CONTENTS
CORPORATE DIRECTORY ........................................................................................................................................................ 2
REVIEW OF OPERATIONS ........................................................................................................................................................ 3
DIRECTORS’ REPORT .................................................................................................................................................................17
AUDITORS’ INDEPENDENCE DECLARATION .............................................................................................................. 25
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME ..... 26
CONSOLIDATED STATEMENT OF FINANCIAL POSITION .................................................................................... 28
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY ..................................................................................... 29
CONSOLIDATED STATEMENT OF CASH FLOWS ...................................................................................................... 31
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS .............................................................................. 32
DIRECTORS’ DECLARATION ................................................................................................................................................66
INDEPENDENT AUDITOR’S REPORT ................................................................................................................................. 67
ADDITIONAL SECURITIES EXCHANGE INFORMATION ........................................................................................ 72
CORPORATE DIRECTORY
DIRECTORS/MANAGEMENT
Tony Leibowitz
Non-Executive Chairman
SHARE REGISTRY
Computershare Investor Services Pty Ltd
John Young
Non-Executive Director
Neil Biddle
Non-Executive Director
Valerie Hodgins Non-Executive Director
Derek Marshall Chief Executive Officer
GPO Box D182
Perth WA 6841
AUSTRALIA
Tel: +61 8 9323 2000
COMPANY SECRETARY
Bermuda
Apex Corporate Services Ltd.
Vallis Building, 4th Floor
58 Par-la-Ville Road
Hamilton HM 11
Bermuda
Australia
(Local Agent and Company Secretary)
Russell Hardwick
AUDITORS
Hall Chadwick WA Audit Pty Ltd
283 Rokeby Road
Subiaco
WA 6008
WEBSITE
www.trekmetals.com.au
REGISTERED OFFICE OF INCORPORATION
Trinity Hall
43 Cedar Avenue
Hamilton HM 12
BERMUDA
REGISTERED OFFICE – AUSTRALIA
Suite 5, 2 Centro Avenue
Subiaco WA 6008
AUSTRALIA
Tel: +61 8 6383 7844
POSTAL ADDRESS
P.O Box 8209
Subiaco East WA 6008
AUSTRALIA
TREK METALS LIMITED | ANNUAL REPORT 2023
2
REVIEW OF OPERATIONS
The year to 31 March 2023 has been a highly productive period for Trek Metals Limited
(“Trek” or “the Company”), with strong progress achieved towards the Company’s
objective of becoming a key participant within the battery supply chain based on its
portfolio of high-potential exploration and development assets in the Pilbara region of
Western Australia.
During the reporting period, Trek delivered positive results from the Tambourah Lithium
Project that support the potential for a major greenfields discovery, as well as completing
the acquisition of the advanced Hendeka Manganese Project (previously named ‘South
Woodie Woodie’), where a major metallurgical testwork program is underway to assess
the potential to produce battery-grade high purity manganese sulphate monohydrate
(HPMSM).
Figure 1: Location of Trek Metals’ Tambourah, Hendeka and Pincunah Projects in the Pilbara region of Western
Australia.
TAMBOURAH PROJECT
The Tambourah Lithium Project is located 70km south-east of Pilbara Minerals’ (ASX: PLS)
world-class Pilgangoora lithium mine site in the Pilbara region of Western Australia
(Figure 1). Trek’s extensive landholding at Tambourah comprises two Exploration Licences
(E45/5484 & E45/5839) which are 100%-owned by ACME Pilbara Pty Ltd, a wholly- owned
subsidiary of Trek Metals Ltd.
TREK METALS LIMITED | ANNUAL REPORT 2023
3
The Project encompasses large areas of the Western Shaw Greenstone Belt, predominantly
within the hinge and eastern limb of an anticline folded around the Tambourah Dome. The
greenstone rocks comprise Archean-aged metavolcanic, metasedimentary, and various
granitoids with associated pegmatitic phases. Historic exploration data highlighted the
potential for lithium-bearing pegmatite mineralisation on both of Trek’s tenements (Refer
ASX: TKM 26th May 2022 for additional information).
Rock chip sampling undertaken by Trek Metals during the reporting period confirmed
the presence of high-grade lithium within an extensive, undrilled pegmatite system.
Highlights included:
• 3.07% Li2O in TKL0045
• 2.69% Li2O in TKL0042
• 2.36% Li2O in TKL0095
• 2.28% Li2O in TKL0044
• 2.11% Li2O in TKL0083
Following completion of the rock chip sampling program, Trek commissioned an
independent evaluation of available stream sediment, rock chip and soil data from the
Tambourah Project which returned highly encouraging results and confirmed the
significant prospectivity of the project to host a greenfields lithium discovery.
The evaluation was undertaken by highly regarded geochemist Dr Nigel Brand, with his
report based on an evaluation and classification of stream sediment, rock chip and soil
data according to their fertility and Lithium (Li) Caesium (Cs) Tantalum (Ta) (LCT)
prospectivity.
Encouragingly, the review has upgraded the prospectivity of the Central Prospect Area due
to the apparent fractionation trends defining classic LCT pegmatite zonation within soil
data (Figure 2). These soil samples were selected for geochemical analysis due to the
abundance of mapped pegmatites, the anomalous lithium values in stream sediment
samples, and the fertility ratios e.g., K/Rb in rock chips in this Central Prospect Area (Refer
ASX: TKM 7th November 2022).
TREK METALS LIMITED | ANNUAL REPORT 2023
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Figure 2: The Central Prospect area at Tambourah exhibits a strong fractionation trend in soil samples
(interpreted zones coloured and labelled by dominant element – Be, Nb & Ta, Li and Cs) with rock chip data
confirming that the more highly fractionated area is dominated by Fertile Pegmatites, which represent a part of
the mineralised LCT system proximal to the lithium-dominant zone. The most fractionated zones represent a
priority drill target area.
The review included classification of all rock chips from the Project which show the Central
Prospect Area as being dominated by Fertile Pegmatites, a highly fractionated pegmatite
that is likely proximal to the lithium-bearing zone of an LCT pegmatite (Figure 3). There
was one pegmatite rock chip classified as a weathered LCT pegmatite within this zone,
adding confidence that the pegmatite swarm in this area is a high-ranking lithium target
and should be drill tested.
As anticipated, the majority of rock chips taken in the Eastern Prospect, where
spodumene-bearing high-grade lithium (up to 3.07% Li2O) was discovered late in 2022
(refer ASX: TKM 7th November 2022), have been classified as LCT pegmatite and therefore
this area remains a high-priority drill target area for the upcoming maiden drill program.
Dr Brand’s report also highlighted the prospectivity of Trek’s southern tenement
(E45/5484), which hosts several
large areas with anomalous stream sediment
geochemistry indicating their lithium prospectivity (Figure 4).
These anomalous areas are located with the greenstone belt adjacent to Monzogranites
and are mapped as having pegmatite in outcrop, however there has been minimal rock
chip sampling and no soil sampling to date. One of the anomalous areas occurs over
6.5km of strike. These large, early-stage target areas will be a focus of exploration during
the 2023 field season.
TREK METALS LIMITED | ANNUAL REPORT 2023
5
Figure 3: Rock chip classification shows that the majority of rocks within the Eastern Prospect area are LCT
pegmatites (including the spodumene-bearing pegmatites discovered late 2022) and, encouragingly, the
Central Prospect area is dominated by Fertile Pegmatites, interpreted to be proximal to lithium-bearing LCT
pegmatites.
Due to the success of the soil and rock chip sampling in defining drill targets, these
exploration methods will be expanded across the Project area to assist with future drill
targeting.
Additional soil samples collected during the 2022 field season on the northern licence
(E45/5839) have been submitted for analysis and additional rock and soil sampling is
planned for both the northern and southern licences (Figure 4) during the upcoming field
season.
Subsequent to the end of the reporting period, Trek secured all the required approvals to
commence its maiden drilling program at the Tambourah Project. A heritage survey was
completed recently over key pegmatite targets, with approval also received from DMIRS,
paving the way for drilling to commence to test the Central and Eastern Prospects.
TREK METALS LIMITED | ANNUAL REPORT 2023
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Figure 4: High-priority lithium target areas defined by stream sediment analysis include known spodumene-
bearing pegmatites in the north (on E45/5839 – the 2022 focus of exploration) but importantly also include
several large anomalous areas in the south (on E45/5484 – which will be a focus of early-stage exploration
during the 2023 field season).
TREK METALS LIMITED | ANNUAL REPORT 2023
7
HENDEKA MANGANESE PROJECT (PILBARA, WESTERN
AUSTRALIA)
Trek secured an exceptional near-term development opportunity in the battery materials
sector during the reporting period through the acquisition of the advanced Hendeka
Manganese Project (previously named the “South Woodie Woodie Project”), located in the
Pilbara region of Western Australia (see Figure 1). Hendeka has a JORC (2012) Inferred
Mineral Resource Estimate (MRE) of 11.3Mt grading 15.0% Mn for the Contact and Contact
North deposits (refer ASX Release 6 June 2022 – Table 1, Appendix 1, 2 & 4 for additional
information), with immediate drill targets for both Resource extensions and new
discoveries.
Following completion of the acquisition, Trek’s initial focus has been on metallurgical test
work to determine the characteristics of the ore and the potential to produce both
concentrate for the steel market and battery-grade manganese products, including high-
purity manganese sulphate monohydrate (MnSO4.H2O) which is seeing growing demand
for use in lithium-ion battery cathode manufacturing.
During the March 2023 Quarter, a selection of PQ3 diamond drill core from the
Contact/Contact North Deposit at Hendeka was selected and submitted to Nagrom
Laboratories under the guidance of BHM Process Consultants. Sample composites are
currently being formed for mineralogical analysis and subsequent diagnostic and bulk
beneficiation testwork.
The key aims of the current metallurgical testwork are:
1)
Identify whether 31.5 mm is the optimal liberation point for
processing or
if coarser particle size processing can be
entertained.
2) Define the concentrate mineralogy and liberation profile with
respect to manganese (Mn) bearing species.
3) Assess the manganese recovery and product purity/grade
achieved.
4) Produce a conceptual metallurgical flowsheet.
The initial metallurgical testwork will encompass stage crushing and comminution, assay
and analysis, scrubbing, and Heavy Liquid Separation (HLS)/Ericsson Cone Testwork.
Following completion of the diagnostic testwork, a crush size will be selected for a bulk
testwork program. It is anticipated that the initial program will be completed, and the bulk
program initiated during the June 2023 Quarter.
Trek plans to use the concentrate produced from this testwork to undertake a
hydrometallurgical testwork program to investigate the potential to produce battery-
grade, high-purity manganese sulphate monohydrate (HPMSM) for the lithium-ion
battery sector.
TREK METALS LIMITED | ANNUAL REPORT 2023
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A helicopter electromagnetic (EM) survey was flown over the eastern and southeastern
parts of the Hendeka Project area with the survey finishing in early 2023. The Versatile
Time-Domain (VTEM) Max survey system was contracted through Perth based UTS
Geophysics Pty Ltd to fly two areas using 100m spaced E-W survey lines covering a large
manganese-mineralised corridor that hosts Trek’s Contact and Contact North
hydrothermal Mn deposits in Archaean dolomite-chert beds, similar to the Woodie Woodie
style hydrothermal Mn deposits located to the north, and a small survey area over the Tally
Ho sedimentary style manganese deposit formed in Proterozoic Manganese Group shale
and siltstone beds (Figure 5).
The VTEM survey crew were based at the Woodie Woodie Mn mine and UTS provided daily
updates to Trek’s consultant geophysicists for survey data QC and selecting areas for infill
flying. Final VTEM data delivered by UTS was processed by Resource Potentials Pty Ltd and
show that the survey area is dominated by conductor anomalies caused by clays in
sedimentary cover deposits associated with the modern Oakover River drainage channel
and thin Cainozoic River sediment deposits left behind on mesas from the ancient Oakover
River system.
Areas with outcropping and shallow soil covered Archaean Pinjian Chert Breccia and
Carawine Dolomite formations are prospective for hosting hydrothermal manganese
mineralisation.
Trek has identified a number of weak to moderately electrically conductive VTEM EM
anomalies in these areas as shown by coloured outlines in Figures 5 and 6, and some of
these VTEM target areas overlap with or are close to anomalous manganese
mineralisation intersected in historical drill-holes while some target areas coincide with
Induced Polarisation anomalies related to manganese mineralisation, forming excellent
target areas for field checking and drilling.
A current standout target is shown on Figure 6, where historical exploration drilling
intersected 14m @ 15.9% Mn from 51m (refer ASX: SPI 23rd December 2014). This target is also
at the interpreted contact between the Pinjin Chert Breccia and the Carawine Dolomite
and is sitting on the edge of a recently defined mid-time EM anomaly.
TREK METALS LIMITED | ANNUAL REPORT 2023
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Figure 5: Map of Trek’s Hendeka Manganese Project area showing example VTEM EM anomaly image of Z
receiver dB/dt component time decay channel window data as a red-green-blue image of channels 28-18-08,
with the location of Mn deposits, Trek’s mineral licence outlines and VTEM target areas coloured by priority rank
where 1 is highest priority.
TREK METALS LIMITED | ANNUAL REPORT 2023
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Figure 6: Map of the northern part of Trek’s Hendeka manganese Project area showing example VTEM EM
anomaly image of Z receiver dB/dt component time decay channel window 15 data as a pseudo colour image,
with the location of historical Mn drilling labelled by Mn grade intervals and maximum 1m grade in the hole as
coloured points at the drill collar, Trek’s mineral licence outlines and VTEM target areas coloured by priority rank
where 1 is highest priority.
TREK METALS LIMITED | ANNUAL REPORT 2023
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PINCUNAH PROJECT
A review of exploration data from the Valley of the Gossans (VOG) prospect and the
greater Pincunah Project during the reporting period resulted in a new mineralisation
model for the area. The review, conducted by independent consultant CSA Global,
suggests that the observed mineralisation at VOG is likely to be of epithermal origin, with
the system potentially capable of hosting significant precious metals.
The identification of epithermal mineralisation potential at VOG as part of a likely precious
metals system has upgraded the previously identified Conductor ‘A’, which has yet to be
tested by drilling.
Figure 7: High mercury (Hg) values at Conductor A potentially indicate a higher crustal level of epithermal
mineralisation which typically contain more precious metals such as gold and silver
A robust multi-element As, Se, Sb, Bi, Ag, Cd, Pb, In, Cu, Mo, Au, S & Te metal association has
been defined in soils at Valley of Gossans Prospect. This metal association also defines
subsidiary targets including those located immediately north-east of Valley of the
Gossans extending to Conductor ‘A’.
All mafic and sedimentary units are strongly altered. Alteration is more difficult to define
in ultramafic samples where the least altered composition is quite close to chlorite. Sericite
alteration is most closely associated with mineralisation. A zonation from possible chloritic
(propylitic) inwards to sericite (phyllic) alteration was recognised and the widespread
presence of chlorite was confirmed via ASD hyperspectral analysis of two drill-holes
(VRC006 & 023).
TREK METALS LIMITED | ANNUAL REPORT 2023
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If Valley of Gossans is indeed a high-sulphidation epithermal system, the mineralogy and
zonation with a predominance of propylitic alteration (chlorite-sericite-carbonate) with
possible minor dickite suggests that current exposure is deep in the system, below
potential economic gold mineralisation.
Potential for deeper porphyry copper mineralisation may still exist. Although the currently
observed absolute gold grades are low (<0.4g/t Au), it is important that gold is correlated
with the best mineralisation in the system so far. If there is porphyry copper mineralisation
at depth, it is reasonable to expect that it is gold-bearing.
The low temperature metal suite that overlies epithermal deposits is Hg-Tl-(As-Sb). While
there is very high As and Sb anomalism at VOG, the Hg and Tl are not so pronounced over
the main As-Sb anomaly. Furthermore, “high temperature metals” like Bi and Cu don’t fit
with low temperature upper levels of an epithermal story.
However, at Conductor ‘A’ there is a very pronounced Hg and Tl anomalism in association
with a comparable multi-element geochemical signature to that at the main VOG
anomaly. It would be reasonable to interpret that Conductor ‘A’ could represent a higher-
level portion of the epithermal system, which should be more prospective for economic
accumulations of precious metals. In addition to the exploration data review, Trek Metals
expanded its tenement holding in the Pincunah district during the reporting period with
the complementary strategic acquisition of tenement E45/4640, which covers the ground
directly adjacent to Conductor ‘A’, from lithium producer Pilbara Minerals (ASX: PLS).
CORPORATE
BOARD CHANGES
Trek Metals appointed experienced commercial and corporate lawyer Valerie Hodgins to
its board as a Non-Executive Director, effective from 1 July 2022. Ms Hodgins is a highly
experienced commercial lawyer with a strong governance and commercial background.
Before undertaking legal studies, she worked in the private sector as a human resources
professional and in industrial relations before qualifying as a commercial lawyer.
In addition, Mr John Young transitioned from Executive Director to Non-Executive Director
effective from the 31st October 2022.
ACQUISITION OF THE HENDEKA MANGANESE PROJECT
Trek Metals secured an exceptional near-term development opportunity in the battery
materials sector through the acquisition of the advanced Hendeka Manganese Project
(previously named “South Woodie Woodie”).
The acquisition was completed on 8 November 2022 via a binding scheme
implementation agreement (“Scheme Implementation Agreement”) under which Trek
Metals acquired all of the shares in the capital of unlisted public company Edge Minerals
Limited (“Edge”) by way of a scheme of arrangement under Part 5.1 of the Corporations
Act 2001 (Cth) (“Scheme”). Edge held a majority interest in the Hendeka Project.
Under the terms of the Scheme, Trek acquired all of the issued shares in the capital of Edge
at a fixed exchange ratio of 2.12 new Trek shares for each Edge share held by Edge
shareholders as at the Scheme record date.
ACQUISITION OF BASE METALS TENEMENT FROM PILBARA MINERALS
Trek Metals completed the acquisition of a 100% interest in precious and base metals
exploration tenement E45/4640, located immediately adjacent to its Pincunah Project
TREK METALS LIMITED | ANNUAL REPORT 2023
13
from Pilgangoora Operations Pty Ltd (“POPL”), a subsidiary of Pilbara Minerals Limited (ASX:
PLS), during the December 2022 Quarter.
In consideration for this acquisition, the Company issued 4,792,332 ordinary shares
($300,000) based on the 20 trading days volume weighted average price for Trek’s shares
three (3) days prior to the Settlement Date. The shares issued were subject to a six-month
voluntary escrow period following the date of issue. POPL will retain all lithium and
tantalum rights and receive a 2.5% Net Smelter Royalty (NSR) on all other minerals
produced from the tenement.
HEADS OF AGREEMENT WITH STRIKE ENERGY
Trek Metals has signed a Heads of Agreement with Strike Energy Limited (ASX: STX). Strike
is proposing to develop the Mid-West Geothermal Power Project and as part of this
proposed development, Strike has applied for a Geothermal Exploration Permit pursuant
to the Petroleum and Geothermal Energy Resources Act 1967 (WA). Subject to the grant of
the Geothermal Exploration Permit (GEP) on conditions acceptable to Strike, Strike is
proposing to drill the Future State-1 well (Well). If Strike (at its election) drills the Well, Strike
has agreed to provide a formational water sample from the Well (Sample) to Trek so that
Trek can analyse the Sample for lithium content.
The Agreement forms part of a regional exploration initiative under which Trek has been
assessing exploration tenure in Western Australia where there may be an opportunity to
explore for lithium-in-brines due to the presence of favourable target horizons that are
being exploited for geothermal energy.
Trek has three granted and two pending mineral exploration licenses held by 100% owned
subsidiary Anaheim Pty Ltd in the Midwest region which overlap Strike Energy’s Geothermal
Power Project – which is based on the Kingia Sandstones target horizon. In the event that
Trek identifies a sufficient quantity and quality of lithium within the brine sample, the two
parties will then consider a potential further agreement that may govern the next stage of
potential project, including such items as:
a) Further drilling of wells and testing for lithium brines;
b) Investigating the legislative regime for undertaking a joint lithium and geothermal
power project;
c) Conducting scoping and commercial feasibility studies; and
d) Undertaking further investigation on the interaction between direct lithium
extraction (DLE) technology and geothermal power projects.
SALE OF 20% INTEREST IN KROUSSOU ZINC-LEAD PROJECT
Trek Metals completed the sale of its remaining 20% interest in the Kroussou zinc-lead
project, located in western Gabon in central Africa to Apollo Minerals Limited (Apollo
Minerals, ASX: AON).
The consideration received by Trek was 3,000,000 fully-paid AON ordinary shares and
1,000,000 options exercisable into ordinary shares at 12c per share, expiring 30 June 2024.
PRINCESS PEGMATITE PROJECT
During the period, Trek secured an exclusive due diligence period and option agreement
over the Princess Pegmatite Project in the Northern Territory (Refer ASX Release 22
December 2022). Trek conducted due diligence activities and based on its analysis
decided not to proceed further with the Project.
TREK METALS LIMITED | ANNUAL REPORT 2023
14
CENTURION PROJECT
During the year the Company withdrew from the Centurion Farm-in and Joint Venture
Agreement with Buxton Resources Limited which comprised the granted Exploration
Licence E80/5579 (Refer ASX Release : 28 March 2022).
CAPITAL RAISING
Post year-end the Company, announced a strongly supported capital raising of up to
A$7.5 million (before costs) to accelerate exploration across its lithium and manganese
projects. The Company received commitments for the Placement comprising 75 million
shares at an issue price of $0.06 per Share to existing and new professional, sophisticated
and other institutional investors to raise a total of $4.5 million (Tranche One) which settled
on the 5th June 2023.
In addition, the Company has elected to accept oversubscriptions of an additional A$3.0
million in Shares from directors of the Company and other investors introduced by the
Board in a second tranche which will be subject to shareholder approval (Tranche Two).
The Placement includes a 1:3 free attaching option exercisable at $0.085 per option
expiring 2 years from the date of issue (Attaching Option). The Attaching Options will be
issued subject to shareholder approval at the Company’s Annual General Meeting
expected to be held in late July 2023 (AGM). The Company intends to list the Attaching
Options, subject to satisfying ASX Listing Rule requirements.
FINANCIAL REVIEW
The Group incurred a loss for the year of $3,990,953 (2022 Loss: $2,185,622). Significant
expenditure items during the period include:
− Exploration and evaluation expenditure of $301,089 (2022: $654,016);
− Acquisition costs impaired of $1,627,005 (2022: Nil);
− Directors’ salaries and Consulting Fees of $291,711 (2022: $179,768);
− Scheme expenses of $126,878 (2022: Nil); and
− Share based payment of $676,595 (2022: $736,830).
The group began the year with $6,366,832 in cash and ended the year with $2,704,166 in
cash. Subject to the disclosures elsewhere in this report, the Directors believe the Group is
in a stable financial position to continue to explore its projects and to identify new
opportunities within the resources sector.
Lastly, I would like to thank all our staff, consultants and stakeholders for their ongoing
efforts on behalf of the Company and look forward to progressing our projects to create
value for shareholders.
Derek Marshall
Chief Executive Officer
22 June 2023
TREK METALS LIMITED | ANNUAL REPORT 2023
15
COMPETENT PERSONS STATEMENT
The information in this report relating to Exploration Results is based on information
compiled by the Company’s Chief Executive Officer, Mr Derek Marshall, a Competent
Person, and Member of the Australian Institute of Geoscientists (AIG). Mr Marshall has
sufficient experience relevant to the style of mineralisation and to the type of activity
described to qualify as a competent person as defined in the 2012 Edition of the
“Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore
Reserves.” Mr Marshall has disclosed that he holds Performance Rights in the Company. Mr
Marshall consents to the inclusion in this announcement of the matters based on his
information in the form and content in which it appears.
Hendeka Mineral Resource
The information in this Report contains references to Edge’s 2012 JORC Mineral Resources
at the Hendeka Project and is extracted from Trek’s ASX Release and Public Report of 6
June 2022. The Company confirms that it is not aware of any new information or data that
materially affects the information included in the relevant market announcement. In the
case of estimates of Mineral Resources or Ore Reserves, the Company confirms that all
material assumptions and technical parameters underpinning the estimates in the
relevant market announcements continue to apply and have not materially changed.
TREK METALS LIMITED | ANNUAL REPORT 2023
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DIRECTORS’ REPORT
The Directors present their report and the audited financial statements of Trek Metals
Limited (“TKM”, “Trek” or the “Company”) and its controlled entities (“Group”) for the year
ended 31 March 2023.
PRINCIPAL ACTIVITIES
The principal activities of the Company and its subsidiaries (“the Group”) is to progress the
exploration of its mineral properties and to identify suitable acquisitions in the mineral
resources sector.
RESULTS AND DIVIDEND
The loss for the Group for the year ended 31 March 2023 was $3,990,953 (31 March 2022:
$2,185,622). The Directors do not recommend the payment of a dividend.
DIRECTORS
The following persons held office as directors during the financial year and to the date of
this report. Directors were in office for the entire period and to the date of this report unless
otherwise stated:
Name,
qualifications and
independence
status
Experience, special responsibilities and other Directorships in
listed entities
Tony Leibowitz
Experience:
Non-Executive
Chairman
(Independent)
Appointed
Mr Leibowitz has over 30 years of corporate finance, investment
banking and broad commercial experience and has a proven track
record of providing the necessary skills and guidance to assist
companies grow and generate sustained shareholder value.
Previous roles include Chandler Macleod Limited and Pilbara
4 September 2020
Minerals Limited, where as Chairman and an early investor in both
companies, he was responsible for substantial
increases
in
shareholder value and returns. Mr Leibowitz was also a global
partner at PricewaterhouseCoopers and chaired the board of
Bardoc Gold prior to the takeover by St Barbara. Mr Leibowitz is a
Fellow of the Institute of Chartered Accountants in Australia.
Special responsibilities:
None
Directorships held in other listed entities during the three years prior
to the current year:
•
Ensurance Limited
• Bardoc Gold Limited (resigned 13 April 2022)
• Greenvale Mining Limited (resigned 31 December 2022)
• Astro Resources NL
TREK METALS LIMITED | ANNUAL REPORT 2023
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Neil Biddle
Experience:
Non-Executive
Director
(Not Independent)
Appointed
4 September 2020
Mr Biddle is a geologist and Corporate Member of the Australasian
Institute of Mining and Metallurgy and has over 30 years’
professional and management experience in the exploration and
mining industry. Mr Biddle was a founding Director of Pilbara Minerals
Limited, serving as Executive Director from May 2013 to August 2016,
serving as a Non-Executive Director from August 2016 to 26 July 2017.
Throughout his career, Mr Biddle has served on the Board of several
ASX listed companies, including Managing Director of TNG Ltd from
1998 - 2007, Border Gold NL from 1994 - 1998 and Consolidated
Victorian Mines from 1991 – 1994. Mr Biddle served on the board of
Bardoc Gold prior to the takeover by St Barbara.
Special responsibilities
None
Directorships held in other listed entities during the three years prior
to the current year:
• Bardoc Gold Limited (resigned 13 April 2022)
• Greenvale Mining Limited
• TNG Limited (resigned 28 November 2022)
John Young
Experience:
Non-Executive
Director
(Not Independent)
Appointed
2 September 2019
Mr Young has a Bachelor of Applied Science (Geology) and is a
member of AusIMM. He is a highly experienced geologist who has
worked on exploration and production projects encompassing gold,
uranium, tungsten, molybdenum, tantalum and lithium.
Mr Young’s corporate experience includes appointments as Chief
Executive Officer of Marenica Energy Limited and CEO and Director
of Thor Mining PLC. Mr Young was Pilbara Minerals Exploration
Manager from June 2014 until August 2015, appointed Technical
Director in September 2015 and transitioned to Non-Executive
Director in July 2017 until his resignation in April 2018. Mr Young served
on the board of Bardoc Gold, prior to the takeover by St Barbara.
Special responsibilities
None
Directorships held in other listed entities during the three years prior
to the current year:
• Green Technology Metals
• Mosman Oil & Gas Limited
• Rarex Limited
• Bardoc Gold Limited (resigned 13 April 2022)
• Astro Resources NL
TREK METALS LIMITED | ANNUAL REPORT 2023
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Valerie Hodgins
Experience:
Non-Executive
Ms Hodgins is a highly experienced commercial lawyer with a strong
Director
governance and commercial background. Before undertaking legal
(Independent)
studies, she worked in the private sector as a human resource
Appointed
1 July 2022
professional and in industrial relations before qualifying as a
commercial lawyer.
Ms Hodgins has worked as a sole practitioner, as well as in the State
and local government sectors, and was previously In-house Counsel
for CGA Mining Limited, a junior TSX and ASX listed company with
mining interests in the Philippines and Africa, up until its acquisition
by Canadian gold miner B2 Gold Corp in January 2013. As a GAICD
and member of AICD WA, and a previous Board member of the
Australian Association of Corporate Counsel and the WA Legal
Practice Board, Ms Hodgins has a strong governance background
and brings diversity and independence to the Board of Trek.
Special responsibilities
None
Directorships held in other listed entities during the three years prior
to the current year:
COMPANY SECRETARY(S)
• Australia - Russell Hardwick – Local Agent and Joint Company Secretary
• Bermuda – c/o Apex Corporate Services Limited
CORPORATE GOVERNANCE
The directors of the Group support and adhere to the principles of corporate governance,
recognising the need for the highest standard of corporate behaviour and accountability.
The company has adopted a Corporate Governance plan taking into account the 4th
edition of the Corporate Governance Principles and Recommendations. Please refer to the
Corporate Governance Statement on the Company’s website:
https://trekmetals.com.au/corporate/corporate-governance.
TREK METALS LIMITED | ANNUAL REPORT 2023
19
BOARD MEETINGS
The Directors held seven (7) “in-person” meetings during the year in addition to nine (9)
board matters were dealt with by Circular resolution signed by all Directors.
The following table shows their attendance at physical Board meetings which were
restricted due to the impacts of Covid 19 with the majority of matters dealt with by Circular
Resolution:
Name
Tony Leibowitz
Neil Biddle
John Young
Valerie Hodgins
Eligible to attend
No. of meetings attended
7
7
7
4
7
7
7
4
BOARD COMMITTEES
The Company does not have an Audit, Remuneration or Nomination Committee. Given its
size and composition, the Board considers that at this stage, no efficiencies or other
benefits would be gained by establishing separate board committees. To assist the Board
to fulfil its function it has adopted charters for each of these committees. In accordance
with the Company’s Board Charter, the Board carries out the duties that would ordinarily
be carried out by the Audit, Remuneration and Nomination Committees under the charters
in place for each of these.
KEY MANAGEMENT SHARES, RIGHTS AND OPTION HOLDINGS
NUMBER OF SHARES HELD BY KEY MANAGEMENT
The number of ordinary shares in Trek Metals Limited held by each Key Management
Personnel of the Group during the financial year is as follows:
31 March 2023
Balance 1 April
2022
Options/ Rights
received as
compensation
Other
31 March 2023
Exercise of
Net Change
Balance
Tony Leibowitz
Neil Biddle
John Young
Valerie Hodgins
Derek Marshall
13,966,953
10,313,726
6,551,738
-
93,476
-
-
-
-
-
1,986,536
1,095,408
1,141,536
-
-
15,953,489
11,409,134
7,693,274
-
93,476
31 March 2022
Tony Leibowitz
Neil Biddle
John Young
Derek Marshall
Balance 1 April
2021
Exercise of Options/
Net Change
Balance
Rights received as
Other
31 March
compensation
2022
11,195,215
10,052,857
6,030,000
-
-
-
-
-
2,771,738
13,966,953
260,869
10,313,726
521,738
6,551,738
93,476
93,476
TREK METALS LIMITED | ANNUAL REPORT 2023
20
NUMBER OF PERFORMANCE RIGHTS HELD BY KEY MANAGEMENT
PERFORMANCE RIGHTS HELD BY KE MANAGEMENT PERSONNEL
The number of performance rights held by each Key Management Personnel of the Group
during the financial year is as follows:
31 March 2023
Balance 1
Granted as
April 2022
Compensation
Vested
Exercised
Balance
during
during
31 March
the year
the year
2023
Vested and
Exercisable
Tony Leibowitz
3,000,000
Neil Biddle
John Young
3,000,000
6,000,000
Valerie Hodgins
-
-
-
-
-
Derek Marshall
6,000,000
5,000,000
-
-
-
-
-
-
-
-
-
-
3,000,000
3,000,000
6,000,000
-
11,000,000
-
-
-
-
-
31 March 2022
Balance 1
Granted as
April 2021
Compensation
Vested
Exercised
Balance
during
during
31 March
the year
the year
2022
Vested and
Exercisable
Tony Leibowitz
3,000,000
Neil Biddle
John Young
3,000,000
6,000,000
-
-
-
Derek Marshall
-
6,000,000
-
-
-
-
-
-
-
-
3,000,000
3,000,000
6,000,000
6,000,000
-
-
-
-
NUMBER OF OPTIONS HELD BY KEY MANAGEMENT PERSONNEL
The number of options over ordinary shares held by each Key Management Personnel of
the Group during the financial year is as follows:
31 March 2023
Tony Leibowitz
Neil Biddle
John Young
Valerie Hodgins
Derek Marshall
31 March 2022
Tony Leibowitz
Neil Biddle
John Young
Derek Marshall
Balance 1 April
Other changes
Total Exercisable
Balance
2022
during the year
31 March 2023
31 March 2023
1,500,000
500,000
1,875,000
-
-
(1,500,000)
(500,000)
-
-
-
-
-
-
-
1,875,000
1,875,000
-
-
-
-
Balance 1 April
Other changes
Total Exercisable
Balance
2021
during the year
31 March 2022
31 March 2022
1,500,000
500,000
1,875,000
-
-
-
-
-
1,500,000
500,000
1,875,000
-
1,500,000
500,000
1,875,000
-
TREK METALS LIMITED | ANNUAL REPORT 2023
21
DIRECTORS’ AND SENIOR MANAGEMENT REMUNERATION
The Board of Directors is responsible for determining and reviewing compensation
arrangements for the directors and senior management. The Board assesses the
appropriateness of the nature and amount of remuneration of non-executive directors
and executives on a periodic basis by reference to relevant employment market
conditions. The Company recognises that it operates in a competitive environment and to
operate effectively it must be able to attract, motivate and retain key personnel. The
compensation structures are designed to attract suitably qualified candidates, reward the
achievement of strategic objectives, and achieve the broader outcome of creation of
value for shareholders. The compensation structures take into account:
•
•
•
•
The capability and experience of the key management personnel;
Size of the Group;
The key management personnel’s ability to control the performance; and
The Group’s exploration success and identification of new investments.
Salaries and fees paid to Directors and Senior Executives have been determined in relation
to salaries paid to comparable companies, management responsibility and experience.
The salaries and fees are reviewed regularly to ensure that Directors and Executives are
appropriately rewarded for their efforts in enhancing shareholder value. Where required,
the Board obtains
independent advice as required on the appropriateness of
compensation packages of the Company given trends of comparative companies and
the objectives of the Company’s compensation strategy. The Board policy is to remunerate
Non-Executive Directors at market rates for time, commitment and responsibilities.
Directors may also provide consultancy services to the Company and are remunerated at
market rates.
On 20th October 2022, shareholders approved a new Incentive Performance Rights and
Option Plan (“Plan”) and participation by Directors in that plan. Key management
personnel and staff are also entitled to participate in the plan. Any rights or options issued
are valued using standard valuation techniques such as Black-Scholes methodology or
Binomial.
The objective of the Plan is to reward Directors, senior management and staff in a manner
that aligns remuneration with the creation of shareholder wealth. The amounts disclosed
as part of remuneration for the financial year have been determined by allocating the
grant date fair value based on the probability of the vesting conditions being achieved
over the expected life of the rights or options. The remuneration policy has been tailored
to increase goal congruence between Shareholders, Directors and Executives. As part of
each of the key management personnel’s remuneration package, there is a performance-
based component consisting of the issue of Performance rights or options to encourage
the alignment of management and Shareholders’ interests.
The Board determines appropriate vesting conditions that includes specific milestones
including such items as retention, key performance indicators and/or a premium over the
prevailing share price to provide potential rewards over a period of time and to align
interests with those of shareholders.
TREK METALS LIMITED | ANNUAL REPORT 2023
22
A summary of the operating losses and share prices at year end for the last four years are
as follows:
2020
2021
2022
2023
Net Profit/(Loss)
($3,539,630)
($274,164)
($2,185,622)
($3,990,953)
Share price at year end
$0.014
Earnings per share
(2.51c)
$0.063
(0.128c)
$0.074
(0.778c)
$0.065
(1.204c)
Remuneration earned and the value ascribed to share based payments which were
expensed during the year ended 31 March 2023 in relation to Directors and Key
Management Personnel is summarised as follows:
Fixed Remuneration
Directors/
Consulting
Fees
$
2023
Non-Executive
Super
Total
Granted
$
$
$
Variable
Remuneration
Options/Rights
Total
Value of Rights /
Remuneration
Options as a %
$
Remuneration
Tony Leibowitz
104,273
10,863
115,136
32,395
147,531
Neil Biddle
Valerie Hodgins(1)
John Young(2)
Executive
64,897
51,198
107,156
6,746
5,376
71,643
56,574
32,395
104,038
-
56,574
171,946
-
107,156
64,790
22.0%
31.1%
-
37.7%
Derek Marshall
278,750
27,125
305,875
315,684
621,559
50.8%
50,110
(1) Ms Hodgins was appointed on 1 July 2022.
(2) Mr Young transitioned to non-executive director on 31 October 2022.
656,384
606,274
445,264
1,101,648
Fixed Remuneration
Directors/
Consulting
Variable
Remuneration
Options/Rights
Fees
$
Super
$
Total
$
Granted
$
Total
Value of Rights /
Remuneration
Options as a %
$
Remuneration
2022
Non-Executive
Tony Leibowitz
90,493
6,764
97,257
96,856
194,113
Neil Biddle
Executive
54,795
5,411
60,206
96,856
157,062
John Young
Derek Marshall(1)
180,000
151,667
-
180,000
15,167
166,834
476,955
(1) Mr Marshall was appointed on 1 September 2021.
27,342
504,297
193,712
175,034
373,712
341,868
562,458
1,066,755
49.9%
61.7%
51.8%
51.2%
TREK METALS LIMITED | ANNUAL REPORT 2023
23
KEY MANAGEMENT PERSONNEL
The remuneration structure for key Management and Directors is based on a number of
factors including length of service, experience, responsibilities and the performance of the
Company.
The Company has entered into an employment contract with Mr Derek Marshall as the
Company’s Chief Executive Officer. The contract commenced on 1 September 2021 on a
continuing basis with no fixed term. The agreement specifies the duties and obligations of
the Chief Executive Officer and contains normal commercial termination clauses including
the provision of three months written notice during the first 12 months of employment and
after the first 12 months of employment by giving not less than six months written notice.
POST BALANCE DATE EVENTS
On 2 May 2023, the Company issued 2,000,000 Performance Rights in accordance with the
Incentive Right & Option Plan approved by shareholders.
On 12 May 2023, the Company signed a binding term sheet with Rio Tinto Exploration Pty
Limited (“RTX”), a wholly-owned subsidiary of the global mining group Rio Tinto, for an
option to farm-in over its Jimblebar Nickel-Copper Project in the Pilbara region of Western
Australia.
On 25 May 2023, the Company announced a strongly supported two-tranche capital
raising of up to A$7.5 million (before costs) to accelerate exploration across its lithium and
manganese projects in the Pilbara region of Western Australia. On 5th June 2023, the
company issued 75 million shares in the capital of the Company (Shares) at an issue price
of $0.06 per Share to raise a total of $4.5 million (Tranche One).
In addition, the Company has elected to accept oversubscriptions of an additional A$3.0
million in Shares from directors of the Company and other investors introduced by the
Board in a second tranche which will be subject to shareholder approval (Tranche Two).
The Placement includes a 1:3 free attaching option exercisable at $0.085 per option
expiring 2 years from the date of issue (Attaching Option). Tranche to and all Attaching
Options will be issued subject to shareholder approval at the Company’s Annual General
Meeting scheduled for 28th July 2023. The Company intends to list the Attaching Options,
subject to satisfying ASX Listing Rule requirements.
NON-AUDIT SERVICES
The Group may decide to employ the auditor on assignments additional to their statutory
audit duties where the auditor’s expertise and experience with the Company and/or Group
are important. Should the Group engage the auditor for non-audit related services; the
provision of the non-audit services
is compatible with the general standard of
independence for the auditors imposed by the Corporations Act 2001.
During the financial year ended 31 March 2023 the group’s auditors Hall Chadwick provided
the Group with no other non-audit related services provided.
Signed on behalf of the Board.
John Young
Non-executive Director
22 June 2023
TREK METALS LIMITED | ANNUAL REPORT 2023
24
To the Board of Directors,
Auditor’s Independence Declaration
As lead audit Director for the audit of the financial statements of Trek Metals Limited for the financial
year ended 31 March 2023, I declare that to the best of my knowledge and belief, there have been no
contraventions of the auditor independence requirements of any applicable code of professional conduct
in relation to the audit.
Yours Faithfully
HALL CHADWICK WA AUDIT PTY LTD
CHRIS NICOLOFF CA
Director
Dated Perth, Western Australia this 22nd day of June 2023
CONSOLIDATED STATEMENT OF PROFIT OR
LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2023
YEAR ENDED
YEAR ENDED
31 MARCH 2023
31 MARCH 2022
NOTES
$
Continuing Operations
Investment revenue
Other income
Share based payment expense
Exploration & evaluation expense
Acquisition cost impaired
Stamp duty on acquisition
Foreign exchange gain/(loss)
Loss on sale of subsidiary
Finance costs
Other operating expenses
Loss before tax
Income tax expense
6
23
11
11
11
6
8
46,221
8,120
(676,595)
(301,089)
(1,627,005)
(155,916)
19
(51,974)
(8,063)
$
25,511
-
(736,830)
(654,016)
-
-
3
-
-
(1,224,671)
(820,290)
(3,990,953)
(2,185,622)
-
-
Loss for the year
(3,990,953)
(2,185,622)
Attributable to:
Equity holders of the Parent
Loss per share for loss attributable to
the ordinary equity holders of the
Parent:
Basic loss per share
Diluted loss per share
(3,990,953)
(2,185,622)
Cents/share
Cents/share
7
7
(1.204)
(1.204)
(0.778)
(0.778)
Notes forming part of these financial statements are included on pages 32 to 65.
TREK METALS LIMITED | ANNUAL REPORT 2023
26
CONSOLIDATED STATEMENT OF PROFIT OR
LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2023
YEAR ENDED
YEAR ENDED
31 MARCH 2023
31 MARCH 2022
NOTES
$
$
Loss for the year
(3,990,953)
(2,185,622)
Other comprehensive income/(loss)
Items that may be reclassified to profit
or loss
Exchange differences arising on
18(c)
translation of foreign operations
Items that have been recycled to profit
or loss
Changes in fair value on assets held as
available for sale
Total Comprehensive Loss for the Year
Attributable
to Owners of
the
Company
-
(196,218)
(48,000)
-
(4,038,953)
(2,381,840)
Notes forming part of these financial statements are included on pages 32 to 65.
TREK METALS LIMITED | ANNUAL REPORT 2023
27
CONSOLIDATED STATEMENT OF FINANCIAL
POSITION
AS AT 31 MARCH 2023
ASSETS
Current Assets
Cash and cash equivalents
Trade and other receivables
Other assets
Total current assets
Non-current Assets
Property, plant and equipment
Right of Use assets
Exploration and evaluation expenditure
Financial assets
Other assets
Total non-current assets
Total Assets
LIABILITIES
Current Liabilities
Trade and other payables
Lease liabilities
Provision
Total current liabilities
Non-current Liabilities
Lease liabilities
Total non-current liabilities
Total Liabilities
NET ASSETS
Equity
Issued capital
Reserves
Accumulated loss
Total Equity
31 MARCH 2023
31 MARCH 2022
NOTES
$
$
9
10
15
11
14
15
16
15
17
18
2,704,166
6,366,832
50,846
32,032
90,327
17,390
2,787,044
6,474,549
317,290
84,257
8,125,997
140,026
-
318,875
-
3,703,707
-
1,151
8,667,570
4,023,733
11,454,614
10,498,282
693,857
31,144
35,112
171,188
-
8,885
760,113
180,073
56,992
56,992
817,105
-
-
180,073
10,637,509
10,318,209
35,897,520
34,969,682
59,080,905
55,757,269
(84,340,916)
(80,408,742)
10,637,509
10,318,209
Notes forming part of these financial statements are included on pages 32 to 65.
TREK METALS LIMITED | ANNUAL REPORT 2023
28
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2023
Consolidated
Note
Issued Capital
Reserve
Share Premium
Share Based
Payments Reserve
$
$
$
Foreign Currency
Translation
Reserve
$
Accumulated
Losses
Total Equity
$
$
Balance at 1 April 2022
34,969,682
51,903,292
1,293,414
2,560,563
(80,408,742)
10,318,209
Loss for the year
Other comprehensive
income/(loss)
Total comprehensive loss
for the year
Transactions with owners,
recorded directly in equity
Issue of ordinary shares
Issue of ordinary shares on
exercise of share options
Share based payments
Expiry of share options
Performance rights
exercised
Share issue expenses
Balance at 31 March 2023
17
17
23
18(b)
18(b)
17
-
-
-
941,169
3,940
-
-
2,612
(19,883)
-
-
-
2,747,772
-
-
-
-
10,460
(1,800)
-
-
7,333
-
676,595
(106,779)
(9,945)
-
-
-
-
-
-
-
-
-
(3,990,953)
(3,990,953)
(48,000)
(48,000)
(4,038,953)
(4,038,953)
-
-
-
106,779
-
-
3,688,941
12,600
676,595
-
-
(19,883)
35,897,520
54,668,857
1,851,485
2,560,563
(84,340,916)
10,637,509
Notes forming part of these financial statements are included on pages 32 to 65.
TREK METALS LIMITED | ANNUAL REPORT 2023
29
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2022
Consolidated
Note
Issued Capital
Reserve
Share Premium
Share Based
Payments Reserve
$
$
$
Foreign Currency
Translation
Reserve
$
Accumulated
Losses
Total Equity
$
$
Balance at 1 April 2021
34,568,285
47,223,165
1,640,152
2,756,781
(79,562,688)
6,625,695
Loss for the year
Other comprehensive
income/(loss)
Total comprehensive loss
for the year
Transactions with owners,
recorded directly in equity
Issue of ordinary shares
Issue of ordinary shares on
exercise of share options
Share based payments
Expiry of share options
Share issue expenses
Balance at 31 March 2022
17
17
23
18(b)
17
-
-
-
-
-
-
892,020
4,657,480
-
-
-
-
9,353
22,647
(4,000)
-
-
(499,976)
-
-
-
996,830
(1,339,568)
-
-
(2,185,622)
(2,185,622)
(196,218)
-
(196,218)
(196,218)
(2,185,622)
(2,381,840)
-
-
-
-
-
-
-
-
1,339,568
-
5,549,500
28,000
996,830
-
(499,976)
10,318,209
34,969,682
51,903,292
1,293,414
2,560,563
(80,408,742)
Notes forming part of these financial statements are included on pages 32 to 65.
TREK METALS LIMITED | ANNUAL REPORT 2023
30
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2023
YEAR ENDED
YEAR ENDED
31 MARCH 2023
31 MARCH 2022
NOTES
$
$
Cash flows from operating activities
Payments to suppliers and employees
Other Income
Interest received
(1,176,919)
(863,926)
8,120
46,221
-
25,511
Net cash used by operating activities
9
(1,122,578)
(838,415)
Cash flows from investing activities
Payments for exploration and evaluation
Payments for property, plant & equipment
Payments for exploration tenements
Acquisition of subsidiary, net of cash
acquired
(1,869,376)
(2,482,444)
(64,080)
(23,699)
6,483
(365,143)
-
-
Net cash used by investing activities
(1,950,672)
(2,847,587)
Cash flows from financing activities
Repayment of borrowings
Proceeds from issue of share capital
Proceeds from exercise of options
Payments for share issue costs
Net cash used in financing activities
(600,000)
-
-
5,577,501
12,600
(2,621)
(590,021)
-
(239,976)
5,337,525
Net decrease in cash and cash equivalents
(3,663,271)
1,651,523
Cash and cash equivalents at beginning of
the year
6,366,832
4,715,309
Effects of exchange rate changes on the
balance of cash held in foreign currencies
605
-
Cash and cash equivalents at the end of
9
2,704,166
6,366,832
year
Notes forming part of these financial statements are included on pages 32 to 65.
TREK METALS LIMITED | ANNUAL REPORT 2023
31
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
NOTE 1: CORPORATE INFORMATION
Trek Metals Limited is a limited company incorporated in Bermuda, whose shares are
publicly traded on the Australian Securities Exchange.
The consolidated financial statements of the Company as at and for the year ended 31
March 2023 comprise the Company and its subsidiaries (together referred to as the
“Group” and individually as “Group entities”) and the Group’s interest in associates and
jointly controlled entities.
The principal activities of the Company and its subsidiaries (“the Group”) is to progress
the exploration of its mineral properties and to identify suitable acquisitions in the mineral
resources sector.
(a) Statement of Compliance
These financial statements are general purpose financial statements which have been
prepared in accordance with the Australian Accounting Standards and Interpretations.
The financial statements comprise the consolidated financial statements of the Group. For
the purposes of preparing the consolidated financial statements, the Company is a for-
profit entity.
Accounting Standards include Australian Accounting Standards. Compliance with
Australian Accounting Standards ensures that the financial statements and notes of the
company and the Group comply with International Financial Reporting Standards (‘IFRS’).
(b) Going Concern
This financial report has been prepared on the going concern basis, which contemplates
the continuity of normal business activity and the realisation of assets and settlement of
liabilities in the normal course of business.
The Group incurred a loss for the year of $3,990,953 (2022: loss of $2,185,622) and cash
outflows from operating activities of $1,122,578 (2022: $838,415).
The directors have prepared a cash flow forecast, which indicates that the Company will
have sufficient cash flows to meet all commitments and working capital requirements for
the 12 month period from the date of signing this financial report.
Based on the cash flow forecasts and other factors referred to above, the directors are
satisfied that the going concern basis of preparation is appropriate. In particular, given
the Company’s history of raising capital to date, the directors are confident of the
Company’s ability to raise additional funds as and when they are required.
TREK METALS LIMITED | ANNUAL REPORT 2023
32
NOTE 2: ADOPTION OF NEW AND REVISED STANDARDS
Accounting Standards that are mandatorily effective for the current reporting
year
The Group has adopted all of the new and revised Standards and Interpretations issued
by the Australian Accounting Standards Board (AASB) that are relevant to its operations
and effective for an accounting period that begins on or after 1 January 2020. New and
revised Standards and amendments thereof and Interpretations effective for the current
year that are relevant to the Group include:
•
•
•
•
•
•
•
•
•
•
AASB 1060 General Purpose Financial Statements – Simplified Disclosures for For-Profit
and Not-for-Profit Tier 2 Entities
AASB 2020-2 Amendments to Australian Accounting Standards – Removal of Special
Purpose Financial Statements for Certain For-Profit Private Sector Entities
AASB 2020-3 Amendments
to Australian Accounting Standards – Annual
Improvements 2018-2020 and Other Amendments
AASB 2020-7 Amendments to Australian Accounting Standards – Covid-19-Related
Rent Concessions: Tier 2 Disclosures
AASB 2020-9 Amendments to Australian Accounting Standards – Tier 2 Disclosures:
Interest Rate Benchmark Reform (Phase 2) and Other Amendments – December 2020
AASB 2021-1 Amendments to Australian Accounting Standards – Transition to
Simplified Disclosures for Not-for-Profit Entities – March 2021
AASB 2021-3 Amendments to Australian Accounting Standards – Covid-19-Related
Rent Concessions beyond 30 June 2021
AASB 2021-7a Amendments to Australian Accounting Standards – Effective Date of
Amendments to AASB 10 and AASB 128 and Editorial Corrections [general editorials]
AASB 2022-2 Amendments to Australian Accounting Standards – Extending Transition
Relief under AASB 1
AASB 2022-4 Amendments to Australian Accounting Standards – Disclosures in
Special Purpose Financial Statements of Certain For-Profit Private Sector Entities
The Directors have determined that there is no material impact of the new and revised
Standards and Interpretations on the Group and, therefore, no material change is
necessary to Group accounting policies.
NOTE 3: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Preparation
The consolidated financial statements have been prepared on the basis of historical cost,
except for certain financial instruments that are measured at fair values at the end of each
reporting period, as explained in the accounting policies below. Historical cost is generally
based on the fair values of the consideration given in exchange for goods and services. All
amounts are presented in AU dollars, unless otherwise noted. 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. In estimating the
fair value of an asset or a liability, the Group takes into account the characteristics of the
asset or liability if market participants would take those characteristics into account when
pricing the asset or liability at the measurement date. Fair value for measurement and/or
disclosure purposes in these consolidated financial statements is determined on such a
TREK METALS LIMITED | ANNUAL REPORT 2023
33
basis, except for share-based payment transactions that are within the scope of AASB 2,
leasing transactions that are within the scope of AASB 16, and measurements that have
some similarities to fair value but are not fair value, such as net realisable value in AASB 2
or value in use in AASB 136.
In addition, for financial reporting purposes, fair value measurements are categorised into
Level 1, 2 or 3 based on the degree to which the inputs to the fair value measurements are
observable and the significance of the inputs to the fair value measurement in its entirety,
which are described as follows:
•
•
•
Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or
liabilities that the entity can access at the measurement date;
Level 2 inputs are inputs, other than quoted prices included within Level 1, that are
observable for the asset or liability, either directly or indirectly; and
Level 3 inputs are unobservable inputs for the asset or liability.
(a) Basis of Consolidation
The consolidated financial statements incorporate the financial statements of the
Company and entities (including structured entities) controlled by the Company and its
subsidiaries. Control is achieved when the Company:
• has power over the investee;
•
is exposed, or has rights, to variable returns from its involvement with the investee; and
• has the ability to use its power to affect its returns.
The Company reassesses whether or not it controls an investee if facts and circumstances
indicate that there are changes to one or more of the three elements of control listed
above.
When the Company has less than a majority of the voting rights of an investee, it has
power over the investee when the voting rights are sufficient to give it the practical ability
to direct the relevant activities of the investee unilaterally. The Company considers all
relevant facts and circumstances in assessing whether or not the Company's voting rights
in an investee are sufficient to give it power, including:
•
the size of the Company's holding of voting rights relative to the size and dispersion of
holdings of the other vote holders;
• potential voting rights held by the Company, other vote holders or other parties;
•
rights arising from other contractual arrangements; and
• any additional facts and circumstances that indicate that the Company has, or does
not have, the current ability to direct the relevant activities at the time that decisions
need to be made, including voting patterns at previous shareholders' meetings.
Consolidation of a subsidiary begins when the Company obtains control over the
subsidiary and ceases when the Company loses control of the subsidiary. Specifically,
income and expenses of a subsidiary acquired or disposed of during the year are included
in the consolidated statement of profit or loss and other comprehensive income from the
date the Company gains control until the date when the Company ceases to control the
subsidiary.
TREK METALS LIMITED | ANNUAL REPORT 2023
34
Profit or loss and each component of other comprehensive income are attributed to the
owners of the Company and to the non-controlling interests. Total comprehensive income
of subsidiaries is attributed to the owners of the Company and to the non-controlling
interests even if this results in the non-controlling interests having a deficit balance.
When necessary, adjustments are made to the financial statements of subsidiaries to
bring their accounting policies into line with the Group's accounting policies.
All intragroup assets and liabilities, equity, income, expenses and cash flows relating to
transactions between members of the Group are eliminated in full on consolidation.
(b) Impairment of Assets
At each reporting date, the Group reviews the carrying values of its tangible and intangible
assets to determine whether there is any indication that those assets have been impaired.
If such an indication exists, the recoverable amount of the asset, being the higher of the
asset’s fair value less costs to sell and value in use, is compared to the asset’s carrying
value. 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 which the estimate of future
cash flows have not been adjusted. Any excess of the asset’s carrying value over its
recoverable amount is expensed to the income statement.
Where it is not possible to estimate the recoverable amount of an individual asset, the
Group estimates the recoverable amount of the cash-generating unit to which the asset
belongs.
Where an impairment loss subsequently reverses, the carrying amount of the asset (or
cash generating unit) is increased to the revised estimate of its recoverable amount, but
so that the increased carrying amount does not exceed the carrying amount that would
have been recognised for the asset (or cash generating unit) in prior years. A reversal of
an impairment loss is recognised immediately in the income statement.
Where a reasonable and consistent basis of allocation can be identified, corporate assets
are also allocated to individual cash-generating units, or otherwise they are allocated to
the smallest group of cash generating units for which a reasonable and consistent
allocation basis can be identified.
(c) Foreign Currency Transactions and Balances
a.
Functional and presentation currency
The functional currency of each of the Group’s entities is measured using the currency of
the primary economic environment in which that entity operates. The functional currency
and presentation currency of the parent is AUD. The consolidated financial statements are
presented in AU Dollars.
b.
Transaction and balances
Foreign currency transactions are translated into functional currency using the exchange
rates prevailing at the date of the transaction. Foreign currency monetary items are
translated at the year-end exchange rate. Non-monetary items measured at historical
cost continue to be carried at the exchange rate at the date of transaction. Non-monetary
items measured at fair value are reported at the exchange rate at the date when fair
values were determined.
TREK METALS LIMITED | ANNUAL REPORT 2023
35
Exchange differences arising on the transition of monetary items are recognised in the
income statement in the period in which they arise, except where deferred in equity as a
qualifying cash flow.
Exchange differences arising on the translation of non-monetary items are recognised
directly in equity to the extent that the gain or loss is directly recognised in equity;
otherwise the exchange difference is recognised in the income statement.
c.
Group companies
The financial results and position of foreign operations whose functional currency is
different from the Group’s presentation currency are translated as follows:
• Assets and liabilities are translated at period-end exchange rates prevailing at that
reporting date;
•
Income and expenses are translated at average exchange rates for the period; and
• Retained earnings are translated at the exchange rates prevailing at the date of the
transaction.
Exchange differences on translation of foreign operations are transferred directly to the
Group’s foreign currency translation reserve in the balance sheet. These differences are
recognised in the income statement in the period in which the operation is disposed.
For the purpose of presenting consolidated financial statements, the assets and liabilities
of the Group’s foreign operations are expressed in AUD using exchange rates prevailing at
the end of the reporting period. Income and expense items are translated at the 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.
Exchange differences arising, if any, are recognised in other comprehensive income and
accumulated in equity (attributed to non-controlling interests as appropriate).
(d) Leases
The Group as lessee
At inception of a contract, the Group assesses if the contract contains or is a lease. If there
is a lease present, a right-of-use asset and a corresponding lease liability are recognised
by the Group where the Group is a lessee. However, all contracts that are classified as
short-term leases (ie a lease with a remaining lease term of 12 months or less) and leases
of low-value assets are recognised as an operating expense on a straight-line basis over
the term of the lease.
Initially the lease liability is measured at the present value of the lease payments still to be
paid at the commencement date. The lease payments are discounted at the interest rate
implicit in the lease. If this rate cannot be readily determined, the Group uses the
incremental borrowing rate.
Lease payments included in the measurement of the lease liability are as follows:
•
fixed lease payments less any lease incentives;
• variable lease payments that depend on an index or rate, initially measured using the
index or rate at the commencement date;
•
the amount expected to be payable by the lessee under residual value guarantees;
TREK METALS LIMITED | ANNUAL REPORT 2023
36
•
•
the exercise price of purchase options, if the lessee is reasonably certain to exercise
the options;
lease payments under extension options, if the lessee is reasonably certain to exercise
the options; and
• payments of penalties for terminating the lease, if the lease term reflects the exercise
of an option to terminate the lease.
The right-of-use assets comprise the initial measurement of the corresponding lease
liability, any lease payments made at or before the commencement date and any initial
direct costs. The subsequent measurement of the right-of-use assets is at cost less
accumulated depreciation and impairment losses.
Right-of-use assets are depreciated over the lease term or useful life of the underlying
asset, whichever is the shortest.
Where a lease transfers ownership of the underlying asset or the cost of the right-of-use
asset reflects that the Group anticipates to exercise a purchase option, the specific asset
is depreciated over the useful life of the underlying asset.
(e) Borrowings
Borrowings are initially recognised at fair value, net of transaction costs incurred.
Borrowings are subsequently measured at amortised cost. Any difference between the
proceeds (net of transaction costs) and the redemption amount is recognised in profit or
loss over the period of the borrowings using the effective interest method. Fees paid on the
establishment of loan facilities are recognised as transaction costs of the loan to the
extent that it is probable that some or all of the facility will be drawn down. In this case, the
fee is deferred until the drawdown occurs. To the extent there is no evidence that it is
probable that some or all of the facility will be drawn down, the fee is capitalised as a
prepayment for liquidity services and amortised over the period of the facility to which it
relates.
The fair value of the liability portion of a convertible note is determined using a market
interest rate for an equivalent non-convertible borrowing. This amount is recorded as a
liability on an amortised cost basis until extinguished on conversion or maturity of the
notes. The remainder of the proceeds is allocated to the conversion option. This is
recognised and included in shareholders’ equity, net of income tax effects.
Borrowings are removed from the balance sheet when the obligation specified in the
contract is discharged, cancelled or expired. The difference between the carrying amount
of a financial liability that has been extinguished or transferred to another party and the
consideration paid, including any non-cash assets transferred or liabilities assumed, is
recognised in profit or loss as other income or finance costs.
Where the terms of a financial liability are renegotiated and the entity issues equity
instruments to a creditor to extinguish all or part of the liability (debt for equity swap), a
gain or loss is recognised in profit or loss, which is measured as the difference between
the carrying amount of the financial liability and the fair value of the equity instruments
issued.
Borrowings are classified as current liabilities unless the Group has an unconditional right
to defer settlement of the liability for at least 12 months after the reporting period.
TREK METALS LIMITED | ANNUAL REPORT 2023
37
NOTE 4: CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF
ESTIMATION UNCERTAINTY
In the application of the Group’s accounting policies, which are described in Note 3, the
directors are required to make judgments, 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.
The 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 if
the revision affects only that period, or in the period of the revision and future periods if the
revision affects both current and future periods.
The following are the critical judgments and estimations that the directors have made in
the process of applying the Group’s accounting policies and that have the most significant
effect on the amounts recognised in the financial statements.
a.
Impairment of capitalised exploration and evaluation expenditure
The future recoverability of capitalised exploration and evaluation expenditure is
dependent on a number of factors, including whether the Group decides to exploit the
related lease itself or, if not, whether it successfully recovers the related exploration and
evaluation asset through sale. Factors which could impact the future recoverability
include the level of proved, probable and inferred mineral resources, future technological
changes which could impact the cost of mining, future legal changes and the approval of
the Environmental Impact Study (including changes to environmental restoration
obligations) and changes to commodity prices.
To the extent that capitalised exploration evaluation expenditure is determined not to be
recoverable in the future, this will reduce profits and net assets in the period in which this
determination is made.
In addition, exploration and evaluation expenditure is capitalised if activities in the area of
interest have not yet reached a stage which permits reasonable assessment of the
existence or otherwise of economically recoverable reserves. To the extent that it is
determined in the future that this capitalised expenditure should be written off, this will
reduce profits and net assets in the period in which this determination is made.
b.
Share-based payment transactions
The Group measures the cost of equity-settled transactions with employees by reference
to the fair value of the equity instruments at the date at which they are granted. The fair
value is determined by using a Black Scholes model.
c.
Taxation
Balances disclosed in the financial statements and the notes thereto related to taxation
are based on the best estimates of the directors. These estimates take into account both
the financial performance and position of the Group as they pertain to current income
taxation legislation, and the directors understanding thereof. No adjustment has been
made for pending or future taxation legislation. The current income tax position represents
the directors’ best estimate, pending an assessment by the applicable taxation
authorities.
TREK METALS LIMITED | ANNUAL REPORT 2023
38
NOTE 5: SEGMENT INFORMATION
(a)
Identification of reportable segments
The Group operates predominantly in the mining and exploration industry. This comprises
exploration and evaluation activities related to the Battery Metals and Gold projects. The
Group continues to assess other commercially and economically viable exploration
projects.
The Group has identified its operating segments based on the internal reports that are
provided to the Board of Directors (chief operating decision makers) to assess
performance and determine the allocation of resources. Management has identified the
operating segments based on the principal location of its projects, and its ASX listing and
management location in Australia.
(b) Basis of accounting for purposes of reporting by operating segments:
(i) Accounting policies adopted
Unless stated otherwise, all amounts reported to the Board of Directors are determined
in accordance with accounting policies that are consistent to those adopted in the
annual financial statements of the Group.
(ii) Inter-segment transactions
Inter-segment
loans payable and receivable are
initially recognised at the
consideration received/to be received net of transaction costs. If inter-segment loans
receivable and payable are generally on commercial terms.
(iii) Segment assets
Where an asset is used across multiple segments, the asset is allocated to that
segment that receives majority economic value from that asset. In the majority of
instances, segment assets are clearly identifiable on the basis of their nature and
physical location.
(iv) Segment liabilities
Liabilities are allocated to segments where there is a direct nexus between the
incurrence of the liability and the operations of the segment. Borrowings and tax
liabilities are generally considered to relate to the Group as a whole and are not
allocated. Segment liabilities include trade and other payables and certain direct
borrowings.
TREK METALS LIMITED | ANNUAL REPORT 2023
39
The following is an analysis of the Group’s results by reportable operating segment for the
period:
Continuing operations
Exploration and evaluation
Corporate
SEGMENT LOSS
31 MAR 2023
31 MAR 2022
$
$
(1,980,068)
(654,016)
(2,010,885)
(1,531,606)
Consolidated segment loss for the year from all
operations
(3,990,953)
(2,185,622)
The following is an analysis of the Group’s assets by reportable operating segment:
Continuing operations
Exploration and evaluation
Unallocated corporate assets
Consolidated segment assets
SEGMENT ASSETS
31 MAR 2023
31 MAR 2022
$
$
8,478,546
2,976,068
4,102,671
6,395,611
11,454,614
10,498,282
The following is an analysis of the Group’s liabilities by reportable operating segment:
Continuing operations
Exploration and evaluation
Unallocated corporate liabilities
Consolidated segment liabilities
SEGMENT LIABILITIES
31 MAR 2023
31 MAR 2022
$
$
439,006
378,099
817,105
55,433
124,640
180,073
TREK METALS LIMITED | ANNUAL REPORT 2023
40
NOTE 6: RECONCILIATION OF REVENUE AND OTHER EXPENSES
Interest revenue is recognised when it is probable that the economic benefits will flow to
the Group and the amount of revenue can be measured reliably. Interest revenue is
accrued on a time basis, by reference to the principal outstanding and at the effective
interest rate applicable, which is the rate that exactly discounts estimated future cash
receipts through the expected life of the financial asset to that asset’s net carrying amount
on initial recognition.
Revenues, expenses and assets are recognised net of the amount of goods and services
tax (GST), except:
(i) where the amount of GST incurred is not recoverable from the taxation authority, it is
recognised as part of the cost of acquisition of an asset or as part of an item of
expense; or
(ii) for receivables and payables which are recognised inclusive of GST.
The net amount of GST recoverable from, or payable to, the taxation authority is included
as part of receivables or payables.
The loss before tax from continuing operations after charging expenses and receiving
income was as follows:
Investment Revenue
Interest revenue
Total Investment Revenue
Other Operating Expenses
Auditor’s remuneration
Communications costs
Consulting expenses
Wages, oncosts and recruitment costs
Directors’ salaries and consultant fees
Insurance
Rental costs
Legal
Corporate & statutory costs
Travel
Software expenses
Business development/conferences
Scheme expenses – Edge Minerals
Depreciation
Other costs
31 MAR 2023
31 MAR 2022
$
$
46,221
46,221
25,511
25,511
(32,303)
(4,672)
(200,042)
(110,791)
(291,711)
(49,261)
(22,004)
(38,178)
(93,139)
(13,796)
(19,088)
(84,263)
(126,878)
(86,443)
(52,102)
(33,000)
(4,790)
(135,181)
(170,860)
(179,768)
(34,097)
(23,543)
(23,568)
(86,725)
(12,064)
(7,334)
(38,904)
-
(54,448)
(16,008)
Total Other Operating Expenses
(1,224,671)
(820,290)
TREK METALS LIMITED | ANNUAL REPORT 2023
41
NOTE 7: EARNINGS PER SHARE
The calculation of the basic and diluted (loss) /earnings per share is based on the
following information:
Earnings
Loss attributable to the ordinary equity holders of
the Company used in calculating basic and
diluted loss per share:
From continuing operations
Shares
Weighted average number of ordinary shares
used as the denominator in calculating basic loss
31 MAR 2023
31 MAR 2022
$
$
(3,990,953)
(2,185,622)
(3,990,953)
(2,185,622)
per share
331,487,651
280,929,853
Adjustment for calculation of diluted earnings per
share:
Options
-
-
Weighted average number of ordinary shares and
potential ordinary
shares used as
the
331,487,651
280,929,853
denominator in calculating diluted loss per share
Basic Loss per Share
Cents/share
Cents/share
Total basic loss per share attributable to the
ordinary equity holders of the Company
(1.204)
(0.778)
Total diluted loss per share attributable to the
ordinary equity holders of the Company
(1.204)
(0.778)
The following number of potential ordinary shares are not dilutive and are therefore
excluded from the weighted average number of ordinary shares in the year ended 31
March 2023:
Unlisted Options
Performance Rights
31 MAR 2023
31 MAR 2022
16,925,000
31,575,000
48,500,000
20,150,000
22,675,000
42,825,000
TREK METALS LIMITED | ANNUAL REPORT 2023
42
NOTE 8:
INCOME TAX
The charge for current income tax expenses is based on the profit for the year adjusted for
any non-assessable or disallowed items. It is calculated using tax rates that have been
enacted or are substantively enacted by the balance sheet date.
Deferred tax is accounted for using the balance sheet liability method in respect of
temporary differences arising between the tax bases of assets and liabilities and their
carrying amounts in the financial statements. No deferred income tax will be recognised
from the initial recognition of an asset or liability, excluding a business combination, where
there is no effect on accounting taxable profit or loss.
Deferred tax is calculated at the tax rates that are expected to apply to the period when
the asset is realised or liability is settled. Deferred tax is credited in the income statement
except where it relates to items that may be credited directly to equity, in which case the
deferred tax is adjusted directly against equity.
Deferred income tax assets are recognised to the extent that it is probable that future tax
profits will be available against which deductible temporary differences can be utilised.
The amount of benefits brought to account or which may be realised in the future is based
on the assumption that no adverse change will occur in income taxation legislation and
the anticipation that the Group will derive sufficient future assessable income to enable
the benefit to be realised and comply with the conditions of deductibility imposed by the
law.
Major components of income tax for the year ended 31 March 2023 are as follows:
Current income
Current income tax (benefit) expense
31 MAR 2023
31 MAR 2022
$
$
2,585,157
706,204
Derecognition of current income tax expense (benefit)
(2,585,157)
(706,204)
Deferred income tax
Relating to origination and reversal of temporary
difference
Derecognition of current income tax benefit (expense)
Adjustment in respect of prior year tax losses/STA
Income tax expense reported in income statement
(375,725)
(2,712,237)
(29,985)
405,710
-
2,242,514
469,723
-
A reconciliation of the income tax expense applicable to the loss from operating activities
before income tax at the statutory income tax rate to income tax expense at the Group’s
effective income tax rates is as follows:
TREK METALS LIMITED | ANNUAL REPORT 2023
43
Loss from operating activities before income tax
(3,990,953)
(2,185,622)
Prima facie tax benefit on loss from ordinary activities
at 30% (2022: 30%)
(1,197,286)
(655,687)
31 MAR 2023
31 MAR 2022
$
$
Tax effect of amounts which are not deductible
(taxable) in calculating taxable income
- Non-deductible expenses
-
-
International tax rate differential
Tax loss not brought to account as a deferred
tax asset
-
Temporary differences not brought to account
At effective income tax rate of 0% (31 March 2022: 0%)
Income tax expensed reported in income statement
Unrecognised deferred tax balances relate to the following:
Deferred tax assets at 30% (2022: 30%)
Provisions
Other assets
Capitalised Expenses
Capitalised Exploration costs
Trade and other payables
Property, plant & equipment
Exploration & evaluation expenditure
Un-realised foreign exchange gains
Business related costs
Total Deferred Tax Assets
699,571
24,336
386,114
9,905
2,585,156
(2,111,777)
722,821
(463,153)
-
-
-
-
31 MAR 2023
31 MAR 2022
$
$
10,534
(6,310)
4,761
2,394
17,011
(120,464)
(1,600,188)
(6)
1,699
(5,217)
4,761
117,999
11,425
(92,982)
(712,123)
(1)
193,428
227,046
(1,498,840)
(447,393)
Potential deferred tax assets for the Group are attributable to Gabonese and Australian
tax losses carried forward by the subsidiaries and future benefits to exploration
expenditure and other temporary differences allowable for deduction. Deferred tax assets
have not been brought to account in the consolidated statements as at 31 March 2023
because the directors are of the opinion that it is not appropriate to regard full realisation
of the deferred tax assets as probable.
TREK METALS LIMITED | ANNUAL REPORT 2023
44
These benefits will only be obtained if:
a) The subsidiaries derive future assessable income of a nature and of an amount
sufficient to enable the benefit from the deductions to be realised; and
b) The subsidiaries continue to comply with the conditions for deductibility imposed by
tax legislation; and
c) No changes in tax legislation adversely affect the subsidiaries in realising the benefit
from the deduction of the losses.
Unused tax losses not brought to account are as follows:
Opening unused tax losses
Add: losses for the year
Less: Prior year adjustment
Unused tax losses
31 MAR 2023
31 MAR 2022
$
$
9,652,463
5,677,315
8,617,189
2,409,404
1,352,365
1,565,744
19,622,017
9,652,463
NOTE 9: CASH AND CASH EQUIVALENTS
Cash and cash equivalents include cash on hand, deposits held at call with banks, other
short term highly liquid investments with original maturities of three months or less, and
bank overdrafts.
Bank balances and cash management accounts
Term deposit (1)
31 MAR 2023 31 MAR 2022
$
$
2,682,615
6,345,329
21,551
21,503
6,366,832
(1) A$20,000 of the cash and cash equivalents is restricted and set aside to offset credit card
2,704,166
limits.
TREK METALS LIMITED | ANNUAL REPORT 2023
45
(a) Reconciliation of profit or loss after income tax to net cash flow from operating
activities
Loss for the year
Share-based payment expense
Loss on sale of plant & equipment
Finance cost
Impairment of exploration expenditure
Depreciation
Discontinued operation
Net exchange differences
Change in operating assets and liabilities, net of
effects from sale of subsidiary:
in
trade and other
(Increase)/decrease
receivables
Increase/(decrease) in other assets – current &
non-current
(Decrease)/increase in trade and other payables
Increase in provisions
Net cash outflow from operating activities
(b) Non-cash investing and financing activities
31 MAR 2023
$
31 MAR 2022
$
(3,990,953)
676,595
1,108
8,063
1,627,005
86,443
51,974
(605)
(2,185,622)
736,830
-
-
653,581
54,448
-
(3)
35,840
(46,119)
(149,875)
505,600
26,227
(1,122,578)
48
(57,106)
5,528
(838,415)
31 MAR 2023
$
31 MAR 2022
$
Acquisition of Edge via the issue of shares (refer
Note 11)
Acquisition of Tenement E45/4640 via issue of
shares
3,382,232
306,709
-
-
NOTE 10: TRADE AND OTHER RECEIVABLES
Current
Other receivables
31 MAR 2023
$
31 MAR 2022
$
50,846
50,846
90,327
90,327
Trade and other receivables are non-interest bearing, have no security held against them
and are, on average, on terms of 15 days.
TREK METALS LIMITED | ANNUAL REPORT 2023
46
NOTE 11: EXPLORATION AND EVALUATION EXPENDITURE
Exploration and evaluation expenditure primarily consist of activities including drilling,
assaying, geochemical and geophysical investigations and independent geological
consultants in respect of each identifiable area of interest. These costs are capitalised
provided the rights to tenure of the area of interest is current and either:
a)
the expenditures are expected to be recouped through successful development and
exploitation or sale of the area of interest; or
b) activities in the area of interest have not at the reporting date reached a stage which
permits a reasonable assessment of the existence or otherwise of economically
recoverable reserves, and active and significant operations in or relating to, the area
of interest are continuing.
When the technical feasibility and commercial viability of extracting a mineral resource
have been demonstrated then any capitalised exploration and evaluation expenditure is
reclassified as capitalised mine development. Prior to reclassification, capitalised
exploration and evaluation expenditure is measured at cost and assessed for impairment.
a.
Impairment
All capitalised exploration and evaluation expenditure is monitored for indications of
impairment on a cash-generating unit basis. The cash generating unit shall not be larger
than the area of interest. If sufficient data exists to determine technical feasibility and
commercial viability, and facts and circumstances suggest that the carrying amount
exceeds the recoverable amount, the capitalised expenditure which is not expected to be
recovered is charged to the income statement.
31 MAR 2023 31 MAR 2022
$
$
Exploration and Evaluation Expenditure
8,125,997
3,703,707
Movement during the period:
Opening balance
Additions for the period
Impairments
Acquisition of Edge Minerals Ltd
Acquisition of tenement E45/4640
Transfer to Other Financial Assets (Sale of
subsidiary)
Loss on Sale of subsidiary
3,703,707
1,453,582
2,049,134
2,308,154
(298,001)
(653,581)
3,200,000
306,709
(188,026)
(51,974)
-
-
-
-
Closing balance at balance date
8,125,997
3,703,707
TREK METALS LIMITED | ANNUAL REPORT 2023
47
The Group’s exploration properties may be subject to claim under Native Title (or
jurisdiction equivalent), or contain sacred sites, or sites of significance to the indigenous
people of Australia. As a result, exploration properties or areas within the tenements may
be subject to exploration restrictions, mining restrictions and/or claims for compensation.
At this time, it is not possible to quantify whether such claims exist, or the quantum of such
claims.
The Company policy is to charge exploration expenditure to specific areas of interest.
Exploration expenditure that cannot be attributed to specific areas of interest is written off.
Recoverability of the Group’s carrying value of interests in mineral projects is subject to the
successful development and exploitation of the exploration properties or alternatively, the
sale of these tenements at amounts at least equal to the book values.
ACQUISITION OF EDGE MINERALS – SCHEME
On 27 October 2022, the Supreme Court of Western Australia made orders approving the
Scheme of arrangement by which Trek acquired all of the issued shares in Edge Minerals
Ltd (Edge). The acquisition of Edge was deemed an asset acquisition. Implementation of
the Scheme was completed on 8th November 2022.
Purchase consideration
Issue of fully paid ordinary shares (48,317,601 @ $0.07)
Net liabilities acquired
Total consideration
Impairment expense ($3.2M)1
Exploration assets at acquisition
Fair value
$
3,382,232
623,318
4,005,550
(805,550)
3,200,000
1.
The value of Edge Minerals Limited has been independently valued as part of the Scheme of
arrangement at $3,200,000 with the excess purchase consideration immediately expensed
due to being in excess of the fair value on acquisition.
TREK METALS LIMITED | ANNUAL REPORT 2023
48
SALE OF SUBSIDIARY PROJECT
On 21 June 2022, the Company announced the completion of the sale of its remaining 20%
interest in the Kroussou zinc-lead project located in west Gabon in central Africa to Apollo
Minerals Limited. This was achieved via the sale of its wholly owned subsidiary Select
Exploration Mauritius which ultimately held the Kroussou project.
The consideration received by Trek was 3,000,000 fully-paid AON ordinary shares and
1,000,000 options exercisable into ordinary shares at 12c per share, expiring 30 June 2024.
The financial impact is summarised as follows:
Carrying value of subsidiary
Value of 3,000,000 shares received from AON at 21 June 2022
Value of 1,000,000 options received by AON at 21 June 2022
Consideration received on sale of subsidiary
Loss on disposal of subsidiary
31 MARCH
2023
$
240,000
174,000
14,026
188,026
(51,974)
In addition, as part of the transaction the Company forgave the Intercompany loan of
$2,164,272 which had been previously impaired in full in prior reporting periods.
NOTE 12: SUBSIDIARIES
The consolidated financial statements include the financial statements of Trek Metals
Limited and the subsidiaries listed below:
COUNTRY
OF
INCORP’N
CLASS OF
SHARE
CAPITAL
HELD
HOLDING & VOTING
CAPACITY (%)
31 MAR 2023
31 MAR 2022
TM Resources Pty Ltd
Australia
Ordinary
Trek Management Pty Ltd
Australia
Ordinary
Elm Resources Pty Ltd
Australia
Ordinary
Select Exploration *
Mauritius
Ordinary
Select Exploration (Gabon) *
Gabon
Ordinary
ACME Pilbara Pty Ltd
Australia
Ordinary
Anaheim Pty Ltd
Australia
Ordinary
Edge Minerals Pty Ltd
Australia
Ordinary
100
100
100
0
0
100
100
100
100
100
100
100
100
100
100
0
*On 25 March 2022, Trek reached agreement with Apollo Minerals to sell all of its remaining interest in the
Kroussou Project via the sale of Select Exploration (Mauritius). Completion of the agreement took place on 21
June 2022. Refer to Note 11 for further details.
TREK METALS LIMITED | ANNUAL REPORT 2023
49
NOTE 13: INVESTMENTS IN ASSOCIATES
An associate is an entity over which the Group has significant influence. Significant
influence is the power to participate in the financial and operating policy decisions of the
investee but is not control or joint control over those policies. Trek Metals Limited holds 49%
of the share capital of Cape Resources Limited company controlled by Glencore
International AG (Glencore). There were no contributions by Trek Metals in 2023. The
investment in this associate is carried at $Nil (2022: nil).
NOTE 14: TRADE AND OTHER PAYABLES
Current
Trade and other payables
Accrued expenses
31 MAR 2023 31 MAR 2022
$
$
304,143
389,714
693,857
102,370
68,818
171,188
Trade payables and accruals are non-interest bearing and have repayment terms within 30 days.
TREK METALS LIMITED | ANNUAL REPORT 2023
50
NOTE 15: LEASES
31 MAR 2023
Leases
(a) Amounts recognised in the balance sheet
Rights-of-use asset
Opening balance
Right-of-use assets recognised as at 22 August
Less: Depreciation
Closing balance
Lease liabilities
Opening balance – Total
Lease liabilities recognised as at 22 August
Add: Interest
Less: Payments
Closing balance - Total
Closing balance - Current
Closing balance – Non-Current
(b) Amounts recognised in the consolidated statement of profit or loss
Depreciation of right-of-use asset
Interest expense on lease liabilities
(c) Leasing Activities
$
-
98,705
(14,448)
84,257
-
98,705
10,569
(21,138)
88,136
31,144
56,992
14,448
10,570
31 MAR 2022
$
-
-
-
-
-
-
-
-
-
-
-
-
-
The Company has entered into an office lease for the premises at Suite 5, 2 Centro Avenue, Subiaco WA. The
lease commenced on 22 August 2022 for an initial two-year period with options available for a further four
years expiring on 26 August 2026.
The lease is recognised as a right-of-use asset and a corresponding liability at the date at which the leased
asset is available for use by the Company. Each lease payment is allocated between the liability and finance
cost. The finance cost is charged to profit or loss over the lease period as to produce a constant periodic rate
of interest on the remaining balance of the liability for each period. The right-of-use asset is amortised over
the shorter of the asset’s useful life and the lease term on a straight-line basis.
Initial measurement
Assets and liabilities from a lease are initially measured on a present value basis. The lease liability includes
the present value of the fixed payments and variable lease payments that depend on an index, initially
measured using the index as at the commencement date (reconciled and adjusted for actual index each
year). The lease payments are discounted using the Company’s incremental borrowing rate of 6%.
The right-of-use asset is measured at cost comprising of the initial measurement of the lease liability.
Subsequent measurement
The right-of-use asset is subsequently measured at cost less any accumulated amortisation and any
accumulated impairment losses and adjusted for any re-measurement of the lease liability.
The lease liability is subsequently measured to reflect the interest on the lease liability, the lease payments
made and any reassessment of the variable payments.
TREK METALS LIMITED | ANNUAL REPORT 2023
51
NOTE 16: PROVISIONS
Provisions are recognised when the Group has a legal or constructive obligation, as a
result of past events, for which it is probable that an outflow of economic benefits will result,
and that outflow can be reliably measured. The amount recognised as a provision is the
best estimate of the consideration required to settle the present obligation at the balance
sheet date, taking into account the risks and uncertainties surrounding the obligation.
Where a provision is measured using the cash flow estimated to settle the present
obligation, its carrying amount is the present value of those cash flows.
Current
Provision for Annual Leave
NOTE 17: ISSUED CAPITAL
31 MAR 2023 31 MAR 2022
$
$
35,112
35,112
8,885
8,885
Authorised ordinary shares of par £0.01 each, carrying one vote per share and rights to
dividends. The ordinary shares on issue is summarised as follows:
31 MARCH 2023
Issued and fully paid ordinary shares
As at 1 April 2022
Allotments
ISSUED
SHARE
NUMBER
CAPITAL
PREMIUM
OF SHARES
$
$
310,460,150
34,969,682
51,903,292
6/06/2022 Exercise of performance rights
150,000
7/11/2022 Acquisition of tenement at $0.064
4,792,332
2,612
85,021
7,333
221,688
per share
8/11/2022 Acquisition of Edge Minerals at
$0.07 per share
48,317,601
856,148
2,526,084
14/11/2022 Exercise of options at $0.056 per
225,000
3,940
10,460
share
Share Issue costs
-
(19,883)
-
Balances as at 31 March 2023
363,945,083
35,897,520 54,668,857
TREK METALS LIMITED | ANNUAL REPORT 2023
52
31 MARCH 2022
Issued and fully paid ordinary shares
As at 1 April 2021
Allotments
16/04/2021 Exercise of options at $0.056
16/09/2021 Exercise of options at $0.056
26/10/2021 Placement at $0.115 per share (1)
30/11/2021 Share purchase plan at $0.115 per
share (2)
Share Issue costs
Balances as at 31 March 2022
(1)
(2)
Shares issued pursuant to capital raising of $3.5M.
Shares issued pursuant to share purchase plan raising $2.05M.
ISSUED
SHARE
NUMBER
CAPITAL
PREMIUM
OF SHARES
$
$
261,703,691
34,568,285 47,223,165
100,000
400,000
1,787
7,566
4,613
18,034
30,434,783
558,941
2,941,059
17,821,676
333,079
1,716,421
-
(499,976)
-
310,460,150
34,969,682 51,903,292
Performance Rights
At 31 March 2023, the number of Performance Rights of the Company on issue are:
Performance Rights
Issued
Fair value at
Grant Date
($)
No of rights
Grant date
Expiry
Class A
Class B
Class C
Class D
Class E
Class F
Class G
Class H
Class I
Class J
Class K
Class L
Class M
4,375,000
4,000,000
4,000,000
750,000
900,000
900,000
2,000,000
2,000,000
2,000,000
800,000
800,000
4,600,000
4,450,000
31,575,000
0.0492
0.0452
0.0420
0.0663
0.0663
0.0663
0.0725
0.0686
0.0664
0.0909
0.0888
0.0869
0.0825
05/03/21
05/03/21
05/03/21
05/03/21
05/03/21
05/03/21
01/09/21
01/09/21
01/09/21
21/01/22
21/01/22
29/11/22
29/11/22
05/03/25
05/03/25
05/03/25
05/03/25
05/03/25
05/03/25
01/09/25
01/09/25
01/09/25
28/01/26
28/01/26
29/11/25
29/11/26
Vested
#
-
-
-
750,000
900,000
900,000
-
-
-
-
-
-
-
2,550,000
TREK METALS LIMITED | ANNUAL REPORT 2023
53
Options on Issue
Unissued ordinary shares of the Company under option at 31 March 2023 are as follows:
Options issued
Options issued as
Share Based Payments:
Directors
Directors
Consultant
Broker Options
Consultant
Broker Options
Options outstanding
and exercisable as at 31
March 2023
Exercise
price
($)
Fair
value at
Grant
Date ($)
No of
options
Grant
date
Expiry
Vested/
Exercisable
#
1,875,000
3,750,000
2,300,000
2,500,000
1,500,000
5,000,000
0.056
0.056
0.056
0.056
0.056
0.200
0.016
0.008
0.008
0.008
0.020
0.052
02/09/19
03/10/19
03/10/19
03/10/19
01/07/20
26/10/21
30/09/23
30/09/23
30/09/23
30/09/23
30/06/24
31/10/23
1,875,000
3,750,000
2,300,000
2,500,000
1,500,000
5,000,000
16,925,000
16,925,000
NOTE 18: RESERVES
(a) Share Premium Reserve
The share premium reserve records the amounts paid by shareholders for shares in excess
of their nominal value. See note 16 for further information.
(b) Share-Based Payment Reserve
The share-based payment reserve records the fair value of options and performance
rights granted to staff and directors, and suppliers.
Movement in unlisted options
Number
$
Balance at 1 April 2022
Options exercised
Options lapsed
Options expensed (prior issues)
Balance at 31 March 2023
20,150,000
(225,000)
532,462
(1,800)
(3,000,000)
(108,000)
-
5,625
16,925,000
428,287
Movement in performance rights
Number
$
Balance at 1 April 2022
Issue of Classes L - M (29 November 2022)
Rights exercised
Rights expensed (prior issues)
Balance at 31 March 2023
22,675,000
9,050,000
(150,000)
-
760,952
-
(9,945)
672,191
31,575,000
1,423,198
TREK METALS LIMITED | ANNUAL REPORT 2023
54
(c) Translation Reserve
Exchange differences relating to the translation of the net assets of the Group’s foreign
operations from their functional currencies to the Group’s presentation currency of AUD
are recognised directly in other comprehensive income and accumulated in the foreign
currency translation reserve. Gains and losses on hedging instruments that are
designated as hedges of net investments in foreign operations are included in the foreign
currency translation reserve. Exchange differences previously accumulated in the foreign
currency translation reserve (in respect of translating both the net assets of foreign
operations and hedges of foreign operations) are reclassified to profit or loss on the
disposal or partial disposal of the foreign operation.
Movement in foreign currency translation
31 MAR 2023
31 MAR 2022
Opening balance
Translation
of
foreign
currency
financial
statements into the functional currency
$
$
2,560,563
-
2,756,781
(196,218)
Closing balance
2,560,563
2,560,563
NOTE 19: FINANCIAL INSTRUMENTS
Financial assets and financial liabilities are recognised when a Group entity becomes a
party to the contractual provisions of the instrument.
Financial assets and financial liabilities are initially measured at fair value. 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.
(a) Financial Assets
On initial recognition, financial assets are classified as measured at:
Amortized cost;
Fair Value through Other Comprehensive Income (“FVOCI”) – debt investment;
FVOCI – equity investment; or
Fair Value through Profit or Loss (“FVTPL”)
The classification of financial assets is generally based on the business model in which a
financial asset is managed and its contractual cash flow characteristics. A financial asset
(unless it is a trade receivable without a significant financing component that is initially
measured at the transaction price) is initially measured at fair value plus, for an item not
at FVTPL, transaction costs that are directly attributable to its acquisition. For financial
assets measured at amortized cost, these assets are subsequently measured at
amortized cost using the effective interest method. The amortized cost is reduced by
impairment losses.
TREK METALS LIMITED | ANNUAL REPORT 2023
55
Interest income, foreign exchange gains and losses and impairment are recognized in
profit or loss. Any gain or loss on derecognition is recognized in profit or loss.
As of 31 March 2023, the Group’s financial instruments consist of cash and cash
equivalents, trade and other receivables and trade and other payables.
Cash and cash equivalents and other receivables are classified as amortised cost under
AASB 9. The trade and other payables are designated as other financial liabilities, which
are measured at amortised cost.
The cash and cash equivalents, trade and other receivables, and trade and other
payables approximate their fair value due to their short-term nature.
The Group classified the fair value of the financial instruments according to the following
fair value hierarchy based on the amount of observable inputs used to value the
instruments:
The three levels of the fair value hierarchy are:
•
•
•
Level 1 – Values based on unadjusted quoted prices available in active markets for
identical assets or liabilities as of the reporting date.
Level 2 – Values based on inputs, including quoted prices, time value and volatility
factors, which can be substantially observed or corroborated in the marketplace.
Prices in Level 2 are either directly or indirectly observable as of the reporting date.
Level 3 – Values based on prices or valuation techniques that are not based on
observable market data.
Impairment of financial assets
The Group assesses the recoverability of financial assets using an ‘expected credit loss’
(“ECL”) model. This impairment model is applied to financial assets measured at
amortized cost, contract assets and debt investments at Fair Value Through Other
Comprehensive Income (“FVOCI”), but not to investments in equity instruments.
In accordance with AASB 9, loss allowances are measured on either of the following bases:
•
•
12-month ECLs: these are ECLs that result from possible default events within the 12
months after the reporting date; and
Lifetime ECL: these are ECLs that result from all possible default events over the
expected life of a financial instrument.
ECLs are probability-weighted estimates of credit losses. Credit losses are measured at
the present value of all cash shortfalls (i.e. the difference between the cash flows due to
the Group in accordance with the contract and the cash flows that the Group expects to
receive). ECLs are discounted at the effective interest rate of the financial asset.
Categories of financial instruments
31 MAR 2023
31 MAR 2022
Financial assets
Cash and bank balances
Trade and other receivables
Financial liabilities
Trade and other payables
$
$
2,704,166
6,366,832
50,846
90,327
693,857
171,188
TREK METALS LIMITED | ANNUAL REPORT 2023
56
Financial Risk Management objectives and policies
The Group’s risk oversight and management program focuses on the unpredictability of
financial markets and seeks to minimise potential adverse effects and ensure that net
cash flows are sufficient to support the delivery of the Group’s financial targets whilst
protecting future financial security. The Group continually monitors and tests its forecast
financial position against these objectives and may undertake forward-rate agreements
when necessary to ensure the objectives are achieved.
The Group’s activities expose it to a variety of financial risks; market, credit and liquidity.
These risks are managed by senior management in line with policies set by the Board. The
Group’s principal financial instruments comprise cash and short-term deposits. Other
financial instruments include trade receivables and trade payables, which arise directly
from operations.
It is, and has been throughout the period under audit, Group policy that no speculative
trading in financial instruments be undertaken.
Market risk
(a)
Interest Rate Risk
The Group is exposed to interest rate risk, which is the risk that a financial instrument’s
value will fluctuate as a result of changes in market interest rates. The Group manages
this risk by maintaining an appropriate mix between fixed and floating rate instruments.
The effective weighted average interest rates on classes of financial assets and financial
liabilities are as follows:
31 March 2023
Financial Assets
Non-interest bearing
Fixed interest rate
instruments
Weighted
Ave
Effective
Int Rate
%
-
0.15
Variable interest rate
0.70
instruments
Total Financial Assets
0.68
50,846
21,551
2,682,615
2,755,012
Financial Liabilities
Non-interest bearing
Total Financial
Liabilities
-
-
693,857
693,857
Less than
1 month
1 – 5
5+
1 month
$
– 1 year
$
years
$
years
$
Total
$
-
-
-
-
-
-
-
-
-
-
-
-
-
-
50,846
21,551
- 2,682,615
- 2,755,012
-
693,857
-
693,857
Financial assets are classified based upon their expected maturity whilst financial
liabilities are classified based upon their contractual maturity.
TREK METALS LIMITED | ANNUAL REPORT 2023
57
31 March 2022
Financial Assets
Non-interest bearing
Fixed interest rate
instruments
Weighted
Ave
Effective
Int Rate
%
-
0.15
Variable interest rate
0.51
instruments
Total Financial
Assets
Financial Liabilities
Non-interest bearing
Total Financial
Liabilities
(b) Currency risk
Less than
1 month
1 – 5
5+
1 month
$
– 1 year
$
years
$
years
$
Total
$
90,327
21,503
6,345,329
0.50
6,457,159
-
-
171,188
171,188
-
-
-
-
-
-
-
-
-
-
-
-
-
-
90,327
21,503
- 6,345,329
- 6,457,159
-
-
171,188
171,188
The Group has subsidiaries only operating in Australia, whose businesses are conducted
predominantly Australian Dollars, exposing the Group to minimal exchange rate
fluctuations.
(c) Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations
resulting in financial loss to the Group. Due to the current nature of the Group’s operations
there is no significant concentration of credit risk. The credit risk on liquid funds is limited
because the counterparties are banks with high credit ratings assigned by international
credit-rating agencies.
The carrying amount of financial assets recorded in the financial statements, net of any
allowances for losses, represents the Group’s maximum exposure to credit risk without
taking account of the value of any collateral or other security obtained.
(d) Capital Risk Management
The Group manages capital to ensure that companies in the Group will be able to continue
as a going concern while maximising the return to stakeholders through the optimisation
of the debt to equity balance. The Group’s focus has been to raise sufficient funds through
equity to fund exploration activity. Management also aims to maintain a capital structure
that ensures the lowest cost of capital available to the entity. The Group monitors capital
on the basis of the gearing ratio and the external borrowings currently in place however
this is not required since the facility was extinguished in the prior period.
(e) Liquidity risk
Liquidity risk refers to the risk that the Group will have insufficient funds to meet its
operational requirements. The Group manages liquidity risk by monitoring forecast cash
flows and ensuring that adequate liquidity levels are maintained. The undiscounted
contractual or expected maturities of the financial assets and liabilities are reported in the
tables under “Interest rate risk”.
TREK METALS LIMITED | ANNUAL REPORT 2023
58
(f) Fair Values
Monetary financial assets and liabilities not readily traded in an organised financial
market have been valued at cost, which approximates fair value.
The carrying amount of cash and cash equivalents approximate net fair value.
The carrying amounts and net fair values of financial assets and liabilities as at the
reporting date are as follows:
FAIR VALUE
31 MAR 2023
HIERARCHY
$
31 MAR 2022
$
Level 2
50,846
90,327
Level 2
693,857
171,188
Financial Assets
Trade and other receivables
Financial Liabilities
Trade and other payables
NOTE 20: COMMITMENTS
The Group has committed to the following minimum expenditure in relation to its
tenements.
31 MAR 2023
$
31 MAR 2022
$
858,000
1,664,145
-
2,522,145
313,000
1,261,666
78,509
1,653,175
Not later than 1 year
Later than 1 year and not later than 5 years
Later than 5 years
NOTE 21: CONTINGENCIES
TM Resources Acquisition
On 16 September 2016, the Company, and the shareholders of TM Resources Pty Ltd (TM)
entered into a Share Sale Agreement which resulted in the Company acquiring all the
shares on issue in TM. The Company paid AUS$10,000 on execution of the Share Sale
Agreement.
The Company also agreed to pay the following contingent consideration:
• Trek Metals Limited (TML) shares to the value of A$50,000 within 7 days of the
grant of the tenements that TM has applied for.
• A$1,000,000 upon the public release by TML of Mineral Resource Estimate in
respect of the Lawn Hill Project of between 550Kt Zn eq - 1.1Mt Zn eq; and
• A$3,000,000 upon the public release by TML of a Mineral Resource Estimate in
respect of the Lawn Hill Project of greater than 1.1Mt Zn eq.
TREK METALS LIMITED | ANNUAL REPORT 2023
59
NOTE 22: RELATED PARTIES
(a) Subsidiaries
The subsidiaries and associates of the Group are identified in Note 12. Transactions
between the Company and its subsidiaries, which are related parties of the Company,
have been eliminated on consolidation and are not disclosed in this note. Details of
transactions between the Group and other related parties are disclosed below.
(b) Directors
The Directors of the Company during the year, and up to the date of this report, were as
follows:
• Tony Leibowitz
• Neil Biddle
• John Young
• Valerie Hodgins
(c) Related party transactions (other than director fees)
Following the acquisition of Edge Minerals Limited, Trek Metals repaid prior Edge Minerals
Limited borrowings and accrued interest for the following Directors:
Kalonda Pty Ltd (a related party of Mr Tony Leibowitz) - $300,000 principal and $1,676 in
accrued interest.
Biddle Partners Pty Ltd (a related party of Mr Neil Biddle) - $300,000 principal and $1,676 in
accrued interest.
Mr John Young provided normal Director consulting services to the Company during the
year totalling $107,156 (2022: $180,000). Of this amount, $6,906 (2022: $15,000) was included
in payables and accruals at the end of the reporting period.
(d) Compensation of Key Management Personnel
The remuneration of directors and other
31 MAR 2023
31 MAR 2022
members of key management during the
year was as follows:
Short term benefits
Share based payments
$
656,384
445,264
1,101,648
$
504,297
562,458
1,066,755
The remuneration of directors and key management is determined by the board having
regard to the performance of individuals and market trends. At the end of the reporting
period the following amounts were payable to KMPs:
• $6,906 (2022: $15,000) was payable to Mr Young
There were no other balances outstanding from/to related parties.
TREK METALS LIMITED | ANNUAL REPORT 2023
60
NOTE 23: SHARE BASED PAYMENTS
Equity-settled share-based payments to directors, employees and others providing
similar services are measured at the fair value of the equity instrument at the grant date.
The fair value determined at the grant date of the equity-settled share-based payments
is expensed on a straight-line basis over the vesting period, based on the Group’s estimate
of shares that will eventually vest. At the end of each reporting period, the Group revises
its estimate of equity instruments expected to vest. The impact of the revision of the
original estimates, if any, is recognised in profit or loss over the remaining vesting period,
with a corresponding adjustment to the Share Based Payments Reserve.
The Trek Metals Ltd Employee Incentive Performance Rights and Options Plan (“Plan”) was
approved at the General Meeting of shareholders on 4 March 2021, and subsequently
renewed at the Annual General Meeting held on 20 October 2022.
(a) Options issued
There were no options issued during the year ended 31 March 2023.
(b) Performance Rights issued
The Company has the following Performance Rights issued to Directors, employees and
consultants in existence during the current and previous reporting periods.
Performance Rights 2023
Class Grant
Expiry Date Opening
Granted
Expired/
Vested
Rights
Rights
date
Balance 1
during
Exercised
during
Vested
Unvested
April 2022
the year
during the
the year
at 31
at 31
A
B
C
D
E
F
G
H
I
J
K
L
M
5/03/2021 5/03/2025
4,375,000
5/03/2021 5/03/2025
4,000,000
5/03/2021 5/03/2025
4,000,000
5/03/2021 5/03/2025
900,000
5/03/2021 5/03/2025
900,000
5/03/2021 5/03/2025
900,000
1/09/2021
1/09/2025
2,000,000
1/09/2021
1/09/2025
2,000,000
1/09/2021
1/09/2025
2,000,000
21/01/2022 28/01/2026
800,000
21/01/2022 28/01/2026
800,000
-
-
-
-
-
-
-
-
-
-
-
29/11/2022 29/11/2025
29/11/2022 29/11/2026
-
-
4,600,000
4,450,000
year
-
-
-
(150,000)
-
-
-
-
March
March
2023
2023
-
-
-
4,375,000
4,000,000
4,000,000
750,000
-
-
-
-
-
-
-
-
-
900,000
900,000
900,000
900,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
2,000,000
2,000,000
2,000,000
800,000
800,000
4,600,000
4,450,000
TREK METALS LIMITED | ANNUAL REPORT 2023
61
Class Grant date
Expiry Date
Opening
Granted
Expired/
Vested
Rights
Rights
Performance Rights 2022
Balance 1
during
Exercised
during
Vested
Unvested
April 2021
the year
during
the year
at 31
at 31
A
B
C
D
E
F
G
H
I
J
K
5/03/2021
5/03/2025
4,375,000
5/03/2021
5/03/2025
4,375,000
5/03/2021
5/03/2025
4,375,000
5/03/2021
5/03/2025
900,000
5/03/2021
5/03/2025
900,000
5/03/2021
5/03/2025
900,000
-
-
-
-
-
-
1/09/2021
1/09/2025
1/09/2021
1/09/2025
1/09/2021
1/09/2025
21/01/2022
28/01/2026
21/01/2022
28/01/2026
-
-
-
-
-
2,000,000
2,000,000
2,000,000
800,000
800,000
the year
-
(375,000)
(375,000)
-
-
-
March
March
2022
2022
-
-
-
4,375,000
4,000,000
4,000,000
-
-
-
-
-
-
-
-
900,000
900,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
900,000
900,000
2,000,000
2,000,000
2,000,000
800,000
800,000
Valuation of the performance rights was undertaken with the following factors and
assumptions being used in determining the fair value of each right on the grant date.
Class Grant Date
Period
Valuation
Probability
Vesting Conditions
(years)
per right $
Performance Rights
A
5/03/2021
4
$0.0492
100%
B
5/03/2021
4
$0.0452
100%
C
5/03/2021
4
$0.0420
100%
D
5/03/2021
E
F
5/03/2021
5/03/2021
4
4
4
$0.0663
100%
$0.0663
100%
$0.0663
100%
10-day VWAP of shares being greater
than A$0.15 per share.
The holder remains employed or
engaged with the Company for 12
months.
10-day VWAP of shares being greater
than A$0.20 per share.
The holder remains employed or
engaged with the Company for 18
months.
10-day VWAP of shares being greater
than A$0.25 per share.
The holder remains employed or
engaged with the Company for 24
months.
The holder remains employed or
engaged with the Company for 12
months.
The holder remains employed or
engaged with the Company for 18
months.
The holder remains employed or
engaged with the Company for 24
months.
TREK METALS LIMITED | ANNUAL REPORT 2023
62
Class Grant Date
Period
Valuation
(years)
per right $
Probability
Vesting Conditions
Performance Rights (cont.)
G
1/09/2021
4
$0.0725
100%
H
1/09/2021
4
$0.0686
100%
I
1/09/2021
4
$0.0664
100%
J
21/01/2022
4
$0.0909
100%
K
21/01/2022
4
$0.0888
100%
L
29/11/2022
3
$0.0869
95%
M
29/11/2022
4
$0.0825
95%
10-day VWAP of shares being greater
than A$0.15 per share.
The holder remains employed or
engaged with the Company for 12
months.
10-day VWAP of shares being greater
than A$0.20 per share.
The holder remains employed or
engaged with the Company for 18
months.
10-day VWAP of shares being greater
than A$0.25 per share.
The holder remains employed or
engaged with the Company for 24
months.
10-day VWAP of shares being greater
than A$0.20 per share.
The holder remains employed or
engaged with the Company for 12
months.
10-day VWAP of shares being greater
than A$0.25 per share.
The holder remains employed or
engaged with the Company for 24
months.
20-day VWAP of shares being greater
than A$0.10 per share (40%)
The holder remains employed or
engaged with the Company for 12
months (40%)
Board discretion after 12 months
based on KPIs (20%)
60-day VWAP of shares being greater
than A$0.20 per share(40%)
The holder remains employed or
engaged with the Company for 24
months (40%).
Board discretion after 24 months
based on KPIs (20%)
TREK METALS LIMITED | ANNUAL REPORT 2023
63
Grant Date
Expiry Date
Class
Total Valuation
Expense recorded to
31 March 2023
Performance Rights
5 March 2021
5 March 2025
Class A
5 March 2021
5 March 2025
Class B
5 March 2021
5 March 2025
Class C
5 March 2021
5 March 2025
Class D
5 March 2021
5 March 2025
Class E
5 March 2021
5 March 2025
Class F
1 Sept 2021
1 Sept 2025
Class G
1 Sept 2021
1 Sept 2025
Class H
1 Sept 2021
1 Sept 2025
Class I
21 Jan 2022
28 Jan 2026
Class J
21 Jan 2022
28 Jan 2026
Class K
29 Nov 2022
29 Nov 2025
Class L
29 Nov 2022
29 Nov 2026
Class M
$
$215,250
$180,800
$168,000
$59,670
$59,670
$59,670
$145,000
$137,200
$132,800
$72,720
$71,040
$383,563
$363,224
$
$215,250
$180,800
$168,000
$59,670
$59,670
$59,670
$145,000
$137,200
$104,785
$72,720
$41,554
$128,205
$60,620
Expenses arising from share-based payment transactions:
Total expenses arising from share-based payment transactions recognised during the
period as follows:
Expensed to Equity
Options issued to directors and brokers
Expensed to Statement of Profit or Loss
Options issued to staff and consultants
2023
$
2022
$
-
-
260,000
260,000
5,625
15,000
Performance Rights issued to key management personnel
445,263
562,458
Performance Rights issued to staff and consultants
225,707
159,372
Total Share based payments expense
676,595
736,830
676,595
996,830
TREK METALS LIMITED | ANNUAL REPORT 2023
64
NOTE 24: POST-BALANCE SHEET EVENTS
On 2 May 2023, the Company issued 2,000,000 Performance Rights in accordance with the
Incentive Right & Option Plan approved by shareholders.
On 12 May 2023, the Company signed a binding term sheet with Rio Tinto Exploration Pty
Limited (“RTX”), a wholly owned subsidiary of the global mining group Rio Tinto, for an
option to farm-in over its Jimblebar Nickel-Copper Project in the Pilbara region of Western
Australia.
On 25 May 2023, the Company announced a strongly supported two-tranche capital
raising of up to A$7.5 million (before costs) to accelerate exploration across its lithium and
manganese projects in the Pilbara region of Western Australia. On 5th June the company
issued 75 million shares in the capital of the Company (Shares) at an issue price of $0.06
per Share to raise a total of $4.5 million (Tranche One).
In addition, the Company has elected to accept oversubscriptions of an additional A$3.0
million in Shares from directors of the Company and other investors introduced by the
Board in a second tranche which will be subject to shareholder approval (Tranche Two).
The Placement includes a 1:3 free attaching option exercisable at $0.085 per option
expiring 2 years from the date of issue (Attaching Option). Tranche to and all Attaching
Options will be issued subject to shareholder approval at the Company’s Annual General
Meeting scheduled for 28th July 2023. The Company intends to list the Attaching Options,
subject to satisfying ASX Listing Rule requirements.
NOTE 25: REMUNERATION OF AUDITORS
Audit or review of the financial report
Other Non-audit services
31 MAR 2023
31 MAR 2022
$
$
32,303
33,000
-
-
32,303
33,000
The auditor of Trek Metals Limited is Hall Chadwick WA Audit Pty Ltd. The auditor provided
no non-audit services during the year.
TREK METALS LIMITED | ANNUAL REPORT 2023
65
DIRECTORS’ DECLARATION
FOR THE YEAR ENDED 31 MARCH 2023
The Directors declare that:
a)
b)
c)
d)
in the directors’ opinion, there are reasonable grounds to believe that the company
will be able to pay its debts as and when they become due and payable;
in the directors’ opinion, the attached financial statements are in compliance with
International Financial Reporting Standards, as stated in Note 1 to the financial
statements;
in the directors’ opinion, the attached financial statements and notes thereto are
in compliance with accounting standards and giving a true and fair view of the
financial position and performance of the consolidated entity; and
this declaration has been made after receiving a declaration to the directors by
the Chairman and Company Secretary.
On behalf of the Board
John Young
Non-executive Director
22 June 2023
TREK METALS LIMITED | ANNUAL REPORT 2023
66
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF TREK METALS LIMITED
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Trek Metals Limited (“the Company”) and its subsidiaries (“the
Consolidated Entity”), which comprises the consolidated statement of financial position as at 31 March
2023, the consolidated statement of profit or loss and other comprehensive income, the consolidated
statement of changes in equity and the consolidated statement of cash flows for the year then ended, and
notes to the financial statements, including a summary of significant accounting policies, and the directors’
declaration.
In our opinion:
a.
the financial report of Trek Metals Limited presents fairly, in all material respects the consolidated
entity’s financial position as at 31 March 2023 and its financial performance for the year then ended
in accordance with Australian Accounting Standards; and
b.
the financial report also complies with International Financial Reporting Standards as disclosed in
Note 1a.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Those standards require that
we comply with relevant ethical requirements relating to audit engagements and plan and perform the audit
to obtain reasonable assurance about whether the financial report is free from material misstatement. 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 Consolidated Entity in accordance
with the auditor independence requirements of the ethical requirements of the Accounting Professional
and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (the Code) that are
relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical
responsibilities in accordance with the Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the financial report of the current period. These matters were addressed in the context of
our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide a
separate opinion on these matters.
Key Audit Matter
How our audit addressed the Key Audit Matter
Acquisition of Edge Minerals Limited
Procedures performed as part of our assessment of the
During the year, the Group completed its acquisition
of Edge Minerals Limited via the issue of shares. This
transaction was accounted for as an asset acquistiion
with the fair value of consideration of $3,382,232.
This was a key audit matter due to:
•
The size of the transaction having a pervasive
impact on the financial statements; and
•
The complexity in identifying the elements of
consideration and the judgement applied in
determining its fair value.
transaction and the appropriateness of the accounting
treatment applied, included:
• Evaluation of management’s assessment of the
combining entities to determine who obtained
control as a result of the transaction;
• Review of contractual agreements relating to
the acquisition and understanding the key
terms and conditions of the transaction;
• Assessment of
the calculation of
the
consideration;
• Verification of the acquisition date balance
sheet of the acquiree to underlying supporting
documentation;
• Assessment of management’s determination of
the fair value of assets and liabilities acquired;
and
• Assessment of the adequacy of the disclosures
in Note 11 of the financial statements.
Capitalised Exploration and Evaluation Costs
Our audit procedures included but were not limited to:
As disclosed in note 11 to the financial statements, the
• Assessing management’s determination of its
Group has
incurred significant exploration and
areas of interest for consistency with the
evaluation expenditures which have been capitalised
definition in AASB 6 Exploration and Evaluation
in accordance with the requirement of Exploration for
of Mineral Resources (“AASB 6”);
and Evaluation of Mineral Resources (AASB 6). As at
31 March 2023, the Group’s capitalised exploration
and evaluation costs are carried at $8,125,997.
• Confirming rights to tenure for a sample of
tenements held and confirming rights to tenure
on tenements nearing expiry will be renewed;
•
Testing the Group’s additions to capitalised
The recognition and recoverability of the capitalised
exploration costs for the year by evaluating a
exploration and evaluation costs was considered a key
sample of recorded expenditure for consistency
audit matter due to:
•
The carrying value of capitalised exploration
and evaluation costs represents a significant
to underlying
records,
the capitalisation
requirements of the Group’s accounting policy
and the requirements of AASB 6;
asset of
the Group, we considered
it
• By testing the status of the Group’s tenure and
Key Audit Matter
How our audit addressed the Key Audit Matter
necessary
to assess whether
facts and
planned future activities, reading board minutes
circumstances existed to suggest the carrying
and discussions with management we
amount of
this asset may exceed
the
assessed each area of interest for one or more
recoverable amount; and
• Determining whether impairment indicators
of the following circumstances that may indicate
impairment of the capitalised exploration costs:
exist
involves significant
judgement by
•
The licenses for the rights to explore
management.
expiring in the near future or are not
expected to be renewed;
• Substantive expenditure
for
further
exploration in the area of interest is not
budgeted or planned;
• Decision or
intent by
the Group
to
discontinue activities in the specific area
of interest due to lack of commercially
viable quantities of resources; and
• Data
indicating
that,
although
a
development in the specific area is likely
to proceed, the carrying amount of the
exploration asset
is unlikely
to be
recorded
in
full
from
successful
development or sale; and
• Assessing the appropriateness of the related
disclosures in the financial statements.
Share based payments – AUD $676,595
Our procedures included, amongst others:
The share based payment expense has been deemed
• Obtaining a reconciliation of the share based
a key audit matter as a result of the judgement
payments in existence during the period.
involved in determining the inputs to the valuation
• Enquiring with management whether there
model.
have been any new options issued during the
period.
As disclosed in Note 23, during the period the entity
• Obtaining management’s calculation of the fair
granted options to suppliers as part of the
value of options issued during the period and
consideration for work performed and also to
assessing the inputs.
employees and directors under the Employee Share
• Assessing the amount recognised during the
Option Plan.
period against the vesting conditions of the
These options are subject to the measurement and
• Enquiring with management about the vesting
recognition criteria of AASB 2 “Share-based
of options issued in prior periods.
options.
Payments”.
There are various inputs applied to the model used to
calculate the value of the options.
• Ensuring the relevant disclosure is complete
and accurate.
Other Information
The directors are responsible for the other information. The other information comprises the information included in
the Consolidated Entity’s annual report for the year ended 31 March 2023, but does not include the financial report
and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not express any
form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information and, in doing
so, consider whether the other information is materially inconsistent with the financial report or our knowledge
obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other information,
we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the Directors for the Financial Report
The directors of the Company are responsible for the preparation of the financial report that gives a true and fair
view in accordance with Australian Accounting Standards and 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 Note 1a, the directors also state, that the financial report complies
with International Financial Reporting Standards.
In preparing the financial report, the directors are responsible for assessing the Consolidated Entity’s ability 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 Consolidated Entity or to cease
operations, or has no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of the Financial Report
Our responsibility is to express an opinion on the financial report based on our audit. 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 Consolidated Entity’s internal control.
•
•
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates
and related disclosures made by the directors.
Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based
on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that
may cast significant doubt on the Consolidated Entity’s ability to continue as a going concern. If we conclude
that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related
disclosures in the financial report or, if such disclosures are inadequate, to modify our opinion. Our
conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future
events or conditions may cause the Consolidated Entity 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 Consolidated Entity to express an opinion on the financial report. We are responsible for
the direction, supervision and performance of the Consolidated Entity 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, related safeguards.
From the matters communicated with the directors, we determine those matters that were of most significance in
the audit of the financial report of the current period and are therefore the key audit matters. We describe these
matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in
extremely rare circumstances, we determine that a matter should not be communicated in our report because the
adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such
communication.
HALL CHADWICK WA AUDIT PTY LTD
CHRIS NICOLOFF CA
Director
Dated in Perth, Western Australia this 22nd day of June 2023
ADDITIONAL SECURITIES EXCHANGE
INFORMATION AS AT 9 JUNE 2023
STOCK EXCHANGE LISTING
Trek Metals Limited is listed on the Australian Securities Exchange. The Company’s ASX
code is TKM.
SUBSTANTIAL SHAREHOLDERS (HOLDING NOT LESS THAN 5%)
The Company is incorporated in Bermuda as an exempted company and is subject to
Bermudan Law. It is not subject to Chapters 6, 6A, 6B and 6C of the Australian Corporations
Act 2001 dealing with the acquisition of shares (including substantial shareholdings and
takeovers). There were no holders with a greater than 5% interest.
CORPORATE GOVERNANCE STATEMENT
The Company’s Corporate Governance Statement is set out at
https://trekmetals.com.au/corporate/corporate-governance/
CLASS OF SHARES AND VOTING RIGHTS
There are 3,026 holders of 438,945,083 ordinary fully paid shares of the Company. The
voting rights attaching to the ordinary shares are in accordance with the Company’s Bye-
Laws being that:
a)
b)
c)
each Shareholder entitled to vote may vote in person or by proxy, attorney or
Representative;
on a show of hands, every person present who is a Shareholder or a proxy, attorney
or Representative of a shareholder has one vote; and
on a poll, every person present who is a shareholder or a proxy, attorney or
Representative of a shareholder shall, in respect of each fully paid Share held by
him, or in respect of which he is appointed a proxy, attorney or Representative, have
one vote for the Share, but in respect of partly paid Shares, shall, have such number
of votes as bears the proportion which the paid amount (not credited) is of the
total amounts paid and payable (excluding amounts credited).
There are no voting rights attached to the options or rights in the Company. Voting rights
are only applicable to the unissued ordinary shares when options or rights have been
exercised. There is no current on-market buy-back.
TREK METALS LIMITED | ANNUAL REPORT 2023
72
SECURITIES SUBJECT TO VOLUNTARY ESCROW
There are no securities subject to voluntary escrow.
DISTRIBUTION OF SECURITY HOLDERS - SHARES
Number of Shares Held
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Total
Number of Shareholders
621
206
348
1,253
598
3,026
%
0.03
0.14
0.65
11.08
88.10
100.00
The number of shareholders holding less than a marketable parcel is 951 based on the
closing price of the Company’s shares of $0.065.
LISTING OF 20 LARGEST SHAREHOLDERS
Name of Ordinary Shareholder
MR ALEX JORDAN
KALONDA PTY LTD
BIDDLE PARTNERS PTY LTD
MR SCOTT DOUGLAS AMOS + MRS KAREN ELIZABETH AMOS
BNP PARIBAS NOMINEES PTY LTD HUB24 CUSTODIAL SERV LTD
>
CITICORP NOMINEES PTY LIMITED
TIFORP PTY LTD
PILBARA MINERALS LIMITED
MR JOHN ALEXANDER YOUNG + MRS CHERYL KAYE YOUNG
FREIGHT SHOW PTY LTD
MS DANIELLE SHARON TUDEHOPE
MS AMELIA JANE KAZAKOFF
STARCHASER NOMINEES PTY LTD AH & AMB SUPER FUND
A/C>
CHURCH STREET TRUSTEES LIMITED
MR KEVIN JOHN DAVIS
MUSEUM INVESTMENTS LIMITED
MR STEPHEN HENRY MICKENBECKER MRS SANDRA MARGARET
MICKENBECKER
CAMPBELL KITCHENER HUME & ASSOCIATES PTY LTD
FIRST CAR INTERNATIONAL LIMITED
FONT SF PTY LTD
KINGSLANE PTY LTD
1
2
3
4
5
6
7
8
9
10
10
12
13
14
15
16
17
18
19
19
19
Number of
% Shares
shares held
18,066,500
14,475,185
10,313,726
9,739,006
8,385,098
8,324,709
5,000,000
4,792,332
4,760,869
4,500,000
4,500,000
4,000,000
3,900,000
3,333,333
3,040,518
2,869,564
2,707,702
2,671,490
2,500,000
2,500,000
2,500,000
Held
4.12
3.30
2.35
2.22
1.91
1.90
1.14
1.09
1.08
1.03
1.03
0.91
0.89
0.76
0.69
0.65
0.62
0.61
0.57
0.57
0.57
122,880,032
28.01
TREK METALS LIMITED | ANNUAL REPORT 2023
73
DISTRIBUTION OF SECURITY HOLDERS – UNQUOTED SECURITIES
a.) Unlisted Options expiring 30th September 2023 @ $0.056
Number of Options Held
Number of holders
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Total – 10,425,000
-
-
-
-
7
7
Holders greater than 20% - Nil
b.) Unlisted Options expiring 31st October 2023 @ $0.20
Number of Options Held
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Total – 5,000,000
Holders greater than 20%
Number of holders
-
-
-
-
1
1
Name of Holder
Number of holders
Atlantic Capital Holdings Pty Ltd
5,000,000
c.) Unlisted Options expiring 30th June 2024 @ $0.056
Number of Options Held
Number of holders
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Total – 1,500,000
-
-
-
-
2
2
%
-
-
-
-
100
100
%
-
-
-
-
100
100
%
100%
%
-
-
-
-
100
100
Holders greater than 20% - Not applicable – Issued under Employee Incentive Scheme.
TREK METALS LIMITED | ANNUAL REPORT 2023
74
DISTRIBUTION OF SECURITY HOLDERS – UNQUOTED SECURITIES
(CONT.)
d.) Performance Rights
Class
Number of Rights
Number of holders
A
B
C
D
E
F
G
H
I
J
K
L
M
N
O
4,375,000
4,000,000
4,000,000
750,000
900,000
900,000
2,000,000
2,000,000
2,000,000
800,000
800,000
4,600,000
4,450,000
1,000,000
1,000,000
4
3
3
2
2
2
1
1
1
2
2
4
4
1
1
Expiry Date
5th March 2025
5th March 2025
5th March 2025
5th March 2025
5th March 2025
5th March 2025
1st September 2025
1st September 2025
1st September 2025
28th January 2026
28th January 2026
29 November 2025
29 November 2026
1 May 2026
1 May 2027
Total
33,575,000
Holders greater than 20% - Not applicable – Issued under Employee Incentive Scheme
COMPANY SECRETARY
Bermuda
Apex Corporate Services Ltd
Address: Vallis Building, 4th Floor,
58 Par-la-Ville Road
Hamilton HM 11
Australia
Russell Hardwick
PRINCIPAL REGISTERED OFFICE - AUSTRALIA
The address of the principal registered office in Australia is:
Suite 5, 2 Centro Avenue
Subiaco WA 6008
T +61 8 6383 7844
E info@trekmetals.com.au
REGISTER OF SECURITIES
Computershare
Level 11, 172 St Georges Terrace
PERTH WA 6000
P: + 61 8 9323 2018
TREK METALS LIMITED | ANNUAL REPORT 2023
75
SCHEDULE OF TENEMENTS
Tenement
E45/4909
Holder
Interest
ACME Pilbara Pty Ltd
(Western Australia)
(100% owned subsidiary)
E45/4917
ACME Pilbara Pty Ltd
(Western Australia)
(100% owned subsidiary)
E45/6240 (application)
ACME Pilbara Pty Ltd
(Western Australia)
(100% owned subsidiary)
E45/5484
ACME Pilbara Pty Ltd
(Western Australia)
(100% owned subsidiary)
E45/5839
ACME Pilbara Pty Ltd
(Western Australia)
(100% owned subsidiary)
E52/3605
ACME Pilbara Pty Ltd
(Western Australia)
(100% owned subsidiary)
E52/3672
ACME Pilbara Pty Ltd
(Western Australia)
(100% owned subsidiary)
E52/3983
ACME Pilbara Pty Ltd
(Western Australia)
(100% owned subsidiary)
E52/4051
ACME Pilbara Pty Ltd
(Western Australia)
(100% owned subsidiary)
E70/6000
ANAHEIM Pty Ltd
(Western Australia)
(100% owned subsidiary)
E70/6004
ANAHEIM Pty Ltd
(Western Australia)
(100% owned subsidiary)
E70/6072
ANAHEIM Pty Ltd
(Western Australia)
(100% owned subsidiary)
E70/6001
ANAHEIM Pty Ltd
(Western Australia)
(100% owned subsidiary)
E80/5808 (appl)
(Western Australia
E80/5823 (appl)
(Western Australia
E80/5824 (appl)
(Western Australia
EL31260 (appl.)
(Northern Territory)
EL31261 (appl.)
(Northern Territory)
EL31751 (appl.)
(Northern Territory)
EL31752 (appl.)
(Northern Territory)
ELM Resources Pty Ltd
(100% owned subsidiary)
ELM Resources Pty Ltd
(100% owned subsidiary)
ELM Resources Pty Ltd
(100% owned subsidiary)
TM Resources Pty Ltd
(100% owned subsidiary)
TM Resources Pty Ltd
(100% owned subsidiary)
TM Resources Pty Ltd
(100% owned subsidiary)
TM Resources Pty Ltd
(100% owned subsidiary)
E46/616
Edge Minerals Pty Ltd
(Western Australia)
(100% owned subsidiary)
E46/787
Edge Minerals Pty Ltd
(Western Australia)
(100% owned subsidiary)
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
80%
100%
TREK METALS LIMITED | ANNUAL REPORT 2023
76
SCHEDULE OF TENEMENTS (CONT.)
Tenement
E46/835
Holder
Bellpiper Pty Ltd
Interest
100%
(Western Australia)
(100% owned subsidiary)
E46/1159
Edge Minerals Pty Ltd
(Western Australia)
(100% owned subsidiary)
E46/1160
Edge Minerals Pty Ltd
(Western Australia)
(100% owned subsidiary)
E46/1282
Edge Minerals Pty Ltd
(Western Australia)
(100% owned subsidiary)
E46/1304
Edge Minerals Pty Ltd
(Western Australia)
(100% owned subsidiary)
E46/1387
Edge Minerals Pty Ltd
(Western Australia)
(100% owned subsidiary)
R46/002
Edge Minerals Pty Ltd
(Western Australia)
(100% owned subsidiary)
E46/1460 (Application)
(Western Australia)
Edge Minerals Pty Ltd
(100% owned subsidiary)
100%
100%
100%
100%
100%
80%
100%
TREK METALS LIMITED | ANNUAL REPORT 2023
77