Annual
Report
For The Year Ended
30 June 2022
Company Details
Directors
Evan Cranston - Non-Executive Chairman
James Henderson - Non-Executive Director
Richard Crookes - Non-Executive Director
Paul Quirk - Non-Executive Director
Company Secretary
Ms Louisa Martino
Banker
National Australia Bank Ltd
Level 14
100 St Georges Tce
Perth, WA, 6005
Auditors
BDO Audit (WA) Pty Ltd
Level 9
Mia Yellagonga Tower 2
5 Spring Street
Perth, WA, 6000
Registered Office and Principal Place of Business
Level 10, 27-31 Macquarie Place
Sydney, NSW, 2000
T +61 2 8029 0676
W www.vitalmetals.com.au
E vital@vitalmetals.com.au
Stock Exchange
The Company’s securities are quoted on the official list of the
Australian Securities Exchange Limited (ASX code: VML);
OTCQB Venture Market (OTCQB Code: VTMXF)
Share Registry
Automic Registry Services
Level 5
191 St Georges Terrace
Perth, WA, 6000
T 1300 288 664
Contents
Chairman’s Letter
Review of Operations
Annual Mineral Resource Statement
Tenement Schedule
Directors’ Report
Auditor’s Independence Declaration
Financial Statements
- Consolidated statement of profit or loss and other comprehensive income
- Consolidated statement of financial position
- Consolidated statement of changes in equity
- Consolidated statement of cash flows
- Notes to the consolidated financial statements
Directors’ Declaration
Independent Auditor’s Report to the Members
ASX Additional Information
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1
Vital Metals | Annual Report 2022 Chairman’s
Letter
Dear Fellow Shareholders,
Welcome to the 2022 Annual Report
for Vital Metals Limited (ASX: VML
| OTCQB: VTMXF), as we reflect
on a year that saw our Company’s
continued transformation and
growth as a North American rare
earths producer.
During the year, we outlined our strategy to
become the world’s first producer of commercial
quantities of both light and heavy rare earths
and we are taking the necessary steps to achieve
this goal, which is exciting for our future.
We followed our first mining campaign at
Nechalacho, completed in October 2021, with the
development of our rare earths extraction plant
at Saskatoon in Canada. We are progressing
our goal of rare earth carbonate production
despite challenging and uncertain operating
conditions that have included travel restrictions
and lockdowns, supply chain issues, labour
shortages and rising costs.
Our Saskatoon plant is processing ore mined at
Nechalacho’s North T deposit in the first stage of
our three-stage strategy. We achieved laboratory
test grades for total rare earths of 75% in our first
run during commissioning of the dense media
separation plant, which is an amazing result
and we are working to further optimise our
operations before ramping up to full production.
We achieved laboratory test
grades for total rare earths
of 75% in our first run during
commissioning of the dense
media separation plant,
which is an amazing result
and we are working to further
optimise our operations before
ramping up to full production
Evan Cranston, Chairman
2
As we look to expand our operations, we will
develop the larger Tardiff deposit at Nechalacho to
create a large-scale, long-life rare earths project.
Our drilling at Tardiff returned encouraging
results as we work towards definition of a maiden
Ore Reserve for the Zone 1 module. Tardiff also
returned positive results from Zone 1 metallurgical
testwork that achieved a final concentrate with a
total rare earth oxide (TREO) of 39.9% at a recovery
rate of 53.7%. We are confident this will allow us to
use a similar process flowsheet for the ore mined
at Tardiff as we are using to produce a rare earth
concentrate from North T, with the addition of a
flotation stage. This is very positive for the future
economics of the project.
Our management team has vast experience in
the rare earths sector, including heavy rare earths,
and we will leverage this knowledge to build a
company that can meet the growing demand
for rare earths produced in stable geo-political
territories.
We are proud of our ESG performance. Our
team strives to build respectful relationships
with our Indigenous stakeholders and to be a
leader among emerging production companies
in ensuring benefits to our local communities,
protecting the environment and ensuring the
health and safety of our employees.
During the year, we commenced trading on
the OTCQB, a US trading platform operated by
the OTC Markets Group in New York. While the
ASX remains our primary market, cross-trading
to the OTCQB offers Vital the opportunity to
build visibility, expand liquidity and diversify
our shareholder base in North America on an
established public market. This was an exciting
step for our Company and positions us in a new
peer group.
Post year-end, we completed a transformational
A$45 million targeted Share Placement to
complete our transition from exploration and
development to production and operations.
This allows us to enter the operational phase of
our Saskatoon plant with a robust balance sheet
that can sustain our production well into the
future, as well as accelerate our mining studies
and permitting for Tardiff’s development. We
thank our Shareholders for your support in
this and welcome our new investor Lionhead
Resources Fund, who was the cornerstone of
the placement with a A$30 million investment.
Lionhead brings a wealth of knowledge and
experience that will benefit Vital as we continue
to progress our three-stage strategy.
As part of this investment, we have welcomed
Lionhead representatives, Richard Crookes
and Paul Quirk to our Board as Non-Executive
Directors, as well as Russell Bradford who has
joined our newly formed Technical Advisory
Committee and as interim CEO. This shift heralds
a new era at Vital and we are excited about what
the future holds for our company.
I thank my fellow Directors and our management
team, for their stellar efforts over the past 12
months to help Vital cement its position as an
emerging North American rare earths producer.
It certainly has been a busy and productive year,
and the progress we have achieved has only
been possible with the efforts and teamwork
from people working right across our operations.
Important milestones lie ahead for us in the
coming year, such as our first delivery to REEtec,
as we continue to execute our development
strategy. I am looking forward to sharing our
progress with you over the coming months.
Yours sincerely
Evan Cranston, Chairman
3
Vital Metals | Annual Report 2022 Review of
Operations
Nechalacho Rare Earths Project, Canada
During the year, Vital outlined a strategy to become the world’s first rare earths producer capable
of producing commercial quantities of both heavy and light rare earths, with 2022 work programs
focusing on this. Its three-stage development plan includes:
Vital’s three-stage strategy focuses on growth
via the Tardiff deposit at Nechalacho (which has
a contained REO resource of more than 1 million
contained tons), as well as development of the Wigu
Hill rare earths project in Tanzania, where Vital is
continuing discussions for a Mining Licence.
Vital Metals announced JORC 2012 compliant
Mineral Resources for its Nechalacho project in
December 2019 which included an MRE for the
North T Zone, demonstrating that the deposit
contained two distinct zones of REE mineralisation,
a bastnaesite subzone at surface and an underlying
xenotime subzone.
This was based on updated geological
interpretations and a validated historic database,
prepared according to the 2012 JORC code. Although
historic assays were validated by core duplicates and
the drill coverage was considered adequate, due to
a lack of QAQC records for the historic assays, the
resources were classed as indicated and inferred.
Vital partially mined the bastnaesite zone at North
T in its 2021 mining campaign, and the xenotime
zone lies near the base of the proposed final mining
envelope.
Stage 1: Foundations - North T deposit,
Nechalacho
• Demonstrate the ability to supply rare earth
feedstock at specification critical for rare earth
customer acceptance protocols.
• Generate positive cashflow to fund expansion.
• Transport ore mined at North T for processing at
Saskatoon.
Stage 2: Expansion and Growth
• Tardiff, Nechalacho:
• Large-scale operation to provide long-
term security to the rare earth supply chain
capitalising off a 1 million contained ton rare
earth resource.
• Wigu Hill, Tanzania:
• Provides expansion capability through an
additional project.
• Large carbonatite (6km+ strike) with limited
drilling.
• Multiple projects enable the flexibility to react
quickly to changes in market demand and
customer requirements.
Stage 3: Heavy Rare Earth Production – North T
Xenotime/ Kipawa
• Enables Vital to be a ‘one stop shop’ for the
supply of the full suite of rare earths.
• Enable Vital to meet US requirement for non-
Chinese heavy rare earths.
• Vital to become the first producer of commercial
quantities of both light and heavy rare earths.
4
Xenotime
Subzones
Cut-off grade
(Y2O3)
Tonnage
Nd2O3
%
Indicated
>0.1%
346,270
Inferred
>0.1%
4,700
Not
Estimated
CeO2
%
0.156
0.177
Y2O3
%
0.271
0.224
Indicated
+ Inferred
>0.1%
350,970
0.156
0.270
Table 1 – JORC resources at North T Zone – 2019 1
Mining at Nechalacho
Vital completed a maiden mining campaign at its
100%-owned Nechalacho Rare Earths Project in
Yellowknife, Northwest Territories (“NWT”), Canada
during the period.
Local contract mining company Det’on Cho
Nahanni Construction mined nearly 58,000 tonnes
of ore from the North T pit at Nechalacho during a
five-month campaign, totalling about two thirds
(68%) of overall material planned to be mined
during the campaign, with 408,000 tonnes of the
planned 599,000 tonnes mined.
Vital’s ore sorter at Nechalacho exceeded
expectations, enabling the Company to successfully
sort lower-grade material previously below the
resource cut-off not included in the mine plan.
Vital also intersected a high-grade zone, the
‘dragon’s tail’, at North T during mining which has
prompted the Company to review its mine plan.
This mine plan redesign is scheduled to occur
through 2022.
Vital produced more than 1,000 tonnes of
beneficiated product at site for processing at the
Saskatoon rare earths extraction facility. In addition,
Vital stockpiled nearly 11,000m3 of material on site
at Nechalacho, comprising high-grade (1,630m3)
and low-grade (4,240m3) crushed material and
fines (4,770m3), which it will process on site.
1
Refer ASX Announcement dated 13 December 2019 – Nechalacho Rare Earth Deposit – JORC 2012 Resources. Mineral Resource
Estimation prepared in accordance with JORC 2012 under the supervision of Dr. William Mercer, registered Professional Geoscientist
(P. Geo.) in the Northwest Territories and Ontario, Canada, as the Competent Person. The cut-off grade for this resource estimate is
preliminary, at pre-scoping study level, as no detailed market, metallurgical or engineering studies have been performed.
5
Vital Metals | Annual Report 2022 Drilling adds to development plans
During drilling on Nechalacho’s Tardiff Zone to
design a mine plan for Stage 2 operations, Vital
reported outstanding first-pass assay results
from the Tardiff Zones 2 and 3. The results
added potential to extend the mine life of the
Nechalacho project significantly, with further
drilling needed to better define the Tardiff
zones, which remain open in all directions.
Vital commenced resource definition drilling
at the Tardiff deposit at Nechalacho, with 48
holes planned to follow up on results from its
2021 program at Tardiff Zone 1, aiming to extend
known high-grade REO mineralisation along
the trends. It will use results from 2022 drilling
to update a Mineral Resource Estimate for the
high-grade Tardiff Zone 1 area, aiming to convert
existing Inferred resources to Measured and
Indicated resources, with the potential to be
converted into reserves, with previous drilling
identifying high grade zones opening the
possibility for the contained tonnage to increase.
Tardiff is part of the Upper Zone at Nechalacho,
which boasts an impressive light rare earth
oxides (LREO) resource of 94.7 million tonnes at
1.46% TREO in the measured (2.9 million tonnes
at 1.47%), indicated (14.7 million tonnes at 1.51%)
and inferred (77.1 million tonnes at 1.46%) JORC
2012 categories. Tardiff Zone 1 is a higher-grade
bastnaesite-rich area.
Vital designed the drill plan to extend the north-
northwest-south-southwest trending zone from
the known 75m of strike to 250m of strike length
with three rows of holes to the north and three
rows south of the zone. This aimed to intersect
a zone of +2% REO on the west side of the 2021
drilling pattern that remained open.
The close-spaced drilling at Tardiff Zone 1
defined a strong zone of higher grade REO
mineralisation with wide intersections greater
than 1.5% TREO. The higher grade mineralisation
in Tardiff Zone 1 was drilled on a 25m grid over
250m x 250m with material above 1.5% TREO
open in most directions.
The 2022 drilling program provided a better
understanding of the mineralisation in the
Tardiff Zone 1 area with higher grade TREO
continuing to the southeast with wide intercepts
above 1.5% in the southern portion of the close-
spaced drilling pattern. To the Northwest of the
drilling pattern, the high-grade zone appears
to be closed off with typical Upper Zone grades
around 1.5% TREO in the intercepts in this area. A
deeper zone of higher grade TREO identified in
historic Avalon drillholes in the northeast of the
drilling pattern has been confirmed in the 2022
drilling and warrants follow-up drilling to outline
this higher grade TREO zone. Currently this
deeper higher grade zone is on the northeast
edge of the close spaced drilling pattern.
Best results2 from the program included:
•
13.7m at 3.91% TREO from 10.3m
• 22.95m at 2.21% TREO from 28.45m
• 32m at 2.11% TREO from 60m
• 48.1m at 2.03% TREO from 13m
The 2022 drilling program has provided enough
close spaced drilling data for Vital to create a
resource model for the Tardiff Zone 1 to allow
follow up mining and metallurgical studies to
assess the viability to mining and processing
the Tardiff Zone 1 area and form the basis of an
engineering study for the development of Tardiff.
2 Appendix 2 in Vital Metals ASX Announcement dated 22 July 2022 lists all 2022 drill holes and Table 1
in that announcement lists all significant intercepts above 1% TREO
6
North Tardiff testwork
In June 2022, Vital announced results from
metallurgical testwork completed on samples from
the Tardiff Zone 1 deposit, part of its Nechalacho
rare earths project in Northwest Territories, Canada,
had exceeded the Company’s expectations.
A 550kg sample from Tardiff Zone 1 underwent
testwork to a scoping study level using a similar
flowsheet to that which Vital is using to produce a
rare earth concentrate from the North T deposit at
Nechalacho – sorting and gravity separation with
the addition of a flotation stage.
This three-stage process produced a final
concentrate with a total rare earth oxide (TREO) of
39.9% at a recovery rate of 53.7%. Final concentrate
grades of 39.9% and exceptionally low mass pull of
3.3% will allow Vital to capitalise on a smaller, lower
CAPEX hydrometallurgical plant. Final concentrate
grade for neodymium oxide (Nd2O3) was 7.07% at
an overall recovery of 51.4%.
Testwork was undertaken by Lakefield SGS in
Canada and managed by Independent Metallurgy
Operations (IMO) in Perth, WA, in consultation with
Vital Metals’ COO Tony Hadley, analysing the overall
circuit performance of the:
• Stage 1: Sorting
• Stage 2: Gravity Separation by Dense Media
Separation on coarse material and Shaking
Table on finer material
• Stage 3: Flotation using a multistage
rougher, cleaner flotation circuit to generate
a final concentrate suitable to be fed into a
downstream hydrometallurgical circuit.
A range of grade recovery curves was achieved,
and the high grade 39.9% TREO @ 66% recovery
concentrate (predominantly light rare earth
bastnaesite) will undergo hydrometallurgical
test-work together with a lower grade 20% TREO
concentrate at ~76% recovery (light + heavy rare
earth mineralisation). Results highlight Vital’s
ability to process Tardiff mineralisation through
a similar process flowsheet as Vital is using for
the North T deposit at Nechalacho.
IMO is evaluating sequential flotation testwork
to determine if separate high-grade light and
heavy rare earth concentrates can be generated
from Tardiff mineralisation, to create the
potential for separate processing and revenue
pathways for light and heavy rare earths.
Concentrate
stream
Assays
(%)
Recovery
(%)
Overall Recovery
(%)
TREO
Y2O3
Nd2O3
TREO
Y2O3
Nd2O3
TREO
Y2O3
Nd2O3
Stage 1 Sorting
3.14
0.08
0.57
91.7
90.8
91.4
91.7
90.8
91.4
Stage 2 Gravity
4.57
0.08
0.79
88.8
79.0
88.9
81.4
71.7
81.2
Stage 3 Flotation
39.9
0.27
7.07
66.0
19.0
63.3
53.7
13.6
51.4
Table 2 North Tardiff Testwork Summary (39.9% TREO Final Concentrate Grade)
– refer ASX release 28 July 2022
7
Vital Metals | Annual Report 2022 Cheetah Resources Environmental Officer Cody Drygeese, of the Yellowknives Dene First
Nation, tests a water sample at the Nechalacho Rare Earth Mine water settling pond.
8
Saskatoon rare earth extraction facility, Canada
Vital commenced development of its rare earth
extraction facility in Saskatoon, Saskatchewan,
Canada, during the period, procuring equipment
based on a start-up production capacity of 1,000t/
year excluding cerium (equivalent to 470t/year of
NdPr) with Stage 2 expansion capacity of 2,000t/
year excluding cerium (940t/year NdPr). This
represents a plant throughput 50% larger than
initially planned, with the expanded capacity
providing Vital with the opportunity to further
double its production capacity.
Through its equipment specification and
procurement, Vital has considered which
equipment is necessary for initial plant production
and requirements for an expanded plant
throughput in Stage 2. Of equipment procured,
Vital has oversized some items to satisfy the
requirements for expanded operations.
Vital engaged an experienced “Principal’s
Representative” to oversee the Project’s delivery and
work with Halyard in project managing the delivery
of the works. In addition, Vital signed an agreement
with the Saskatchewan Research Council (SRC) to
provide technical support with the construction
and operation of the plant and ensure ongoing
collaboration between Vital and SRC as it develops
the SRC Rare Earth Processing Facility nearby.
Construction of the plant continued through
the December quarter with all major equipment
ordered and deliveries commencing, however
there were several delays due to shipping
bottlenecks which affected progress, and first
feed into the plant was delayed.
In April 2022, Vital’s wholly owned subsidiary, Vital
Metals Canada Limited (“VMCL”), signed a funding
agreement with PrairiesCan (formerly Western
Economic Diversification Canada) for C$5 million,
provided under Canada’s Jobs and Growth Fund,
which will assist with Vital’s working capital
during ramp-up of the Company’s operations,
including establishing the Saskatoon facility, for
processing bastnaesite concentrate to produce a
mixed rare earth carbonate.
Vital announced it had commenced feeding ore
into a dense media separation (DMS) plant as
part of commissioning the extraction plant in
June 2022. Following this, it announced high-
grade results from the DMS unit commissioning
that were comparable to the total rare earth
oxide (TREO) grade achieved from laboratory
metallurgical testwork3.
3 Vital Metals ASX Announcement 8 July 2022
9
Vital Metals | Annual Report 2022 Results showed the TREO concentrate grade
(the Sinks) from the DMS plant achieved
comparable grades to those seen in testwork,
with 43.7% TREO achieved from the DMS
Cyclone at Saskatoon, compared to 44.6% TREO
achieved in laboratory conditions at SGS.
The DMS unit also achieved 75.2% recovery in its
first run for a single pass, processing ~2,300kg
of concentrate mined at Vital’s Nechalacho rare
earth project (North T zone), sorted onsite and
then crushed at the Saskatchewan Research
Council (SRC) facility adjacent to Vital’s
Saskatoon plant. The SRC is providing technical
support during the construction and operation
of the plant as part of ongoing collaboration,
allowing Vital and SRC to maximise potential
synergies between the two operations.
With the concentrate grade reaching the target,
the plant will now undergo some adjustments
and ultimately further trials will be conducted that
involve taking the tails (floats) from the first pass
and subjecting it to a second scavenging step
to try and increase the recovery further, whilst
maintaining the combined sinks concentrate
grade >40% TREO.
Vital’s sample processed was crushed to -2mm,
with material -2mm and greater than 0.5mm being
fed to the DMS cyclone at SG of 2.7, which was
slightly lower than the target SG of 2.85, providing
opportunities for further optimisation. The -0.5mm
material will be processed through shaking tables
as part of the overall commissioning process. Vital
will use results from the DMS unit’s first run to
finetune its Saskatoon operations.
Products
S.G.
DMS Feed
DMS Con (SINKS)
DMS Tails (FLOATS)
Assays,
% TREO*
Percentage Distribution
(%)
SGS
2.86
27.8
44.6
6.16
Vital
2.70
26.13
43.7
11.8
SGS
–
100.0
90.4
9.6
Vital
–
100.0
75.2
24.8
* The % TREO recovery using the 2 product formula C*(F-T)/F*(C-T)*100 = 75.2% for a single pass.
Table 3 Results from commissioning Vital’s DMS plant at Saskatoon – refer ASX release 28 July 2022
10
Vital will incrementally commission the remaining
circuits of the process flow sheet over the coming
months, with plans to produce a 2.5-tonne rare
earth carbonate sample for offtake partner REEtec
Ag as the next step of product qualification. This
approach will focus on producing product at
specification, minimising off-spec production and
waste, prior to the commencement of production
ramp-up.
Vital’s Saskatoon plant will have initial throughput
capacity of 1,000 tonnes/year of rare earth oxide
(REO) excluding cerium, which is equivalent to
~470t NdPr/year, increasing to 2,000 tonnes/year
REO excluding cerium, equivalent to 940t NdPr/
year, in Stage 2.
Under Vital’s amended offtake agreement with
REEtec, following REEtec’s decision to use Vital’s
product as its principal feedstock for its rare earth
separation facility, Vital will incrementally deliver
187.5t NdPr (contained within approximately 500t
TREO) to REEtec by October 2023 and a minimum
of 750t/year NdPr over five years (total 3,750t
NdPr) contained within approximately 2,000t/
year TREO. Vital’s process will naturally remove
a significant percentage of cerium with the final
product to contain a maximum of 25% cerium.
In April 2022, REEtec signed a supply agreement
with Frankfurt-listed German auto parts supplier
Schaeffler AG (“Schaeffler”) (FRA: SHA). This first
of its kind deal, encapsulating the entire rare
earth supply chain from raw material to electric
motors, secures Vital’s revenue from the sale of its
product to REEtec and confirms REEtec’s viability
as an offtake partner as it progresses to build a
commercial separation facility.
Vital also has a Memorandum of Understanding
(“MOU”) with Ucore Rare Metals (TSX -V: UCU,
OTCQX: UURAF) for Vital to supply rare earth
carbonate feedstock for Ucore’s ALASKA2023
project. Under the MOU, Vital will sell Ucore
a minimum of 500t REO (ex-cerium)/year,
commencing H1 2024.
Kyle Beyha, a Sahtu Dene and night shift
supervisor at the North T rare earth mine.
11
Vital Metals | Annual Report 2022 Heavy rare earths projects
Vital signed a binding term sheet with Quebec
Precious Metals Corporation (TSX.V: QPM, OTCQB:
CJCFF, FSE: YXEP) (“QPM”)) to acquire QPM’s 68%
interest in the Kipawa exploration project and
100% interest in the Zeus exploration project (the
“Projects”) for C$8m, payable over four years.
Joint Venture partner Investissement Québec
(“IQ”) holds the remaining 32% of the Kipawa
project on a contributing basis.
Kipawa is a heavy rare earths project, located
50km from Temiscaming in Quebec, with a non-
JORC compliant Mineral Resource Estimate4. It
is defined by three enriched horizons within the
“Syenite Complex”, which contains some light rare
earth oxides but primarily heavy rare earth oxides.
Drilling since 2011 totals 293 drill holes (24,571m) and
was used to prepare a feasibility study which was
completed by Matamec Explorations Inc. in 2013.
The Projects total 73 claims over 43km2 and lie in
the Grenville geological province, approximately
55km south of the geological contact with the
Superior geological province. The lithologies
consist mainly of gneiss with a grade of
metamorphism ranging from the greenschist
facies to the amphibolite-granulite facies.
The Company's xenotime resource at North T sits
beneath the base of the current mining envelope
allowing Vital to accelerate plans to become a
producer of both rare earths groups.
4 ASX Announcement 11 August 2021: Vital Metals Ltd enters agreement to acquire heavy rare earths projects
The Yellowknives Dene Drummers performed traditional songs and hand games for guests at the unveiling of Vital's Rare Earth
Processing Facility in Saskatoon in September, 2022.
From left: Ethan Sundberg, Gordie Liske, Randy Baillargeon, Paul Betsina, Blake Baillargeon and Cody Drygeese.
12
Denenu Kue Chief Louis Balsillie and his family with a load of core boxes made at Fort
Resolution, NWT. They hauled the load via Cheetah's ice road in the spring of 2021.
13
Vital Metals | Annual Report 2022 Rare earth offtake agreements
Vital amended its offtake agreement with Norway-
based REEtec AS (“REEtec”), increasing the volume
of product sold to REEtec by 50%.
Under the amended agreement, Vital will sell to
REEtec rare earth carbonate product containing
a minimum of 750t Neodymium/Praseodymium
(NdPr), contained within 2,000t/year total rare earth
oxides (TREO) with a maximum of 25% Cerium.
This represents a total of 75% of Vital’s expanded
operation at its Saskatoon rare earths extraction
plant, and represents a 50% increase in the product
to be supplied under the existing Definitive Offtake
Agreement announced in February 2021.
The amended agreement extends Vital’s product
sales to REEtec to 2028 and provides the option
to further expand operations during an additional
10-year long-term supply agreement to provide up
to 2,500t NdPr per annum contained within ~6,800
tonnes TREO (containing a maximum 25% cerium).
In addition, Vital signed a non-binding
Memorandum of Understanding (“MOU”) with
rare earth processing technology developer Ucore
Rare Metals Inc. (TSX-V: UCU, OTCQX: UURAF,
“Ucore”) for the supply of rare earth carbonate.
Ucore is focused on developing rare earth
processing technologies through its ALASKA2023
project, with the goal of fostering an independent
American REE supply chain and it aims to secure
a US allied REE feedstock source.
The main terms of the non-binding MOU are as
follows:
• Vital will sell to Ucore a minimum of 500t REO
(ex-cerium)/year by H1 2024.
• Vital will expand its operations to supply to
Ucore a minimum of 50% of Ucore’s proposed
5,000t TREO/year RE separation plant by 2026.
• Customer acceptance protocols will include
the supply of a sample (1-2kg)
ESG Performance
The Company continues to build mutually respectful
relationships with our Indigenous stakeholders.
Cheetah was recognised as "the first mining
company in Canada to contract an Indigenous
group to be a miner on their traditional lands".
Compared to its peers, the Company achieved
outstanding Indigenous and local employment
and procurement levels and was a leader in
introducing COVID-19 protection for its employees.
The Company is widely acknowledged for its
environmental innovation and adapting and
adopting technologies such as sensor-based ore
sorting that significantly reduce environmental
impact.
The Nechalacho mine hosted Indigenous,
community, regulatory, government, and
academic visitors seeking to learn about Vital's
ESG approach and Canada's first rare earth mine.
Post-year-end, Cheetah Resouces completed its
first Towards Sustainable Mining Gap Audit to
qualify for membership in the Mining Association
of Canada.
14
Wigu Hill Project
Tanzania
The Company continued
discussions with the Tanzanian
Government regarding the
issuance of a Mining Licence
(ML) for the Wigu Hill rare earth
project during the period.
Nahouri Gold Project
Burkina Faso
There were no exploration
activities at Vital’s Burkina Faso
project during the period.
Aue Cobalt Project
Germany
There were no exploration
activities at Vital’s Aue project
during the period.
15
Vital Metals | Annual Report 2022 Compliance Statements
This Annual Report contains information relating
to Mineral Resource Estimates in respect of the
Nechalacho Project extracted from ASX market
announcements reported previously and published
on the ASX platform on 13 December 2019 and 15
April 2020. The Company confirms that it is not
aware of any new information or data that materially
affects the information included in the original
market announcements and that all material
assumptions and technical parameters underpinning
the estimates in the original market announcements
continue to apply and have not materially changed.
This Annual Report contains information relating
to Exploration Results extracted from ASX market
announcements reported previously and published
on the ASX platform on 8 July 2022, 22 July 2022 and
28 July 2022. The Company confirms that it is not
aware of any new information or data that materially
affects the information included in the original
market announcement.
16
The TOMRA sensor-based sorter uses x-ray, computer and air jet technology to dry-sort
bastnaesite ore from country rock without water or chemicals.
17
Vital Metals | Annual Report 2022 Annual Mineral
Resource Statement
Nechalacho Rare Earths Project
The Company’s Mineral Resources Statement has been complied and is reported in accordance with the
Australasian Code of Reporting of Exploration Results, Mineral Resources and Ore Reserves (the JORC 2012
edition) and Chapter 5 of the ASX Listing Rules.
Vital’s governance arrangements and internal controls for reporting its Mineral Resources Estimate includes
reporting on an annual basis and in compliance with the 2012 Edition of JORC and the ASX Listing Rules. The
Competent Person is suitably qualified and experienced, as defined in the 2012 Edition of JORC.
As at 30 June 2022, the Nechalacho Rare Earths Project has Mineral Resource Estimates, as defined in Tables
4 and 5 below. There have been no changes to the Mineral Resource Estimates for the Upper Zone since the
2021 Annual Resources Statement. The North T Mineral Resource estimates have been depleted by mining
since the 2021 Annual Resource Statement. The depleted Mineral Resource estimates for the North T are
stated in Table 5 below.
Confidence
category
ND2O3
cut-off
grade
(%)
Measured
Indicated
Inferred
Total
0.1
0.1
0.1
0.1
Tonnage
REO
Vital
HREO
ND2O3
PR6O11
(Mt)
2.914
(%)
(%)
(%)
(%)
(%)
1.468
1.326
0.142
0.288
0.077
14.662
1.508
1.372
0.137
0.295
0.080
77.159
1.456
1.323
0.133
0.291
0.077
94.735
1.464
1.330
0.134
0.291
0.078
Table 4 – Nechalacho Rare Earths Project, Canada Mineral Resource Estimates for the Tardiff Upper Zone
– refer ASX release 13 December 2019
Confidence
category
30 June 2021
2021 – 2022 Depletion
30 June 2022
Kilo
Tonnes
LREO
(%)
LREO
Tonnes
Kilo
Tonnes
LREO
(%)
LREO
Tonnes
Kilo
Tonnes
LREO
(%)
LREO
Tonnes
Measured
Indicated
68
33
9.60
6,528
7.80
2,574
Total
101
9.01
9,102
4
3
7
5.87
228
10.07
313
7.74
541
64
30
94
9.83
6,300
7.56
2,261
9.11
8,561
Table 5 – Nechalacho Rare Earths Project, Canada Mineral Resource Estimates
for the North T Deposit after mining depletion in 2021
– refer ASX release 15 April 2020
18
Nechalacho Rare Earths Project
The annual Mineral Resources Estimate in respect of the Nechalacho Rare Earths Project is based on, and
fairly represents, information and supporting documentation prepared by a competent person. The Mineral
Resource Estimate as a whole has, as to the form and content in which it appears in the Annual Report, been
approved by Mr Brendan Shand. Mr Shand is a Competent Person, a member of the Australasian Institute of
Mining and Metallurgy and an employee of the Company. Mr Shand has sufficient experience that is relevant
to the style of mineralisation and type of deposit under consideration and to the activity being undertaken
to qualify as a Competent Person, as defined in the 2012 Edition of the ‘Australian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves’. Mr Shand consents to the inclusion in the report of
the matters based on his information in the form and context in which it appears.
Tenement Schedule
The Group’s tenement schedule is as follows:
Location
Canada
Burkina Faso
Germany
Tanzania
Tenement
Beneficial Interest
Nechalacho*
Nahouri
Kampala
Zeko
Aue
Wigu Hill**
100%
100%
100%
100%
100%
0%
* Vital owns 100% of the mineral rights of the Nechalacho Project above the 150 m elevation level
** Vital has signed a project development and option agreement to acquire Wigu Hill. The Company has the right to
acquire the licence upon the issuance of the licence by the Tanzanian Government
19
Vital Metals | Annual Report 2022 Directors’
Report
The Board of Directors present their report on the Consolidated
entity (referred to hereafter as the Group) consisting of Vital Metals
Limited and the entities it controlled at the end of, or during the
year ended 30 June 2022.
Directors
The names and details of the Company’s directors in office during the financial year and until the
date of this report are as follows. Where applicable, all current and former directorships held in listed
public companies over the last three years have been detailed below. Directors were in office for this
entire period unless otherwise stated.
Photo Below: : Nechalacho is resupplied by a 130 km ice road from Yellowknife. It was opened in March of 2021 by former Yellowknives
Dene Chief Ernest Betsina, flanked by Cheetah officials David Connelly and Ray Anguelov.
20
Names, qualifications, experience and special responsibilities
Mr Evan Cranston
Non-Executive Chairman
Mr Cranston is an experienced mining executive with a background in corporate and mining law.
He is the principal of corporate advisory and administration firm, Konkera Corporate and has
extensive experience in the areas of equity capital markets, corporate finance, structuring, asset
acquisition, corporate governance and external stakeholder relations. He holds both a Bachelor
of Commerce and Bachelor of Laws from the University of Western Australia. Mr Cranston is a
former Non-Executive Director of New Century Resources Limited (ASX: NCZ) and Boss Resources
Limited (ASX: BOE). He is currently Executive Chairman of African Gold Ltd (ASX: A1G), Non-
Executive Director of Carbine Resources Limited (ASX: CRB), Non-Executive Chairman of Firebird
Metals Limited (ASX: FRB) and Chairman and Director of TSX-listed Benz Mining Corp (TSX-V:BZ).
Photo Below: Vincent Laniece, General Manager of Vital's Saskatoon Rare Earth Processing Facility, explains the soon-to-be completed
plant and its processes to some of the 200 guests during the Rare Earth Summit in September, 2022
21
Vital Metals | Annual Report 2022 Mr Geoff Atkins
(ceased 2 September 2022)
Managing Director
Mr Atkins is a Civil Engineer with over 20
years of project and corporate development
experience across commercial, industrial,
mining and infrastructure sectors
with responsibility for driving projects
from concept, through feasibility and
development to operational assets.
Mr Atkins is not a director of any other ASX-
listed Company.
Mr James Henderson
Non-Executive Director
Mr Henderson is currently Executive Chairman
of Transocean Group Pty Ltd, a corporate
advisory and private equity group focused on
the emerging company market. His expertise is
in the area of corporate strategy and structuring,
capital raising and commercial negotiation.
Mr Henderson has led teams on a variety of
transactions including mergers, acquisitions,
dispositions, takeovers, and capital raisings
particularly in Australia, Canada, the USA and
Africa and was a founding shareholder in
Cheetah Resources Pty Ltd.
Mr Henderson is also a Non-Executive Director
of Compass Gold Corporation (TSX-V: CVB).
22
Teams from Vital Metals’ Saskatoon plant and Cheetah Resources’ Yellowknife office met at the Saskatoon plant during the Rare
Earth Summit in September 2022. From left: Ryan Frey, Metallurgist; Laurette Lefol, Finance Manager; David Connelly, VP Strategy and
Corporate Affairs; Paul Henry, Director of Cheetah Resources Corp. and Vital Metals Canada Ltd.; Sheldon Hill, Construction Engineer; ;
Nicole Tews, Cheetah Office Manager; Matthew Edler, Executive VP Vital Metals; Cody Drygeese, Environmental Officer. Kneeling: Sarah
Campbell, Cheetah Events Manager; Vincent Laniece, General Manager Operations (Sask); Russel Bradford, interim CEO, Vital Metals.
23
Vital Metals | Annual Report 2022 As the world recognises the importance of reliable supply systems, guests
from multiple governments and four nations joined interim CEO Russell
Bradford (centre, with tie) in symbolically linking together two chains to
show their role in the world's first rare earth supply chain of friends and allies.
From left: Aaron Carroll, First Secretary, Australian High Commission in Canada; Kimberly Lavoie,
Director General, Natural Resources Canada; Dr. Abdul Jalil, Assistant Deputy Minister, Prairies
Canada; Mayor Charlie Clark, City of Saskatoon; Hon. Caroline Wawzonek, NWT Minister of
Industry, Trade and Investment; Chief Ed Sangris, Yellowknives Dene First Nation; Ron Hyggen,
Treaty 6 representative; Russell Bradford, Interim CEO, Vital Metals Ltd.; Hon. Jeremy Harrison,
Saskatchewan Minister of Trade and Export Development; Milton Tootoosis, Metis representative;
Heather Quale, Honourary Norwegian Consul; Yvonne Denz, Canadian German Chamber of
Industry and Commerce; Andrew McIntyre, US Dept of State Consulate General – Calgary.
24
25
Vital Metals | Annual Report 2022 Mr Richard Crookes
(appointed 10 August 2022)
Mr Paul Quirk
(appointed 10 August 2022)
Non-Executive Director
Non-Executive Director
Mr Crookes is currently the Managing Partner of
Lionhead Resources (LHR) and Chairman of the
Investment Committee. He has more than 35
years of global resource industry experience across
a diverse range of projects, geographies and
commodities as both an operator and investor.
Mr Crookes is a former Chief Geologist and Mining
Manager or Ernest Henry Mining (ASX: EVN) and
an Executive Director of Macquarie’s Metals &
Energy Capital division.
Mr Quirk is currently a partner at Lionhead
Resources (LHR) and is responsible for originating
new investments opportunities and building and
maintaining investor relations.
Prior to LHR, Mr Quirk co-founded Lionhead Capital
Partners, a multi-strategy principal investment firm
focused on mining, real estate and private equity
investing. Mr Quirk was one of the founding partners
of Cora Gold, a gold exploration and development
company operating in Mali.
Mr Crookes is the Chairman of Black Rock Mining
(ASX: BKT) and a Non-Executive Director of
Lithium Power International (ASX: LPI).
Mr Quirk holds a Bachelor of Commerce in
Accounting and Finance from the Northeastern
University.
Mr Crookes holds a Bachelor of Science in Geology
and a Graduate Diploma in Applied Finance, is a
member of the Australasian Institute of Mining
and Metallurgy (AusIMM), a Fellow of the Financial
Services Institute of Australia (FINSIA) and a
member of the Australian Institute of Company
Directors (AICD).
Company Secretary
Ms Louisa Martino
Company Secretary
Ms Martino has a Bachelor of Commerce from the University of Western Australia, is a member of the
Institute of Chartered Accountants Australia & New Zealand (ICAA), a member of the Financial Services
Institute of Australasia (FINSIA) and a fellow of the Governance Institute of Australia (FGIA). She provides a
number of listed companies with company secretarial services and has worked within corporate finance,
assisting with company compliance and capital raisings. Ms Martino holds the position of Company
Secretary for listed companies, PYX Resources Ltd (NSX: PYX), Cokal Ltd (ASX: CKA), EV Resources Ltd
(ASX: EVR), and Oklo Resources Ltd (ASX: OKU).
26
Principal Activities
The principal activities of the Group during the
year were mineral exploration and development in
Burkina Faso, Tanzania, Germany and Canada.
Cheetah Geologist Sarah
Bodeving in front of the TOMRA
ore sorter that significantly
reduces the environmental
footprint of mining.
27
Vital Metals | Annual Report 2022 Corporate
Increased US investor focus
Vital entered into an agreement for the provision
of capital markets consulting and advisory services
with Ecoban Securities Corporation (“Tectonic”).
Tectonic will serve as the Company’s North American
investor relations and capital markets consultant
and advisor, having played a key role in Vital’s $43M
capital raising in March 2021.
Vital secures C$5 million funding facility
Vital’s wholly owned subsidiary, Vital Metals
Canada Ltd (“VMCL”), signed a funding agreement
with PrairiesCan (formerly Western Economic
Diversification Canada) for C$5 million, provided
under Canada’s Jobs and Growth Fund.
The C$5m funding will assist with Vital’s working
capital during ramp-up of the Company’s operations,
including establishing the Saskatoon Rare Earth
Extraction facility in Saskatchewan, for processing
bastnaesite concentrate to produce a mixed rare
earth carbonate. Activities associated with the
new plant, for which funding is available, include
engineering and design, equipment purchase
and installation, commissioning, and optimization
to finalise establishment of the new processing
facilities.
The funding relates to reimbursement of 32% of
eligible expenditure incurred by VMCL from 19 April
2021 to March 31 2023 in respect of the Saskatoon
Plant, with a maximum reimbursement of $3m for
expenditure incurred to 31 March 2022 and C$2m for
expenditure incurred to 31 March 2023.
Terms of the PrairiesCan Repayable Contribution are
as follows:
• Amount of the repayable contribution: C$5
million;
• Term of the repayable contribution: monthly
payments over 5 years commencing 1 April 2024;
•
Interest rate: 0%;
• Funds are repayable at any time without penalty,
there is no security associated with the repayable
contribution;
• Termination occurs upon full repayment of the
contribution and receipt of final report by the
government.
Vital joins OTCQB
Vital’s shares commenced trading on the OTCQB
Venture Market (OTCQB), a US trading platform
operated by the OTC Markets Group in New York, on
11 March 2022 following the Company’s successful
application.
OTC is the largest Alternative Trading System in
the US, with more than 11,000 securities quoted on
that market. Cross-trading to the OTCQB offers the
Company the opportunity to build visibility, expand
liquidity and diversify its shareholder base in North
America on an established public market.
The Company’s primary listing remains on the
Australian Securities Exchange (ASX). Streamlined
market standards enable the Company to utilise
its ASX reporting, with no additional compliance
requirements, and make its information available in
the US. The Company confirms that admission to the
OTCQB is non-dilutive because no additional capital
is required to be raised and no new Shares will be
issued in conjunction with inclusion on the OTCQB.
28
The Company also applied to the Depository Trust
Company (“DTC”) for eligibility which would greatly
simplify the process for North American investors
trading the Company’s Shares. DTC is a subsidiary
of The Depository Trust & Clearing Corporation, part
of the US Federal Reserve System that manages
the electronic clearing and settlement of publicly
traded companies. DTC eligibility is expected
to simplify the process of trading and enhance
liquidity of the Company’s shares on the OTCQB by
greatly broadening the pool of brokerage firms that
will allow their clients to trade the stock.
Amended terms for Kipawa/Zeus acquisition
In February 2022, Vital advised it had amended the
terms of its planned acquisition of Quebec Precious
Metals Corporation’s (“QPM’s”) 68% interest in the
Kipawa exploration project and 100% interest in the
Zeus exploration project (the “Projects”).
The terms of the acquisition were amended to
extend the due diligence period to 30 September
2022. This extension will enable Vital to undertake
more extensive engagement with local
communities to help inform the details of its plan
for development of the Project.
COVID-19
As with other companies, COVID-19 has caused some
disruption to the Company’s activities, however
development activities continued with the Company
remaining focused on bringing the Nechalacho Rare
Earth Project into operation in the shortest possible
timeframe. The Company has a focus on the welfare
of its employees and continues to take measures to
ensure their well-being including, health screening
and temperature monitoring, change in rosters,
spatial distancing protocols as well as, a change in
flow of staff to and from local communities.
As at 30 June 2022, the Company, its staff and
contractors based in Canada have been minimally
impacted by the COVID-19 pandemic and continue
to operate as planned, with the exception of the
Saskatoon plant. The Saskatoon plant has been
impacted by increases in logistics costs, steel
and a shortage of labour caused by the COVID-19
pandemic.
Management is actively monitoring the global
situation and its impact on the Group's financial
condition, liquidity, operations, suppliers, industry,
and workforce. Given the daily evolution of the
COVID-19 outbreak and the global responses to
curb its spread, the Group is not able to estimate
the effects of the COVID-19 outbreak on its results
of operations, financial condition, or liquidity for the
2022 financial year.
29
Vital Metals | Annual Report 2022 Financial Position
As of 30 June 2022, the Company held approximately $5.16m in cash.
The Group’s net assets at 30 June 2022 were $60,664,058 (30 June 2021: $62,984,038).
The Directors consider that the Group is in a strong and stable financial position to continue
and grow its existing activities.
Financial Results
The Group recorded an operating loss for the year of $4,770,105 (2021: loss of $4,745,906). The 2022 result
is consistent with the nature and operations of the Group.
Significant Changes in State of Affairs
Other than as disclosed in this Annual Report, no significant changes in the state of affairs of the Group
occurred during the financial year.
Photo Below: This fist-size sample of bastnaesite rare earth ore is hosted in white quartz country rock at the Nechalacho Mine's
North T zone. It contains some of the world's highest grades of rare earth elements.
30
Events Subsequent to Reporting Date
Board and Management Changes
Following Lionhead Resources Fund’s (LHR) A$30
million investment in Vital as part of its A$45 million
placement, Richard Crookes and Paul Quirk joined
the Vital Board as Non-Executive Directors, as
nominees of LHR.
Mr Crookes is managing partner of Lionhead
Resources (LHR) and chairman of the Investment
Committee. He has more than 35 years of global
resource industry experience across a diverse range
of projects, geographies and commodities as both
an operator and investor.
Mr Quirk is a partner at Lionhead Resources and
is responsible for originating new investment
opportunities and building and maintaining investor
relations. Mr Quirk has had a successful career as a
private equity investor, with more than 15 years of
private equity and operational experience in mining
and other industries.
In addition to Mr Crookes and Mr Quirk joining
Vital’s Board, LHR’s Russell Bradford joined Vital’s
new Technical Advisory Committee. Mr Bradford is
a partner at Lionhead Resources and a metallurgist
with more than 35 years of project management
and operational experience in the mining sector.
On 31 August 2022, the Company announced that
it had terminated the consultancy agreement
between Atkins Projects and Infrastructure Pty
Ltd and the Company and that Geoff Atkins will
cease as Managing Director Vital Metals, effective
immediately.
Russell Bradford was appointed interim CEO.
Photo Below: Community tours bring leaders and elders into Nechalacho to see the operation and become familiar with how it
operates. Here, Tlicho First Nations pause for a photo near a tri-lingual sign.
31
Vital Metals | Annual Report 2022
Capital Raising
On 1 August 2022, Vital announced it had raised
A$45 million via a targeted placement, with private
equity firm Lionhead Resources Fund LP (“LHR”)
becoming a cornerstone investor following its A$30
million investment.
Vital completed the placement at an issue price
of A$0.04 per share via a share placement to
institutional, sophisticated and professional investors
with 1,125 million new fully-paid ordinary shares to be
issued (“Placement”). Vital received strong support
for the Placement.
The Placement was led by Joint Lead Managers
Petra Capital and MST Financial. Financial advisers
were Tectonic Advisory Partners (“Tectonic”) and
Transocean Securities Pty Ltd.
The Company entered a subscription agreement
with LHR which, among other things, provides LHR
with the right to appoint two non-executive directors
to the Vital Board.
Proceeds from the Placement will finalise
construction, commissioning and ramp-up of
Vital’s Saskatoon Plant and enable it to accelerate
development of projects including the Tardiff deposit
at Nechalacho, as it executes a strategy to become
the world’s first producer of commercial quantities of
both heavy and light rare earths. It will also provide
working capital requirements as Vital transitions
from rare earths exploration and development into
operations.
Settlement of Tranche 1 occurred on 10 August
2022 and settlement of Tranche 2 is anticipated five
business days after a General Meeting to be held in
October 2022.
As a result of the Placement, LHR will become
Vital's major shareholder, holding approximately
12.8% following completion of Tranche 1 and
approximately 14.1% after Tranche 2.
Key terms of the subscription agreement with
LHR include the following:
• Board Representation:
• For so long as LHR has an interest of 10% in
the Company, LHR has the right to appoint
two (2) nominees to the Board.
• For so long as LHR has an interest of 5% in
the Company, LHR has the right to appoint
one (1) nominee to the Board.
• Participation Rights: Provided LHR has an
interest of at least 10% in the Company, VML
will not make equity offers to other subscribers
unless LHR is first given a reasonable
opportunity to participate in the offer on
equivalent terms to other subscribers. If the
equity offer is not a pro-rata offer and primarily
relates to a financing to develop the North T
Project, LHR will have the right (but not the
obligation) to invest up to 66.67% of the equity
offer (being the same proportion as LHR's
participation in this Placement).
• Technical Advisory Committee (TAC):
The Company and LHR agreed to establish a
TAC, which shall comprise no more than six
members, with 33% or two persons (whichever
is the lower) appointed by LHR and the
remainder appointed by the VML Board. The
purpose of the TAC is to provide guidance
to the Company in respect of all aspects
(including technical, financial, permitting, ESG
and stakeholder engagement) that directly or
indirectly affect the Company or its assets.
32
Project Geologist Chris Pedersen is a veteran
explorer of the Nechalacho deposit, with
experience going back into the 1970s.
33
Vital Metals | Annual Report 2022 Dividends
No dividends were paid or declared during the financial year. No recommendation for payment of
dividends has been made.
Likely Developments And Expected Results Of Operations
The Group entered into mining activities from July 2021 in the North T zone and intends to continue its
exploration and development activities in Tardiff Zones 2 and 3 in Canada and other projects, whilst
assessing opportunities to acquire further suitable projects for exploration as they arise.
Environmental Regulation
The Group is subject to significant environmental regulation in respect to its exploration and
development activities.
The Group aims to ensure the appropriate standard of environmental care is achieved, and in doing so,
that it is aware of and is in compliance with all environmental legislation. The directors of the Group are
not aware of any breach of environmental legislation for the year under review.
Insurance of Directors and Officers
The Company has entered into an agreement to indemnify all directors and officers against any liability
arising from a claim brought by a third party against the Company. The agreement provides for the
Company to pay all damages and costs which may be awarded against the officer or director.
During the period the Company has paid an insurance premium in respect of a Directors’ and Officers’
Liability Insurance Contract. The insurance premium relates to liabilities that may arise from an Officer’s
position, with the exception of conduct involving a wilful breach of duty or improper use of information
or position to gain personal advantage.
The officers covered by the insurance policies are the Directors, Company Secretary and Officers of
the Company. The contract of insurance prohibits the disclosure of the nature of the liabilities and the
amount of the premium.
34
Legal Proceedings
The Company was not a party to any legal proceedings during the year.
Proceedings on Behalf of the Group
No person has applied for leave of Court to bring proceedings on behalf of the company or intervene in
any proceedings to which the Company is a party for the purpose of taking responsibility on behalf of the
Company for all or any part of those proceedings.
Non-Audit Services
During the year, BDO provided consulting services in relation to Benchmark and Executive Remuneration.
The Group has not provided any indemnity to the Auditors.
Directors’ Interests In Securities Of The Group
As at the date of this report, the interests of the Directors in the shares, options and other performance
securities of Vital Metals Limited were:
Director
Ordinary Shares
Options
Evan Cranston
16,528,998
180,000,000
Geoff Atkins*
92,149,547
90,000,000
James Henderson
208,296,342
60,000,000
Richard Crookes
Paul Quirk
Nil
Nil
Nil
Nil
* As at date of ceasing to be a Director
35
Vital Metals | Annual Report 2022 Shares Under Option
At the date of this report, the Group had on issue 5,223,770,521 ordinary shares and 435,500,000
options over ordinary shares.
Unissued ordinary shares of the Company under option at the date of this report are as follows:
Date Options
Granted
Expiry Date
Exercise Price
Number Under
Option
22 October 2019
22 October 2024
22 October 2019
22 October 2024
22 October 2019
22 October 2024
22 December 2021
22 December 2024
24 December 2020
31 January 2025
$0.02
$0.025
$0.03
$0.07
$0.02
110,000,000
110,000,000
110,000,000
20,000,000
6,000,000
24 December 2020
31 January 2025
$0.025
6,000,000
24 December 2020
31 January 2025
31 January 2020
31 January 2025
$0.03
$0.02
6,000,000
22,500,000
31 January 2020
31 January 2025
$0.025
22,500,000
31 January 2020
31 January 2025
$0.03
Total
22,500,000
435,500,000
No person entitled to exercise any option referred to above has or had, by virtue of the option, a right
to participate in any share issue of any other body corporate.
36
Directors’ Meetings
The table below sets out the number of Directors’ meetings held during the period and the number
of meetings attended by each as a Director. The Directors have determined that the Company is not
a sufficient size to merit the establishment of Board Committees and therefore, duties ordinarily
assigned to Committees are carried out by the full Board.
Director
Evan Cranston
Geoff Atkins
James Henderson
Number of Meetings
held while in office
Meetings attended
9
9
9
9
9
9
Corporate Governance Statement
Pursuant to the ASX Listing Rules, the Company’s Corporate Governance Statement will be released
in conjunction with this report. The Company’s Corporate Governance Statement is available on the
Company’s website at: https://www.vitalmetals.com.au/corporate/corporate-governance/
Nechalacho’s North T mine is one of the world’s richest sources of rare earth ore.
37
Vital Metals | Annual Report 2022 Audited Remuneration Report
The information provided in this remuneration report has been audited as required by section 308(3C) of the
Corporations Act 2001. The Directors and Key Management Personnel for the year ended 30 June 2022 were:
Name
Position for the year ended 30 June 2022
Evan Cranston
Non-Executive Chairman
Geoff Atkins
Managing Director
James Henderson
Non-Executive Director
Anthony Hadley
Chief Operating Officer
Remuneration Policy
Remuneration of Directors and Executives is referred
to as compensation throughout this report. Key
Management Personnel including Directors of the
Company and other executives have authority and
responsibility for planning, directing and controlling
the activities of the Group. Compensation levels for
Directors and Key Management Personnel of the
Group are competitively set to attract and retain
appropriately qualified and experienced directors
and executives.
The Board is responsible for compensation policies
and practices. The Board, where appropriate, seeks
independent advice on remuneration policies and
practices, including the compensation packages and
terms of employment. No such advice was sought in
the current year.
The compensation structures explained below 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 a number of factors, including length
of service and the particular experience of the
individual concerned.
Fixed Compensation
Fixed compensation consists of base compensation
(which is calculated on a total cost basis and
includes any FBT charges related to employee
benefits including motor vehicles) as well as,
employer contributions to superannuation funds.
Compensation levels are reviewed annually by the
Board where applicable.
38
Share–based compensation
Share options are granted to key employees as the Directors believe that this is the most appropriate method
of aligning performance to the interests of shareholders. The Directors feel that it appropriately links the
long-term incentives of key employees to the interest of shareholders. The ability to exercise the options is
conditional on continued service for a period as determined by the Board upon each issuance of options.
The Group does not have a policy that prohibits those that are granted share-based payments as part of their
remuneration from entering into other arrangements that limit their exposure to losses that would result
from share price decreases.
Employment Contracts of Directors and Executives
As at 30 June 2022, all Directors and all executives, have formal contracts with the Company.
The terms during the past year and as at the date of this report are set out as follows:
Name
Position
Annual Remuneration
FY 2022
$
Evan Cranston
Non-Executive Chairman
60,000
Geoff Atkins (ceased 2 September 2022)
Managing Director
270,000
James Henderson
Non-Executive Director
40,000
Anthony Hadley
Chief Operating Officer
523,8031
1 Includes expense for options issued under Employee Incentive Plan
39
Vital Metals | Annual Report 2022 Geoff Atkins (ceased 2 September 2022)
Anthony Hadley
The Managing Director, Geoff Atkins is under a
consulting agreement that commenced on
1 October 2019. The terms of the contract include:
• Annual consulting fee of $270,000; and
• An incentive component comprising 90,000,000
options in 3 equal tranches to purchase fully
paid ordinary shares in the Company with the
following key terms:
• Options were approved by shareholders at
General Meeting held 16 October 2019;
• Exercise Prices Tranche 1-$0.02, Tranche
2-$0.025, Tranche 3-$0.03
• Expiry date of 5 years from date of issue
The duration of the consultancy agreement is for
a minimum of 3 years. Mr Atkins may resign from
his position and thus terminate the consultancy by
giving 3 months’ written notice. The Company may
terminate the consultancy agreement by providing 3
months’ written notice or providing payment in lieu
of the notice period (based on the consulting fee).
The Company may terminate the contract at any
time without notice if serious misconduct has
occurred. Where termination with cause occurs, the
Managing Director is only entitled to that portion of
remuneration (consultancy fee) and only up to the
date of termination.
The Chief Operating Officer, Tony Hadley is an
employee of the Company under an executive
agreement signed on 7 February 2020. Under the
terms of the contract:
• A salary package of $280,000 per annum plus
statutory superannuation; and
• An incentive component comprising 3
tranches of 6,000,000 options each to
purchase fully paid ordinary shares in the
company with the following key terms:
• Exercise Price of Tranche 1-$0.02, Tranche
2-$0.025, Tranche 3-$0.03
• Expiry date of 31 January 2025
• Options to vest as follows:
• Tranche 1 -6,000,000 options vest
1 year from date of issue
• Tranche 2 -6,000,000 options vest
2 years from date of issue
• Tranche 3 -6,000,000 options vest
3 years from date of issue.
The duration of the consultancy agreement will
continue until the agreement is validly terminated
in accordance with its terms. Mr Hadley may
resign from his position and thus terminate the
agreement by giving 3 months’ written notice.
The Company may terminate the agreement by
providing 3 months’ written notice or providing
payment in lieu of the notice period (based on the
fixed component of Mr Hadley’s remuneration
including any accrued statutory leave liabilities).
40
Non-Executive Directors
Total compensation for all Non-Executive Directors, last voted upon by shareholders at the 2007
AGM, is not to exceed $400,000 per annum.
The remuneration policy for Non-Executive Directors remains unchanged.
Company performance, shareholder wealth and directors’ and executives’ remuneration
No relationship exists between shareholder wealth, director and executive remuneration and
Company performance due to the infant stage of the Company’s operations.
Historical Information
The table below shows the gross revenue, losses and earnings per share for the last five years for
the listed entity.
2022
$
2021
$
2020
$
2019
$
2018
$
Net profit/(loss)
(4,770,105)
(4,745,906)
(4,578,593)
3,225,692
(3,253,430)
Share price at year end (cents)
3.9
4.8
1.0
1.2
1.0
Earnings/(loss) per share (cents)
(0.11)
(0.16)
(0.23)
0.18
(0.21)
Details of remuneration
The Key Management Personnel of the Group are the Directors and Chief Operating Officer. Given the
size and nature of operations of the Group, there are no other employees who are required to have their
remuneration disclosed in accordance with the Corporations Act 2001.
41
Vital Metals | Annual Report 2022 Remuneration of Key Management Personnel
Details of the remuneration provided to the Key Management Personnel of the Group are set out
in the following table:
Short term Salary
and Fees
Short Term
Bonus1
Post-employment
Superannuation
Termination
$
$
$
$
Share-based
payments
Options1
$
Total
$
Performance
related
Directors of Vital Metals Limited
Evan Cranston (Non-Executive Chairman) (appointed 22 October 2019)
2022
2021
60,000
60,000
-
-
-
-
Geoff Atkins (Managing Director) (appointed 22 October 2019)
2022
2021
270,000
270,000
-
-
-
-
James Henderson (Non-Executive Director) (appointed 4 August 2020)
2022
2021
40,000
36,667
-
-
-
-
Phillip Coulson (Non-Executive Director) (resigned 20 December 2020)
2022
2021
-
18,817
-
-
Zane Lewis (Executive Director) (resigned 4 August 2020)
2022
2021
-
6,667
-
-
-
-
-
-
Francis Harper (Non- Executive Director) (resigned 4 August 2020)
2022
2021
-
3,333
Other Key Management Personnel
Anthony Hadley (COO)
2022
2021
280,000
280,000
-
-
-
-
Total Key Management Personnel compensation
2022
2021
650,000
675,484
-
-
-
-
28,000
26,600
28,000
26,600
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
60,000
60,000
270,000
270,000
40,000
1,737,991
1,774,658
-
-
-
-
-
-
-
18,817
-
6,667
-
3,333
215,803
523,803
189,514
496,114
215,803
893,803
1,927,505
2,629,589
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(1) The fair value of the options is calculated at the date of grant using a Black Scholes option valuation model and allocated to each
reporting period evenly over the period from the grant date to vesting date. The value disclosed is the fair value of the options
recognised in this reporting period. The options of the Directors of Vital Metals Limited vested fully in the reporting period they were
issued, those of Key Management Personnel vest over three years
42
There were no options or performance rights granted to Key Management Personnel as compensation
during the reporting period, other than those set out below.
Options and Performance Rights granted as compensation
Options and performance rights are issued at no cost to Directors and Executives as part of their
remuneration. The options and performance rights are not issued based on performance criteria, but are
issued to increase goal congruence between Executives, Directors and Shareholders.
There were no performance rights or options issued to Key Management Personnel during the year.
Grant Date
Exercise
Price
Number
Granted
Number
Vested
Expiry Date
Volatility
Fair Value
per security
at grant date
(cents)
Exercised
Number
Options
2021 Financial Year
James Henderson
24/12/2020
$0.02
20,000,000
20,000,000
22/10/2024
100%
James Henderson
24/12/2020
$0.025
20,000,000
20,000,000
22/10/2024
100%
James Henderson
24/12/2020
$0.03
20,000,000
20,000,000
22/10/2024
100%
Anthony Hadley
24/12/2020
$0.02
6,000,000
6,000,000
31/01/2025
Anthony Hadley
24/12/2020
$0.025
6,000,000
Anthony Hadley
24/12/2020
$0.03
6,000,000
-
-
31/01/2025
31/01/2025
100%
100%
100%
2.98
2.89
2.82
2.97
2.89
2.82
-
-
-
-
-
-
Exercise of options and performance rights granted as compensation
During the reporting period, there were Nil shares issued on the exercise of options and performance
rights previously granted as compensation, and there were no modifications to the terms of previously
granted options.
43
Vital Metals | Annual Report 2022 Additional disclosures relating to Key Management Personnel
Shareholding
The numbers of shares in the Company held during the financial year by each Director of Vital Metals
Limited and other Key Management Personnel of the Group, including their personally-related parties,
are set out below.
2022
Balance at start
of the year
Received during
the year on
the exercise of
options
Other changes
during the year
Balance at end of
the year
Directors of Vital Metals Limited
Ordinary shares
Evan Cranston
16,528,998
Geoff Atkins
93,449,547
James Henderson
208,296,342
Other Key Management Personnel
Anthony Hadley
–
–
–
–
–
–
–
–
–
16,528,998
93,449,547
208,296,342
–
Photo Below: Yellowknives Dene First Nations drummers commissioned the TOMRA sorter in July 2021 with drum songs and prayers.
44
Option and Performance Rights holding
The number of performance rights and options over ordinary shares in the Company held during the financial
year by each Director of Vital Metals Limited and other Key Management Personnel of the Group, including
their personally-related parties, are set out below:
2022
Balance at start
of the year
Granted as
compensation
Exercised
Expiry
Other
changes
Balance at end
of the year
Vested and
exercisable
Directors of Vital Metals Limited
Options
Evan Cranston
180,000,000
Geoff Atkins
90,000,000
James Henderson
60,000,000
Other Key Management Personnel
Options
Anthony Hadley
18,000,000
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
180,000,000 180,000,000
90,000,000
90,000,000
60,000,000
60,000,000
–
18,000,000
6,000,000
Loans to Key Management Personnel
There were no loans to Key Management Personnel during the year (2021: nil).
Other transactions with Key Management Personnel
There were no other transactions with Key Management Personnel during the year other than salaries and
wages, as disclosed in the remuneration report.
45
Vital Metals | Annual Report 2022 Voting and comments made at the Company's
2021 Annual General Meeting ('AGM')
At the 2021 AGM, 92.34% of the votes received
supported the adoption of the remuneration report
for the year ended 30 June 2021. The Company
did not receive any specific feedback at the AGM
regarding its remuneration practices.
End of Audited Remuneration Report.
A copy of the auditor's independence declaration as
required under section 307C of the Corporations Act
2001 is set out on page 49.
This report has been made in accordance with a
resolution of the Board of Directors pursuant to s.298
(2) of the Corporations Act 2001.
Signed in accordance with a resolution of the
directors.
Evan Cranston
Chairman
Sydney: 30 September 2022
Engagement of remuneration consultants
During the financial year, the Company engaged
BDO Reward (WA) Pty Ltd to review the Key
Management Personnel remuneration for the year
ended 30 June 2022 for a fee of $18,868.
Securities Trading Policy
The Company’s Securities Trading Policy provides
guidance on acceptable transactions in dealing in
the Company’s various securities, including shares,
debt notes and options. The Company’s Securities
Trading Policy defines dealing in company securities
to include:
a. Subscribing for, purchasing or selling Company
Securities or entering into an agreement to do
any of those things;
b. Advising, procuring or encouraging another
person (including a family member, friend,
associate, colleague, family company or family
trust) to trade in Company Securities; and
c. Entering into agreements or transactions which
operate to limit the economic risk of a person’s
holdings in Company Securities.
The Securities Trading Policy details acceptable
and unacceptable times for trading in Company
Securities including, detailing potential civil and
criminal penalties for misuse of “inside information”.
The Directors must not deal in Company Securities
without providing written notification to the
Chairman. The Chairman must not deal in Company
Securities without the prior approval of the Chief
Executive Officer. The Directors are responsible
for disclosure to the market of all transactions or
contracts involving the Company’s shares.
46
Definition drilling on the Tardiff Zone continued
day and night through the late winter.
47
Vital Metals | Annual Report 2022 Vital Metals
ABN 32 112 032 596
Auditor’s Independence Declaration
Tel: +61 8 6382 4600
Fax: +61 8 6382 4601
www.bdo.com.au
Level 9, Mia Yellagonga Tower 2
5 Spring Street
Perth, WA 6000
PO Box 700 West Perth WA 6872
Australia
DECLARATION OF INDEPENDENCE BY NEIL SMITH TO THE DIRECTORS OF VITAL METALS LIMITED
As lead auditor of Vital Metals Limited for the year ended 30 June 2022, I declare that, to the best of
my knowledge and belief, there have been:
1. No contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit; and
2. No contraventions of any applicable code of professional conduct in relation to the audit.
This declaration is in respect of Vital Metals Limited and the entities it controlled during the period.
Neil Smith
Director
BDO Audit (WA) Pty Ltd
Perth
30 September 2022
BDO Audit (WA) Pty Ltd ABN 79 112 284 787 is a member of a national association of independent entities which are all members of BDO Australia
Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit (WA) Pty Ltd and BDO Australia Ltd are members of BDO
International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability
limited by a scheme approved under Professional Standards Legislation.
48
Financial Report
49
Vital Metals | Annual Report 2022 CONSOLIDATED STATEMENT OF PROFIT OR LOSS
AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2022
Continuing Operations
Sundry income
Other income and expense
Exploration and evaluation expenditure
Administration expenses
Depreciation
Share based payments expense
Total expenses
Loss from continuing operations
Finance income
Finance costs
Net finance income/ (cost)
Loss before income tax
Income tax expense
Loss after income tax
Note
1.1
1.1
8.1
2022
$
92,553
92,553
2021
$
309,309
309,309
(2,553)
(10,752)
(565,990)
(3,615,565)
(759,990)
(532,562)
(5,476,660)
(5,384,107)
657,700
(43,698)
614,002
(134,161)
(2,439,911)
(206,259)
(2,267,157)
(5,058,240)
(4,748,931)
8,886
(5,861)
3,025
1.2
(4,770,105)
-
(4,745,906)
-
(4,770,105)
(4,745,906)
Loss from discontinued operations net of tax
-
-
Net loss for the year
Other comprehensive income
Items that may be reclassified subsequently to profit or
loss:
Foreign currency translation differences for foreign
operations
Other comprehensive income for the year,
net of income tax
Total comprehensive loss for the year
(4,770,105)
(4,745,906)
1,630,074
99,329
1,630,074
99,329
(3,140,031)
(4,646,577)
50
VITAL METALS LIMITED and its Controlled Entities
Page 26
2022 Annual Report
Vital Metals ABN 32 112 032 596 Consolidated Statement of Profit or Loss and Other Comprehensive Income for the Year Ended 30 June 2022
CONSOLIDATED STATEMENT OF PROFIT OR LOSS
AND OTHER COMPREHENSIVE INCOME ((CONT.))
FOR THE YEAR ENDED 30 JUNE 2022
Note
2022
$
2021
$
Loss attributable to:
Owners of the Company
Total Comprehensive Loss attributable to:
Owners of the Company
Loss per share and for loss attributable to the ordinary
equity holders of the company:
Diluted loss per share for loss attributable to the
ordinary equity holders of the company:
1.3
1.3
(4,770,105)
(4,770,105)
(3,140,031)
(3,140,031)
(4,745,906)
(4,745,906)
(4,646,577)
(4,646,577)
(0.11) cents
(0.16) cents
(0.11) cents
(0.16) cents
The above Consolidated Statement of Profit or Loss and Other Comprehensive Income should be read in conjunction
with the accompanying notes
VITAL METALS LIMITED and its Controlled Entities
Page 27
2022 Annual Report
51
Vital Metals ABN 32 112 032 596 Consolidated Statement of Profit or Loss and Other Comprehensive Income for the Year Ended 30 June 2022Vital Metals | Annual Report 2022
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2022
CURRENT ASSETS
Cash and cash equivalents
Trade and other receivables
TOTAL CURRENT ASSETS
NON-CURRENT ASSETS
Property, plant and equipment
Right of use asset
Exploration and evaluation expenditure
Mine under development
Inventory
TOTAL NON-CURRENT ASSETS
TOTAL ASSETS
CURRENT LIABILITIES
Trade and other payables
Government loans
Financial liabilities
Provisions
TOTAL CURRENT LIABILITIES
NON-CURRENT LIABILITIES
Government loans
Financial liabilities
Provisions
TOTAL NON-CURRENT LIABILITIES
TOTAL LIABILITIES
NET ASSETS
EQUITY
Contributed equity
Reserves
Accumulated losses
TOTAL EQUITY
Note
2.1
2.2
3.1
3.2
3.3
3.4
3.5
2.3
3.6
3.6
2022
$
2021
$
5,158,350
2,712,484
34,906,990
1,306,814
7,870,834
36,213,804
17,894,347
568,139
13,531,005
26,532,671
2,621,782
3,162,089
167,829
13,291,395
12,938,011
-
61,147,944
29,559,324
69,018,778
65,773,128
6,402,913
35,498
229,112
103,709
2,280,163
-
65,991
30,063
6,771,232
2,376,217
386,399
316,539
880,550
1,583,487
-
98,011
314,862
412,873
8,354,720
2,789,090
60,664,058
62,984,038
4.1
4.2
107,553,071
9,731,099
(56,620,112)
107,265,582
7,568,463
(51,850,007)
60,664,058
62,984,038
The above Consolidated Statement of Financial Position should be read in conjunction with the accompanying notes.
52
VITAL METALS LIMITED and its Controlled Entities
Page 28
2022 Annual Report
Vital Metals ABN 32 112 032 596 Consolidated Statement of Financial Position as at 30 June 2022
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2022
Contributed
Equity
$
Share-based
Payment Reserve
$
Foreign Currency
Translation Reserve
$
Accumulated
Losses
$
Total
$
Balance at 1 July 2021
Loss for year
Transferred to
accumulated losses
Other comprehensive
income
Exchange differences on
translation of foreign
operation
Total other
comprehensive income
Total comprehensive
profit/(loss) for the year
Transactions with owners
in their capacity of
owners
Contributions of equity,
net of transaction costs
Share based payments
107,265,582
-
7,157,816
-
-
-
-
-
-
-
-
-
-
-
-
410,647
-
(51,850,007)
(4,770,105)
62,984,038
(4,770,105)
-
-
-
-
(4,770,105)
(4,770,105)
1,630,074
1,630,074
-
-
1,630,074
1,630,074
1,630,074
(4,770,105)
(3,140,031)
287,489
-
532,562
-
-
-
-
287,489
532,562
Balance at 30 June 2022
107,553,071
7,690,378
2,040,721
(56,620,112)
60,664,058
The above Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes.
VITAL METALS LIMITED and its Controlled Entities
Page 29
2022 Annual Report
53
Vital Metals ABN 32 112 032 596 Consolidated Statement of Changes in Equity for the Year Ended 30 June 2022Vital Metals | Annual Report 2022
Vital Metals
ABN 32 112 032 596
Consolidated Statement of Changes in Equity
for the Year Ended 30 June 2021
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2021
Contributed
Equity
$
Share-based
Payment Reserve
$
Foreign Currency
Translation Reserve
$
Accumulated
Losses
$
Total
$
Balance at 1 July 2020
Loss for year
Other comprehensive
income
Exchange differences on
translation of foreign
operation
Total other
comprehensive income
Total comprehensive
profit/(loss) for the year
Transactions with
owners in their capacity
of owners
Contributions of equity,
net of transaction costs
Share based payments
57,645,649
-
4,890,659
-
-
-
-
-
-
-
-
-
-
49,619,933
-
2,267,157
311,318
-
-
99,329
99,329
99,329
-
-
(47,104,101)
(4,745,906)
15,743,525
(4,745,906)
(4,745,906)
(4,745,906)
-
-
99,329
99,329
(4,745,906)
(4,646,577)
-
-
49,619,933
2,267,157
Balance at 30 June 2021
107,265,582
7,157,816
410,647
(51,850,007)
62,984,038
The above Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes.
VITAL METALS LIMITED and its Controlled Entities
Page 30
2022 Annual Report
54
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2022
CASH FLOW FROM OPERATING ACTIVITIES
Payments for exploration and evaluation costs
Payments to suppliers and employees
Payments for inventory
Government incentive received
Interest received
Interest paid
Note
2022
$
(590,233)
(3,531,722)
(714,854)
92,553
12,929
(21,021)
2021
$
(134,161)
(2,373,531)
-
309,309
8,886
(5,861)
Net cash outflow in operating activities
2.1
(4,752,348)
(2,195,358)
CASH FLOW FROM INVESTING ACTIVITIES
Payments for exploration expenditure
Payments for mine under development
Payments for property, plant and equipment
Payments for Kipawa acquisition deposit
Payments for rent bond
Proceeds from sale of shares
Proceeds from disposal of non-current assets
(1,380,021)
(13,242,077)
(10,395,467)
(1,107,321)
(23,149)
-
29,867
(6,523,613)
(5,632,054)
(1,768,730)
-
(292,005)
45,249
-
Net cash outflow in investing activities
(26,118,168)
(14,171,153)
CASH FLOW FROM FINANCING ACTIVITIES
Proceeds from share issues
Proceeds from borrowings
Options exercised
Cost of share capital issued
Repayment of lease liability
Net cash from financing activities
-
1,043,991
287,500
-
(252,835)
1,078,656
51,000,000
-
1,605,000
(2,985,067)
(103,205)
49,516,728
Net increase/(decrease) in cash held
(29,791,860)
33,150,217
Cash at beginning of the year
34,906,990
1,756,773
Foreign exchange variances on cash
43,220
-
Cash at end of the year
2.1
5,158,350
34,906,990
The above Consolidated Statement of Cash Flows should be read in conjunction with the
accompanying notes.
VITAL METALS LIMITED and its Controlled Entities
Page 31
2021 Annual Report
55
Vital Metals ABN 32 112 032 596 Consolidated Statement of Cash Flows for the Year Ended 30 June 2022Vital Metals | Annual Report 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
ABOUT THIS REPORT
The principal accounting policies adopted in the preparation of these financial statements are set out below. These
policies have been consistently applied to all the years presented, unless otherwise stated. The financial statements
are for the consolidated entity consisting of Vital Metals Limited and its subsidiaries. The financial statements are
presented in Australian dollars, which is also the parent entity’s functional currency. Canadian entities adopt Canadian
dollars as the functional currency. Vital Metals Limited is a company limited by shares, domiciled and incorporated in
Australia. The financial statements were authorised for issue by the directors on 30 September 2022. The Directors
have the power to amend and reissue the financial statements.
Basis of preparation
These general purpose financial statements have been prepared in accordance with Australian Accounting Standards
and Interpretations issued by the Australian Accounting Standards Board and the Corporations Act 2001. Vital Metals
Limited is a for-profit entity for the purpose of preparing the financial statements.
(i) Compliance with IFRS
The consolidated financial statements of the Vital Metals Limited Group also comply with International Financial
Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB).
(ii) New accounting standards and interpretations
New, revised or amended Accounting Standards and Interpretations adopted by the Group
The Group has adopted all of the new, revised or amending Accounting Standards and Interpretations issued by the
Australian Accounting Standards Board (“AASB”) that are mandatory for the current reporting period. The adoption
of these Accounting Standards and Interpretations did not have any significant impact on the financial performance
or position of the Group during the financial year.
(iii) Early adoption of standards
The Group has not elected to apply any pronouncements before their operative date in the annual reporting period
beginning 1 July 2021.
(iv) New and amended standards not yet adopted by the Group
Certain new accounting standards and interpretations have been published that are not mandatory for the 30 June
2022 reporting period. The directors have not early adopted any of these new amended standards and interpretations.
The directors are in the process of assessing the impact of the applications of the standard and its amendment to the
extent relevant to the financial statement of the Group.
(v) Historical cost convention
These financial statements have been prepared under the historical cost convention.
Principles of consolidation
Subsidiaries
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Vital Metals Limited
(“Company” or “parent entity”) as at 30 June 2022 and the results of all subsidiaries for the year then ended. Vital
Metals Ltd and its subsidiaries together are referred to in these financial statements as the Group or the consolidated
entity.
Subsidiaries are all entities (including special purpose entities) over which the Group has control. The Group controls
an entity when it is exposed to, or has the right to, variable returns from its involvement with the entity and has the
ability to affect those returns through its power to direct the activities of the entity.
56
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Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-
consolidated from the date that control ceases.
The acquisition method of accounting is used to account for business combinations by the Group.
Intercompany transactions, balances and unrealised gains on transactions between Group companies are eliminated.
Unrealised losses are also eliminated unless the transaction provides evidence of the impairment of the asset
transferred. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the
policies adopted by the Group.
Impairment of assets
Assets, except for deferred tax assets, are reviewed for impairment whenever events or changes in circumstances
indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which
the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair
value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest
levels for which there are separately identifiable cash inflows which are largely independent of the cash inflows from
other assets or groups of assets (cash-generating units). Non-financial assets that suffered an impairment are
reviewed for possible reversal of the impairment at each reporting date.
Financial instruments
Financial assets and financial liabilities are recognised in the Group’s statement of financial position when the Group
becomes a party to the contractual provisions of the instrument.
Financial instruments (except for trade receivables) are initially measured at fair value plus transaction costs, except
where the instrument is classified “at fair value through profit or loss”, in which case transaction costs are expensed
to profit or loss immediately.
Classification and subsequent measurement
Financial assets
Financial assets are subsequently measured at:
•
•
•
amortised cost;
fair value through other comprehensive income; or
fair value through profit or loss.
A financial asset that meets the following conditions is subsequently measured at amortised cost:
•
•
the financial asset is managed solely to collect contractual cash flows; and
the contractual terms within the financial asset give rise to cash flows that are solely payments of principal
and interest on the principal amount outstanding on specified dates.
A financial asset that meets the following conditions is subsequently measured at fair value through other
comprehensive income:
•
•
the contractual terms within the financial asset give rise to cash flows that are solely payments of principal
and interest on the principal amount outstanding on specified dates; and
the business model for managing the financial assets comprises both contractual cash flows collection and
the selling of the financial asset.
By default, all other financial assets that do not meet the measurement conditions of amortised cost and fair value
through other comprehensive income are subsequently measured at fair value through profit or loss.
The initial designation of the financial instruments to measure at fair value through profit or loss is a one-time option
on initial classification and is irrevocable until the financial asset is derecognised.
Financial liabilities
Financial liabilities are subsequently measured at:
•
•
amortised cost; or
fair value through profit or loss.
33
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Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022Vital Metals | Annual Report 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
A financial liability is measured at fair value through profit and loss if the financial liability is:
•
•
•
a contingent consideration of an acquirer in a business combination to which AASB 3: Business Combinations
applies;
held for trading; or
initially designated as at fair value through profit or loss.
All other financial liabilities are subsequently measured at amortised cost using the effective interest method.
Derecognition
Derecognition refers to the removal of a previously recognised financial asset or financial liability from the statement
of financial position.
Derecognition of financial assets
A financial asset is derecognised when the holder's contractual rights to its cash flows expires, or the asset is
transferred in such a way that all the risks and rewards of ownership are substantially transferred.
All of the following criteria need to be satisfied for derecognition of financial asset:
•
•
•
the right to receive cash flows from the asset has expired or been transferred;
all risk and rewards of ownership of the asset have been substantially transferred; and
the Group no longer controls the asset (i.e. the Group has no practical ability to make a unilateral decision to
sell the asset to a third party).
On derecognition of a financial asset measured at amortised cost, the difference between the asset's carrying amount
and the sum of the consideration received and receivable is recognised in profit or loss.
On derecognition of a debt instrument classified as at fair value through other comprehensive income, the cumulative
gain or loss previously accumulated in the investment revaluation reserve is reclassified to profit or loss.
On derecognition of an investment in equity which was elected to be classified under fair value through other
comprehensive income, the cumulative gain or loss previously accumulated in the investment revaluation reserve is
not reclassified to profit or loss, but is transferred to retained earnings.
Derecognition of financial liabilities
A liability is derecognised when it is extinguished (i.e. when the obligation in the contract is discharged, cancelled or
expires). An exchange of an existing financial liability for a new one with substantially modified terms, or a substantial
modification to the terms of a financial liability is treated as an extinguishment of the existing liability and recognition
of a new financial liability.
The difference between the carrying amount of the financial liability derecognised and the consideration paid and
payable, including any non-cash assets transferred or liabilities assumed, is recognised in profit or loss.
Impairment
The Group recognises a loss allowance for expected credit losses on financial assets that are measured at amortised
cost or fair value through other comprehensive income.
Loss allowance is not recognised for:
financial assets measured at fair value through profit or loss; or equity instruments measured at fair value through
other comprehensive income.
The Group uses the simplified approach to impairment, as applicable under AASB 9: Financial Instruments:
Simplified approach
The simplified approach does not require tracking of changes in credit risk at every reporting period, but instead
requires the recognition of lifetime expected credit loss at all times. This approach is applicable to:
•
•
trade receivables or contract assets that result from transactions within the scope of AASB 15: Revenue from
Contracts with Customers and which do not contain a significant financing component; and
lease receivables.
58
34
Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
In measuring the expected credit loss, a provision matrix for trade receivables was used taking into consideration
various data to get to an expected credit loss (i.e. diversity of customer base, appropriate groups of historical loss
experience, etc).
Recognition of expected credit losses in financial statements
At each reporting date, the Group recognises the movement in the loss allowance as an impairment gain or loss in the
statement of profit or loss and other comprehensive income.
The carrying amount of financial assets measured at amortised cost includes the loss allowance relating to that asset.
Assets measured at fair value through other comprehensive income are recognised at fair value, with changes in fair
value recognised in other comprehensive income. Amounts in relation to change in credit risk are transferred from
other comprehensive income to profit or loss at every reporting period.
For financial assets that are unrecognised (e.g. loan commitments yet to be drawn, financial guarantees), a provision
for loss allowance is created in the statement of financial position to recognise the loss allowance.
Share based payments
The Group provides benefits to employees (including directors) of the Group in the form of share-based payment
transactions, whereby employees render services in exchange for shares or rights over shares (‘equity-settled
transactions’) - refer to Note 8.1.
The cost of these equity-settled transactions with employees is measured by reference to the fair value at the date at
which they are granted. The fair value is determined by an internal valuation using an appropriate option pricing
model.
The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over the period
in which the performance conditions are fulfilled, ending on the date on which the relevant employees become fully
entitled to the award (‘vesting date’).
The cumulative expense recognised for equity-settled transactions at each reporting date until vesting date reflects
(i) the extent to which the vesting period has expired and (ii) the number of options that, in the opinion of the directors
of the Group, will ultimately vest. This opinion is formed based on the best available information at reporting date.
No adjustment is made for the likelihood of market performance conditions being met as the effect of these conditions
is included in the determination of fair value at grant date.
No expense is recognised for awards that do not ultimately vest, except for awards where vesting is conditional upon
a market condition.
Where an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and any expense
not yet recognised for the award is recognised immediately. However, if a new award is substituted for the cancelled
award, and designated as a replacement award on the date that it is granted, the cancelled and new award are treated
as if they were a modification of the original award.
Key estimates and judgements
Impact of Coronavirus (COVID-19) pandemic
Judgement has been exercised in considering the impacts that the Coronavirus (COVID-19) pandemic has had, or may
have, on the company based on known information. Other than as addressed in specific notes, there does not
currently appear to be either any significant impact upon the financial statements or any significant uncertainties with
respect to events or conditions which may impact the company unfavourably as at the reporting date or subsequently
as a result of the Coronavirus (COVID-19) pandemic.
35
59
Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022Vital Metals | Annual Report 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
Other key estimates and judgements are discussed in the following notes:
Property, plant and equipment
Right of use asset
Deferred exploration and evaluation costs
Production start date
Impairment of assets
Inventory
Share based payments
(Note 3.1)
(Note 3.2)
(Note 3.3)
(Note 3.4)
(Note 3.4)
(Note 3.5)
(Note 8.1)
60
36
Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
CONTENTS OF THE NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
PAGE
1. FINANCIAL PERFORMANCE
1.1. INCOME AND EXPENSES
1.2. INCOME TAX
1.3. LOSS PER SHARE
1.4. SEGMENT INFORMATION
2. WORKING CAPITAL PROVISIONS
2.1. CASH AND CASH EQUIVALENTS
2.2. TRADE AND OTHER RECEIVABLES
2.3. TRADE AND OTHER PAYABLES
3.
INVESTED CAPITAL
3.1. PROPERTY, PLANT AND EQUIPMENT
3.2. RIGHT OF USE ASSET
3.3. EXPLORATION AND EVALUATION
3.4. MINE UNDER DEVELOPMENT
3.5. INVENTORY
3.6. GOVERNMENT LOANS
4. CAPITAL STRUCTURE AND FINANCING ACTIVITIES
4.1. CONTRIBUTED EQUITY
4.2. RESERVES
4.3. DIVIDENDS
5. RISK
5.1. FINANCIAL RISK MANAGEMENT
6. GROUP STRUCTURE
6.1. SUBSIDIARIES
7. UNRECOGNISED ITEMS
7.1. COMMITMENTS
7.2. CONTINGENCIES
7.3. EVENTS OCCURRING AFTER THE REPORTING PERIOD
8. OTHER INFORMATION
8.1. SHARE-BASED PAYMENTS
8.2. RELATED PARTY TRANSACTIONS
8.3. PARENT ENTITY FINANCIAL INFORMATION
8.4. REMUNERATION OF AUDITIORS
8.5. OTHER ACCOUNTING POLICIES
62
62
65
65
66
67
67
67
68
68
68
71
72
73
75
76
77
77
78
79
79
79
84
84
84
84
84
85
86
86
89
90
91
91
37
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Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022Vital Metals | Annual Report 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
1. FINANCIAL PERFORMANCE
1.1. INCOME AND EXPENSES
The following significant Income and expense items
not separately highlighted in the Statement of Profit
or Loss and Other Comprehensive Income are
relevant in explaining the financial performance:
Income:
Government incentives
Administration expenses
Professional fees
Corporate compliance
Personnel expenses
Other administration expense
Total other administration expenses
Personnel expenses
Wages and salaries
Annual leave
Superannuation
Recruitment costs
Total personnel expenses
1.2. INCOME TAX
(a) The major components of income tax are:
Statement of Profit or Loss and Other
Comprehensive Income
Current income tax
Current income tax benefit
Deferred income tax
Relating to origination and reversal of temporary
differences
Unused tax losses not recognised as deferred tax
asset
Tax rebate from R&D activities
Income tax benefit reported in the Statement of
Profit or Loss and Other Comprehensive Income
The aggregate amount of income tax attributable to
the financial period differs from the amount
calculated on the operating loss. The differences are:
Accounting loss before taxation
Prima facie tax benefit at the Australian tax rate of
30% (2021: 30%)
62
38
2022
$
2021
$
92,553
309,309
759,089
383,068
1,400,610
1,072,798
3,615,565
1,169,503
39,565
71,855
119,687
1,400,610
534,579
332,529
1,035,935
536,868
2,439,911
980,987
23,589
31,359
-
1,035,935
2022
$
2021
$
-
-
-
-
-
-
-
-
-
-
(4,770,105)
(4,745,906)
(1,431,032)
(1,423,772)
Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
1.2 INCOME TAX (CONT.)
Add tax effect of:
Non-deductible items
Foreign operations not brought to account
Less effect of:
Capital raising costs
Non-assessable government payments
Tax losses not brought to account
Income tax expense
(b) Deferred income tax:
Statement of Financial Position
Deferred income tax at 30 June relates to the
following:
Deferred tax liabilities
Property, plant and equipment – depreciation
Accrued income
Exploration expenses
Right of use asset
Set-off against tax assets
Deferred tax assets
Tax value of losses carried forward
Set-off of deferred tax liability
Accrued expenses
Asset impairments
Employee benefits
Other prepayments/capital expenditure
Right of use liability
Non-recognition of deferred tax assets
2022
$
2021
$
307,015
261,933
(22,579)
-
884,662
-
-
-
-
-
-
-
12,423,648
-
20,386
2,404,020
28,205
591
-
(14,876,850)
-
720,395
141,546
(46,418)
(17,576)
625,825
-
-
-
-
3,937
(3,937)
-
10,737,632
(3,937)
-
2,404,020
7,559
23,170
4,193
(13,172,637)
-
(c) Tax losses
At 30 June 2022, the Consolidated Entity has $12,423,648 (2021: $10,737,632) of taxable losses that
are available for offset against future taxable profits of the consolidated entity, subject to the loss
recoupment requirements in the Income Tax Assessment Act 1997.
No deferred tax asset has been recognised in the Statement of Financial Position in respect of the
amount of these losses, as it is not presently probable future taxable profits will be available against
which the Company can utilise the benefit.
Unrecognised deferred tax assets
Tax losses – revenue (at 30%)
2022
$
12,423,648
2021
$
10,737,632
39
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Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022Vital Metals | Annual Report 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
1.2 INCOME TAX (CONT.)
(d) Tax consolidation legislation
The Company and its wholly-owned Australian resident entities have formed a tax-consolidated Group
with effect from 3 October 2005 and are therefore taxed as a single entity from that date. The head
entity within the tax-consolidated group is Vital Metals Limited.
The controlled entities have been fully compensated for all deferred tax assets and liabilities transferred
to Vital Metals Limited on the date of forming a tax consolidated group. The entities have also entered
into a tax sharing and compensation agreement where the wholly owned entities reimburse Vital
Metals Limited for any current income tax payable or receivable by Vital Metals Limited in respect of
their activities. The group has decided to use the “separate taxpayer within group” approach in
accordance with UIG 1052 to account for the current and deferred tax amounts amongst the entities
within the consolidated group
(e) Corporate Tax Rate
In 2018, the government enacted a change in the eligibility to access the lower income tax rate for small
business entities. For the year ending 30 June 2022, Vital Metals Ltd does not satisfy these requirements
and is therefore subject to the corporate tax rate of 30%.
Accounting policy
Current tax
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at
the end of the reporting period in the countries where the Company’s subsidiaries operate and generate
taxable income. Management periodically evaluates positions taken in tax returns with respect to situations
in which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate on
the basis of amounts expected to be paid to the tax authorities.
Deferred tax
Deferred income tax is provided in full, using the liability method, on temporary differences arising between
the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements.
However, the deferred income tax is not accounted for if it arises from initial recognition of an asset or liability
in a transaction other than a business combination that at the time of the transaction affects neither
accounting nor taxable profit or loss. Deferred income tax is determined using tax rates (and laws) that have
been enacted or substantially enacted by the reporting date and are expected to apply when the related
deferred income tax asset is realised or the deferred income tax liability is settled.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is
probable that future taxable amounts will be available to utilise those temporary differences and losses.
Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount
and tax bases of investments in controlled entities where the parent entity is able to control the timing of the
reversal of the temporary differences and it is probable that the differences will not reverse in the foreseeable
future.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax
assets and liabilities and when the deferred tax balances relate to the same taxation authority. Current tax
assets and tax liabilities are offset where the entity has a legally enforceable right to offset and intends either
to settle on a net basis, or to realise the asset and settle the liability simultaneously.
Current and deferred tax for the year
Current and deferred tax is recognised in profit or loss, except to the extent that it relates to items recognised
in other comprehensive income or directly in equity. In this case, the tax is also recognised in other
comprehensive income or directly in equity, respectively.
64
40
Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
1.3. LOSS PER SHARE
Basic loss per share – cents per share
Diluted loss per share – cents per share
The following reflects the loss and share data
used in the calculations of basic loss per share
and diluted loss per share:
Net loss
Weighted average number of shares
outstanding:
Weighted average number of ordinary shares
used in calculating basic loss per share:
Weighted average number of ordinary shares
used in calculating diluted loss per share:
2022
(0.11)
(0.11)
2021
(0.16)
(0.16)
(4,770,105)
(4,745,906)
4,164,674,865
2,891,485,852
4,164,674,865
2,891,485,852
Classification of securities
Diluted loss per share is calculated after classifying all options on issue and all ownership-based
remuneration scheme shares remaining uncovered at 30 June 2022 that are dilutive as potential ordinary
shares. As at 30 June 2022, the company has on issue a total of 446,833,334 options over unissued capital.
Diluted loss per share has been calculated excluding the dilutionary effect of the options as the group made
a loss for the year and the impact would be to reduce the loss per share.
Conversions, calls, subscriptions or issues after 30 June 2022
Since 30 June 2022, the Company has issued 10,666,667 shares on conversion of options and 1,042,620,770
shares as part of a placement, raising $41,704,831.
Accounting Policy
Earnings per share
Basic earnings per share is determined by dividing the profit from ordinary activities after related income
tax expense and after preference dividends by the weighted average number of ordinary shares outstanding
during the year.
Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take
into account the after income tax effect of interest and other financing costs associated with dilutive
potential ordinary shares and the weighted average number of shares assumed to have been issued for no
consideration in relation to dilutive potential ordinary shares.
41
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Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022Vital Metals | Annual Report 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
1.4. SEGMENT INFORMATION
The consolidated entity has four reportable segments being mineral exploration and prospecting for
minerals in Australia, Canada, Burkina Faso and Tanzania.
The following is an analysis of the Group’s revenue and results by reportable segment:
Australia
Canada Burkina Faso
Tanzania
Consolidated Total
2022
$
2021
2022
2021
2022
2021
2022
2021
2022
2021
$
$
$
$
$
$
$
$
$
-
58,587
92,553
250,722
11,109
8,886
646,591
-
11,109
67,473
739,144
250,722
(3,322,124) (3,819,194) (1,048,870)
(792,551)
(3,322,124) (3,819,194) (1,048,870)
(792,551)
-
-
-
-
-
-
-
-
-
-
-
-
92,553
309,309
- 657,700
8,886
- 750,253
318,195
- (399,112) (134,161) (4,770,105) (4,745,906)
- (399,112) (134,161) (4,770,105) (4,745,906)
8,758,083 37,633,400 60,225,146 28,104,179 35,549 35,549
582,152
101,977 7,815,504 2,730,051 (42,938) (42,938)
-
-
- 69,018,778 65,773,128
- 8,354,719 2,789,090
Segment
income
Interest
revenue
Total
revenue
Segment
loss
Net loss
before
tax
Segment
assets
Segment
liabilities
Accounting Policy
Operating segments are reported in a manner consistent with the internal reporting provided to the chief
operating decision maker. The chief operating decision maker, who is responsible for allocating resources
and assessing performance of the operating segments, has been identified as the full Board of Directors.
The Group has identified four reportable segments being activities undertaken in Australia, Burkina Faso,
Tanzania and Canada. These segments include the activities associated with the determination and
assessment of the existence of commercially economic reserves, from the Group’s mineral assets in these
geographic locations.
Segment performance is evaluated based on the operating profit or loss or cash flows and is measured in
accordance with the Group’s accounting policies.
66
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Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
2. WORKING CAPITAL PROVISIONS
2.1. CASH AND CASH EQUIVALENTS
Cash at bank
Cash held as security deposits
Cash and cash equivalents as shown in the
statement of financial position and the
statement of cash flows
Reconciliation of Loss after Income Tax to
net cash flows from operating activities:
Loss after income tax
Non-cash flows from continuing
operations:
Depreciation
Share based payments
Other Adjustments
(Profit)/ Loss on sale of non-current assets
(Profit)/ Loss on sale of shares
Changes in assets and liabilities:
(Increase) / decrease in receivables
Increase / (decrease) in payables
Increase / (decrease) in inventory
Increase / (decrease) in provisions
FX Movement
Net cash (used in) operating activities
2022
$
4,228,279
930,071
2021
$
34,020,139
886,851
5,158,350
34,906,990
(4,770,105)
(4,745,906)
759,990
532,562
1,456
1,097
(30,535)
(263,793)
(823,272)
39,565
(199,313)
(4,752,348)
206,259
2,267,157
10,752
-
153,035
(110,588)
-
23,933
-
(2,195,358)
Accounting Policy
For the purpose of the statement of cash flows, cash includes cash on hand and in banks and at call deposits
with banks or financial institutions.
The Group’s risk exposure in relation to cash and cash equivalents is further discussed in Note 5.1.
2.2. TRADE AND OTHER RECEIVABLES
Current
Trade and other receivables
Trade Debtors
Security and other deposits
Other
2022
$
18,133
357,913
2,336,438
2,712,484
2021
$
21,161
201,610
1,084,043
1,306,814
Cash at bank and short-term bank deposits
AAA rating
5,158,350
34,906,990
Carrying value is considered to approximate fair value. Refer to Note 5.1 for the Group’s interest rate and
liquidity risk.
43
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Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022Vital Metals | Annual Report 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
2.2 TRADE AND OTHER RECEIVABLES (CONT.)
Other receivables includes a deposit of $1,107,321 (2021: Nil) on the Kipawa exploration project.
2.3. TRADE & OTHER PAYABLES
Current
Trade creditors and other payables
Accrued expenses
2022
$
6,287,293
115,620
6,402,913
2021
$
1,601,178
678,985
2,280,163
Carrying value is considered to approximate fair value. Refer to Note 5.1 for the Group’s interest rate and
liquidity risk.
Accounting Policy
Trade creditors and other payables are recognised when the consolidated entity becomes obliged to make
future payments resulting from the purchase of goods and services.
3.
INVESTED CAPITAL
3.1. PROPERTY, PLANT AND EQUIPMENT
Software:
At cost
Accumulated depreciation
Plant and equipment:
At cost
Accumulated Depreciation
Motor vehicles
At cost
Accumulated depreciation
Fixtures and Fittings
At cost
Accumulated depreciation
Capital Works in Progress
At cost
On costs
2022
$
78,482
(78,482)
-
4,806,239
(437,308)
4,368,931
572,128
(88,944)
483,184
337,295
(120,066)
217,229
12,473,094
351,909
12,825,003
2021
$
115,182
(52,321)
62,861
2,845,506
(29,972)
2,815,534
76,730
(21,519)
55,211
257,374
(28,891)
228,483
-
-
-
Total property, plant & equipment
– written down value
17,894,347
3,162,089
68
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Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
3.1 PROPERTY PLANT AND EQUIPMENT (CONT.)
On costs include directly attributable costs such as:
•
•
•
•
•
costs of employee benefits (as defined in AASB 119 Employee Benefits) arising directly from the
construction or acquisition of the item of property, plant and equipment;
costs of site preparation;
initial delivery and handling costs;
costs of testing whether the asset is functioning properly, after deducting the net proceeds from selling
any items produced while bringing the asset to that location and condition (such as samples produced
when testing equipment); and
professional fees
The remaining expenditure commitment relating to the Capital Works in Progress is disclosed in Note 7.1.
Movements in carrying amounts
Software
$
Plant and
Equipment
$
Motor
Vehicles
$
Fixtures and
Fittings
$
Capital
Works in
Progress
$
Total
$
62,861
-
2,815,534
1,959,124
55,211
533,743
228,483
78,512
-
12,825,003
3,162,089
15,396,382
-
(36,700)
-
(12,275)
-
-
(2,515)
-
(28,517)
(2,915)
-
-
(26,161)
(393,453)
(74,737)
(86,851)
-
-
-
-
(17.705)
(36,700)
(28,517)
(581,202)
-
4,368,931
483,184
217,229
12,825,003
17,894,347
$
$
$
$
$
$
57,553
36,700
-
27,682
1,405,562
1,407,448
35,086
39,641
-
-
257,374
-
1,407,448
-
(1,407,448)
1,527,769
1,739,277
-
(31,392)
(25,158)
(19,516)
(28,891)
62,861
2,815,534
55,211
228,483
-
-
(104,957)
3,162,089
2022
Opening net
book value
Additions
Exchange
differences
Write-offs
Disposals
Depreciation
Expense
Balance at
30 June 2022
2021
Opening net
book value
Additions
Transfers
Depreciation
Expense
Balance at
30 June 2021
Key estimates and judgements (PPE)
The estimations of useful lives, residual values and depreciation methods require management judgements
and are regularly reviewed. If they need to be modified, the depreciation expense is accounted for
prospectively from the date of the assessment until the end of the revised useful life (for both the current
and future years).
Estimated economically recoverable reserves are used in determining the depreciation and/or amortisation
of mine-specific assets. This results in a depreciation/amortisation charge proportional to the depletion of
the anticipated remaining life-of-mine production. The life of each item, which is assessed at least annually,
has regard to both its physical life limitations and present assessments of economically recoverable reserves
of the mine property at which the asset is located. These calculations require the use of estimates and
assumptions, including the amount of recoverable reserves and estimates of future capital expenditure.
45
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Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022Vital Metals | Annual Report 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
3.1 PROPERTY PLANT AND EQUIPMENT (CONT.)
The calculation of the depreciate rate could be impacted to the extent that actual productions in the future
is different from current forecast production based on economically recoverable reserves, or if future capital
expenditure estimates change. Changes to economically recoverable reserves could arise due to changes in
the factors or assumptions used in estimating reserves, including:
•
•
the effect on economically recoverable reserves of differences between actual commodity prices and
commodity price assumptions
unforeseen operational issues
Changes in estimates are accounted for prospectively, if appropriate.
Capital Works in Progress represents capital items (ultimately plant and equipment and directly attributable
costs) that have been ordered and partly paid for at the Reporting Date, but where the asset has not been
received and/ or is still being constructed at the Reporting Date. Management do not deem the Saskatoon
plant as ready for intended use therefore, depreciation has not commenced.
Accounting Policy
Each class of property, including software, plant and equipment and motor vehicles is carried at cost less,
where applicable, any accumulated depreciation and impairment. Historical cost includes expenditure that
is directly attributable to the acquisition of the items.
Subsequent costs are included in the asset's carrying amount or recognised as a separate asset, as
appropriate, only when it is probable that future economic benefits associated with the item will flow to the
Group and the cost of the item can be measured reliably. The carrying amount of any component accounted
for as a separate asset is derecognised when replaced. All other repairs and maintenance are charged to
profit or loss during the reporting period in which they are incurred.
Capital Works in Progress are measured at cost until the capital works are completed and underlying
equipment is delivered and installed for use. At the Reporting Date, management will consider if there is any
circumstance that has arisen that would require any adjustment to the carrying value of the capital works in
progress.
Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are
included in the statement of profit or loss and other comprehensive income.
Depreciation
Depreciation is provided on a diminishing value basis on all property, plant and equipment. This is done over
the useful lives of the asset to the Company commencing from the time the asset is held ready for use.
The depreciation periods used for each class of depreciable assets are:
Class of fixed asset
Software
Plant and equipment
Motor vehicles
Fixtures and fittings
Depreciation period
2-3 years
2-10 years
3 years
2-40 years
An item of property, plant and equipment and any significant part initially recognised is derecognised upon
disposal (i.e., at the date the recipient obtains control) or when no future economic benefits are expected
from its use or disposal. Any gain or loss arising on derecognition of the asset (calculated as the difference
between the net disposal proceeds and the carrying amount of the asset) is included in statement of profit
or loss and other comprehensive income when the asset is derecognised.
The asset’s residual values, useful lives and methods of depreciation/ amortisation are reviewed at each
reporting period and adjusted prospectively, if appropriate.
46
70
Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
3.2. RIGHT OF USE ASSET
Accounting Policy
AASB 16 eliminates the distinction between operating and finance leases and brings all leases (other than
short term and low value leases) on to the balance sheet. As a lessee, the Group recognises a right-of-use
asset representing its right to use the underlying asset and a lease liability representing its obligation to make
lease payments.
An assessment is made at inception to determine whether the contract is a lease. A contract is a lease if it
conveys a right to control the use of an identified asset for a period of time in exchange for consideration.
The Group recognises a right of use asset and a corresponding lease liability with respect to all lease
arrangements in which it is the lessee, except for short-term leases (defined as leases with a lease term of 12
months or less). For these leases, the Group recognises the leases payments as an operating expense on a
straight-line basis over the shorter of the term of the lease and the estimated useful lives of the assets, as
follows:
Right of use asset
Land and buildings
Depreciation period
3-10 years
The lease liability is initially measured at the present value of the lease payments that are not paid at the
commencement date, discounted by using the rate implicit in the lease. If this rate cannot be readily
determined, the Group uses its incremental borrowing rate.
Right of use assets are measured at cost, less any accumulated depreciation, and adjusted for any
remeasurement of lease liabilities. The cost of right of use assets includes the amount of lease liabilities
recognised, initial direct costs incurred, and lease payments made at or before the commencement date less
any lease incentives received.
Movements in carrying amounts
2022
Opening net book value
Additions
Depreciation Expense
Balance at 30 June 2022
2021
Opening net book value
Additions
Depreciation Expense
Balance at 30 June 2021
Land and buildings
$
167,829
579,098
(178,788)
Total
$
167,829
579,098
(178,788)
568,139
568,139
$
91,928
178,994
(103,093)
$
91,928
178,994
(103,093)
167,829
167,829
Lease assets – amounts recognised in the Consolidated Statement of Profit or Loss and Other
Comprehensive Income
Depreciation charge
Land and buildings – right of use assets
Property, plant and equipment
Total depreciation
2022
$
178,788
581,202
759,990
2021
$
103,166
103,093
206,259
Interest expense (included in finance expenses) in relation to leased assets for the year ended 30 June 2022
was $20,787.
47
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Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022Vital Metals | Annual Report 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
3.3. EXPLORATION AND EVALUATION
Costs carried forward in respect of areas of
interest in the exploration and evaluation
phases:
Opening net book amount
Exploration expenditure
Exploration expenditure – written off
Transferred to mine under development
Closing net book amount
The closing balances relate to the following
areas of interest:
Nechalacho Project, Canada
2022
$
2021
$
13,291,395
1,836,652
(254,408)
(1,342,635)
13,531,004
12,467,416
6,875,674
(134,161)
(5,917,534)
13,291,395
13,531,004
13,531,004
13,291,395
13,291,395
Accounting Policy
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 area of interest.
The Group reviews the carrying value of exploration and evaluation expenditure on a regular basis to
determine whether economic quantities of reserves have been found or whether further exploration and
evaluation work is underway or planned to support continued carry forward of capitalised costs. This
assessment requires judgement as to the status of the individual projects and their estimated recoverable
amount.
Exploration and evaluation costs related to areas of interest are carried forward to the extent that:
•
•
•
The rights to tenure of the areas of interest are current and the Group controls the area of interest
in which the expenditure has been incurred, and
Such costs are expected to be recouped through successful development and exploitation of the
area of interest, or alternatively by its sale, or
Exploration and evaluation 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 in relation to, the area of interest
are continuing.
Exploration and evaluation costs include the acquisition of rights to explore; topographical, geological,
geochemical and geophysical studies; exploratory drilling, trenching and sampling; and associated activities
relating to the evaluation of the technical feasibility and commercial viability of extracting the mineral
resource. General and administrative costs are included in the measurement of exploration and evaluation
costs where they are directly related to operational activities in a particular area of interest.
Significant judgements and estimates
The above accounting policy requires certain estimates and assumptions on future events and circumstances,
in particular whether an economically viable extraction operation can be established. These estimates and
assumptions may change as new information becomes available and could have a material impact on the
carrying value of deferred exploration and evaluation costs. Exploration and evaluation assets are assessed
and reviewed at each reporting date for impairment, where facts and circumstances suggest that the carrying
amount of the assets may exceed its recoverable amount. If the recoverable amount is less than the carrying
amount, the asset is written down to its recoverable amount and an impairment loss recognised.
72
48
Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
3.3 EXPLORATION AND EVALUATION (CONT.)
At each reporting date the Group undertakes an assessment of the carrying amount of its exploration and
evaluation assets. As a result of this review, exploration expenditure of $565,990 (2021: $134,161) on the
Wigu Hill and Kipawa Projects was written off and recognised in the Statement of Profit or Loss as both
projects currently do not possess the rights to tenure. A further $84,051 in wages for Wigu Hill was expensed
directly to the Statement of Profit or Loss, under personnel expenses.
3.4. MINE UNDER DEVELOPMENT
Mine under Development
Balance at the start of the year
Transferred from deferred exploration and
evaluation costs
Additions
Rehabilitation provision
Balance at the end of the year
2022
$
12,938,011
1,342,635
11,371,476
880,549
26,532,671
2021
$
-
5,917,534
7,020,477
-
12,938,011
Accounting Policy
Mine under development includes aggregate expenditure in relation to mine construction, mine
development, exploration and evaluation expenditure where a development decision has been made and
acquired mineral interests.
Expenditure incurred in constructing a mine by, or on behalf of, the Group is accumulated separately for each
area of interest in which economically recoverable reserves and resources have been identified. This
expenditure includes direct costs of construction, drilling costs and removal of overburden to gain access to
the ore, borrowing costs capitalised during construction and an appropriate allocation of attributable
overheads.
Mines under development are accumulated separately for each area of interest in which economically
recoverable reserves have been identified and a decision to develop has occurred. This expenditure includes
all capitalised exploration and evaluation expenditure in respect of the area of interest, direct costs of
development, an appropriate allocation of overheads and where applicable borrowing costs capitalised
during development. Once mining of the area of interest can commence, the aggregated capitalised costs are
classified under non-current assets as mines in production or an appropriate class of property, plant and
equipment.
The Group undertakes regular impairment reviews incorporating an assessment of recoverability of cash
generating assets. Cash generating assets relate to specific areas of interest in the Group’s mine property
assets. The recoverable value of specific areas of interest are assessed by value in use calculations determined
with reference to the projected net cash flows estimated under the Life of Mine Plan. As at 30 June 2022, the
Group determined that there were no impairment indicators.
49
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Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022Vital Metals | Annual Report 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
3.4 MINE UNDER DEVELOPMENT (CONT.)
Significant judgements and estimates
Production start date
The Group assesses the stage of each mine under development to determine when a mine moves into the
production phase, this being when the mine is substantially complete and ready for its intended use. The
Group considers various relevant criteria to assess when the production phase is considered to have
commenced. At this point, all related amounts are reclassified from ‘Mines under development’ to ‘Mines in
production’. Some of the criteria used to identify the production start date include, but are not limited to:
1. Level of capital expenditure incurred compared with the original development cost estimate;
2. Completion of a reasonable period of testing of the mine plant and equipment;
3. Ability to produce metal in saleable form (within specifications);
4. Ability to sustain ongoing production of metal; and
5. Positive cash flow position from operations.
When a mine development project moves into the production phase, the capitalisation of certain mine
development costs and pre-production revenues cease and costs are either regarded as forming part of the
cost of inventory or expensed, except for costs that qualify for capitalisation relating to mining asset additions
or improvements or mineable reserve development. It is also at this point that amortisation commences. At
30 June 2022, the North T Zone is not considered to be at this stage and therefore, remains as a development
asset with no amortisation charge.
Recoverability of mine under development
The Group undertakes an impairment review to determine whether any indicators of impairment are present.
Where indicators of impairment exist, an estimate of the recoverable amount of the Cash Generating Unit
(CGU) is made. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds
its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and
value in use.
For the purposes of assessing impairment, assets are grouped at the lowest levels for which they are
separately identifiable cash flows. Where an impairment loss subsequently reverses, the carrying amount of
the asset, other than goodwill, is increased to the revised estimate of its recoverable amount, but only to the
extent the increased carrying amount does not exceed the carrying amount that would have been
determined had no impairment loss been recognised in prior years. A reversal of an impairment loss is
recognised immediately in profit or loss.
Prior to transition to mine development, the Group assesses for impairment to confirm recoverability of costs
capitalised during the exploration and evaluation phase.
An impairment indicator assessment was undertaken for all operations at reporting date and it was concluded
that no indicators were identified, which would give rise to impairment.
Assessments of the recoverable amounts require the use of estimates and assumptions such as reserves,
resources, mine lives, discount rates, exchange rates, commodity prices, grade of ore mined, recovery
percentage, operating performance, costs and capital estimates.
74
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Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
3.5. INVENTORY
Non-current
Ore stockpile, at cost
Consumables
Balance at the end of the year
2022
$
1,798,510
823,272
2,621,782
2021
$
-
-
-
Accounting Policy
Ore stockpiles are valued at the lower of cost and net realisable value. Regular reviews are undertaken to
establish whether any items are obsolete or damaged, and if so their carrying value is written down to net
realisable value.
Inventory is recognised when it is probable that the future economic benefits will flow to the entity and the
asset has a cost or value that can be measured reliably. Ore is recognised as inventory as soon as it is extracted
and an assessment of mineral content is possible.
Consumables are valued at the lower of cost or net realisable value. Any provision for obsolescence is
determined by reference to specific items of stock. A regular and ongoing review is undertaken to determine
the extent of any provision for obsolescence.
The Group engaged a mining contractor that has resulted in extraction of ore and improvement of access to
the ore body for future periods. On the basis of mining costs incurred, the relevant portion of costs has been
allocated to inventory, with the remainder capitalised as Mine under Development costs, representing the
removal of overburden material. Net realisable value is the estimated selling price in the ordinary course of
business less processing cost and the estimated selling cost.
If the ore stockpile is not expected to be processed in 12 months after reporting date, it is included in Non-
Current Assets and the net realisable value is calculated on a discounted cash flow basis. The non-current ore
stockpiles represent the stockpiles held at the Group’s interest in Yellowknife and Saskatoon that are not
expected to be processed in the next 12 months. The determination of the current and non-current portion
of ore stockpiles includes the use of estimates and judgements about when ore stockpile draw downs for
processing will occur. These estimates and judgements are based on current forecasts and ramp-up
schedules.
Significant judgements and estimates
Inventories require certain estimates and assumptions most notably in regard to grades, volumes and
densities. Costs are allocated based on the cost of the mining campaign and the total of ore produced over
the amount of tonnes mined.
Stockpiles are measured by estimating number of tonnes added and removed from the stockpile, with
surveys performed to track volumetric data.
3.6. GOVERNMENT LOANS
During the year, Vital’s Canadian subsidiary, Cheetah Resources Corp. received CAD $946,184 (AUD
$1,064,923) from the Canadian Northern Economic Development Agency (“CanNor”). A second payment
was received in July 2022 (CAD $315,395). Terms of the loan are as follows:
Interest on loan: 0%
- Maturity date: 1 January 2033
-
- Repayment terms: agreed repayment schedule, over 10 years
-
Loan terms: eligible expenditure on capital assets and contract/ professional fees
51
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Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022Vital Metals | Annual Report 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
3.6 GOVERNMENT LOANS (CONT.)
AASB 9 requires non-current loans that carry no interest are to be measured at fair value using prevailing
interest rates for a similar instrument. As at 30 June 2022, the total fair value was $398,457. The notional
interest will be unwound over the loan period.
Government loans
Current
Non-current
2022
$
35,498
386,399
421,897
2021
$
-
-
-
4. CAPITAL STRUCTURE AND FINANCING ACTIVITIES
4.1. CONTRIBUTED EQUITY
(a) Issued and paid up capital
Fully paid ordinary shares
107,553,071
107,265,582
2022
$
2021
$
(b) Movements in shares on issue
Beginning of the year
Issued during the year:
Issue of shares on capital raisings
Issue of shares on exercise of
options
Issue of shares in conversion of
performance shares
Transaction costs on capital raisings
End of the year
2022
Number of
shares
2021
Number of
shares
2022
$
2021
$
4,154,233,084 2,142,611,289
107,265,582
57,645,649
- 1,061,538,462
16,250,000 150,083,333
-
287,500
51,000,000
1,605,000
-
800,000,000
4,170,483,084 4,154,233,084
-
4,170,483,084 4,154,233,084
-
-
107,553,082
(11)
107,553,071
-
110,250,649
(2,985,067)
107,265,582
76
52
Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
4.1 CONTRIBUTED EQUITY (CONT.)
(c) Movements in options on issue
Beginning of the financial year
Issued during the year:
- Exercisable at 3 cents and expiring 24 December 2023
- Exercisable at 2 cents and expiring 31 January 2024*
- Exercisable at 2.5 cents and expiring 31 January 2024*
- Exercisable at 3 cents and expiring 31 January 2024*
- Exercisable at 7 cents and expiring 22 December 2024
- Exercisable at 2 cents and expiring 31 January 2025*
- Exercisable at 2.5 cents and expiring 31 January 2025*
- Exercisable at 3 cents and expiring 31 January 2025*
Exercised during the year:
- Exercised at 2 cents and expiring 30 April 2021
- Exercised at 2.3 cents and expiring 30 April 2021
- Exercised at 1 cent and expiring 17 November 2021
- Exercised at 1.5 cents and expiring 19 July 2022
- Exercised at 3 cents and expiring 24 December 2023
Expired/cancelled during the year:
- Options expired 30 April 2021
End of the financial year
Number of options
2022
2021
443,083,334
472,166,667
-
-
-
-
20,000,000
-
-
-
-
-
(6,250,000)
(5,000,000)
(5,000,000)
5,000,000
20,000,000
20,000,000
20,000,000
-
6,000,000
6,000,000
6,000,000
(50,000,000)
(7,500,000)
(18,750,000)
(16,333,333)
-
-
446,833,334
(19,500,000)
443,083,334
* Of the total 83,000,000 options issued during the 2021 financial year, 60,000,000 were issued to Director
James Henderson and 18,000,000 were issued to Mr Anthony Hadley.
(d) Terms and condition of contributed equity
Ordinary shares
Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the
Company in proportion to the number of and amounts paid on the shares held. On a show of hands every
holder of ordinary shares present at a meeting in person or by proxy, is entitled to one vote, and upon a poll
each share is entitled to one vote. Ordinary shares have no par value and the Company does not have a
limited amount of authorised capital.
(e) Capital risk management
The Board’s policy is to maintain a strong capital base so as to maintain investor, creditor and market
confidence and to sustain future developments of the business. The Board’s focus has been to raise sufficient
funds through equity (via rights issues and placements) to fund exploration and evaluation activities. There
were no changes in the Group’s approach to capital management during the year. Neither the Company nor
any of its subsidiaries are subject to externally imposed capital requirements.
Management also monitor capital through the assessment of adequate working capital. The working capital
as at 30 June 2022 is shown below:
Current assets
Current liabilities
Working capital
2022
$
7,870,834
(6,771,232)
1,099,602
2021
$
36,213,804
(2,376,218)
33,837,586
53
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Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022Vital Metals | Annual Report 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
4.1 CONTRIBUTED EQUITY (CONT.)
Accounting Policy
Ordinary shares are classified as equity
Incremental costs directly attributable to the issue of new shares or options are shown in equity as a
deduction net of tax, from the proceeds. Incremental costs directly attributable to the issue of new shares or
options for the acquisition of a business are not included in the cost of acquisition as part of the purchase
consideration.
If the entity reacquires its own equity instruments, e.g. as the result of a share buyback, those instruments
are deducted from equity and the associated shares are cancelled. No gain or loss is recognised in the profit
or loss and the consideration paid including any directly attributable incremental costs (net of income taxes)
is recognised directly in equity.
4.2. RESERVES
Share based payment reserve
Opening balance
Movement for the year
Closing balance
Foreign Currency Translation Reserve
Opening balance
Movement for the year
Closing balance
Total Reserves
2022
$
7,157,816
532,562
7,690,378
410,647
1,630,074
2,040,721
9,731,099
2021
$
4,890,659
2,267,157
7,157,816
311,318
99,329
410,647
7,568,463
(i) Share based payment reserve
The share-based payments reserve is used to recognise the fair value of options issued. Refer to Note 8.1 for
details.
(ii) Foreign currency translation reserve
Exchange differences arising on translation of the foreign controlled entities are taken to the foreign currency
translation reserve, as described below. The reserve is recognised in profit or loss when the net investment
is disposed of.
Accounting Policy
(i) Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing
at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such
transactions and from the translation at year end exchange rates of monetary assets and liabilities,
denominated in foreign currencies, are recognised in profit or loss.
(ii) Foreign operations
The assets and liabilities of foreign operations are translated to the functional currency as exchange rates at
the reporting date. The income and expenses of foreign operations are translated to Australian dollars at
exchange rates at the dates of the transactions.
Foreign currency differences are recognised in other comprehensive income, and presented in the foreign
currency translation reserve in equity.
78
54
Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
4.2 RESERVES (CONT.)
On consolidation, exchange differences arising from the translation of any net investment in foreign entities
are recognised in other comprehensive income. When the settlement of a monetary item receivable from or
payable to a foreign operation is neither planned nor likely in the foreseeable future, foreign exchange gains
and losses arising from such a monetary item are considered to form part of a net investment in a foreign
operation and are recognised in other comprehensive income, and are presented in the translation reserve
in equity. When a foreign operation is sold or any borrowings forming part of the net investment are repaid,
the associated exchange differences are reclassified to profit or loss, as part of the gain or loss on sale.
4.3. DIVIDENDS
No dividends were paid during the financial year. No recommendation for payment of dividends has been
made.
5. RISK
5.1. FINANCIAL RISK MANAGEMENT
The Group’s activities expose it to a variety of financial risks: market risk (including currency risk and interest
rate risk), credit risk and liquidity risk. The Group’s overall risk management program focuses on the
unpredictability of financial markets and seeks to minimise potential adverse effects on the financial
performance of the Group.
Risk management is carried out by the full Board of Directors as the Group believes that it is crucial for all
board members to be involved in this process. The Managing Director, with the assistance of senior
management as required, has responsibility for identifying, assessing, treating and monitoring risks and
reporting to the board on risk management.
(a) Credit Risk
Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails
to meet its contractual obligations.
Financial instruments other than receivables that potentially subject the Group to concentrations of credit
risk consist principally of cash deposits. The Group places its cash deposits with high credit quality financial
institutions, being in Australia one of the major Australian (big four) banks. Cash holdings in other countries
are not significant. The Group’s cash deposits are all on call or in term deposits and attract a rate of interest
at normal short-term money market rates.
The Group’s exposure to credit risk is low and limited to cash and cash equivalents and other receivables. All
cash and cash equivalents total $5,158,350 as at 30 June 2022 (2021: $34,906,990) are held with financial
institutions that have a AAA credit rating (Standard & Poor’s).
The maximum exposures to credit risk are the amounts as shown in the Statement of Financial Position.
The group applies the AASB 9 simplified approach to measuring expected credit losses which uses a lifetime
expected loss allowance for all trade receivables. These provisions are considered representative across all
customers of the Group based on recent sales experience, historical collection rates and forward-looking
information that is available.
(b) Cash flow interest rate risk
The Group’s exposure to the risks of changes in market interest rates, foreign exchange rates, and equity
prices will affect the Consolidated Entity’s income or the value of its holdings of financial instruments. The
objective of market risk management is to manage and control market risk exposures within acceptable
parameters, while optimising the return.
55
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Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022Vital Metals | Annual Report 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
5.1 FINANCIAL RISK MANAGEMENT (CONT.)
The Group is exposed to fluctuations in foreign exchange rates of the Canadian Dollar in respect of its
operations in Canada and CFA Franc in relation to its activities in Burkina Faso. The group maintains minimal
working capital in Canada and Burkina Faso and only transfers cash funds as required, as such the
Consolidated Statement of Financial Position exposure at any point in time is not significant. Foreign
exchange risk will also arise from commercial transactions and recognised assets and liabilities denominated
in a currency that is not the entity’s functional currency and net investments in foreign operations.
The Group is also exposed to fluctuations in interest rates in relation to its cash deposits and commodity
prices in relation to the carrying value of its exploration and evaluation assets. The Group monitors all of the
above-mentioned risks and takes action as required.
The Group’s exposure to interest rate risk, and the effective weighted average interest rate for each class of
financial asset and financial liability is set out below:
Weighted
Average
Effective
Interest
Rate
2022
%
Variable
Interest
Rate
2022
$
Fixed Interest Rate
Maturing
Within
1 Year
2022
$
1-5
Years
2022
$
0.25
5,158,350
-
-
-
5,158,350
-
-
-
-
-
-
-
Non-
Interest
Bearing
2022
$
Total
2022
$
-
5,158,350
2,712,484
2,712,484
2,712,484
7,870,834
6,402,913
6,402,913
6,402,913
6,402,913
-
-
-
-
-
2022
Financial assets:
Cash at bank
Trade and other
receivables
Total financial
assets
Financial
liabilities:
Trade and other
payables
Total financial
liabilities
80
56
Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
5.1 FINANCIAL RISK MANAGEMENT (CONT.)
Weighted
Average
Effective
Interest
Rate
2021
%
Variable
Interest
Rate
2021
$
Fixed Interest Rate
Maturing
Within
1 Year
2021
$
1-5
Year
2021
$
0.25
34,906,990
-
-
34,906,990
-
-
-
-
-
-
-
-
Non-
Interest
Bearing
2021
$
Total
2021
$
-
34,906,990
1,306,814
1,306,814
1,306,814
36,213,804
2,280,163
2,280,163
2,280,163
2,280,163
-
-
-
-
-
2021
Financial
assets:
Cash at bank
Trade and other
receivables
Total financial
assets
Financial
liabilities:
Trade and other
payables
Total financial
liabilities
At 30 June 2022, if interest rates had changed by -/+ 25 basis points from the weighted average rate for the
period with all other variables held constant, post-tax loss for the Group would have been $9,251
higher/lower (2021: -/+ 25 basis points, $78,365 higher/lower) as a result of lower/higher interest income
from cash and cash equivalents.
Sensitivity Analysis
At the reporting date, the variable interest profile of the Group’s interest-bearing financial instruments were:
Financial assets
0.25% (2021- 0.25%) increase
0.25% (2021- 0.25%) decrease
2022
$
3,700,269
9,251
(9,251)
2021
$
31,346,023
78,365
(78,365)
(c) Liquidity risk
The Group manages liquidity risk by continuously monitoring forecast and actual cash flows and ensuring
sufficient cash and marketable securities are available to meet the current and future commitments of the
Group. Due to the nature of the Group’s activities, being mineral exploration, the Group has limited access
to credit facilities, with the primary source of funding being equity raisings. The Board of Directors constantly
monitor the state of equity markets in conjunction with the Group’s current and future funding requirements,
with a view to initiating appropriate capital raisings as required.
The financial liabilities of the Group are confined to trade and other payables as disclosed in the statement
of financial position. All trade and other payables are due within 12 months of the reporting date. All other
financial liabilities were fully repaid during the year.
57
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Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022Vital Metals | Annual Report 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
5.1 FINANCIAL RISK MANAGEMENT (CONT.)
The following are the contractual maturities of trade and other payables.
Group:
at 30
June 2022
Less than 6
months
6 – 12
months
Between 1
and 2
years
Between
2 and 5
years
Over 5
years
Total
contractual
cash flows
Carrying
amount
(assets)
/liabilities
$
$
$
$
$
$
$
Trade and
other
payables
Financial
liabilities
Group:
at 30
June 2021
Trade and
other
payables
Financial
liabilities
5,763,290
430,262
499
208,862
- 6,402,913
6,402,913
-
229,112
-
-
- 229,112
229,112
Less than 6
months
6 – 12
months
Between 1
and 2
years
Between
2 and 5
years
Over 5
years
Total
contractual
cash flows
Carrying
amount
(assets)
/liabilities
$
$
$
$
$
$
$
2,245,921
15,566
18,676
-
65,992
-
-
-
- 2,280,163
2,280,163
-
65,992
65,992
(d) Foreign Exchange Risk
A risk arises when future commercial transactions and recognised assets and liabilities are denominated in a
currency other than the consolidated entity’s functional currency.
The Group operates internationally, with its major assets being held in Canada, and is exposed to foreign
exchange risk arising from currency exposures to the Euro, FCFA (fixed to the Euro), Tanzanian Shilling and
Canadian Dollar. Historically, given the level of expenditure and available funding, the Group considered its
exposure to foreign exchange risk was manageable and hedging policies were not adopted. The Company,
through the Managing Director and the Financial Officer regularly monitor movements in the foreign
currencies that the Company is exposed to. If appropriate, and from time to time, the Company may enter
into forward foreign exchange contract to minimise its exposure to foreign exchange risks. The Company
also has foreign currency denominated accounts that are utilised to manage this risk. The Company did not
enter into any new forward foreign exchange contracts during the year.
The Board considers policies relating to foreign currency exposure from time to time and, based on available
funding, proposed exploration programs and foreign currency exposures, may or may not decide to enter in
further forward foreign exchange contracts. The Board will continue to review its position in respect of
foreign exchange risk management and will adopt suitable policies as required.
The carrying value of foreign currency denominate monetary assets and liabilities as at the reporting date
are as follows:
CAD
Euro/CFA
82
Assets
2022
AUD
1,239,120
15,620
2021
AUD
3,371,196
15,620
58
Liabilities
2022
AUD
7,106,941
16,593
2021
AUD
2,610,815
16,593
Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
5.1 FINANCIAL RISK MANAGEMENT (CONT.)
Foreign Currency Sensitivity Analysis
The Group is mainly exposed to CAD, CFA and Tanzanian Shilling. The following table details the Group’s
sensitivity to a 10% increase and decrease in the Australian dollar against the relevant foreign currencies.
10% is the sensitivity rate that represents management’s assessment of the reasonably possible change in
foreign exchange rates. The sensitivity analysis includes only outstanding foreign currency denominated
monetary items and adjusts their translation at the year-end for a 10% change in foreign currency rates. A
positive number below indicates an increase in profit where the Australian dollar strengthens 10% against
the relevant currency. For a 10% weakening of the Australian dollar against the relevant currency, there
would be a comparable impact on the profit, and the balances below would be negative.
CAD Dollars
CFA
Financial Assets
+10% Appreciation
-10% Depreciation
Financial
Liabilities*
+10% Appreciation
-10% Depreciation
2022
AUD
123,912
(123,912)
2021
AUD
337,120
(337,120)
710,694
(710,694)
261,081
(261,081)
2022
AUD
1,562
(1,562)
1,659
(1,659)
2021
AUD
1,562
(1,562)
1,659
(1,659)
* Note – the majority of the balance of financial liabilities relates to capitalised exploration and development
expenditure. Therefore, the variations in the balance as shown in the sensitivity analysis would not impact
the profit or loss, but rather the carrying value of the capitalised exploration and development expenditure.
Forward Foreign Exchange Contracts
As at 30 June 2022 there were no outstanding forward foreign exchange contracts (2021: Nil).
(e) Fair value of financial instruments
The carrying amounts of all financial assets and liabilities approximate their respective net fair values at
reporting date.
Fair value estimation
Fair values have been determined for measurement and/or disclosure purposes based on the following
methods. Where applicable, further information about the assumptions made in determining fair values is
disclosed in the notes specific to that asset or liability.
Trade and other receivables
Fair value, which is determined for disclosure purposes, is estimated as the present value of future cash flows,
discounted at the market rate of interest at the reporting date.
Trade and other payables
Fair value, which is determined for disclosure purposes, is calculated based on the present value of future
principal and interest cash flows, discounted at the market rate of interest at the reporting date.
Borrowings
Fair value, which is determined for disclosure purposes, at the time of for establishing the financial liability
and based on the present value of the remaining cash flows, discounted at the assessed weighted average
cost of capital.
59
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Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022Vital Metals | Annual Report 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
6. GROUP STRUCTURE
6.1. SUBSIDIARIES
The consolidated financial statements include the financial statements of the ultimate parent entity Vital
Metals Limited and the subsidiaries listed in the following table:
Name of Entity
Country of Incorporation
Equity Interest
Cheetah Resources Pty Ltd
NWT Rare Earths Ltd
Cheetah Resources Corp.
Vital Metals Canada Limited
Vital Metal Burkina Sarl
Kisaki Mining Company Limited
Australia
Canada
Canada
Canada
Burkina Faso
United Republic of
Tanzania
2022
100%
50%
100%
100%
100%
90%
2021
100%
50%
100%
100%
100%
90%
7. UNRECOGNISED ITEMS
7.1. COMMITMENTS
EXPENDITURE COMMITMENTS
(a) Capital expenditure commitments
- Within one year
- Later than one year but not later than
five years
(b) Mineral tenement commitments
- Within one year
- Later than one year but not later than
five years
2022
$
2021
$
13,984,606
-
951,854
-
-
-
-
-
13,984,606
951,854
7.2. CONTINGENCIES
There are two royalties in place relating to the Nechalacho Project:
1. A 3% net smelter return royalty.
a)
b)
the royalty holder has agreed to waive their right to the royalty for the first five (5)
years following commencement of commercial production at the Nechalacho
Project; and
the royalty holder has also agreed to grant an option to pay C$2,000,000 at any time
during the eight (8) year period following the acquisition of the Nechalacho Project
to cancel the royalty.
2. The Murphy Royalty which is a 2.5% net smelter return royalty held by a third party. Vital holds
an option to purchase the royalty for an inflation adjusted fixed amount estimated to currently
be C$1,500,000.
The NWT Mining Regulation require that a sliding scale net profit royalty (ranging between 0% - 14%, based
on mine profitability) is payable once the project is in profit and the pre-development costs are recouped.
84
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Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
7.2 CONTINGENCIES (CONT.)
The Group has obtained several licence permits in Canada on the commencement of operations at
Nechalacho. In accordance with these permits, the Group must meet all requirements for waste
management, spillage contingency, water management etc., with reclamation costs estimated at $880,549
(C$782,368). The Group holds $880,549 as a deposit in favour of the Canadian Department of Lands as a
reclamation security in respect of the permits held. Should the Group not meet all permit requirements in
relation to rehabilitation, these funds will be accessed directly by the Canadian Department of Lands to meet
the Group’s obligations.
7.3. EVENTS OCCURING AFTER THE REPORTING PERIOD
Capital Raising
In August 2022, Vital announced it had raised $45M via a targeted placement, with private equity firm
Lionhead Resources Fund LP (LHR) becoming a cornerstone investor following its A$30.0 million (before costs)
investment. Vital completed the Placement at an issue price of A$0.04 per share via a share placement to
institutional, sophisticated and professional investors with 1,125 million new fully paid ordinary shares to be
issued (“Placement”).
Proceeds from the Placement will finalise construction, commissioning and ramp-up of Vital’s Saskatoon Plant
and enable it to accelerate development of projects including the Tardiff deposit at Nechalacho, as it executes
a strategy to become the world’s first producer of commercial quantities of both heavy and light rare earths.
It will also provide working capital requirements as Vital transitions from rare earths exploration and
development into operations.
Board and Management Changes
Following Lionhead Resources Fund’s (LHR) A$30 million investment in Vital as part of its A$45 million
placement, Richard Crookes and Paul Quirk joined the Vital Board as Non-Executive Directors, as nominees
of LHR.
Mr Crookes is managing partner of Lionhead Resources (LHR) and chairman of the Investment Committee.
He has more than 35 years of global resource industry experience across a diverse range of projects,
geographies and commodities as both an operator and investor.
Mr Quirk is a partner at Lionhead Resources and is responsible for originating new investment opportunities
and building and maintaining investor relations. Mr Quirk has had a successful career as a private equity
investor, with more than 15 years of private equity and operational experience in mining and other industries.
In addition to Mr Crookes and Mr Quirk joining Vital’s Board, LHR’s Russell Bradford joined Vital’s new
Technical Advisory Committee. Mr Bradford is a partner at Lionhead Resources and a metallurgist with more
than 35 years of project management and operational experience in the mining sector.
On 31 August 2022, the Company announced that it had terminated the consultancy agreement between
Atkins Projects and Infrastructure Pty Ltd and the Company and that Geoff Atkins will cease as Managing
Director Vital Metals, effective immediately.
Russell Bradford was appointed interim CEO.
COVID-19
The Company, its staff and contractors based in Canada have been minimally impacted by the COVID-19
pandemic and continue to operate its programs as planned.
Management is actively monitoring the global situation and its impact on the Group's financial condition,
liquidity, operations, suppliers, industry, and workforce. Given the daily evolution of the COVID-19 outbreak
and the global responses to curb its spread, the Group is not able to estimate the effects of the COVID-19
outbreak on its results of operations, financial condition, or liquidity for the 2022 financial year.
61
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Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022Vital Metals | Annual Report 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
7.3 EVENTS OCCURING AFTER THE REPORTING PERIOD (CONT.)
Other than the above, there has not been any matter or circumstance that has arisen since the end of the
financial year, that has significantly affected or may significantly affect the operations of the Group, the
results of those operations, or the state of affairs of the Group in future financial years.
8. OTHER INFORMATION
8.1. SHARE-BASED PAYMENTS
(a) Expenses arising from share-based payment transactions
Total expenses arising from share-based payment transactions recognised during the period were as follows:
SHARE BASED PAYMENTS
Options issued to directors
Options issued to Employee/Consultant
2022
$
2021
$
-
532,562
532,562
1,737,991
529,166
2,267,157
86
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Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
8.1 SHARE-BASED PAYMENTS (CONT.)
The fair value of options issued were calculated by using a Black-Scholes pricing model applying the following
inputs.
Employee/
Consultant
Employee/
Consultant
Employee/
Consultant
Employee/
Consultant
Grant dated
Number Issued
Share price at grant date
Exercise price
Life of options (years)
Vesting life (years)2
Expected share price volatility
Weighted average risk free interest rate
Fair value per option
21/11/2019
22,500,000
$0.13
$0.025
5
2
100%
0.84%
$0.0084
21/11/2019
22,500,000
$0.13
$0.030
5
3
100%
0.84%
$0.0082
26/11/2020
6,000,000
$0.036
$0.020
4
1
117.83%
0.29%
$0.0298
26/11/2020
6,000,000
$0.036
$0.025
4
2
117.83%
0.29%
$0.0289
Grant dated
Number Issued
Share price at grant date
Exercise price
Life of options (years)
Vesting life (years)2
Expected share price volatility
Weighted average risk free interest rate
Fair value per option
Notes:
Employee/
Consultant
Employee/
Consultant
Employee/
Consultant
26/11/2020
6,000,000
$0.036
$0.030
4
3
117.83%
0.29%
$0.0282
22/12/2021
10,000,0001
$0.048
$0.07
3
-
83.86%
1.32%
$0.0217
22/12/2021
10,000,0003
$0.048
$0.07
3
-
83.86%
1.32%
$0.0217
1. No implied service condition therefore, these options vest immediately
2.
3.
These options have a service condition and therefore, vest over the vesting life
These options vest upon any of the following conditions being met:
Vital Metals exceeds market capitalisation of A$1 billion
-
A US or appropriate other (equivalent) listing obtained, via IPO or other means such as RTO (or equivalent) or ADR
-
listing
Change of Control event
At Vital Metals’ board discretion
-
-
Any of the conditions above must be satisfied and the options exercised within 3 years of the grant date, at which time the
options will expire.
A probability of less than 100% has been applied to achieving these milestones and therefore, nil expense has been
recognised for the year ended 30 June 2022.
Historical volatility has been used as the basis for determining expected share price volatility as it assumed
that this is indicative of future trends, which may not eventuate.
The fair value and grant date of the options is based on historical exercise patterns, which may not eventuate
in the future.
For service provider options the value of the service received was unable to be measured reliably and
therefore the value was measured by reference to the fair value of the options issued.
63
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Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022Vital Metals | Annual Report 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
8.1 SHARE-BASED PAYMENTS (CONT.)
(b) Options
Set out below are summaries of the options granted:
Consolidated
2022
Weighted
average
exercise price
cents
2.40
7.00
1.80
-
2.70
2.50
3.80
2021
Weighted
average
exercise price
cents
1.70
2.50
1.70
2.30
2.40
2.40
2.50
Number of
options
472,166,667
83,000,000
(92,583,333)
(19,500,000)
443,083,334
380,083,334
63,000,000
Number of
options
443,083,334
20,000,000
(16,250,000)
-
446,833,334
402,333,334
44,500,000
Outstanding at the beginning of the year
Granted
Exercised
Expired
Outstanding at year-end
Exercisable at year-end
Un-exercisable at year-end
The weighted average remaining contractual life of share options outstanding at the end of the financial year
was 2.26 years (2021: 3.18 years), and the exercise price ranges from 1.5 to 7.0 cents.
Options exercised during the year resulted in 16,250,000 shares (2021: 92,583,333 shares) being issued at an
average price of $0.018 each.
The range of exercise prices for options outstanding at the end of the year is $0.01 to $0.07 (2021: $0.01 to
$0.03).
(c) Expenses arising from share-based payment transactions
Total expenses arising from share-based payment transactions recognised during the period were as follows:
Options issued to directors (vested)
Options issued to employees (vested)
Options issued to consultants
(d) Performance shares
2022
$
-
315,313
217,249
532,562
2021
$
1,737,991
425,347
103,819
2,267,157
On 16 October 2019, the Company issued 800,000,000 performance shares which convert to one ordinary
share upon completion of the following milestones:
•
•
400,000,000 Performance Shares (Tranche 1) with a fair value of $4,800,000 that will convert to one
Share on the Company entering into binding offtake for a minimum of 1,000 kgs of contained REO
in respect of the Nechalacho Project or Wigu Hill Project within 2 years of the Acquisition completion
date; and
400,000,000 Performance Shares (Tranche 2) with a fair value of $4,800,000 that will each convert
to one Share on the Company commencing mining operations at the Nechalacho Project or Wigu
Hill Project within 3 years of the issue of the Tranche 1 performance shares. Where this Tranche 2
milestone is satisfied, the Tranche 1 milestone will automatically be deemed to have been satisfied.
88
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Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
8.1 SHARE-BASED PAYMENTS (CONT.)
The Company assessed the probability of conditions being met at 0% in relation to Tranche 1 and 0% in
relation to Tranche 2 as at the date of acquisition. The performance shares issued as part of the acquisition
will not be remeasured at each reporting period. At the commencement of commercial mining operations at
Nechalacho during the 2021 financial year, the 800,000,000 Performance Shares were converted to ordinary
shares on a 1:1 basis. At 30 June 2022, nil Performance Shares are on issue (2021: Nil).
Accounting Policy
Equity-settled and cash-settled share-based compensation benefits are provided to employees.
Equity-settled transactions are awards of shares, or options over shares that are provided to employees in
exchange for the rendering of services. Cash-settled transactions are awards of cash for the exchange of
services, where the amount of cash is determined by reference to the share price.
The costs of equity-settled transactions are recognised as an expense with a corresponding increase in equity
over the vesting period. The cumulative charge to profit or loss is calculated based on the grant date fair value
of the award, the best estimate of the number of awards that are likely to vest and the expired portion of the
vesting period. The amount recognised in profit or loss for the period is the cumulative amount calculated at
each reporting date less amounts already recognised in previous periods.
The costs of equity-settled transactions are measured at fair value on grant date. Fair value is independently
determined using either the Binomial or Black-Scholes option pricing model that takes into account the
exercise price, the term of the option, the impact of dilution, the share price at grant date and expected price
volatility of the underlying share, the expected dividend yield and the risk free interest rate for the term of
the option, together with non-vesting conditions that do not determine whether the consolidated entity
receives the services that entitle the employees to receive payment. No account is taken of any other vesting
conditions.
Significant judgements and estimates
The Group has an Incentive Option Scheme (“Scheme”) for executives and employees of the Group. In
accordance with the provisions of the Scheme, as approved by the shareholders at the November 2020
annual general meeting, executives and employees may be granted options at the discretion of the directors.
Each share option converts into one ordinary share of Vital Metals Limited on exercise. No amounts are paid
or are payable by the recipient on receipt of the option. The options carry neither rights of dividends nor
voting rights. Options may be exercised at any time from the date of vesting to the date of their expiry.
Options issued to directors are not issued under the Scheme but are subject to approval by shareholders.
8.2. RELATED PARTY TRANSACTIONS
(a) Parent entity
The ultimate parent entity within the Group is Vital Metals Limited.
(b) Subsidiaries
Interests in subsidiaries are set out in note 6.1.
(c) Key Management Personnel disclosures
Directors and other Key Management Personnel
The directors of Vital Metals Limited during the financial year were:
Evan Cranston
-
- Geoff Atkins
-
James Henderson
65
89
Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022Vital Metals | Annual Report 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
8.2 RELATED PARTY TRANSACTIONS (CONT.)
Other Key Management Personnel consisted of:
-
Anthony Hadley
Compensation of Key Management Personnel
Short-term employee benefits
Post-employment benefits
Termination
Share-based payments
2022
$
650,000
28,000
-
215,803
893,803
2021
$
675,484
26,600
-
1,927,505
2,629,589
Other disclosures regarding Key Management Personnel are made in the remuneration report on pages 35
to 46.
8.3. PARENT ENTITY FINANCIAL INFORMATION
The following information relates to the parent entity, Vital Metals Limited, as at 30 June 2022. The
information presented here has been prepared using accounting policies consistent with those presented in
this report.
Assets
Current assets
Non-current assets
Inter-company loan
Total assets
Liabilities
Current liabilities
Non-current liabilities
Total liabilities
Net Assets
Equity
Issued capital
Reserves
Accumulated losses
Total equity
Financial performance
Profit/(loss) for the year
Other comprehensive income
Total comprehensive Profit/(loss)
2022
$
4,083,233
4,851,135
50,351,962
59,286,330
276,626
-
276,626
2021
$
31,649,974
3,289,290
24,860,212
59,799,476
101,976
-
101,976
59,009,704
59,697,500
107,553,083
7,690,379
(56,233,758)
59,009,704
(3,207,859)
-
(3,207,859)
107,265,583
7,157,816
(54,725,899)
59,697,500
(3,819,194)
-
(3,819,194)
Contingent liabilities and commitments
-
-
There are no parent company guarantees in place at the Reporting date.
90
66
Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
8.4. REMUNERATION OF AUDITORS
Amounts received or due and receivable by BDO
Audit and review of financial statements
by BDO Audit (WA) Pty Ltd
-
- Other amounts received or due and
receivable by BDO Reward (WA) Pty Ltd
Total remuneration
2022
$
117,780
18,868
136,648
2021
$
77,814
19,882
97,696
During the year, BDO Reward (WA) Pty Ltd were engaged to complete a remuneration review of Key
Management Personnel for the year ended 30 June 2022.
8.5. OTHER ACCOUNTING POLICIES
Goods and services tax
Revenues, expenses and assets are recognised net of the amount of goods and services tax (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 are stated with the amount of GST included.
The net amount of GST recoverable from, or payable to, the ATO is included as a current asset or liability in
the statement of financial position.
Cash flows are included in the statement of cash flows 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.
67
91
Vital Metals ABN 32 112 032 596 Notes to the Consolidated Financial Statements for the Year Ended 30 June 2022Vital Metals | Annual Report 2022
DIRECTORS’ DECLARATION
VITAL METALS LIMITED AND ITS CONTROLLED ENTITIES
ABN 32 112 032 596
DIRECTORS’ DECLARATION
In the directors’ opinion:
1.
the consolidated financial statements comprising the statement of profit or loss and other comprehensive
income, statement of financial position, statement of changes in equity, statement of cash flows and
accompanying notes set out on pages 56 to 91 are in accordance with the Corporations Act 2001, including
(a) complying with Australian Accounting Standards, the Corporations Regulations 2001 and other
mandatory professional reporting requirements; and,
(b) giving a true and fair view of the consolidated entity’s financial position as at 30 June 2022 and of its
performance for the financial year ended on that date;
2.
3.
there are reasonable grounds to believe that the Company will be able to pay its debts as and when they
become due and payable.
the remuneration disclosures included in the Directors' Report (as part of the audited Remuneration
Report), for the year ended 30 June 2022, comply with Section 300A of the Corporations Act 2001; and
The Notes to the Consolidated Financial Statements confirm that the financial statements also comply with
International Financial Reporting Standards as issued by the International Accounting Standards Board.
The directors have been given the declarations by the chief executive officer and chief financial officer required by
section 295A of the Corporations Act 2001.
This declaration is made in accordance with a resolution of the directors.
Evan Cranston
Chairman
Sydney: 30 September 2022
92
68
Vital Metals ABN 32 112 032 596 Directors’ Declaration Tel: +61 8 6382 4600
Fax: +61 8 6382 4601
www.bdo.com.au
Level 9, Mia Yellagonga Tower 2
5 Spring Street
Perth, WA 6000
PO Box 700 West Perth WA 6872
Australia
INDEPENDENT AUDITOR'S REPORT
To the members of Vital Metals Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Vital Metals Limited (the Company) and its subsidiaries (the
Group), which comprises the consolidated statement of financial position as at 30 June 2022, the
consolidated statement of profit or loss and other comprehensive income, the consolidated statement
of changes in equity and the consolidated statement of cash flows for the year then ended, and notes
to the financial report, including a summary of significant accounting policies and the directors’
declaration.
In our opinion the accompanying financial report of the Group, is in accordance with the Corporations
Act 2001, including:
(i)
Giving a true and fair view of the Group’s financial position as at 30 June 2022 and of its
financial performance for the year ended on that date; and
(ii)
Complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s responsibilities for the audit of the Financial
Report section of our report. We are independent of the Group in accordance with the Corporations
Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s
APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code)
that are relevant to our audit of the financial report in Australia. We have also fulfilled our other
ethical responsibilities in accordance with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been
given to the directors of the Company, would be in the same terms if given to the directors as at the
time of this auditor’s report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
BDO Audit (WA) Pty Ltd ABN 79 112 284 787 is a member of a national association of independent entities which are all members of BDO Australia
Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit (WA) Pty Ltd and BDO Australia Ltd are members of BDO
International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability
limited by a scheme approved under Professional Standards Legislation.
93
Vital Metals ABN 32 112 032 596 Independent Auditor’s Report to the MembersVital Metals | Annual Report 2022 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.
Accounting for mine under development
Key audit matter 1
How the matter was addressed in our audit
At 30 June 2022 the carrying value of the mine under
Our procedures included, but were not limited to:
development asset was disclosed in Note 3.4.
As the carrying value of the mine under development
asset represents a significant asset of the Group, we
considered it necessary to assess whether any facts or
circumstances exist to suggest that the carrying
amount of this asset may exceed its recoverable
amount and assess the accounting and classification of
the asset.
This was determined to be a key audit matter due to
the significant judgement applied in determining
whether impairment indicators exist in accordance
with Australian Accounting Standard AASB 136
Impairment of Assets.
•
•
•
•
Verifying, on a sample basis, mining costs
capitalised during the year for compliance with
the recognition and measurement criteria of AASB
116 Property, Plant and Equipment;
Considering the status of the operation by holding
discussions with management, and reviewing the
ASX announcements and director’s minutes to
determine the appropriate classification;
Considering whether any facts or circumstances
existed indicating that impairment testing was
required; and
Assessing the adequacy of the related disclosures
in Note 3.4 to the Financial Statements.
Carrying value of exploration and evaluation assets
Key audit matter 2
How the matter was addressed in our audit
At 30 June 2022 the carrying value of the capitalised
Our procedures included, but were not limited to:
exploration and evaluation assets was disclosed in
Note 3.3.
As the carrying value of the exploration and evaluation
assets represent significant assets of the Group, we
considered it necessary to assess whether any facts or
circumstances exist to suggest that the carrying
amount of this asset may exceed its recoverable
amount.
•
•
Obtaining a schedule of the area of interest held
by the Group and assessing whether the rights to
tenure of the area of interest remained current at
balance date;
Verifying, on a sample basis, exploration and
evaluation expenditure capitalised during the year
for compliance with the recognition and
measurement criteria of AASB 6;
94
Vital Metals ABN 32 112 032 596 Independent Auditor’s Report to the Members Key audit matter 2
How the matter was addressed in our audit
This was determined to be a key audit matter due to
the significant judgement applied in determining the
treatment of exploration expenditure in accordance
with Australian Accounting Standard AASB 6
Exploration for and Evaluation of Mineral Resources.
•
•
•
•
Considering the status of the ongoing exploration
programmes in the respective areas of interest by
holding discussions with management, and
reviewing the Company’s exploration budgets,
ASX announcements and director’s minutes;
Considering whether any area of interest had
reached a stage where a reasonable assessment of
economically recoverable reserves existed;
Considering whether any facts or circumstances
existed to suggest impairment testing was
required; and
Assessing the adequacy of the related disclosures
in Note 3.3 to the Financial Statements.
Other information
The directors are responsible for the other information. The other information comprises the
information in the Group’s annual report for the year ended 30 June 2022, but does not include the
financial report and the auditor’s report thereon.
Our opinion on the financial report does not cover the other information and we do not express any
form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the directors for the Financial Report
The directors of the Company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due to
fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the group to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the Group or to cease
operations, or has no realistic alternative but to do so.
95
Vital Metals ABN 32 112 032 596 Independent Auditor’s Report to the MembersVital Metals | Annual Report 2022 Auditor’s responsibilities for the audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of this financial report.
A further description of our responsibilities for the audit of the financial report is located at the
Auditing and Assurance Standards Board website (http://www.auasb.gov.au/Home.aspx) at:
https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf
This description forms part of our auditor’s report.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 38 to 46 of the directors’ report for the
year ended 30 June 2022.
In our opinion, the Remuneration Report of Vital Metals, for the year ended 30 June 2022, complies
with section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the
Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility
is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with
Australian Auditing Standards.
BDO Audit (WA) Pty Ltd
Neil Smith
Director
Perth
30 September 2022
96
Vital Metals ABN 32 112 032 596 Independent Auditor’s Report to the Members ASX ADDITIONAL INFORMATION
As at 7 September 2022
The Australian Securities Exchange Limited, in respect of listed public companies, requires the following information:
1. Shareholding
(a)
Distribution of shareholders as at 7 September 2022 - fully paid ordinary shares
Size of Holding
1 - 1,000 shares
1,001 - 5,000 shares
5,001 – 10,000 shares
10,000 – 100,000 shares
100,001 shares and over
Number of
Shareholders
123
39
1,204
7,232
4,218
Percentage of
Holders
1.0%
0.3%
9.4%
56.4%
32.9%
Number of Shares
20,241
112,942
10,364,595
319,525,551
4,893,747,192
Percentage
of Shares
0.0%
0.0%
0.2%
6.1%
93.7%
Total
12,816
100.0%
5,223,770,521
100.0%
(b)
Marketable Parcels
The number of shareholdings less than a marketable parcel is 1,880 holders with 16,456,225 shares as at
7 September 2022. The required marketable parcel is $500 (13,158 shares).
(c)
Substantial Shareholders
As at 7 September 2022, there were two substantial shareholders who had notified the Company in
accordance with section 671B of the Corporations Act 2001 as having a substantial interest of 5% or more
in the Company’s voting securities.
Substantial Shareholder
Number of Securities
Voting Power
Lionhead Resources Fund I LP, Lionhead
Resources Fund I GP Limited, Lionhead Resources
Limited, Lionhead Resources Advisors Limited,
LHR CICI I GP Limited, LHR CI I LP, LHR Co-Invest I
LP and LHR Investments Coöperatief U.A. (“Other
Lionhead Parties”)
(d)
Voting Rights
667,620,770
12.8%
All ordinary shares (whether fully paid or not) carry one vote per share without restriction. There are no
voting rights attached to any class of options, Performance Rights or Performance Shares on issue.
(e)
On-market Buy-Back
Currently there is no on-market buy-back of the Company’s securities.
74
97
Vital Metals ABN 32 112 032 596 ASX Additional Information as at 7 September 2022Vital Metals | Annual Report 2022
ASX ADDITIONAL INFORMATION
As at 7 September 2022
(f)
Top Twenty Shareholders of Vital Metals Limited – Ordinary Shares:
LIONHEAD RESOURCES I BV
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
TRANSOCEAN PRIVATE INVESTMENTS PTY LTD
CITICORP NOMINEES PTY LIMITED
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
BNP PARIBAS NOMS PTY LTD
TISIA NOMINEES PTY LTD
ATKINS PROJECTS AND INFRASTRUCTURE PTY LTD
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
BNP PARIBAS NOMS PTY LTD
BNP PARIBAS NOMINEES PTY LTD
BNP PARIBAS NOMINEES PTY LTD ACF CLEARSTREAM
TROCA ENTERPRISES PTY LTD
SEAMIST ENTERPRISES PTY LTD
MR JACK DWYER
KOBIA HOLDINGS PTY LTD
UBS NOMINEES PTY LTD
PONDEROSA INVESTMENTS WA PTY LTD
MR PAUL ANTHONY HENRY
TREASURY SERVICES GROUP PTY LTD
Fully Paid Ordinary
Shares
667,620,770
409,354,636
208,296,342
187,775,453
144,776,666
106,704,176
100,000,467
91,849,547
68,208,559
56,325,920
50,731,824
36,755,191
36,331,637
33,937,310
30,649,848
29,994,000
29,375,000
26,875,000
25,000,000
24,500,000
Percentage
of
Total
(%)
12.78%
7.84%
3.99%
3.59%
2.77%
2.04%
1.91%
1.76%
1.31%
1.08%
0.97%
0.70%
0.70%
0.65%
0.59%
0.57%
0.56%
0.51%
0.48%
0.47%
Totals: Top 20 Holders of ORDINARY Shares (TOTAL)
Total Remaining Holders Balance
2,365,062,346
2,858,708,175
45.28%
54.72%
Total All shareholders
5,223,770,521
100.0%
98
75
Vital Metals ABN 32 112 032 596 ASX Additional Information as at 7 September 2022
ASX ADDITIONAL INFORMATION
As at 7 September 2022
2. UNQUOTED EQUITY SECURITIES
The unquoted equity securities outstanding are as follows:
Number
Class
Holders with more than 20% interest in that
class
20,000,000
Unlisted options exercisable at 7.0 cents
expiring 9 August 2024
Ecoban Securities Corporation Limited
20,000,000
Unlisted options exercisable at 2.0 cents
expiring 22 October 2024
Jalonex Investments Pty Ltd (20,000,000)
20,000,000
Unlisted options exercisable at 2.5 cents
expiring 22 October 2024
Jalonex Investments Pty Ltd (20,000,000)
20,000,000
Unlisted options exercisable at 3.0 cents
expiring 22 October 2024
Jalonex Investments Pty Ltd (20,000,000)
90,000,000
Unlisted options exercisable at 2.0 cents
expiring 22 October 2024
90,000,000
Unlisted options exercisable at 2.5 cents
expiring 22 October 2024
90,000,000
Unlisted options exercisable at 3.0 cents
expiring 22 October 2024
28,500,000
Unlisted options exercisable at 2.0 cents
expiring 31 January 2025
28,500,000
Unlisted options exercisable at 2.5 cents
expiring 31 January 2025
28,500,000
Unlisted options exercisable at 3.0 cents
expiring 31 January 2025
Atkins Projects and Infrastructure Pty Ltd (Geoff
Atkins) (30,000,000)
Konkera Pty Ltd (Evan
Cranston) (60,000,000)
Atkins Projects and Infrastructure Pty Ltd (Geoff
Atkins) (30,000,000)
Konkera Pty Ltd (Evan
Cranston) (60,000,000)
Atkins Projects and Infrastructure Pty Ltd (Geoff
Atkins) (30,000,000)
Konkera Pty Ltd (Evan
Cranston) (60,000,000)
Mathew Edler (12,500,000)
Darren Sutton (7,500,000)
Anthony Hadley (6,000,000)
David Connelly (2,500,000)
Mathew Edler (12,500,000)
Darren Sutton (7,500,000)
Anthony Hadley (6,000,000)
David Connelly (2,500,000)
Mathew Edler (12,500,000)
Darren Sutton (7,500,000)
Anthony Hadley (6,000,000)
David Connelly (2,500,000)
76
99
Vital Metals ABN 32 112 032 596 ASX Additional Information as at 7 September 2022Vital Metals | Annual Report 2022
ASX ADDITIONAL INFORMATION
As at 7 September 2022
Distribution of holders of unquoted equity securities
Unlisted options
($0.07 @ 9/08/2024)
Unlisted options
Unlisted options
Unlisted options
Unlisted options
($0.02 @ 22/10/2024)
($0.025 @ 22/10/2024)
($0.03 @ 22/10/2024)
($0.02 @ 22/10/2024)
No. of
holders
No. of
securities
No. of
holder
No. of
securities
No. of
holder
No. of
securities
No. of
holder
s
No. of
securities
No. of
holders
No. of
securities
1 – 1,000
1,001 –
5,000
5,001 –
10,000
10,001 –
100,000
100,001
and over
Total
-
-
-
-
1
1
-
-
-
-
20,000,000
20,000,000
-
-
-
-
1
1
-
-
-
-
20,000,000
20,000,000
-
-
-
-
1
1
-
-
-
-
20,000,000
20,000,000
-
-
-
-
1
1
-
-
-
-
20,000,000
20,000,000
-
-
-
-
2
2
-
-
-
-
90,000,000
90,000,000
Unlisted options
Unlisted options
Unlisted options
Unlisted options
Unlisted options
($0.025 @ 22/10/2024)
($0.03 @ 22/10/2024)
($0.02 @ 31/01/2025)
($0.025 @ 31/01/2025)
($0.03 @ 31/01/2025)
No. of
holders
No. of
securities
No. of
holders
No. of
securities
No. of
holder
No. of
securities
No. of
holders
No. of
securities
No. of
holders
No. of
securities
1 – 1,000
1,001 – 5,000
5,001 –
10,000
10,001 –
100,000
100,001 and
over
Total
-
-
-
-
2
2
-
-
-
-
90,000,000
90,000,000
-
-
-
-
2
2
-
-
-
-
90,000,000
90,000,000
-
-
-
-
4
4
-
-
-
-
28,500,000
28,500,000
-
-
-
-
4
4
-
-
-
-
28,500,000
28,500,000
-
-
-
-
4
4
-
-
-
-
28,500,000
28,500,000
3. RESTRICTED SECURITIES:
The Company has the following restricted securities: nil
77
100
Vital Metals ABN 32 112 032 596 ASX Additional Information as at 7 September 2022
Level 10, 27-31 Macquarie Place
Sydney, NSW, 2000
T +61 2 8029 0676
W www.vitalmetals.com.au
E vital@vitalmetals.com.au
ABN 32 112 032 596