United Uranium Limited
(ACN 123 920 990)
Annual Report
For the Period from 13 February 2007 to 30 June
2007
Annual Report 2007
United Uranium Limited
CONTENTS
Corporate Directory
Directors’ Report
Auditor’s Independence Declaration
Income Statement
Balance Sheet
Cash Flow Statement
Statement of Changes in Equity
Notes to the Financial Statements
Directors’ Declaration
Independent Audit Report To The Members
of United Uranium Limited
Corporate Governance Statement
Additional Shareholder Information
Schedule of Mineral Tenements
2
3
13
14
15
16
17
18
34
35
37
43
46
1
Annual Report 2007
United Uranium Limited
CORPORATE DIRECTORY
NON EXECUTIVE CHAIRMAN
Xing Yan (Simon)
EXECUTIVE DIRECTOR
George Lazarou
NON-EXECUTIVE DIRECTORS
Michael Vaughan
Mark Fogarty
COMPANY SECRETARY
Cecilia Chiu
PRINCIPAL & REGISTERED OFFICE
Suite 33, Level 3, 22 Railway Road
SUBIACO WA 6008
Telephone: (08) 9388 8041
Facsimile: (08) 9388 8042
AUDITORS
Rix Levy Fowler
Level 1, 12 Kings Park Road
WEST PERTH WA 6005
SHARE REGISTRAR
Advanced Share Registry Services
110 Stirling Highway
NEDLANDS WA 6009
Telephone: (08) 9389 8033
Facsimile: (08) 9389 7371
STOCK EXCHANGE LISTING
Australian Stock Exchange
(Home Exchange: Perth, Western Australia)
Code: UUL, UULO
2
Annual Report 2007
United Uranium Limited
DIRECTORS' REPORT
The directors of United Uranium Limited submit herewith the financial report of the company for the
financial period ended 30 June 2007. In order to comply with the provisions of the Corporations Act
2001, the directors report as follows:
1.
DIRECTORS
The names and details of the Company’s directors in office since the incorporation of the
company until the date of the report are as follows. Directors were in office for the entire period
unless otherwise stated.
Mr Xing Yan (Simon) – Non-Executive Chairman
Mr George Lazarou – Executive Director
Mr Michael Vaughan – Non-Executive Director
Mr Mark Fogarty – Non-Executive Director
INFORMATION ON DIRECTORS
Xing Yan (Simon) Non-Executive Chairman
Experience
Mr Yan has over 30 years of senior level management experience in
international mining trade. He was part of the management team of
China National Minerals and Metals Import & Export Corporation
(MINMETALS); the largest and most established resource company in
China.
He headed the Non-Ferrous section of MINMETALS and had a stellar
record of being the leading global exporter of Molybdenum Concentrate,
Silicon Metal and Fero-Silicon. He then became the representative of
MINMETALS to Australia in purchasing W.A minerals for the Chinese
market. He established trade relations, this includes the successful iron-
ore export of Robe River to China.
After the tenure of representation, he settled down in Western Australia
and established a number of successful private enterprises of which he
holds directorships. The contact and knowledge about the two country’s
business systems, remains him widely sought as a consultant for
international trade issues.
Interest in Shares
Interest in Options
3,650,000 Fully paid Ordinary Shares
1,000,000
40 cent options exercisable on or before 30/6/10
1,825,000 20 cent options exercisable on or before 30/6/09
3
Annual Report 2007
United Uranium Limited
DIRECTORS' REPORT (Continued)
INFORMATION ON DIRECTORS (Continued)
George Lazarou
Executive Director
Qualifications
BCom, CA
Experience
Mr Lazarou is a qualified Chartered Accountant who has over 13 years’
experience, including 5 years as a Partner with a West Perth accounting
firm, specialising in the areas of Audit, Advisory and Corporate
Services. Mr Lazarou has extensive skills in the areas of audit, corporate
services, due diligence,
reports, merger &
acquisitions and valuations. Mr Lazarou also brings with him a high
level of commercial skills having worked closely with publicly listed
companies in the mining, building, engineering, environmental and
construction industries. Mr Lazarou is also a non-executive director of
Cortona Resources Ltd.
independent expert
Interest in Shares
Interest in Options
350,000 Fully paid Ordinary Shares
1,000,000 40 cent options exercisable on or before 30/6/10
175,000 20 cent options exercisable on or before 30/6/09
Michael Vaughan Non-Executive Director
Qualifications
B.A Grad Dip Bus
Experience
Mr Vaughan has over 20 years commercial experience and has held
State Management positions for private international companies within
the FMCG industry in Western Australia since 1991.
Mr Vaughan qualifies as a professional investor and has created
substantial shareholder value for private companies through personal
ownership and management of small businesses within the FMCG
industry.
For the last 20 years Mr Vaughan has been actively involved as an
investor in the equity markets. Investment focus has been on emerging
and advanced uranium exploration companies for the last 5 years.
Experience in the investment and equity markets has enabled Mr
Vaughan to develop a wide range of contacts within the Western
Australian business community; including Investors and Broking House
Advisors from a number of Investment firms.
Interest in Shares
Interest in Options
350,000 Fully paid Ordinary Shares
1,000,000 40 cent options exercisable on or before 30/6/10
175,000 20 cent options exercisable on or before 30/6/09
4
Annual Report 2007
United Uranium Limited
DIRECTORS' REPORT (Continued)
INFORMATION ON DIRECTORS (Continued)
Mark Fogarty
Non-Executive Director
Qualifications
BSc. M AusIM
Experience
Mr Fogarty has had over fifteen year experience in the mining and
exploration industry in various position, include his current appointment
as Senior Geologist at Scimitar Resources. Mr Fogarty graduated in
2001 with a Bachelor of Science degree.
Mr Fogarty’s experience includes work on Redport Limited’s Lake
five years experience working on
Maitland Uranium Project,
International Goldfields’ Mt Ida Project (including the Baldock
resource) and Evanston Projects, Consolidated Gold’s Orient Well Gold
Project located at Kookynie, WA, Mt Burgess Mining NL’s Butcher
Well mine including exploration on the Red October project, Arimco
NL’s Gidgee Gold Mine, and various projects at Nord Resources
including Karara Gold Mine, Randells, Mount Monger and Barwidgee.
Interest in Shares
Interest in Options
150,000 Fully paid Ordinary Shares
75,000 20 cent options exercisable on or before 30/6/09
Directorships of other listed companies
Directorships of other listed companies held by directors in the 3 years immediately before the
end of the financial period are as follows:
Name
Xing Yan (Simon)
George Lazarou
Company
-
Cortona Resources Limited
Coziron Resources Limited
Period of directorship
-
Appointed 12 January 2006
Appointed 22 May 2006, resigned
15 August 2007.
-
-
Michael Vaughan
Mark Fogarty
-
-
COMPANY SECRETARY
The following persons have held the position of company secretary during or at the end of the
financial period:
Elizabeth Hanrahan (resigned 17 July 2007)
Ms Elizabeth Hanrahan has four years corporate and accounting experience. She has been
involved in the listing of a number of junior mineral exploration companies on ASX in the past
four years and has worked for a number of exploration companies. She has experience in ASX
compliance and regulatory requirements. Ms Hanrahan is also Company Secretary for Red
Emperor Resources NL and Whinnen Resources Limited.
5
Annual Report 2007
United Uranium Limited
DIRECTORS' REPORT (Continued)
COMPANY SECRETARY(Continued)
Cecilia Chiu (appointed 17 July 2007)
Ms Chiu was appointed Company Secretary on 17 July 2007. Ms Chiu is a Certified Practising
Accountant and holds a Bachelor of Commerce degree from the University of Western
Australia. She has more than 7 years accountancy experience. Ms Chiu has previously worked
as an auditor at Ernst & Young, and for 5 years at Ord Partners in West Perth specializing in
mining industry audit and assurance services. Ms Chiu is currently a financial accountant at
Mining Corporate providing corporate and advisory services to the mining industry.
2.
PRINCIPAL ACTIVITIES
The principal activity of the Company during the financial period was uranium exploration.
There were no significant changes in the nature of the Company’s principal activities during the
financial period.
3.
OPERATING RESULTS
The profit of the Company after providing for income tax amounted to $3,173
4.
DIVIDENDS PAID OR RECOMMENDED
The directors do not recommend the payment of a dividend and no amount has been paid or
declared by way of a dividend to the date of this report.
5.
REVIEW OF OPERATIONS
Introduction
Overall, activity for the period was minimal due to the Company listing very late in the
reporting period.
Works undertaken during the period comprised of predominantly administrative and logistical
preparation for proposed field work, and database enhancing and updating.
Corporate
The Company completed the IPO process and successfully list on the Australian Stock
Exchange (“ASX”) on 1st June 2007.
Under the Offer, United Uranium was seeking to raise $5,000,000 of new equity capital by the
issue of 25,000,000 Shares at $0.20 per Share.
Due to high demand, United Uranium was able to complete the raising early and fully
subscribed.
6
Annual Report 2007
United Uranium Limited
DIRECTORS' REPORT (Continued)
5.
REVIEW OF OPERATIONS (Continued)
Review of Operations
1.1 Background
The Company’s primary objective is to build a uranium exploration and mining company at a
time when the global demand for the commodity is increasing significantly.
United Uranium intends to achieve this goal by:
exploring the existing project at Pine Creek;
•
• maintaining a watching brief over the uranium sector in Australia (and overseas) and
•
pursuing uranium development and acquisition opportunities; and
assembling a team of experienced uranium and mining industry professionals to develop a
portfolio of high quality uranium production and advanced exploration assets.
The Company has secured tenements across ground in the Northern Territory which it believes
is prospective.
The Company controls the Pine Creek Project (EL24815) area that has been shown to contain a
number of clusters of first and second order radiometric anomalies that have never been
systematically explored for uranium. The radiometric anomalies are associated with the
favourable lithologies which have hosted uranium deposits in the Pine Creek region.
United Uranium will also undertake research with a view to acquiring additional uranium and
other mineral projects with the intention of developing them into economically mineable
deposits in Australia and overseas.
1.2 Projects
Project Review – Pine Creek Project
The Pine Creek Geosyncline is a major gold and uranium province in the Northern Territory
which also contains many minor Cu, Pb-Zn and Sn mineral occurrences. Many of these
metalliferous deposits have probably formed by the late stage magmatic fluids associated with
post-orogenic granitoids.
Several uranium deposits and prospects in the central and southern Pine Creek Orogeny are
located outside the areas of the uranium fields and are classified as ‘vein type’. Most of these
occurrences, with the exception of Twin and Dam, were discovered during the first phase of
uranium exploration during the early 1950’s. Adelaide River, George Creek and Fleur de Lys
were among some of the earliest uranium mining operations in the Northern Territory, but were
not large enough to attract much interest when compared to the Rum Jungle Mineral Field and
Alligator River deposits. As a consequence there is little geological information available. Ore
was processed at Rum Jungle and a total of 19.7 t of U3O8 was produced from vein type
deposits.
Location
The Pine Creek Project area is approximately 25 kilometres southwest of the small township of
Pine Creek in the Jindare Homestead. Access is gained from the north along the Stuart
Highway and also along the south via all weather tracks from Pine Creek.
7
Annual Report 2007
United Uranium Limited
DIRECTORS' REPORT (Continued)
6.
SIGNFICANT CHANGES IN STATE OF AFFAIRS
The following significant changes in the state of affairs of the Company occurred during the
financial period:
3 ordinary shares at $1.00 each were issued on incorporation of the Company, on 13 February
2007.
On 16 February 2007 the Company issued 8,150,000 ordinary shares at $0.001 each to the
directors and promoters of the Company.
On 15 March 2007 the Company issued 3,250,000 ordinary shares at $0.10 each to raise
$325,000 seed capital.
On 15 May 2007, the Company issued 1,000,000 ordinary shares at $0.20 each to United Mining
Resources Pty Ltd as consideration for acquisition of tenements.
On 1st June 2007, the Company completed an IPO raising $5,000,000 through the issue of
25,000,000 ordinary shares at $0.20 each and successfully listed on Australian Stock Exchange.
There were no other significant changes in the state of affairs of the Company during the
financial period.
7.
AFTER BALANCE DATE EVENTS
On 1 August 2007, the Company lodged a prospectus for a one for two non-renounceable
entitlements issue to its shareholders to raise approximately $187,000 through the issue of up to
18,700,001 new options to subscribe for fully paid ordinary shares in United Uranium. The New
Options are exercisable at 20 cents each on or before 30 June 2009 and were issued for the cost
of 1 cent per option.
No other matters or circumstances have arisen since the end of the financial period which
significantly affected or may significantly affect the operations of the Company, the results of
those operations, or the state of affairs of the Company in future financial years.
8. MEETINGS OF DIRECTORS
The number of directors' meetings held during the financial period each director held office
during the financial period and the number of meetings attended by each director are:
Director
Xing Yan
George Lazarou
Michael Vaughan
Mark Fogarty
Directors Meetings
Number
Eligible to
Attend
4
4
4
2
Meetings
Attended
4
4
4
1
The Company does not have a formally constituted audit committee as the board considers that
the company’s size and type of operation do not warrant such a committee.
8
Annual Report 2007
United Uranium Limited
DIRECTORS' REPORT (Continued)
9.
FUTURE DEVELOPMENTS
The Company will continue its mineral exploration activity at and around its exploration
projects with the object of identifying commercial resources.
10. ENVIRONMENTAL ISSUES
The Company is aware of its environmental obligations with regards to its exploration activities
and ensures that it complies with all regulations when carrying out any exploration work.
11. REMUNERATION REPORT
Remuneration Policy
The remuneration policy of United Uranium Limited has been designed to align director and
executive objectives with shareholder and business objectives by providing a fixed remuneration
component which is assessed on an annual basis in line with market rates and offering specific
long-term incentives based on key performance areas affecting the Company’s financial results.
The board of United Uranium Limited believes the remuneration policy to be appropriate and
effective in its ability to attract and retain the best directors and executives to run and manage
the Company.
The board’s policy for determining the nature and amount of remuneration for board members
and senior executives of the Company is as follows:
The remuneration policy, setting the terms and conditions for the executive directors and other
senior executives, was developed by the board. All executives receive a base salary (which is
based on factors such as length of service and experience) and superannuation. The board
reviews executive packages annually by reference to the Company’s performance, executive
performance and comparable information from industry sectors and other listed companies in
similar industries.
The board may exercise discretion in relation to approving incentives, bonuses and options. The
policy is to attract the highest calibre of executives and reward them for performance that results
in long-term growth in shareholder wealth.
Executives are also entitled to participate in the employee share and option arrangements.
The executive directors and executives receive a superannuation guarantee contribution required
by the government, which is currently 9%, and do not receive any other retirement benefits.
All remuneration paid to directors and executives is valued at the cost to the company and
expensed. Options are valued using the Black-Scholes method.
The board policy is to remunerate non-executive directors at market rates for comparable
companies for time, commitment and responsibilities. The board determines payments to the
non-executive directors and reviews their remuneration annually, based on market practice,
duties and accountability. Independent external advice is sought when required. The maximum
aggregate amount of fees that can be paid to non-executive directors is subject to approval by
shareholders at the Annual General Meeting (currently $250,000). Fees for non-executive
directors are not linked to the performance of the Company. However, to align directors’
interests with shareholder interests, the directors are encouraged to hold shares in the company
and are able to participate in the employee option plan.
9
Annual Report 2007
United Uranium Limited
11. REMUNERATION REPORT (Continued)
DIRECTORS' REPORT (Continued)
Performance based remuneration
The company has no performance based remuneration component built into director and
executive remuneration packages.
Company performance, shareholder wealth and director’s and executive’s remuneration
The remuneration policy has been tailored to increase goal congruence between shareholders
and directors and executives. Currently, this is facilitated through the issue of options to the
majority of directors and executives to encourage the alignment of personal and shareholder
interests. The company believes the policy will be effective in increasing shareholder wealth.
For details of directors and executives interests in options at period end, refer note 13 (f) of the
financial statements.
Employment contracts of key management personnel
For details of service agreements between key management personnel and United Uranium
Limited, refer note 13 of the financial statements.
Compensation of key management personnel for the period ended 30 June 2007
SHORT-TERM BENEFITS
POST EMPLOYMENT
SHARE-BASED
PAYMENT
TOTAL
Salary & Fees Cash Bonus
Non-
Monetary
Superannuation
Retirement
Benefits
Equity
Options
$
Directors
(Simon) Xing Yan – Non-Executive Chairman
2007
4,167
George Lazarou – Executive Director
2007
4,167
Michael Vaughan – Non-Executive Director
2007
3,333
Mark Fogarty – Non-Executive Director
2007
2,083
Total Remuneration
-
-
-
-
-
-
-
-
375
375
300
187
2007
13,750
-
-
1,237
-
-
-
-
-
-
-
4,542
-
-
-
-
-
4,542
-
-
3,633
2,270
-
14,987
10
Annual Report 2007
United Uranium Limited
11. REMUNERATION REPORT (Continued)
DIRECTORS' REPORT (Continued)
Compensation options granted during the period ended 30 June 2007
No compensation options were granted to key management personnel during the financial
period.
Performance income as a proportion of total income
No performance based bonuses have been paid to key management personnel during the
financial period.
12. OPTIONS
At the date of this report unissued ordinary shares of the Company under option are:
Expiry Date
Exercise Price
Number of Shares
30 June 2010
30 June 2009
$0.40
$0.20
3,000,000
18,684,964
15,036 ordinary shares have been issued as a result of the exercise of options during or since the
end of the financial period.
13.
INDEMNIFYING OFFICERS OR AUDITOR
In accordance with the constitution, except as may be prohibited by the Corporations Act 2001
every Officer, auditor or agent of the Company shall be indemnified out of the property of the
Company against any liability incurred by him in his capacity as Officer, auditor or agent of the
Company or any related corporation in respect of any act or omission whatsoever and
howsoever occurring or in defending any proceedings, whether civil or criminal.
14. PROCEEDINGS ON BEHALF OF COMPANY
No person has applied for leave of Court to bring proceedings on behalf of the company or
intervene in any proceedings to which the company is a party for the purpose of taking
responsibility on behalf of the company for all or any part of these proceedings.
The Company was not a party to any such proceedings during the period.
15. AUDITORS INDEPENDENCE DECLARATION
The lead auditor’s independence declaration for the period ended 30 June 2007 has been
received and can be found on page 13 of annual report.
11
Annual Report 2007
United Uranium Limited
16. NON-AUDIT SERVICES
DIRECTORS' REPORT (Continued)
The board of directors is satisfied that the provision of non-audit services performed during the
period by the Company’s auditors is compatible with the general standard of independence for
auditors imposed by the Corporations Act 2001. The directors are satisfied that the services
disclosed below did not compromise the external auditor’s independence for the following
reason:
• The nature of the services provided do not compromise the general principles relating to
auditors independence as set out in the APES 110 (Code of Ethics for Professional
Accountants)
• Total other fees paid or payable to the auditors for non-audit services performed during
the period ended 30 June 2007 is $7,000 for the preparation of Independent
Accountant’s Report.
The board of directors, in accordance with advice from the audit committee, is satisfied that no
non-audit services were performed during the period by the Company’s auditors.
Signed in accordance with a resolution of the Board of Directors.
George Lazarou
Executive Director
Dated this 26th day of September 2007
12
To The Board of Directors
Auditor’s Independence Declaration
under Section 307C of the Corporations Act 2001
This declaration is made in connection with our audit of the financial report of United Uranium
Limited for the period ended 30 June 2007 and in accordance with the provisions of the
Corporations Act 2001.
We declare that, to the best of our knowledge and belief, there have been:
(cid:1)
(cid:1)
no contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit;
no contraventions of the Code of Professional Conduct of the Institute of Chartered Accountants
in Australia in relation to the audit.
Yours faithfully
RIX LEVY FOWLER
Audit & Corporate Pty Ltd
CHRIS WATTS
Director
DATED at PERTH this 26th day of September 2007
13
Annual Report 2007
United Uranium Limited
INCOME STATEMENT
For the Period Ended 30 June 2007
Company
Period ended
30 June 2007
Note
Revenue
Employee benefit expense
Consultancy expense
Exploration costs expensed
Administration
Profit before income tax expense
Income tax expense
Net profit attributable to members
Basic earnings per share (cents per
share)
Diluted earnings per share (cents per
share)
2
4
17
17
$
39,903
(14,081)
(12,600)
(3,000)
(7,049)
3,173
-
3,173
0.02
0.01
The accompanying notes form part of these financial statements.
14
Annual Report 2007
United Uranium Limited
BALANCE SHEET
As at 30 June 2007
Note
Company
2007
$
CURRENT ASSETS
Cash and cash equivalents
Trade and other receivables
TOTAL CURRENT ASSETS
NON CURRENT ASSETS
Exploration assets
Other financial assets
TOTAL NON CURRENT ASSETS
TOTAL ASSETS
CURRENT LIABILITIES
Trade and other payables
Provision
TOTAL CURRENT LIABILITIES
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued Capital
Retained Profits
TOTAL EQUITY
5
6
7
8
9
10
11
12
4,986,762
57,209
5,043,971
201,375
50,000
251,375
5,295,346
22,322
331
22,653
22,653
5,272,693
5,269,520
3,173
5,272,693
The accompanying notes form part of these financial statements.
15
Annual Report 2007
United Uranium Limited
CASH FLOW STATEMENT
For the Period Ended 30 June 2007
Company
Period ended
30 June 2007
$
Note
Cash Flows from Operating Activities
- Interest received
- Payments to suppliers and employees
18,507
(28,681)
Net cash used in operating activities
18 (ii)
(10,174)
Cash Flows from Investing Activities
- Purchase of exploration assets
- Purchase of available for sale investment
Net cash used in investing activities
Cash Flows from Financing Activities
- Proceeds from issue of shares
- Payments for cost of issue of shares
Net cash provided by financing activities
Net increase in cash held
Cash at beginning of financial period
(4,513)
(50,000)
(54,513)
5,331,884
(280,435)
5,051,449
4,986,762
-
Cash at end of financial period
18 (i)
4,986,762
The accompanying notes form part of these financial statements
16
Annual Report 2007
United Uranium Limited
STATEMENT OF CHANGES IN EQUITY
For the Period Ended 30 June 2007
Company
At incorporation
Issue of share capital
Capital raising costs
Profit for the period
Balance at 30 June 2007
Issued
Capital
$
3
5,533,150
(263,633)
-
5,269,520
Retained
Profit
$
-
-
-
3,173
3,173
Total
$
3
5,533,150
(263,633)
3,173
5,272,693
The accompanying notes form part of these financial statements.
17
Annual Report 2007
United Uranium Limited
NOTES TO THE FINANCIAL STATEMENTS
For the Period Ended 30 June 2007
1.
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES
The financial report is a general purpose financial report that has been prepared in accordance
with Australian Accounting Standards including Australian Accounting Interpretation, other
authoritative pronouncements of the Australian Accounting Standards Board and the
Corporations Act 2001.
The financial report covers the Company of United Uranium Limited. United Uranium
Limited is a listed public company, incorporated and domiciled in Australia.
The financial report of United Uranium Limited complies with International Financial
Reporting Standards (IFRS) in their entirety.
The following is a summary of the material accounting policies adopted by the entity in the
preparation of the financial report. The accounting policies have been consistently applied,
unless otherwise stated.
The financial report has been prepared on an accruals basis and is based on historical costs
modified by the revaluation of selected non-current assets, financial assets and financial
liabilities for which the fair value basis of accounting has been applied.
(a) Cash and cash equivalents
Cash and short-term deposits in the balance sheet comprise cash at bank and on hand and
short-term deposits with an original maturity of three months or less.
For the purposes of the Cash Flow Statement, cash and cash equivalents consist of cash
and cash equivalents as defined above, net of outstanding bank overdrafts.
(b) Critical Accounting Judgements, Estimates and Assumptions
The carrying amounts of certain assets and liabilities are often determined based on
estimates and assumptions of future events. The key estimates and assumptions that have
a significant risk of causing a material adjustment to the carrying amounts of certain
assets and liabilities within the next annual reporting period are:
Exploration and evaluation costs
Acquisition, exploration and evaluation expenditure incurred is accumulated in respect of
each identifiable area of interest. These costs are carried forward in respect of an area that
has not at balance sheet 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.
(c) Earnings Per Share
Basic earnings per share (“EPS”) is calculated by dividing the net profit attributable to
members for the reporting period, after excluding any costs of servicing equity, by the
weighted average number of ordinary shares of the Company, adjusted for any bonus
issue.
18
Annual Report 2007
United Uranium Limited
NOTES TO THE FINANCIAL STATEMENTS
For the Period Ended 30 June 2007
1.
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Diluted EPS is calculated as net loss attributable to members, adjusted for, costs of
servicing equity (other than dividends) and preference share dividends; the after tax effect
of dividends and interest associated with dilutive potential ordinary shares that would
have been recognised as expenses; and other non-discretionary changes in revenues or
expenses during the period that would result from the dilution of potential ordinary
shares; divided by the weighted average number of ordinary shares and dilutive potential
ordinary shares, adjusted for any bonus element.
(d) Exploration, Evaluation and Development Expenditure
Exploration, evaluation and development expenditure incurred is accumulated in respect
of each identifiable area of interest. These costs are carried forward only if they relate to
an area of interest for which rights of tenure are current and in respect of which:
(i)
(ii)
such costs are expected to be recouped through successful development and
exploitation or from sale of the area; or
exploration and evaluation activities in the area have not, at balance date, reached a
stage which permit a reasonable assessment of the existence or otherwise of
economically recoverable reserves, and active operations in, or relating to, the area
are continuing.
Accumulated costs in respect of areas of interest which are abandoned are written off in
full against profit in the year in which the decision to abandon the area is made.
A regular review is undertaken of each area of interest to determine the appropriateness of
continuing to carry forward costs in relation to that area of interest.
The recoverability of the carrying amount of the exploration and evaluation assets is
dependent on the successful development and commercial exploitation, or alternatively,
sale of the respective areas of interest.
(e) Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST, except where the
amount of GST incurred is not recoverable from the Australian Tax Office (ATO). In
these circumstances the GST is recognised as part of the cost of acquisition of the asset or
as part of an item of the expense. Receivables and payables in the balance sheet are
shown inclusive of GST.
The net amount of GST recoverable from, or payable to, the ATO is included as a current
asset or liability in the balance sheet.
Cash flows are included in the Cash Flow Statement on a gross basis. The GST
components of cash flows arising from investing and financing activities which are
recoverable from, or payable to, the ATO are classified as operating cash flows.
19
Annual Report 2007
United Uranium Limited
NOTES TO THE FINANCIAL STATEMENTS
For the Period Ended 30 June 2007
1.
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
(f) Impairments
At each reporting date the Company assesses whether there is any indication whether
there is any indication that an asset may be impaired. Where an indication of impairment
exists, the Company makes a formal estimate of recoverable amount. Where carrying
amount of an asset exceeds its recoverable amount the asset is considered impaired and is
written down to its recoverable amount.
Recoverable amount is the greater of fair value less costs to sell and value in use. It is
determined for an individual asset, unless the asset’s value in use cannot be estimated to
be close to its fair value less costs to sell and it does not generate cash inflows that are
largely independent of those from other assets or Company assets, in which case, the
recoverable amount is determined for the cash-generating unit to which the asset belongs.
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.
(g) Income Tax
Deferred income tax is provided on all temporary differences at the balance sheet date
between the tax bases of assets and liabilities and their carrying amounts for financial
reporting purposes.
Deferred income tax liabilities are recognised for all taxable temporary differences:
•
•
except where the deferred income tax liability arises from the initial recognition
of an asset or liability in a transaction that is not a business combination and, at
the time of the transaction, affects neither that accounting profit nor taxable
profit or loss; and
in respect of taxable temporary differences associated with investments in
subsidiaries, associates and interests in joint ventures, except where the timing of
the reversal of the temporary differences will not reverse in the foreseeable future.
Deferred income tax assets are recognised for all deductible temporary differences, carry-
forward of unused tax assets and unused tax losses, to the extent that it is probable that
taxable profit will be available against which the deductible temporary differences, and
the carry-forward of unused tax assets and unused tax losses can be utilised:
•
•
except where the deferred income tax asset relating to the deductible temporary
difference arises from the initial recognition of an asset or liability in a transaction
that is not a business combination and, at the time of the transaction, affects
neither the accounting profit nor taxable profit or loss; and
in respect of deductible temporary differences with investments in subsidiaries,
associates and interests in joint ventures, deferred tax assets are only recognised
to the extent that it is probable that the temporary differences will reverse in the
foreseeable future and taxable profit will be available against which the
temporary differences can be utilised.
20
Annual Report 2007
United Uranium Limited
NOTES TO THE FINANCIAL STATEMENTS
For the Period Ended 30 June 2007
1.
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
(g) Income Tax (Continued)
The carrying amount of deferred income tax assets is reviewed at each balance sheet date
and reduced to the extent that it is no longer probable that sufficient taxable profit will be
available to allow all or part of the deferred income tax asset to be utilised.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to
apply to the year when the asset is realised or the liability is settled, based on tax rates
(and tax laws) that have been enacted or substantively enacted at the balance sheet date.
Income taxes relating to items recognised directly in equity are recognised in equity are
not in the income statement.
(h) Issued Capital
Ordinary shares are classified as equity.
Any transaction costs arising on the issue of ordinary shares are recognised directly in
equity as a reduction of the share proceeds received.
(i) Revenue
Revenue is recognised to the extent that it is probable that the economic benefits will flow
to the Company and the revenue can be reliably measured. The following specific
recognition criteria must also be met before revenue is recognised:
Interest
Revenue is recognised as the interest accrues.
(j) Trade and Other Payables
Liabilities for trade creditors and other amounts are carried at cost which is the fair value
of consideration to be paid in the future for goods and services received, whether or not
billed to the Company.
Payables to related parties are carried at the principal amount. Interest, when charged by
the lender, is recognised as an expense on an accrual basis.
(k) Trade and Other Receivables
Trade receivables, which generally have 30-90 day terms, are recognised and carried at
original invoice amount less an allowance for any uncollectible amounts. An allowance
for doubtful debts is made when there is objective evidence that the Company will not be
able to collect the debts. Bad debts are written off when identified.
Receivables from related parties are recognised and carried at the nominal amount due.
Interest is taken up as income on an accrual basis.
21
Annual Report 2007
United Uranium Limited
NOTES TO THE FINANCIAL STATEMENTS
For the Period Ended 30 June 2007
1.
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
(l) Investments
All investments are initially recognised at cost, being the fair value of the consideration
given and including acquisition charges associated with the investment.
After initial recognition, investments, which are classified as held for trading and
available-for-sale, are measured at fair value. Gains or losses on investments held for
trading are recognised in the income statement.
Gains or losses on available-for-sale investments are recognised as a separate component
of equity until the investment is sold, collected or otherwise disposed of, or until the
investment is determined to be impaired, at which time the cumulative gain or loss
previously reported in equity is included in the income statement.
For investments that are actively traded in organised financial markets, fair value is
determined by reference to Stock Exchange quoted market bid prices at the close of
business on the balance sheet date.
(m) Comparatives
Comparative balances for the Company are not available as it was incorporated during the
financial period, on 13 February 2007.
2. EXPENSES
Profit before income tax has been determined after
following specific expenses:
Employee benefits expense
-Salary
- Exploration costs expensed
3.
AUDITORS’ REMUNERATION
Remuneration of the auditor for:
- Auditing or reviewing the financial report
- Other services
Company
2007
$
14,081
3,000
7,000
7,000
14,000
22
Annual Report 2007
United Uranium Limited
NOTES TO THE FINANCIAL STATEMENTS
For the Period Ended 30 June 2007
Company
2007
$
4.
INCOME TAX
a.
b.
The components of tax expense comprise:
Current tax
Deferred tax
The prima facie tax benefit on loss before income
tax is reconciled to the income tax as follows:
Prima facie tax benefit on profit before income tax at
30%
Add:
Tax effect of:
- Current year revenue losses not recognised
Less:
Tax effect of:
- Exploration and evaluation expenditure deductible
for income tax purposes not recognised
- Other deferred tax balances not recognised
Income tax attributable to entity
The applicable weighted average effective tax rates
are as follows:
c.
The following deferred tax balances at 30%
have not been recognised:
Deferred Tax Assets:
Carry forward revenue losses
Capital raising costs
Property, plant and equipment
Provisions and accruals
Other
Deferred Tax Liabilities:
Exploration expenditure
Other
23
-
-
-
952
78,656
79,608
60,413
19,195
-
0%
78,656
63,560
403
2,199
151
144,969
60,413
6,418
66,831
Annual Report 2007
United Uranium Limited
NOTES TO THE FINANCIAL STATEMENTS
For the Period Ended 30 June 2007
4.
INCOME TAX (Continued)
The tax benefits of the above Deferred Tax Assets will only be obtained if:
(a) the company derives future assessable income of a nature and of an amount sufficient to enable
the benefits to be utilised;
(b) the company continues to comply with the conditions for deductibility imposed by law; and
(c) no changes in income tax legislation adversely affect the company in utilising the benefits.
The above Deferred Tax Liabilities have not been recognised as they have given rise to the carry
recognised.
forward
the Deferred Tax Asset has not been
for which
revenue
losses
Company
2007
$
4,986,762
18,261
38,948
57,209
201,375
-
200,000
4,375
(3,000)
201,375
50,000
5. CASH AND CASH EQUIVALENTS
Current
Cash at Bank
6. TRADE AND OTHER RECEIVABLES
Current
GST Receivable
Other Debtors
7. EXPLORATION ASSETS
Costs carried forward in respect of areas of
interest in:
Exploration and evaluation phases – at cost
Brought forward
Consideration for the exploration assets
acquired during the period
Exploration expenditure capitalised during the
period
Exploration expenditure written off
At reporting date
8. OTHER FINANCIAL ASSETS
Non Current
Available for sale investments
24
Annual Report 2007
United Uranium Limited
NOTES TO THE FINANCIAL STATEMENTS
For the Period Ended 30 June 2007
9. TRADE AND OTHER PAYABLES
Current
Trade creditors
Other creditors and accruals
10. PROVISIONS
Current
Short term provisions
11. ISSUED CAPITAL
Company
2007
$
1,571
20,751
22,322
331
331
(a) 37,400,003 fully paid ordinary shares
(b) 3,000,000 options
5,269,520
-
(a) Movements in fully paid ordinary shares on issue:
Ordinary Shares
At the beginning of the reporting period
Shares issued during the period:
At incorporation at $1.00 each
Promoter shares issued on 16 February
2007 at $0.001 each
Seed capital shares issued on 15 March
2007 at $0.10 each
Vendor shares issued on 15 March 2007
as consideration of tenement acquisition
Initial Public Offering at $0.20 each
Capital raising costs
At reporting date
(b) Movements in options on issue:
Options
At the beginning of the reporting period
Options issued during the period:
Options exercisable at 40 cents on or
before 30 June 2010 for nil consideration
At reporting date
Company
$
-
Number
-
3
3
8,150
8,150,000
325,000
3,250,000
200,000
5,000,000
(263,633)
1,000,000
25,000,000
-
5,269,520 37,400,003
Company
$
-
Number
-
-
-
3,000,000
3,000,000
25
Annual Report 2007
United Uranium Limited
NOTES TO THE FINANCIAL STATEMENTS
For the Period Ended 30 June 2007
11.
ISSUED CAPITAL (Continued)
(c) Terms of Ordinary Shares
Ordinary shares participate in dividends and the proceeds on winding up of the Company in
proportion to the number of shares held and in proportion to the amount paid up on the shares
held.
At shareholders meetings each ordinary share is entitled to one vote in proportion to the paid up
amount of the share when a poll is called, otherwise each shareholder has one vote on a show of
hands.
(d) Terms of Options
At the end of reporting period, there are 3,000,000 options over unissued shares as follows:
•
3,000,000 unlisted options exercisable at 40 cents on or before 30 June 2010
12. RETAINED EARNINGS
Retained earnings at the beginning of the
reporting period
Net profit attributable to members
Retained earnings at the end of the reporting
period
Company
2007
$
-
3,173
3,173
13. KEY MANAGEMENT PERSONNEL DISCLOSURES
(a) Details of key management personnel
The following persons were directors of United Uranium Limited during the financial period:-
Xing Yan (Simon) Non-Executive Chairman
George Lazarou
Michael Vaughan
Mark Fogarty
Executive Director
Non-Executive Director
Non-Executive Director
(b) Remuneration policy of key management personnel
The objective of the Company’s executive reward framework is set to attract and retain the
most qualified and experienced directors and senior executives. The board ensures that
executive reward satisfies the following key criteria for good reward governance practices:
•
•
•
•
Competitiveness
Acceptability to shareholders
Performance linkage
Capital management
26
Annual Report 2007
United Uranium Limited
NOTES TO THE FINANCIAL STATEMENTS
For the Period Ended 30 June 2007
13. KEY MANAGEMENT PERSONNEL DISCLOSURES (Continued)
Directors’ fees
A director may be paid fees or other amounts as the directors determine where a director
performs special duties or otherwise performs services outside the scope of the ordinary duties
of a director. A director may also be reimbursed for out of pocket expenses incurred as a result
of their directorship or any special duties.
Service agreements
Pursuant to an agreement executed on 21 March 2007, George Lazarou will provide services
to the company as an Executive Director. The broad terms of this agreement include:
• on and from the Listing Date $120,000 per annum plus superannuation on a pro-rata
basis; and
The agreement may be terminated by either party by providing 3 months written notice and
upon payment of any outstanding fees for services rendered.
Pursuant to an agreement executed on 21 March 2007, Xing Yan (Simon) will provide
services to the company as an Non-executive Chairman. The broad terms of this agreement
include:
• on and from the Listing Date $50,000 per annum plus superannuation.
The agreement may be terminated by either party by providing 3 months written notice and
upon payment of any outstanding fees for services rendered.
Pursuant to an agreement executed on 21 March 2007, Michael Vaughan will provide services
to the company as an Non-executive Director. The broad terms of this agreement include:
• on and from the Listing Date $40,000 per annum plus superannuation.
The agreement may be terminated by either party by providing 3 months written notice and
upon payment of any outstanding fees for services rendered.
Pursuant to an agreement executed on 21 March 2007, Mark Fogarty will provide services to
the company as an Non-executive Director. The broad terms of this agreement include:
• on and from the Listing Date $25,000 per annum plus superannuation.
The agreement may be terminated by either party by providing 3 months written notice and
upon payment of any outstanding fees for services rendered.
27
Annual Report 2007
United Uranium Limited
NOTES TO THE FINANCIAL STATEMENTS
For the Period Ended 30 June 2007
13. KEY MANAGEMENT PERSONNEL DISCLOSURES (Continued)
(c) Compensation of key management personnel by individual
SHORT-TERM BENEFITS
POST EMPLOYMENT
SHARE-BASED
PAYMENT
TOTAL
Salary & Fees Cash Bonus
Non-
Monetary
Superannuation
Retirement
Benefits
Equity
Options
$
Directors
(Simon) Xing Yan – Non-Executive Chairman
2007
4,167
George Lazarou – Executive Director
2007
4,167
Michael Vaughan – Non-Executive Director
2007
3,333
Mark Fogarty – Non-Executive Director
2007
2,083
Total Remuneration
-
-
-
-
-
-
-
-
375
375
300
187
2007
13,750
-
-
1,237
-
-
-
-
-
-
-
4,542
-
-
-
-
-
4,542
-
-
3,633
2,270
-
14,987
(d) Compensation options: Granted and vested during the period
There were no compensation options granted to key management personnel of the Company
during the period.
(e) Shares issued on exercise of compensation options
There were no shares issued on exercise of compensation options during the period.
(f) Option holdings of key management personnel
2007
Xing Yan (Simon)
George Lazarou
Michael Vaughan
Mark Fogarty
Balance
at
beginning
period
-
-
-
-
-
Granted as
Remuneration
Exercised Bought &
(Sold) (i)
Balance at
30.06.07
Total
Vested at
30.06.07
Total
Exercisable
at 30.06.07
-
-
-
-
-
-
-
-
-
-
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
-
-
-
-
3,000,000
3,000,000
3,000,000
3,000,000
(i) These options were issued to directors as promoters of the Company.
28
Annual Report 2007
United Uranium Limited
NOTES TO THE FINANCIAL STATEMENTS
For the Period Ended 30 June 2007
13. KEY MANAGEMENT PERSONNEL DISCLOSURES (Continued)
(g) Shareholdings of key management personnel
2007
Xing Yan (Simon)
George Lazarou
Michael Vaughan
Mark Fogarty
Balance at
beginning
period
-
-
-
-
-
Granted as
Remuneration
On Exercise of
Options
Bought &
(Sold)
Balance at
30.06.07
-
-
-
-
-
-
-
-
-
-
3,650,000
3,650,000
350,000
350,000
150,000
350,000
350,000
150,000
4,500,000
4,500,000
(h) Loans to key management personnel
No loans were made to key management personnel of the company during the financial period.
(i) Other transactions and balances with key management personnel
During the period United Mining Resources Pty Ltd, a company associated with Mr Xing Yan
received 1,000,000 shares at $0.20 as consideration for the acquisition of tenements.
During the period Mining Corporate Pty Ltd, a company associated with Mr George Lazarou
received $38,500 for the provision of corporate advisory services in relation to the company’s
Initial Public Offering.
During the period, Mining Corporate Pty Ltd also received $4,400 consulting fee for the
provision of company secretarial services, and $1,650 for the provision of office premises and
administrative services to the company.
These costs have not been included in directors’ remuneration as these fees were not paid to
individual directors in relation to the management of the affairs of the Company. All transactions
were entered into on normal commercial terms.
29
Annual Report 2007
United Uranium Limited
NOTES TO THE FINANCIAL STATEMENTS
For the Period Ended 30 June 2007
14.
RELATED PARTY DISCLOSURES
Key management personnel
Disclosures relating to key management personnel are set out in note 13 and the Directors’
Report.
15. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The Company’s principal financial instruments comprise cash and short term deposits. The main
purpose of the financial instruments is to earn the maximum amount of interest at a low risk to
the Company. The Company also has other financial instruments such as trade debtors and
creditors which arise directly from its operations. For the period under review, it has been the
Company’s policy not to trade in financial instruments
The main risks arising from the Company’s financial instruments are interest rate risk and credit
risk. The board reviews and agrees policies for managing each of these risks and they are
summarised below:
(a) Interest Rate Risk
The Company is exposed to movements in market interest rates on short term deposits. The
policy is to monitor the interest rate yield curve out to 120 days to ensure a balance is
maintained between the liquidity of cash assets and the interest rate return. The Company does
not have short or long term debt, and therefore this risk is minimal.
(b) Credit Risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations
resulting in financial loss to the Company. The Company has adopted the policy of only
dealing with credit worthy counterparties and obtaining sufficient collateral or other security
where appropriate, as a means of mitigating the risk of financial loss from defaults.
The Company does not have any significant credit risk exposure to any single counterparty or
any Company of counterparties having similar characteristics. The carrying amount of financial
assets recorded in the financial statements, net of any provisions for losses, represents the
Company’s maximum exposure to credit risk.
30
Annual Report 2007
United Uranium Limited
NOTES TO THE FINANCIAL STATEMENTS
For the Period Ended 30 June 2007
16. FINANCIAL INSTRUMENTS
(a) Interest Rate Risk
The Company’s exposure to interest rate risk and the effective weighted average interest rate
for each class of financial assets and financial liabilities is set out in the following table:
2007
Financial Assets
Cash at bank
Trade & other
receivables
Available for sale
investment
Weighted Average
Interest Rate
Financial Liabilities
Trade & other
creditors
Weighted Average
Interest Rate
Floating
interest
rate
$
Fixed interest maturing in
over 1
year less
than 5
$
1 year or
less
$
more
than 5
years
$
12,438
4,974,324
-
-
-
12,438
-
4,974,324
-%
6.27%
-
-
-
-
-
-
-
-
-
-
-
-
-
Non-Interest
bearing
$
Total
$
-
4,986,762
57,209
57,209
50,000
107,209
50,000
5,093,971
22,322
22,322
22,322
22,322
-
-
-
-
-
-
-
(b) Net fair value of financial assets and liabilities
The carrying amount of cash and cash equivalents approximates fair value because of their
short-term maturity.
17.
EARNINGS PER SHARE
Company
2007
$
(a) Profit used in the calculation of basic earnings per share
3,173
(b) Weighted average number of ordinary shares
outstanding during the reporting period used in
calculation of basic earnings per share:
(c) Weighted average number of ordinary shares
outstanding during the reporting period used in
calculation of diluted earnings per share:
Number of
shares
19,239,784
22,174,091
31
Annual Report 2007
United Uranium Limited
NOTES TO THE FINANCIAL STATEMENTS
For the Period Ended 30 June 2007
18. CASH FLOW INFORMATION
(i) Reconciliation of cash and cash equivalent:-
Company
2007
$
Cash on Bank
4,986,762
(ii) Reconciliation of cash flows from operating
activities with profit after income tax
Profit after income tax
Exploration expenditure written off
Changes in assets and liabilities
- Increase in trade and other receivables
- Increase in trade and other payables
- Increase in provisions
Net cash (outflows) from Operating Activities
(iii) Non-cash financing and investing activities
3,173
3,000
(39,000)
22,322
331
(10,174)
During the period ended 30 June 2007, the Company issued 1,000,000 shares at $0.20 to United
Mining Resources Pty Ltd as consideration for the acquisition of tenements.
19. SEGMENT INFORMATION
The Company operates predominantly in one geographical segment, being Australia and in one
industry, mineral exploration.
20. EVENTS SUBSEQUENT TO REPORTING DATE
On 1 August 2007, the Company lodged a prospectus for a one for two non-renounceable
entitlements issue to its shareholders to raise approximately $187,000 through the issue of up to
18,700,001 new options to subscribe for fully paid ordinary shares in United Uranium. The New
Options are exercisable at 20 cents each on or before 30 June 2009 and were issued for the cost
of 1 cent per option.
No other matters or circumstances have arisen since the end of the financial period which
significantly affected or may significantly affect the operations of the Company, the results of
those operations, or the state of affairs of the Company in future financial years.
21. CONTINGENT LIABILITIES
In the opinion of the directors there were no contingent liabilities at 30 June 2007, and the
interval between 30 June 2007 and the date of this report
32
Annual Report 2007
United Uranium Limited
NOTES TO THE FINANCIAL STATEMENTS
For the Period Ended 30 June 2007
22. COMMITMENTS
(a) Exploration commitments
The Company will have minimum obligations pursuant to the terms and conditions of
prospective tenement licenses in the forthcoming year of $246,000 for exploration commitments
and $13,827 for rental commitments. These obligations are capable of being varied from time to
time, in order to maintain current rights to tenure to mining tenements.
(b) Lease expenditure commitments
The Company has no operating lease commitments, as it is currently leasing premises on a
monthly tenancy.
33
Annual Report 2007
United Uranium Limited
DIRECTORS' DECLARATION
The directors of the company declare that:
1.
the financial statements and notes, as set out on pages 14 to 33, are in accordance
with the Corporations Act 2001:
(a) comply with Accounting Standards and the Corporations Regulations 2001;
and
(b) give a true and fair view of the financial position as at 30 June 2007 and of the
performance for the period ended on that date of the Company; and
2.
the Chief Executive Officer and Chief Financial Officer have each declared that:
(a)
the financial records of the company for the financial period have been
properly maintained in accordance with section 286 of the Corporations Act
2001;
(b) the financial statements and notes for the financial period comply with the
Accounting Standards; and
(c)
the financial statements and notes for the financial period give a true and fair
view.
3.
in the directors’ opinion there are reasonable grounds to believe that the Company
will be able to pay its debts as and when they become due and payable.
This declaration is made in accordance with a resolution of the Board of Directors and
is signed for and on behalf of the directors by:
George Lazarou
Executive Director
Dated this 26th day of September 2007
34
Independent Audit Report
To the Members of United Uranium Limited
We have audited the accompanying financial report of United Uranium Limited (the company), which
comprises the balance sheet as at 30 June 2007, and the income statement, statement of changes in
equity and cash flow statement for the period ended on that date, a summary of significant accounting
policies and other explanatory notes and the directors’ declaration of the company.
As permitted by the Corporations Regulations 2001, the company has disclosed information about the
remuneration of directors and executives (remuneration disclosures), required by Accounting Standard
AASB 124: Related Party Disclosures, under the heading “Remuneration Report” in the directors’ report
and not in the financial report.
Directors Responsibility for the Financial Report
The directors of the company are responsible for the preparation and fair presentation of the financial
report in accordance with Australian Accounting Standards (including the Australian Accounting
Interpretations) and the Corporations Act 2001. This responsibility includes establishing and maintaining
internal control relevant to the preparation and fair presentation of the financial report that is free from
material misstatement, whether due to fraud or error; selecting and applying appropriate accounting
policies; and making accounting estimates that are reasonable in the circumstances. In Note 1, the
directors also state, in accordance with Accounting Standards AASB 101: Presentation of Financial
Statements, that compliance with the Australian equivalents to International Financial Reporting Standards
(IFRS) ensures that the financial report, comprising the financial statements and notes, complies with
IFRS.
The directors also are responsible for preparation and presentation of the remuneration disclosures
contained in the directors’ report in accordance with the Corporations Regulations 2001.
Auditor’s Responsibility
Our responsibility is to express an opinion on the financial report based on our audit. We conducted our
audit in accordance with Australian Auditing Standards. These Auditing Standards require that we comply
with relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain
reasonable assurance whether the financial report is free from material misstatement and that the
remuneration disclosures in the directors’ report comply with Accounting Standard AASB 124.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
financial report. The procedures selected depend on the auditor’s judgment, including the assessment of
the risks of material misstatement of the financial report, whether due to fraud or error. In making those risk
assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation
of the financial report 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 entity’s internal control. An audit also
includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting
estimates made by the directors, as well as evaluating the overall presentation of the financial report and
the remuneration disclosures in the directors’ report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
audit opinion.
35
Independent Auditor’s Report
To the Members of United Uranium Limited (Continued)
Independence
In conducting our audit, we have complied with the independence requirements of the Corporations Act 2001. We confirm that
the independence declaration required by the Corporations Act 2001, provided to the directors of United Uranium Limited on
26th September 2007, would be in the same terms if provided to the directors as at the date of this auditor’s report.
Auditor’s Opinion
In our opinion:
a.
the financial report of United Uranium Limited is in accordance with the Corporations Act 2001, including:
i.
ii.
giving a true and fair view of the company’s financial position as at 30 June 2007 and of its performance for the period
ended on that date; and
complying with Australian Accounting Standards (including the Australian Accounting Interpretations) and the
Corporations Regulations 2001;
b.
the financial report also complies with International Financial Reporting Standards as disclosed in Note 1; and
c.
the remuneration disclosures that are contained in the directors’ report comply with Accounting Standard AASB 124.
RIX LEVY FOWLER
Audit & Corporate Pty Ltd
CHRIS WATTS
Director
DATED at PERTH this 26th day of September 2007
36
Annual Report 2007
United Uranium Limited
CORPORATE GOVERNANCE
The Company is committed to implementing the highest standards of corporate governance. In
determining what those high standards should involve the Company has turned to the ASX Corporate
Governance Council’s Principles of Good Corporate Governance and Best Practice
Recommendations. The Company is pleased to advise that the Company’s practices are largely
consistent with those ASX guidelines. As consistency with the guidelines has been a gradual process,
where the Company did not have certain policies or committees recommended by the ASX Corporate
Governance Council (the Council) in place during the reporting period, we have identified such
policies or committees.
Where the Company’s corporate governance practices do not correlate with the practices
recommended by the Council, the Company is working towards compliance however it does not
consider that all the practices are appropriate for the Company due to the size and scale of Company
operations.
To illustrate where the Company has addressed each of the Council’s recommendations, the following
table cross-references each recommendation with sections of this report. The table does not provide
the full text of each recommendation but rather the topic covered. Details of all of the
recommendations can be found on the ASX Corporate Governance Council’s website at
http://www.asx.com.au/about/CorporateGovernance_AA2.shtm
Recommendation
Recommendation 1.1 Functions of the Board and Management
Recommendation 2.1 Independent Directors
Recommendation 2.2 Independent Chairman
Recommendation 2.3 Role of the Chairman and CEO
Recommendation 2.4 Establishment of Nomination Committee
Recommendation 2.5 Reporting on Principle 2
Recommendation 3.1 Directors’ and Key Executives’ Code of Conduct
Recommendation 3.2 Company Security Trading Policy
Recommendation 3.3 Reporting on Principle 3
Recommendation 4.1 Attestations by CEO and CFO
Recommendation 4.2 Establishment of Audit Committee
Recommendation 4.3 Structure of Audit Committee
Recommendation 4.4 Audit Committee Charter
Recommendation 4.5 Reporting on Principle 4
Recommendation 5.1 Policy for Compliance with Continuous Disclosure
Recommendation 5.2 Reporting on Principle 5
Recommendation 6.1 Communications Strategy
Recommendation 6.2 Attendance of Auditor at General Meetings
Recommendation 7.1 Policies on Risk Oversight and Management
Recommendation 7.2 Attestations by CEO and CFO
Recommendation 7.3 Reporting on Principle 7
Recommendation 8.1 Evaluation of Board, Directors and Key Executives
Recommendation 9.1 Remuneration Policies
Recommendation 9.2 Establishment of Remuneration Committee
Section
1.1
1.2
1.2
1.2
2.3
1.2, 1.4.6, 2.3.2
1.1
1.4.9
1.1 and 1.4.9
1.4.11
2.1
2.1.2
2.1
2.1
1.4.4
1.4.4
1.4.8
1.4.8
2.1.3
1.4.11
2.1.3
1.4.10
2.2.4
2.2
Recommendation 9.3 Executive and Non-Executive Director Remuneration
2.2.4.1 and 2.2.4.2
Recommendation 9.4 Equity-Based Executive Remuneration
Recommendation 9.5 Reporting on Principle 9
Recommendation 10.1 Company Code of Conduct
2.2.4.1
2.2.2 and 2.2.4
3
37
Annual Report 2007
United Uranium Limited
Board of Directors
Role of the Board
1.
1.1
The Board’s role is to govern the Company rather than to manage it. In governing the Company, the
Directors must act in the best interests of the Company as a whole. It is the role of senior management
to manage the Company in accordance with the direction and delegations of the Board and the
responsibility of the Board to oversee the activities of management in carrying out these delegated
duties.
In carrying out its governance role, the main task of the Board is to drive the performance of the
Company. The Board must also ensure that the Company complies with all of its contractual, statutory
and any other legal obligations, including the requirements of any regulatory body. The Board has the
final responsibility for the successful operations of the Company.
To assist the Board carry our its functions, it has developed a Code of Conduct to guide the Directors,
the Chief Executive Officer, the Chief Financial Officer and other key executives in the performance
of their roles.
1.2
To add value to the Company the Board has been formed so that it has effective composition, size and
commitment to adequately discharge its responsibilities and duties given its current size and scale of
operations. Directors are appointed based on the specific skills required by the Company and on their
decision-making and judgment skills.
The Company recognises the importance of Non-Executive Directors and the external perspective and
advice that Non-Executive Directors can offer. Mr Michael Vaughan and Mark Fogarty are Non-
Executive Directors and are independent directors as they meet the following criteria for independence
adopted by the Company:
An Independent Director is a Non-Executive Director and:
Composition of the Board
• is not a substantial shareholder of the Company or an officer of, or otherwise associated
directly with, a substantial shareholder of the Company;
• within the last three years has not been employed in an executive capacity by the Company or
another group member, or been a Director after ceasing to hold any such employment;
• within the last three years has not been a principal of a material professional adviser or a
material consultant to the Company or another group member. Or an employee materially
associated with the service provided;
• is not a material supplier or customer of the Company or another group member, or an officer
of or otherwise associated directly or indirectly with a material supplier or customer;
• has no material contractual relationship with the Company or other group member other than
as a Director of the Company;
• has not served on the Board for a period which could, or could reasonably be perceived to,
materially interfere with the Director’s ability to act in the best interests of the Company; and
• is free from any interest and any business or other relationship which could, or could
reasonably be perceived to, materially interfere with the Director’s ability to act in the best
interests of the Company.
Responsibilities of the Board
1.3
In general, the Board is responsible for, and has the authority to determine, all matters relating to the
policies, practices, management and operations of the Company. It is required to do all things that
may be necessary to be done in order to carry out the objectives of the Company.
Without intending to limit this general role of the Board, the principal functions and responsibilities of
the Board include the following.
• Leadership of the Organisation: overseeing the Company and establishing codes that reflect
the values of the Company and guide the conduct of the Board.
• Strategy Formulation: to set and review the overall strategy and goals for the Company and
ensuring that there are policies in place to govern the operation of the Company.
• Overseeing Planning Activities: the development of the Company’s strategic plan.
38
Annual Report 2007
United Uranium Limited
• Shareholder Liaison: ensuring effective communications with shareholders through an
appropriate communications policy and promoting participation at general meetings of the
Company.
• Monitoring, Compliance and Risk Management: the development of the Company’s risk
management, compliance, control and accountability systems and monitoring and directing the
financial and operational performance of the Company.
• Company Finances: approving expenses and approving and monitoring acquisitions,
divestitures and financial and other reporting.
• Human Resources: appointing, and, where appropriate, removing the Chief Executive Officer
or Managing Director (CEO / MD) and Chief Financial Officer (CFO) as well as reviewing the
performance of the CEO and monitoring the performance of senior management in their
implementation of the Company’s strategy.
• Ensuring the Health, Safety and Well-Being of Employees: in conjunction with the senior
management team, developing, overseeing and reviewing the effectiveness of the Company’s
occupational health and safety systems to ensure the well-being of all employees.
• Delegation of Authority: delegating appropriate powers to the CEO to ensure the effective
day-to-day management of the Company and establishing and determining the powers and
functions of the Committees of the Board.
Full details of the Board’s role and responsibilities are contained in the Board Charter, a copy of which
is available for inspection at the Company’s registered office.
1.4
1.4.1 Conflicts of Interest
Directors must:
Board Policies
• disclose to the Board actual or potential conflicts of interest that may or might reasonably be
thought to exist between the interests of the Director and the interests of any other parties in
carrying out the activities of the Company; and
• if requested by the Board, within seven days or such further period as may be permitted, take
such necessary and reasonable steps to remove any conflict of interest.
If a Director cannot or is unwilling to remove a conflict of interest then the Director must, as per the
Corporations Act, absent himself or herself from the room when discussion and/or voting occurs on
matters about which the conflict relates.
1.4.2 Commitments
Each member of the Board is committed to spending sufficient time to enable them to carry out their
duties as a Director of the Company.
1.4.3 Confidentiality
In accordance with legal requirements and agreed ethical standards, Directors and key executives of
the Company have agreed to keep confidential, information received in the course of the exercise of
their duties and will not disclose non-public information except where disclosure is authorised or
legally mandated.
1.4.4 Continuous Disclosure
The Board has designated the Company Secretary as the person responsible for overseeing and
coordinating disclosure of information to the ASX as well as communicating with the ASX. In
accordance with the ASX Listing Rules the Company immediately notifies the ASX of information:
• concerning the Company that a reasonable person would expect to have a material effect on
the price or value of the Company’s securities; and
• that would, or would be likely to, influence persons who commonly invest in securities in
deciding whether to acquire or dispose of the Company’s securities.
1.4.5 Education and Induction
It is the policy of the Company that new Directors undergo an induction process in which they are
given a full briefing on the Company. Where possible this includes meetings with key executives,
tours of the premises, an induction package and presentations. Information conveyed to new Directors
include:
39
Annual Report 2007
United Uranium Limited
• details of the roles and responsibilities of a Director;
• formal policies on Director appointment as well as conduct and contribution expectations;
• access to a copy of the Board Charter;
• guidelines on how the Board processes function;
• details of past, recent and likely future developments relating to the Board;
• background information on and contact information for key people in the organisation;
• an analysis of the Company;
• a synopsis of the current strategic direction of the Company; and
• a copy of the Constitution of the Company.
Independent Professional Advice
In order to achieve continuing improvement in Board performance, all Directors are encouraged to
undergo continual professional development. Specifically, Directors are provided with the resources
and training to address skills gaps where they are identified.
1.4.6
The Board collectively and each Director has the right to seek independent professional advice at the
Company’s expense, up to specified limits, to assist them to carry out their responsibilities.
1.4.7 Related Party Transactions
Related party transactions include any financial transaction between a Director and the Company.
Unless there is an exemption under the Corporations Act from the requirement to obtain shareholder
approval for the related party transaction, the Board cannot approve the transaction.
1.4.8
The Company respects the rights of its shareholders and to facilitate the effective exercise of those
rights the Company is committed to:
Shareholder Communication
• communicating effectively with shareholders through releases to the market via ASX,
information mailed to shareholders and the general meetings of the Company;
• giving shareholders ready access to balanced and understandable information about the
Company and corporate proposals;
• making it easy for shareholders to participate in general meetings of the Company; and
• requesting the external auditor to attend the annual general meeting and be available to answer
shareholder questions about the conduct of the audit and the preparation and content of the
auditor’s report.
The Company also makes available a telephone number and email address for shareholders to make
enquiries of the Company.
1.4.9 Trading in Company Shares
Due to the size of the Company, the Board does not consider it appropriate to implement a Share
Trading Policy. Rather, it reminds directors, officers and employees of the prohibition in the
Corporations Act 2001 concerning trading in the Company’s securities when in possession of “inside
information”.
1.4.10 Performance Review/Evaluation
It is the policy of the Board to conduct evaluation of its performance. The evaluation process was
introduced via the Board Charter adopted on 1 March 2007 and will be implemented for the financial
period ended 30 June 2007. The objective of this evaluation will be to provide best practice corporate
governance to the Company.
1.4.11 Attestations by CEO and CFO
It is the Board’s policy, that the CEO and the CFO make the attestations recommended by the ASX
Corporate Governance Council as to the Company’s financial condition prior to the Board signing the
Annual Report. However, as at the date of this report the Company does not have a designated CEO or
CFO These roles are performed by the Managing Director and Company Secretary.
2.
2.1
Due to the size and scale of operations of the Company the full Board undertakes the role of the Audit
Committee. Below is a summary of the role and responsibilities of an Audit Committee.
Board Committees
Audit Committee
40
Annual Report 2007
United Uranium Limited
2.1.1 Role
The Audit Committee is responsible for reviewing the integrity of the Company’s financial reporting
and overseeing the independence of the external auditors.
As the whole Board only consists of four (4) members, the Company does not have an audit committee
because it would not be a more efficient mechanism than the full Board for focusing the Company on
specific issues and an audit committee cannot be justified based on a cost-benefit analysis. However,
in accordance with the ASX Listing Rules, the Company is moving towards establishing an audit
committee consisting primarily of Independent Directors.
In the absence of an audit committee, the Board sets aside time to deal with issues and responsibilities
usually delegated to the audit committee to ensure the integrity of the financial statements of the
Company and the independence of the external auditor.
2.1.2 Responsibilities
The Audit Committee or as at the date of this report the full Board of the Company reviews the audited
annual and half-yearly financial statements and any reports which accompany published financial
statements and recommends their approval to the members.
The Audit Committee or as at the date of this report the full Board of the Company each year reviews
the appointment of the external auditor, their independence, the audit fee, and any questions of
resignation or dismissal.
The Audit Committee or as at the date of this report the full Board of the Company is also responsible
for establishing policies on risk oversight and management.
2.1.3 Risk Management Policies
The Board’s Charter clearly establishes that it is responsible for ensuring there is a sound system for
overseeing and managing risk. As the whole Board only consists of four (4) members, the Company
does not have a Risk Management Committee because it would not be a more efficient mechanism
than the full Board for focusing the Company on specific issues.
2.2
2.2.1 Role
The role of a Remuneration Committee is to assist the Board in fulfilling its responsibilities in respect
of establishing appropriate remuneration levels and incentive policies for employees.
As the whole Board only consists of four (4) members, the Company does not have a remuneration
committee because it would not be a more efficient mechanism than the full Board for focusing the
Company on specific issues.
2.2.2 Responsibilities
The responsibilities of a Remuneration Committee, or the full Board include setting policies for senior
officers’ remuneration, setting the terms and conditions of employment for the Chief Executive
Officer, reviewing and making recommendations to the Board on the Company’s incentive schemes
and superannuation arrangements, reviewing the remuneration of both Executive and Non-Executive
Directors and making recommendations on any proposed changes and undertaking reviews of the
Chief Executive Officer’s performance, including, setting with the Chief Executive Officer goals and
reviewing progress in achieving those goals.
2.2.3 Remuneration Policyi
Directors’ Remuneration for the majority of directors was approved at a Board meeting held on 14
June 2006.
2.2.3.1 Senior Executive Remuneration Policy
The Company is committed to remunerating its senior executives in a manner that is market-
competitive and consistent with best practice as well as supporting the interests of shareholders.
Consequently, under the Senior Executive Remuneration Policy the remuneration of senior executive
may be comprised of the following:
Remuneration Committee
•
•
fixed salary that is determined from a review of the market and reflects core performance
requirements and expectations;
a performance bonus designed to reward actual achievement by the individual of performance
objectives and for materially improved Company performance;
41
Annual Report 2007
United Uranium Limited
•
•
participation in any share/option scheme with thresholds approved by shareholders;
statutory superannuation.
Nomination Committee
By remunerating senior executives through performance and long-term incentive plans in addition to
their fixed remuneration the Company aims to align the interests of senior executives with those of
shareholders and increase Company performance.
The value of shares and options were they to be granted to senior executives would be calculated using
the Black and Scholes method.
The objective behind using this remuneration structure is to drive improved Company performance
and thereby increase shareholder value as well as aligning the interests of executives and shareholders.
The Board may use its discretion with respect to the payment of bonuses, stock options and other
incentive payments.
2.2.3.2 Non-Executive Director Remuneration Policy
Non-Executive Directors are to be paid their fees out of the maximum aggregate amount approved by
shareholders for the remuneration of Non-Executive Directors. Non-Executive Directors do not
receive performance based bonuses and do not participate in equity schemes of the Company.
Non-Executive Directors are entitled to but not necessarily paid statutory superannuation.
2.2.4 Current Director Remuneration
Full details regarding the remuneration of Directors, is included in the Directors’ Report.
2.3
2.3.1 Role
The role of a Nomination Committee is to help achieve a structured Board that adds value to the
Company by ensuring an appropriate mix of skills are present in Directors on the Board at all times.
As the whole Board only consists of four (4) members, the Company does not have a nomination
committee because it would not be a more efficient mechanism than the full Board for focusing the
Company on specific issues.
2.3.2 Responsibilities
The responsibilities of a Nomination Committee would include devising criteria for Board
membership, regularly reviewing the need for various skills and experience on the Board and
identifying specific individuals for nomination as Directors for review by the Board. The Nomination
Committee would also oversee management succession plans including the CEO/ MD and his/her
direct reports and evaluate the Board’s performance and make recommendations for the appointment
and removal of Directors. Currently the Board as a whole performs this role.
2.3.3 Criteria for selection of Directors
Directors are appointed based on the specific governance skills required by the Company. Given the
size of the Company and the business that it operates, the Company aims at all times to have at least
two Directors with experience appropriate to the Company’s target market. In addition, Directors
should have the relevant blend of personal experience in accounting and financial management and
Director-level business experience.
3.
Company Code Of Conduct
The Board has decided against the implementation of a code of conduct as it does not believe that it is
in the best interests of its employees or other stakeholders to have what purports to be an exhaustive
code of conduct. The Board feels that such a code may be too prescriptive and not allow the
employees the discretion they need to best serve the Company’s stakeholders.
42
Annual Report 2007
Shareholding
ADDITIONAL SHAREHOLDER INFORMATION
United Uranium Limited
The distribution of members and their holdings of equity securities in the company as at 20 September
2007 was as follows:
Class of Equity Securities
Number Held as at 20 September 2007
Fully Paid Ordinary Shares
1-1,000
1,001 - 5,000
5,001 – 10,000
10,001 - 100,000
100,001 and over
Totals
10
95
220
227
46
598
Holders of less than a marketable parcel:- fully paid shares
1
Substantial Shareholders
The names of the substantial shareholders listed in the Company’s register as at 20 September 2007:
Shareholder
Cheng Rong Wang
Xibo Ma
Xing Yan
Western Investment Holding Pty Ltd
Unquoted Securities
The Company has issued the following unquoted securities:
Number
4,750,000
3,340,000
2,650,000
1,500,000
Class of Equity Security
40 cents options expiring 30 June 2010
Fully paid ordinary shares
Number
3,000,000
10,775,000
Number of Security
Holders
3
25
Restricted Securities
The Company has issued the following restricted securities:
Class of Equity Security
Fully paid ordinary shares
Fully paid ordinary shares
40 cents options expiring 30 June 2010
Number
1,625,000
9,150,000
3,000,000
Date Ceasing To Be
Restricted Securities
15 March 2008
1 June 2009
1 June 2009
43
ADDITIONAL SHAREHOLDER INFORMATION (Continued)
United Uranium Limited
Annual Report 2007
Voting Rights
Ordinary Shares
In accordance with the Company's Constitution, on a show of hands every member present in person
or by proxy or attorney or duly authorised representative has one vote. On a poll every member
present in person or by proxy or attorney or duly authorised representative has one vote for every fully
paid ordinary share held.
Twenty Largest Shareholders
The names of the twenty largest ordinary fully paid as at 20 September 2007 are as follows:
Name
Number of Ordinary
Fully Paid Shares Held
Cheng Rong Wang
Xibo Ma
Xing Yan
Western Investment Holding Pty Ltd
Kam Lan Choo
Stoneham Holdings Aust. Pty Ltd
Kelmine Pty Ltd
Austhong International Group Pty Ltd
Shriver Nominees Pty Ltd
United Mining Resources Pty Ltd
You Lian Zheng
David Jiang
FM104.9 Network Pty Ltd
HSBC Custody Nominees (Australia) Limited
Stephen Brockhurst
Bessarlie Pty Ltd
Michael Vaughan
Xiuzhen Liu
Anthony Brockhurst
Jian Luo Sin
4,750,000
3,340,000
2,650,000
1,500,000
1,450,000
1,150,000
1,100,000
1,100,000
1,000,000
1,000,000
900,000
750,000
650,000
500,000
350,003
350,000
350,000
316,704
300,000
275,000
Held of Issued
Ordinary Capital
(%)
12.695
8.927
7.083
4.009
3.875
3.074
2.940
2.940
2.673
2.673
2.405
2.005
1.737
1.336
0.935
0.935
0.935
0.846
0.802
0.735
TOTAL
23,781,707
63.56
44
Annual Report 2007
United Uranium Limited
ADDITIONAL SHAREHOLDER INFORMATION (Continued)
Twenty Largest Option Holders
The names of the twenty largest holders of $0.20 options expiring 30 June 2009 as at 20 September 2007
are as follows:
Name
Cheng Rong Wang
Xibo Ma
Xing Yan
Kam Lan Choo
Western Investment Holding Pty Ltd
Stoneham Holdings Aust. Pty Ltd
Kelmine Pty Ltd
Austhong International Group Pty Ltd
Shriver Nominees Pty Ltd
United Mining Resources Pty Ltd
You Lian Zheng
Xiu Zheng Liu
David Jiang
FM104.9 Network Pty Ltd
HSBC Nominees (Australia) Limited
Stephen Brockhurst
Bessarlie Pty Ltd
Michael Vaughan
Kouta Bay Pty Ltd
Dan Li & Jian Jun Liu
Number of Options
Held
2,375,000
1,670,000
1,325,000
775,509
750,000
575,000
550,000
550,000
500,000
500,000
450,000
375,000
375,000
325,000
250,000
175,001
175,000
175,000
168,750
160,000
% Held of Issued
Options
12.711
8.938
7.091
4.150
4.014
3.077
2.944
2.944
2.676
2.676
2.408
2.007
2.007
1.739
1.338
0.937
0.937
0.937
0.903
0.856
12,199,260
65.289
45
Annual Report 2007
United Uranium Limited
SCHEDULE OF MINERAL TENEMENTS
Project
Pine Creek
McArthur
Birrindudu
Wiso
Wiso
Dunmarra
Tenement
EL 24815
ELA 25839
ELA 25837
ELA 25835
ELA 25836
ELA 25838
Equity
80%
80%
80%
80%
80%
80%
46