foreign currency translation differences for foreign operations
Income tax on other comprehensive income
Total comprehensive profit for the period
Accumulated deficit at beginning of year
Accumulated deficit at end of year
31 December
2021
A$’000
31 December
2020
A$’000
-
(1,729)
(1,729)
4,683
-
53
4,736
3,008
-
3.008
-
-
3,008
(192,328)
(189,320)
(52)
(718)
(770)
(5,664)
(280)
91
(5,853)
(6,623)
-
(6,623)
-
-
(6,623)
(185,705)
(192,328)
92
74
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
32. Deed of cross guarantee (continued)
Current Assets
Cash and cash equivalents
Trade and other receivables
Prepayments
Total current assets
Non-current assets
Property, plant and equipment
Investments in subsidiaries
Total non-current assets
Total assets
Current Liabilities
Trade and other payables
Loan payables
Employee provisions
Total current liabilities
Total liabilities
Net assets
Equity
Share capital
Reserves
(Accumulated deficit)
Total equity
31 December
2021
A$’000
31 December
2020
A$’000
776
467
326
1,569
-
129,658
129,658
131,227
435
-
59
494
494
17,037
335
42
17,414
4,481
81,783
86,264
103,678
815
1,830
46
2,691
2,691
130,733
100,987
272,980
47,073
(189,320)
130,733
246,594
46,721
(192,328)
100,987
75
93
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
33. Non-controlling interest
No change in the non-controlling interests in the Eastshore and the Amaam project occurred during the years ended
31 December 2021 and 2020.
34. Auditors’ Remuneration
Details of the amounts paid to the auditor, Deloitte, and related network firms for audit and non-audit services
provided during the year are set out below.
Audit services:
Audit and review of financial reports Deloitte Australia
Audit and review of financial reports Deloitte Overseas
Services other than statutory audit
Other services
Taxation compliance and advisory services Deloitte
Australia
Taxation compliance services and advisory services
Deloitte Overseas
31 December
2021
A$
31 December
2020
A$
137,350
243,218
380,568
123,245
159,710
282,955
26,881
19,950
66,823
93,704
474,272
35,944
55,894
338,849
35. Events after the reporting period
In January 2022, the Company entered into purchase agreements amounting to A$9.638 million for delivery of
mining equipment during the first half of 2022.
94
76
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
Directors’ declaration
For the year ended 31 December 2021
1.
In the opinion of the Directors of Tigers Realm Coal Limited (‘the Company’):
(a)
the attached consolidated financial statements and notes that are set out on pages 34 to 76 are in
accordance with the Corporations Act 2001, including:
(i)
giving a true and fair view of the Group’s financial position as at 31 December 2021 and of its
performance for the financial year ended on that date; and
(ii) complying with Australian Accounting Standards (including the Australian Accounting
Interpretations) and the Corporations Regulations 2001; and
(b)
there are reasonable grounds to believe that the Company will be able to pay its debts as and when they
become due and payable.
2.
3.
4.
There are reasonable grounds to believe that the Company and the group entities identified in Note 32 will be
able to meet any obligations or liabilities to which they are or may become subject to by virtue of the Deed of
Cross Guarantee between the Company and those group entities pursuant to ASIC Corporations (Wholly owned
Companies) Instrument 2016/785.
The Directors have been given the declarations required by Section 259A of the Corporations Act 2001 from the
chief executive officer and the chief financial officer for the financial year ended 31 December 2021.
The Directors also draw attention to Note 2(a) to the consolidated financial statements, which includes a
statement of compliance with International Financial Reporting Standards.
Signed in accordance with a resolution of the Directors:
Dated at Melbourne this 24th day of February 2022.
________________________________________________
Craig Wiggill
Director
77
95
Annual Report 2021Tigers Realm Coal Deloitte Touche Tohmatsu
ABN 74 490 121 060
Level 23, Riverside Centre
123 Eagle Street
Brisbane, QLD, 4000
Australia
Phone: +61 7 3308 7000
www.deloitte.com.au
The Board of Directors
Tigers Realm Coal Limited
151 Wellington Parade South
East Melbourne
VIC 3002
24 February 2022
Dear Board Members,
TTiiggeerrss RReeaallmm CCooaall LLiimmiitteedd
In accordance with section 307C of the Corporations Act 2001, I am pleased to provide the following
declaration of independence to the directors of Tigers Realm Coal Limited.
As lead audit partner for the audit of the financial statements of Tigers Realm Coal Limited for the
financial year ended 31 December 2021, I declare that to the best of my knowledge and belief, there
have been no contraventions of:
(i)
the auditor independence requirements of the Corporations Act 2001 in relation to the
audit; and
(ii) any applicable code of professional conduct in relation to the audit.
Yours sincerely,
DELOITTE TOUCHE TOHMATSU
JJaaccqquueess SSttrryyddoomm
Partner
Chartered Accountants
Liability limited by a scheme approved under Professional Standards Legislation.
Member of Deloitte Asia Pacific Limited and the Deloitte organisation.
96
78
Annual Report 2021Tigers Realm Coal
Deloitte Touche Tohmatsu
ABN 74 490 121 060
Level 23, Riverside Centre
123 Eagle Street
Brisbane, QLD, 4000
Australia
Phone: +61 7 3308 7000
www.deloitte.com.au
Deloitte Touche Tohmatsu
ABN 74 490 121 060
Level 23, Riverside Centre
123 Eagle Street
Brisbane, QLD, 4000
Australia
Phone: +61 7 3308 7000
www.deloitte.com.au
TTiiggeerrss RReeaallmm CCooaall LLiimmiitteedd
In accordance with section 307C of the Corporations Act 2001, I am pleased to provide the following
declaration of independence to the directors of Tigers Realm Coal Limited.
As lead audit partner for the audit of the financial statements of Tigers Realm Coal Limited for the
financial year ended 31 December 2021, I declare that to the best of my knowledge and belief, there
have been no contraventions of:
(i)
the auditor independence requirements of the Corporations Act 2001 in relation to the
audit; and
(ii) any applicable code of professional conduct in relation to the audit.
The Board of Directors
Tigers Realm Coal Limited
151 Wellington Parade South
East Melbourne
VIC 3002
24 February 2022
Dear Board Members,
Yours sincerely,
DELOITTE TOUCHE TOHMATSU
JJaaccqquueess SSttrryyddoomm
Partner
Chartered Accountants
IInnddeeppeennddeenntt AAuuddiittoorr’’ss RReeppoorrtt ttoo tthhee MMeemmbbeerrss ooff TTiiggeerrss
RReeaallmm CCooaall LLiimmiitteedd
RReeppoorrtt oonn tthhee AAuuddiitt ooff tthhee FFiinnaanncciiaall RReeppoorrtt
OOppiinniioonn
We have audited the financial report of Tigers Realm Coal Limited (the “Company”) and its subsidiaries
(the “Group”), which comprises the consolidated statement of financial position as at 31 December
2021, the consolidated statement of comprehensive income, the consolidated statement of changes in
equity and the consolidated statement of cash flows for the year then ended, and notes to the financial
statements, including a summary of significant accounting policies, and the directors’ declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations
Act 2001, including:
(i)
giving a true and fair view of the Group’s financial position as at 31 December 2021 and of its
financial performance for the year then ended; and
(ii)
complying with Australian Accounting Standards and the Corporations Regulations 2001.
BBaassiiss ffoorr OOppiinniioonn
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial
Report section of our report. We are independent of the Group in accordance with the auditor
independence requirements of the Corporations Act 2001 and the ethical requirements of the
Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional
Accountants (including Independence Standards) (the Code) that are relevant to our audit of the
financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with
the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been
given to the directors of the Company, would be in the same terms if given to the directors as at the
time of this auditor’s report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Liability limited by a scheme approved under Professional Standards Legislation.
Member of Deloitte Asia Pacific Limited and the Deloitte organisation.
Liability limited by a scheme approved under Professional Standards Legislation.
Member of Deloitte Asia Pacific Limited and the Deloitte organisation.
78
79
97
Annual Report 2021Tigers Realm Coal
KKeeyy AAuuddiitt MMaatttteerrss
Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the financial report for the current period. These matters were addressed in the context of
our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide
a separate opinion on these matters.
KKeeyy AAuuddiitt MMaatttteerr
Estimation of the amount of royalty liability in
relation to the Amaam and Amaam North Projects
As disclosed in Note 21, the Group has entered
into a number of royalty arrangements as part of
obtaining control in the Amaam and Amaam North
Projects.
Management is required to make a number of
judgements to estimate the amount of the liability,
including identifying an appropriate methodology,
the probability, amount and timing of expected
future cash flows from the revenue derived from
the sale of coal produced and the discount rate. As
the estimate is sensitive to these judgments, there
is a risk that changes in key assumptions can have
a significant impact on the estimate and therefore
reported results.
HHooww tthhee ssccooppee ooff oouurr aauuddiitt rreessppoonnddeedd ttoo tthhee KKeeyy AAuuddiitt
MMaatttteerr
In conjunction with our valuation specialists, we
performed our audit procedures including, but were not
limited to:
•
• Assessing
Evaluating management’s process and assessing
the design and implementation of key controls
management have in place for determining the
royalty liability.
and
challenging management’s
assumptions made
in relation to forecast
production and sales volumes, forecast coal
prices. This included assessing the consistency of
relevant
assumptions with other
these
information, including, but not limited to life-of-
mine plans, external observable market data and
economic analysis.
the
the
assumptions used to determine the discount
rate.
Performing
of
management’s production and sales volumes,
coal prices assumptions to evaluate the accuracy
of the management’s forecasting;
Performing sensitivity analysis on a number of
key assumptions, including production and sales
volumes, coal prices and discount rate;
reasonableness of
retrospective
review
a
• Challenging
•
•
• Assessing the appropriateness of the disclosures
in Note 21 to the financial statements.
OOtthheerr IInnffoorrmmaattiioonn
The directors are responsible for the other information. The other information comprises the
information which will be included in the Group’s annual report for the year ended 31 December 2021
(but does not include the financial report and our auditor’s report thereon). We obtained the Directors’
Report, Corporate Governance Statement and Shareholder Information, which are to be included in
the annual report, prior to the date of this auditor’s report. The remaining sections of the annual report
are expected to be made available to us after that date.
Our opinion on the financial report does not cover the other information and accordingly we do not
and will not express any form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information
identified above and, in doing so, consider whether the other information is materially inconsistent
with the financial report or our knowledge obtained in the audit, or otherwise appears to be materially
misstated. If, based on the work we have performed on the other information that we obtained prior
80
98
Annual Report 2021Tigers Realm Coal
KKeeyy AAuuddiitt MMaatttteerrss
Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the financial report for the current period. These matters were addressed in the context of
our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide
a separate opinion on these matters.
KKeeyy AAuuddiitt MMaatttteerr
HHooww tthhee ssccooppee ooff oouurr aauuddiitt rreessppoonnddeedd ttoo tthhee KKeeyy AAuuddiitt
MMaatttteerr
Estimation of the amount of royalty liability in
In conjunction with our valuation specialists, we
relation to the Amaam and Amaam North Projects
performed our audit procedures including, but were not
As disclosed in Note 21, the Group has entered
into a number of royalty arrangements as part of
obtaining control in the Amaam and Amaam North
•
Evaluating management’s process and assessing
the design and implementation of key controls
management have in place for determining the
limited to:
Projects.
Management is required to make a number of
judgements to estimate the amount of the liability,
including identifying an appropriate methodology,
the probability, amount and timing of expected
future cash flows from the revenue derived from
the sale of coal produced and the discount rate. As
the estimate is sensitive to these judgments, there
is a risk that changes in key assumptions can have
a significant impact on the estimate and therefore
reported results.
royalty liability.
• Assessing
and
challenging management’s
assumptions made
in relation to forecast
production and sales volumes, forecast coal
prices. This included assessing the consistency of
these
assumptions with other
relevant
information, including, but not limited to life-of-
mine plans, external observable market data and
economic analysis.
• Challenging
the
reasonableness of
the
assumptions used to determine the discount
rate.
•
•
Performing
a
retrospective
review
of
management’s production and sales volumes,
coal prices assumptions to evaluate the accuracy
of the management’s forecasting;
Performing sensitivity analysis on a number of
key assumptions, including production and sales
volumes, coal prices and discount rate;
• Assessing the appropriateness of the disclosures
in Note 21 to the financial statements.
OOtthheerr IInnffoorrmmaattiioonn
The directors are responsible for the other information. The other information comprises the
information which will be included in the Group’s annual report for the year ended 31 December 2021
(but does not include the financial report and our auditor’s report thereon). We obtained the Directors’
Report, Corporate Governance Statement and Shareholder Information, which are to be included in
the annual report, prior to the date of this auditor’s report. The remaining sections of the annual report
are expected to be made available to us after that date.
Our opinion on the financial report does not cover the other information and accordingly we do not
and will not express any form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information
identified above and, in doing so, consider whether the other information is materially inconsistent
with the financial report or our knowledge obtained in the audit, or otherwise appears to be materially
misstated. If, based on the work we have performed on the other information that we obtained prior
80
to the date of this auditor’s report, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.
When we read the remaining sections of the annual report, if we conclude that there is a material
misstatement therein, we are required to communicate the matter to the directors and use our
professional judgement to determine the appropriate action.
RReessppoonnssiibbiilliittiieess ooff tthhee DDiirreeccttoorrss ffoorr tthhee FFiinnaanncciiaall RReeppoorrtt
The directors of the Company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due to
fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the Group to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the Group or to cease
operations, or have no realistic alternative but to do so.
AAuuddiittoorr’’ss RReessppoonnssiibbiilliittiieess ffoorr tthhee AAuuddiitt ooff tthhee FFiinnaanncciiaall RReeppoorrtt
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of this financial report.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional
judgement and maintain professional scepticism throughout the audit. We also:
•
Identify and assess the risks of material misstatement of the financial report, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from fraud is higher than for one resulting from
error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the
override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Group internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the directors.
81
99
Annual Report 2021Tigers Realm Coal
• Conclude on the appropriateness of the directors’ use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to
events or conditions that may cast significant doubt on the Group ability to continue as a going
concern. If we conclude that a material uncertainty exists, we are required to draw attention
in our auditor’s report to the related disclosures in the financial report or, if such disclosures
are inadequate, to modify our opinion. Our conclusions are based on the audit evidence
obtained up to the date of our auditor’s report. However, future events or conditions may
cause the Group to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the financial report, including the
disclosures, and whether the financial report represents the underlying transactions and events
in a manner that achieves fair presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities
or business activities within the Group to express an opinion on the financial report. We are
responsible for the direction, supervision and performance of the Group’s audit. We remain
solely responsible for our audit opinion.
We communicate with the directors regarding, among other matters, the planned scope and timing of
the audit and significant audit findings, including any significant deficiencies in internal control that we
identify during our audit.
We also provide the directors with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other
matters that may reasonably be thought to bear on our independence, and where applicable, actions
taken to eliminate threats or safeguards applied.
From the matters communicated with the directors, we determine those matters that were of most
significance in the audit of the financial report of the current period and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter
should not be communicated in our report because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.
100
82
Annual Report 2021Tigers Realm Coal
• Conclude on the appropriateness of the directors’ use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to
events or conditions that may cast significant doubt on the Group ability to continue as a going
concern. If we conclude that a material uncertainty exists, we are required to draw attention
in our auditor’s report to the related disclosures in the financial report or, if such disclosures
are inadequate, to modify our opinion. Our conclusions are based on the audit evidence
obtained up to the date of our auditor’s report. However, future events or conditions may
cause the Group to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the financial report, including the
disclosures, and whether the financial report represents the underlying transactions and events
in a manner that achieves fair presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities
or business activities within the Group to express an opinion on the financial report. We are
responsible for the direction, supervision and performance of the Group’s audit. We remain
solely responsible for our audit opinion.
We communicate with the directors regarding, among other matters, the planned scope and timing of
the audit and significant audit findings, including any significant deficiencies in internal control that we
identify during our audit.
We also provide the directors with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other
matters that may reasonably be thought to bear on our independence, and where applicable, actions
taken to eliminate threats or safeguards applied.
From the matters communicated with the directors, we determine those matters that were of most
significance in the audit of the financial report of the current period and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter
should not be communicated in our report because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.
RReeppoorrtt oonn tthhee RReemmuunneerraattiioonn RReeppoorrtt
Opinion on the Remuneration Report
We have audited the Remuneration Report included in paragraph 12 of the Directors’ Report for the
year ended 31 December 2021.
In our opinion, the Remuneration Report of Tigers Realm Coal Limited, for the year ended 31 December
2021, complies with section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the
Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility
is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with
Australian Auditing Standards.
DELOITTE TOUCHE TOHMATSU
Jacques Strydom
Partner
Chartered Accountants
Brisbane, 24 February 2022
82
83
101
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
SHAREHOLDER INFORMATION
1. Top 20 Shareholders as at 14 February 2022
Number of shares
% of Total
YEADON INVESTMENTS PTY LTD ATF YEADON TRUST
4,824,423,317
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
BV MINING HOLDING LIMITED
RDIF INVESTMENT MANAGEMENT LLC
NAMARONG INVESTMENTS PTY LTD
PINE RIDGE HOLDINGS PTY LTD
BNP PARIBAS NOMINEES PTY LTD
SHIMMERING BRONZE PTY LIMITED
CO-INVESTMENT PARTNERSHIP I LP
SENNEN TROVE PTY LTD
FOREMOST MANAGEMENT SERVICES PTY LIMITED
MR STEPHEN ALEXANDER CHING
MASIK ENTERPRISES PTE LTD
ASIPAC GROUP PTY LTD
MR. DMITRY GAVRILIN
GP SECURITIES PTY LTD
CANCELER PTY LTD
ROMADAK PTY LTD
HSBC CUSTODY NOMINEES (AUSTRALIA)
LIMITED – A/C 2
2,886,487,115
2,377,541,065
1,036,224,898
735,511,670
181,922,857
80,302,505
65,912,029
51,811,415
23,937,359
22,468,970
21,300,000
20,000,000
18,846,246
16,388,169
14,270,960
14,000,000
13,000,000
12,461,460
11,950,101
36.92
22.09
18.20
7.93
5.63
1.39
0.61
0.50
0.40
0.18
0.17
0.16
0.15
0.14
0.13
0.11
0.11
0.10
0.10
0.10
TOTAL
12,428,760,136
95.12
102
84
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
SHAREHOLDER INFORMATION
1. Top 20 Shareholders as at 14 February 2022
YEADON INVESTMENTS PTY LTD ATF YEADON TRUST
4,824,423,317
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
Number of shares
% of Total
BV MINING HOLDING LIMITED
RDIF INVESTMENT MANAGEMENT LLC
NAMARONG INVESTMENTS PTY LTD
PINE RIDGE HOLDINGS PTY LTD
BNP PARIBAS NOMINEES PTY LTD
SHIMMERING BRONZE PTY LIMITED
CO-INVESTMENT PARTNERSHIP I LP
SENNEN TROVE PTY LTD
FOREMOST MANAGEMENT SERVICES PTY LIMITED
MR STEPHEN ALEXANDER CHING
MASIK ENTERPRISES PTE LTD
ASIPAC GROUP PTY LTD
MR. DMITRY GAVRILIN
GP SECURITIES PTY LTD
CANCELER PTY LTD
ROMADAK PTY LTD
HSBC CUSTODY NOMINEES (AUSTRALIA)
LIMITED – A/C 2
TOTAL
2,886,487,115
2,377,541,065
1,036,224,898
735,511,670
181,922,857
80,302,505
65,912,029
51,811,415
23,937,359
22,468,970
21,300,000
20,000,000
18,846,246
16,388,169
14,270,960
14,000,000
13,000,000
12,461,460
11,950,101
12,428,760,136
95.12
36.92
22.09
18.20
7.93
5.63
1.39
0.61
0.50
0.40
0.18
0.17
0.16
0.15
0.14
0.13
0.11
0.11
0.10
0.10
0.10
84
Tigers Realm Coal Limited
Notes to the consolidated financial statements
For the year ended 31 December 2021
SHAREHOLDER INFORMATION (CONTINUED)
2. Voting rights of ordinary shares
On a show of hands one vote for each shareholder, and on a poll, one vote for each fully paid
ordinary share.
3. Distribution of Shareholders and Shareholdings as at 14 February 2022
Holding and
Distribution
1 to 1000
1001 to 5000
5001 to 10000
10001 to 100000
100001 and Over
Total
No. of Holders
Securities
%
49
29
48
464
571
1,161
4,933
96,888
415,783
23,063,238
13,043,121,526
13,066,702,368
.00
.00
.00
.18
99.82
100.00
4. Tigers Realm Coal Substantial Shareholders as at 14 February 2022
Holder
Dr Bruce Gray
BV Mining Holding Limited
RDIF Investment Management LLC *
Namarong Investments Pty Ltd
No. of Shares % of Total
7,825,877,288
2,377,541,065
1,098,398,595
735,511,670
59.89
18.20
8.41
5.63
*Including CO-INVESTMENT PARTNERSHIP I LP, CO-INVESTMENT PARTNERSHIP II CV
5. Shareholdings of less than a marketable parcel as at 14 February 2022
255 holding a total of 3,152,172 shares.
6. Unquoted Securities as at 14 February 2022
8,002,000 unlisted options on issue.
85
103
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal Limited
Corporate Directory
DIRECTORS
Craig Wiggill (Chairman)
Owen Hegarty
Bruce Gray
David Swan
Mitch Jakeman
COMPANY SECRETARY
David Forsyth
REGISTERED OFFICE
151 Wellington Parade South,
East Melbourne, Victoria, 3002
Tel: +61 3 8644 1300
PRINCIPAL OFFICE
37 Leningradski Avenue
Moscow, Russia 125167
Tel: +7 495 646 8353
Email: ir@tigersrealmcoal.com
AUDITORS
Deloitte Touche Tohmatsu
123 Eagle Street,
Brisbane, Queensland, 4000
BANKERS
Commonwealth Bank of Australia Limited
727 Collins Street,
Melbourne, Victoria, 3008
104
2
Annual Report 2021Tigers Realm Coal
Tigers Realm Coal
Annual Report 2021
Tigers Realm Coal Limited
151 Wellington Parade South
East Melbourne Victoria 3002
T +61 3 8644 1300
tigersrealmcoal.com