Volt Resources Limited
(formerly Mozambi Resources Limited)
a n d c o n t r o l l e d e n t i t i e s
ABN 28 106 353 253
Financial Report for the year ended
30 June 2016
Volt Resources Limited ABN 28 106 353 253
Financial Report for the Year Ended 30 June 2016
Corporate Directory
Directors’ Report
Auditor’s Independence Declaration
Independent Auditor’s Report
Directors’ Declaration
Consolidated Statement of Profit or Loss
Consolidated Statement of Other Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to the Financial Statements
Additional ASX Information
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Volt Resources Limited ABN 28 106 353 253
Corporate Directory
Directors
Securities Exchange Listing
Mr Stephen Hunt – Executive Chairman
Australian Securities Exchange
Mr Alwyn Vorster – Non-Executive Director
Home Exchange: Perth, Western Australia
Mr Matthew Bull – Non-Executive Director
Codes: VRC, VRCO
Company Secretary
Mr Stephen Brockhurst
Registered and Principal Administration Office
Website and Email
www.voltresources.com
info@voltresources.com
Level 11, London House
216 St Georges Terrace
PERTH WA 6000
Tel: +(618) 9481 0389
Auditors
HLB Mann Judd
Level 4, 130 Stirling Street
PERTH WA 6000
Share Registry
Advanced Share Registry Services
110 Stirling Hwy
NEDLANDS WA 6009
Postal Address
PO Box 1156
NEDLANDS WA 6909
Tel: (+618) 9389 8033
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Volt Resources Limited ABN 28 106 353 253
Directors’ Report
Your Directors present their report on the consolidated entity consisting of Volt Resources Limited (formerly Mozambi
Resources Limited) (“the Company” or “VRC”) and the entities it controlled during the financial year ended 30 June 2016
(“Consolidated Entity” or “Group”).
Directors
The names of the Directors of Volt Resources Limited in office during the financial year and until the date of this report
are:
Mr Stephen Hunt – Executive Chairman (appointed 15 December 2015)
Mr Matthew Bull – Non Executive Director
Mr Alwyn Vorster – Non Executive Director (appointed 1 April 2016)
Mr Adrien Wing – Non Executive Chairman (resigned 15 December 2015)
Mr Alan Armstrong – Non Executive Director (resigned 22 August 2016)
Company Secretary
Mr Stephen Brockhurst
Principal activities
The principal activities of the Group during the financial year were graphite exploration in Tanzania.
Annual activities report
During the reporting period, substantial progress has been achieved advancing the Board’s strategic objectives. In
particular, the rapid projected evolution of the electric vehicle and power utility storage sectors globally are propelling
growing demand for lithium-ion batteries and in turn, presenting unparalleled new opportunities for high quality natural
graphite suppliers.
With highly targeted marketing, Volt Resources now has several current and prospective customers in China, Europe and
the USA testing samples of its super jumbo and jumbo flake graphite. Concurrently, the team in Perth is advancing the
Prefeasibility Study and activities on the ground in Tanzania are ramping-up to ensure that future clients’ natural graphite
requirements will be met.
Holistically, there was considerable activity on multiple fronts across Volt Resources, with key developments highlighted
below.
NEW CORPORATE NAME
In April 2016, following shareholder approval, the Company formally changed its name to Volt Resources Limited (ASX:
VRC), from Mozambi Resources Limited (ASX: MOZ) to better reflect the new business dynamics.
NAMANGALE PROJECT IN SOUTHERN TANZANIA
During the first half of the fiscal year, Volt Resources finalised the acquisition of a 1,955 square kilometre tenement
package in southern Tanzania (Figure 1: Volt Resources Project Area). Shortly after finalising this acquisition, inaugural
drilling commenced at Namangale North (previously Namangale 1) and Namangale South (previously Namangale 2 and
3).
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Volt Resources Limited ABN 28 106 353 253
Directors’ Report
Figure 1: Volt Resource’s project area
At the conclusion of the 2015 drilling campaign, the following results were achieved:
82 reverse circulation holes and 4,472m drilled; and,
10 diamond holes and 535m drilled.
Subsequent resource modelling determined a substantial maiden JORC compliant graphite resource (Table 1: JORC
compliant resource post 2015 drilling campaign).
Deposit
INDICATED
Namangale North
INFERRED
Namangale North
Namangale South
Total
Tonnes
(Mt)
62.6
133.4
18.4
214.4
Grade
(% TGC)
5.1
5.1
5.4
5.1
Table 1: JORC compliant resource post 2015 drilling campaign
The 2016 drilling results showed the mineralisation intersected was consistent with the work undertaken in 2015 and
moreover, indicated material areas of extension within each deposit. Resource modelling on the 2016 drilling campaign
results is now underway.
Deposit
Reverse circulation
Diamond drill
Total
Namangale North
Namangale South
Total
15
43
58
1,776m
4,183m
5,959m
15
7
22
1,385m
447m
1,832m
30
50
80
3,161m
4,630m
7,791m
Table 2: Drilling completed at each deposit in 2016
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Volt Resources Limited ABN 28 106 353 253
Directors’ Report
PREFEASIBILITY STUDY
Completing the Prefeasibility Study (PFS) by the end of 2016 is a critical milestone the Board aims to achieve as part of its
strategy to continue de-risking the Namangale project. Post the close of the reporting period, the Board appointed a
dedicated project manager, Mr Mark Hoffman, to work closely with consultants BatteryLimits Pty Ltd to facilitate this
outcome.
Project engineers from BatteryLimits have been to the mine site in Tanzania and produced detailed plans on where to
locate key infrastructure such as the central processing facility, tailings dam, waste dumps and access roads.
The Namangale project is located only 10km away from sealed roads, then 130km direct to the deep-water port of
Mtwara. Currently, the port has an export capacity of 400,000 tonnes per annum and its prevailing utilisation is around
35%. However, should it be needed, capacity could be increased to 750,000 tonnes per annum across the same number
of berths if incremental equipment is installed to handle containerised traffic. The Environmental and Social Impact
Survey (ESIS) is progressing as planned for both deposits. This is important as the ESIS is a material component of the
mining license application process in Tanzania.
NAMANGALE METALLURGICAL RESULTS
Establishing a global supply chain hinges on being able to demonstrate the ability to deliver a consistent high quality
product that meets customers’ requirements.
During the course of 2016, Volt Resources has been able to demonstrate improving purity and flake distribution from
optimised metallurgical test-work conducted across the Namangale North and South deposits. Key salient highlights
during 2016 include:
Production of graphite flake concentrate from a simple crush and flotation process, without using toxic industrial
chemicals.
Across the Namangale North and South deposits, multiple results showing total graphitic carbon (TGC) exceeding
99%.
Ability to produce super jumbo and jumbo flake concentrate samples for clients up to 99.6% TGC.
Graphite flake distribution with up to 81.3% in the super jumbo, jumbo and large flake categories (Figure 2: Flake
distribution achieved from Test 49 at Namangale South during Jan – Aug 2016).
(%)
40
35
30
25
20
15
10
5
0
Super jumbo
Jumbo
Large
Medium
Fine
Amorphous
Figure 2: Flake distribution achieved from Test 49 at Namangale South during Jan – Aug 2016
Reflecting on these excellent metallurgical results, the Board believes the test-work results clearly demonstrate to
prospective customers the Namangale deposit is world-class. Further, the Board believes the product from Namangale
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Volt Resources Limited ABN 28 106 353 253
Directors’ Report
will meet the commercial application requirements of most customer groups, but particularly the lithium-ion battery
sector which is currently the major demand driver for natural graphite.
NAMANGALE SOUTH
Test 49
Nam S Oxide
Test 48
Nam S Oxide
Test 53
Nam S Oxide
Weight
(%)
21.4
35.8
24.1
5.6
5.2
2.9
2.8
2.1
TGC
(%)
96.5
97.8
97.6
96.9
96.3
94.4
87.2
81.7
Weight
(%)
18.2
36.8
25.7
6.0
5.7
3.2
2.8
1.6
TGC
(%)
98.6
98.4
97.9
97.0
96.2
94.9
88.7
81.5
Weight
(%)
5.5
26.7
29.0
9.0
9.2
7.2
8.7
4.7
TGC
(%)
97.4
99.6
99.5
99.6
99.4
99.1
98.5
94.1
Test 34
Nam S Oxide
Test 30
Nam S Oxide
Test 28
Nam S Oxide
Weight (%)
10.3
29.7
27.1
8.0
8.8
6.6
6.6
2.9
TGC
(%)
99.1
98.8
98.1
97.5
97.3
96.9
95.9
92.4
Weight
(%)
TGC (%) Weight (%)
5.9
28.1
30.3
8.4
10.1
7.6
7.3
2.2
99.3
98.8
97.8
97.3
96.9
96.7
95.7
91.6
10.2
30.5
27.0
8.1
10.0
5.9
6.2
2.2
TGC
(%)
98.6
98.0
96.6
95.6
95.0
94.4
92.7
87.5
Size
(µm)
500
300
180
150
106
75
25
-25
Size
(µm)
500
300
180
150
106
75
25
-25
Table 3: Results from metallurgical test-work conducted on Namangale South test pit during January - August 2016
NAMANGALE NORTH – RESULT SUMMARY
Test 50
Nam N Oxide
Size
(µm)
500
300
180
150
106
75
25
-25
Weight
(%)
1.8
14.7
26.9
11.5
15.2
12.8
12.1
5.0
TGC
%
98.3
97.3
95.8
94.8
94.7
94.2
91.4
79.4
Test 47
Nam N Oxide
Test 52
Nam N Oxide
Weight
(%)
TGC
%
Weight
(%)
TGC
%
3.6
16.7
26.4
10.8
14.4
11.3
11.5
5.2
96.8
94.6
92.6
92.0
91.8
91.3
86.2
69.7
0.3
7.3
22.3
12.0
17.3
15.1
18.1
7.7
97.9
99.2
98.8
98.4
98.2
98.0
96.9
91.2
Table 4: Results from metallurgical test-work conducted on Namangale North test pit during January - August 2016
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Volt Resources Limited ABN 28 106 353 253
Directors’ Report
GLOBAL MARKETING FOCUS
Establishing a rapport with prospect global clients early on in Volt Resources’ evolution has been a critical Board objective.
With each graphite project unique and the market generally opaque, it is important to gather first hand intelligence on
what prospective clients require and tailor the product offering accordingly. More importantly, it is critical to maintain
regular dialogue with prospective customers to understand any nuanced changes in their requirements so this can be
factored into the mix. The Board remains vigilant that continually differentiating the product offering is strategically
important to ensure the success of the project.
During the reporting period, the Company successfully signed Memoranda of Understandings (MOU) with three large
groups in China for 100,000 tonnes per annum (Table 5: China-based MOU partners). This was a significant vote of
confidence in Volt Resources’ business model considering metallurgical test-work remains ongoing for further
optimisation. Of particular significance was signing up Optimum Nano which is one of China’s largest integrated lithium-
ion battery producer.
Customer
Business description
Annual graphite
required (Tonnes)
Optimum Nano
Huzhou Chuangya
Large scale integrated lithium-ion
battery producer
Large scale anode & electrolyte
manufacturer
Shenzhen Sinuo
Specialised anode & spherical graphite
producer
Table 5: China-based MOU partners
60,000
20,000
20,000
In August 2016, in order to expand and focus on securing more traditional western off-take MOUs, the Board appointed
Mr Michael Lew as VP Business Development for North America and Europe. Based in New York, Mr Lew is currently
Director, Emerging Opportunities for the National Alliance for Advanced Transportation Batteries International. Having
heavily interacted with battery manufacturers, particularly those aligned with transport and energy storage, Mr Lew is
highly suited to leverage his extensive North American and European network to promote Volt Resources’ natural
graphite products.
In September 2016, the three China-based partners were sent graphite concentrate samples from the Namangale South
deposit with up to 99.6% TGC. They will be conducting independent testing on the samples to ensure it meets with their
specifications for downstream applications. The Board is optimistic that there will be further samples required and these
groups will sign binding off-take agreements at the conclusion of their respective testing programmes.
Incrementally, graphite concentrate samples from the Namangale South deposit were also sent to prospective customers
in Europe and the USA. The Board is highly encouraged by this development and expects further samples to be dispatched
to prospective customers in the USA and Europe in coming months as Mr Lew settles into his new role. To date, the spread
of customer activities that samples were sent to comprises an integrated lithium-ion battery and electric vehicle
manufacturer, graphite anode producer, graphite trading house and graphene product specialist.
CAPITAL RAISING & EAS ADVISORS
Over the course of the reporting period, Volt Resources has raised $12m from shareholders via a rights issue, share
placements and options exercised. Proceeds have been used for general working capital and primarily to fund the PFS. At
30 June 2016, Volt Resources had $7.6m cash on hand which the Board believes is more than adequate to fund working
capital requirements and the PFS.
In May 2016, EAS Advisors LLC (“EAS”) was appointed as Volt Resources’ corporate advisor to the North American
investment community. Since its inception in 2008, EAS has achieved a solid legacy assisting select ASX companies to
secure funding to deliver growth. Notably, it has participated in over $3.5bn worth of transactions.
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Volt Resources Limited ABN 28 106 353 253
Directors’ Report
The Board is now working closely with EAS on executing Volt Resources’ business plan. For instance, EAS organised the
recent investor roadshow in New York and has made introductions to prospective customers.
GRAPHITE INDUSTRY OUTLOOK
The Board remains up to date on developments within the graphite industry that directly impact Volt Resources’
prospects. In particular, the Board is encouraged by developments in China and the pursuit of “green solutions” to the
pollution problems.
Combined with events in developed nations, many industry commentators now expect a near eight-fold increase in
electric vehicle demand to circa 6 million by 2020 (from 800k in 2015) and rapid evolution of the utility power storage
market.
Indeed, Volt Resources has primary evidence about the positive knock-on effect this rapid growth is having on the lithium-
ion battery sector. All three MOU partners confirmed to a Board member, on a recent visit to China, that their capacity
will expand between 200-300% over the next 2-3 years to meet future demand.
This scenario augurs favourably for Volt Resources with its high quality natural graphite. Longer-term, industry expert,
UK-based Benchmark Minerals Intelligence expects more than US$20bn to be outlayed on building lithium-ion battery
mega-and-giga factories over the next 3-5 years. Excluding Tesla’s facility in Nevada, there are seven facilities currently
under construction in China.
Placing this in context, BMI conservatively forecasts that demand for spherical graphite, derived from natural sourced
concentrate, from the lithium-ion battery sector alone could underpin a 200% increase in demand to circa 160,000 tonnes
per annum by 2020 (Figure 3: BMI forecast for spherical graphite derived from natural feedstock).
Figure3: BMI forecast for spherical graphite derived from natural feedstock
Assuming a yield of 50% to derive spherical graphite, this implies a minimum of 320,000 tonnes of naturally sourced
graphite concentrate will be needed by 2020 (2015: circa 107,000 tonnes) to meet just the lithium-ion battery sector’s
requirements. However, this figure may prove to be overly conservative if the disruptive impact of electric vehicles and
power storage utilities has been underestimated.
Based on current market forecast, the Board believes its strategy to strengthen Volt Resources’ marketing focus and
traction with prospective clients to secure off-take MOUs that convert into binding agreements, is critical. Moreover, the
Board is acutely cognisant that it must continue to demonstrate to prospective clients the ability to deliver high quality
graphite concentrate products. In parallel, the Board is rapidly executing the business plan to ensure all key studies and
regulatory requirements are progressed with urgency to ensure the Namangale project is continually de-risked and
succeeds in getting into production as quickly as possible.
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02040608010012014016018020152020FSpherical graphite demand ('000 tpa)
Volt Resources Limited ABN 28 106 353 253
Directors’ Report
Competent Person Statement
The information in this report that relates to Exploration Targets, Exploration Results, Mineral Resources or Ore Reserves
is based on information compiled by Mr Matthew Bull, a Competent Person who is a member of Australian Institute of
Geoscientists. Mr Bull is a Director of Volt Resources. Mr Bull has sufficient experience that is relevant to the style of
mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent
Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources
and Ore Reserves’. Mr Bull consents to the inclusion in the report of the matters based on his information in the form and
context in which it appears.
Significant changes in state of affairs
There were no significant changes in the state of affairs of the Group during the year other than as noted above or
elsewhere in this report.
Information on Directors
Current Directors
Mr Stephen Hunt – Executive Chairman
Qualifications – Bachelor of Business (Maj. Marketing), AICD member
Special responsibilities – Chairman
Other current directorship of Listed Public Companies – Nil
Former Directorship (of Listed Public Companies) in last three years – Magnis Resources
Interests in Shares and Options over Shares in the Company –
5,088,454 ordinary shares;
2,000,000 listed options (VRCO); 10,000,000 performance rights
Mr. Hunt has more than 25 years of experience in the marketing of steel and mineral products worldwide. His career
includes 15 years at BHP Billiton Ltd. where he spent 5 years in the London office marketing minerals to European and
Middle Eastern customers. Stephen has built on his extensive network and developed his own minerals trading company,
which has a strong Chinese focus. He brings along with him 15 years of cumulative board experience with ASX limited
companies and most recently was a founding director of Magnis Resources Limited.
Mr Alwyn Vorster – Non-Executive Director
Qualifications – BSc Geology; MBA, MSc Mineral Economics
Special responsibilities – Nil
Other current directorship of Listed Public Companies – Managing Director of BC Iron Ltd
Former Directorship (of Listed Public Companies) in last three years – Managing Director of Iron Ore Holdings Ltd (2010-
2014)
Interests in Shares and Options over Shares in the Company:
2,000,000 listed options (VRCO); 8,000,000 performance rights (subject to shareholder approval)
Mr Vorster is a mining professional with more than 25 years of experience working with numerous large and smaller
mining companies in technical and commercial roles covering the total supply chain from geology, mining, rail and port,
shipping, marketing and sales. He has held various CEO roles during his career, including with BC Iron Ltd, API
Management and with Iron Ore Holdings Ltd. Mr Vorster is an executive committee member of the Australia China
Business Council, a member of the Australian Institute of Company Directors, and a board member of the RSPCA WA. He
brings significant project development, transactional and company risk management experience to the Board.
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Volt Resources Limited ABN 28 106 353 253
Directors’ Report
Mr Matthew Bull – Non-Executive Director
Qualifications – Bsc geology (hons)
Special responsibilities - Nil
Other current directorship of Listed Public Companies – Nil
Former directorships (of Listed Public Companies) in last three years - Nil
Interests in Shares and Options over Shares in the Company:
3,838,885 fully paid ordinary shares
3,000,000 unlisted options
Matthew has over 10 years’ experience in the mining and exploration industry. He has worked in a wide range of
commodities including graphite, gold and iron ore. He has considerable experience on the operation greenfield and
resource development drilling exploration programs. His previous positions include consultant geologist working on
Discovery Africa’s Tanzanian Graphite Project and CEO/Chief Geologist at Baru Resources.
Company Secretary
Mr Stephen Brockhurst
Qualifications – B.Com
Special responsibilities – Company Secretary
Stephen is a Director of Mining Corporate and has many years of experience in delivering company secretarial services to
predominantly mining and exploration companies.
Former Directors
Mr Alan Armstrong – former Non-Executive Director
Qualifications – B.Bus (Accounting/Finance), CA
Alan was previously employed as a senior accountant with Shakespeare Partners in Perth. Having 8 years’ experience in
taxation and business services, he joined Shakespeare Partners in 2012. Prior to this he was employed by Christies
Accountants and Advisors in regional NSW. Operating in the mid-tier sector, he has gained experience in various client
facing roles over his career to date. He is a member of Chartered Accountants Australia and New Zealand.
Mr Adrien Wing – former Non-Executive Chairman and Company Secretary
Qualifications – B.Bus (Accounting), CPA
Adrien practised in the audit and corporate divisions of a medium sized chartered accounting firm before focusing on
providing company secretarial and corporate accounting services to a number of publicly listed companies on the
Australian Securities Exchange. His experience extends to all corporate and secretarial matters relating to ASX listed
entities, including liaising with shareholders and stakeholders such as ASIC and ASX, managing statutory and reporting
obligations, corporate governance and all other board processes. He is experienced with public companies’ investment
banking and capital raising processes through IPO's, Reverse Take-Overs (RTO’s), Private Placements and Rights Issues as
well as M&A initiatives and applicable due diligence.
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Volt Resources Limited ABN 28 106 353 253
Directors’ Report
Meetings of Directors
The following table sets out the number of meeting of the Company’s directors held during the year ended 30 June 2016,
and the number of meetings attended by each director.
Directors’ Meetings
Eligible to attend
9
17
17
5
8
Attended
9
17
16
5
8
Mr Stephen Hunt
Mr Alan Armstrong
Mr Matthew Bull
Mr Alwyn Vorster
Mr Adrien Wing
Share options
At the date of this report the following options have been granted over unissued capital.
Number
2,200,000
4,200,000
4,200,000
4,200,000
4,200,000
10,500,000
248,693,926
7,500,000
7,500,000
7,500,000
300,693,926
Exercise Price
25c
12c
10c
8c
6c
2c
2c
12c
14c
16c
Expiry Date
30/11/2016
30/04/2019
30/04/2019
30/04/2019
30/04/2019
31/12/2017
31/12/2017
12/08/2017
12/08/2018
12/08/2019
Unlisted
Unlisted
Unlisted
Unlisted
Unlisted
Unlisted
Listed - VRCO
Unlisted
Unlisted
Unlisted
Performance rights
19,000,000 performance rights have been issued during the 2016 financial year. A balance of 10,000,000 remain
outstanding and 9,000,000 performance rights have been converted into shares during the financial year.
Subsequent events
On 15 August 2016, Mr Adrien Wing resigned as Company Secretary and was replaced by Mr Stephen Brockhurst.
On 22 August 2016, Mr Alan Armstrong resigned as a director of the Company.
Since balance date the following equity issues have occurred:
- 46,474,723 shares issued upon the exercise of options
- 1,250,000 shares issued for marketing and consulting services in lieu of cash consideration
- 7,500,000 options for corporate advisory services exercisable at $0.12 on or before 12 August 2017
- 7,500,000 options for corporate advisory services exercisable at $0.14 on or before 12 August 2018
- 7,500,000 options for corporate advisory services exercisable at $0.16 on or before 12 August 2019
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Volt Resources Limited ABN 28 106 353 253
Directors’ Report
Likely Developments
The Group intends to continue its exploration activities on its existing tenements, assess the viability of existing tenements
and to acquire further suitable tenements for exploration and/or development as opportunities arise.
Environmental regulation
The Group has a policy of exceeding or at least complying with its environmental performance obligations.
During the financial year, the Group did not materially breach any particular or significant Commonwealth, State, Territory
or other regulation in respect to environmental management.
Dividends
No dividends have been declared, provided for or paid in respect of the financial year ended 30 June 2016 (2015: None).
Indemnification and insurance of Officers and Auditors
Since the end of the year, the Group has paid a premium in respect of a contract insuring the directors and secretaries of
the Group (as named above), against liabilities incurred as such a director, secretary or executive officer to the extent
permitted by the Corporation Act 2001. The contract of insurance prohibits disclosure of the nature of the liability and
the amount of the premium. The Group has not otherwise, during or since the financial year, indemnified or agreed to
indemnify an officer or auditor of the Group or of any related body corporate against a liability incurred as such an officer
or auditor.
Proceedings on behalf of company
No person has applied for leave of court to bring proceedings on behalf of the Group or intervene in any proceeding to
which the Group is a party for the purpose of taking responsibility on behalf of the Company for all or any part of those
proceedings.
The Group was not a party to any such proceedings during the year.
Corporate Governance
In recognising the need for the highest standards of corporate behaviour and accountability, the Directors of the
Consolidated Entity support, and adhere to, good corporate governance practices. Refer to the Company’s Corporate
Governance Statement at www.voltresources.com.
Non-audit services
No fees for non-audit services were paid or payable to the external auditor of the Parent Entity during the year ended 30
June 2016 (2015: nil).
Auditor’s Independence Declaration
The Auditor’s independence declaration is included on page 21 of the financial report and forms part of this directors’
report.
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Volt Resources Limited ABN 28 106 353 253
Directors’ Report
Remuneration Report – Audited
This remuneration report outlines the key management personnel remuneration arrangements of the Group in
accordance with the requirements of the Corporations Act 2001 and its Regulations. For the purposes of this report, key
management personnel (KMP) of the Group are defined as those persons having authority and responsibility for planning,
directing and controlling the major activities of the Company and the Group, directly or indirectly, including any director
(whether executive or otherwise) of the parent company, and includes the specified executives.
For the purposes of this report, the term 'executive' encompasses the chief executive, senior executives and secretaries
of the Parent and the Group.
Details of key management personnel
(i) Directors
Current:
Stephen Hunt
Matthew Bull
Alwyn Vorster
Former:
Adrien Wing
Alan Armstrong
Executive Chairman (appointed 15 December 2015)
Non-Executive Director
Non-Executive Director (appointed 1 April 2016)
Non-Executive Chairman (resigned 15 December 2015)
Non-Executive Director (former Managing Director) (resigned 22 August 2016)
(ii) Company Secretary
Stephen Brockhurst (appointed 15 August 2016)
Adrien Wing (resigned 15 August 2016)
Remuneration committee
The remuneration committee of the board of directors of the Company is responsible for determining and reviewing
remuneration arrangements for the directors and executives. The remuneration committee assesses the appropriateness
of the nature and amount of remuneration of executives on a periodic basis by reference to relevant employment market
conditions with the overall objective of ensuring maximum stakeholder benefit from the retention of a high quality, high
performing director and executive team.
Remuneration philosophy
The performance of the Company depends upon the quality of its directors and executives. To prosper, the Company
must attract, motivate and retain highly skilled directors and executives. To this end, the charter adopted by the
remuneration committee aims to align rewards with achievement of strategic objectives. The remuneration framework
applied provides for a mixture of fixed and variable pay and a blend of short and long term incentives as appropriate.
Remuneration structure
In accordance with best practice corporate governance, the structure of non-executive director and executive
remuneration is separate and distinct.
Non-executive directors
The maximum aggregate amount of fees that can be paid to non-executive directors is subject to approval by shareholders
at General Meeting. The Company’s policy is to remunerate non-executive directors at market rates (for comparable
companies) for time, commitment and responsibilities. Fees for non-executive directors are not linked to the
performance of the Company, however to align directors’ interests with shareholders’ interests, directors are encouraged
to hold shares in the Company, and subject to approval by shareholders, are permitted to participate in the Employee
Share Option Plan.
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Volt Resources Limited ABN 28 106 353 253
Directors’ Report
Remuneration Report (Cont.)
Retirement benefits and allowances
No retirement benefits or allowances are paid or payable to directors of the Company (other than statutory or mandatory
superannuation contributions, where applicable).
Executives
Base pay
Executives are offered a competitive level of base pay which comprises the fixed (unrisked) component of their pay and
rewards. Base pay for senior executives is reviewed annually to ensure market competitiveness. There are no guaranteed
base pay increases included in any senior executives’ contracts.
Short term incentives
Payment of short term incentives is dependent on the achievement of key performance milestones as determined by the
remuneration committee. For the periods ended 30 June 2015 and 2016, these milestones required performance in
relation to key strategic, non-financial measures linked to drivers of performance in future reporting periods.
No bonuses have been paid or are payable in respect of the year to 30 June 2016. There have been no forfeitures of
bonuses by key management personnel during the current or prior periods and no cash bonuses remained unvested at
year-end.
Long Term Incentives - Share-based compensation
Both performance rights and share options have been issued to Directors and executives as part of their remuneration.
Share-based compensation instruments are not issued based on performance criteria, however, they are issued with
vesting conditions and exercise prices set specifically to increase goal congruence between Directors, executives and
shareholders.
Performance rights and options granted under the Plan carry no dividend or voting rights.
The company currently has no policy in place to limit an individual’s risk exposure in relation to the issue of company
securities as remuneration.
Service agreements
On 30 September 2015, the Company entered into a consultancy agreement with Mr Alan Armstrong, in his capacity as
Managing Director. The agreement is with Loup Soltaire Pty Ltd, an associated company of Mr Armstrong.
Material terms of the contract are as follows:
Role – to provide managerial consultancy advice, particularly in regards to development and production
programs;
Term of agreement – 3 years
Consultancy fee of $8,334 per month, increased to $12,500 per month from March 2016 (including
Director Fees)
Termination of the agreement by the Company can occur upon giving 6 months notice, or payment in lieu
thereof, of 6 months consulting fees.
Mr Armstrong resigned on 22 August 2016.
Page | 15
Volt Resources Limited ABN 28 106 353 253
Directors’ Report
Remuneration Report (Cont.)
Service agreements (Cont.)
These conditions were achieved during the financial year and 9,000,000 shares issued for nil consideration to satisfy the
terms of the Performance Rights.
On 11 December 2015, the Company entered into a consultancy agreement with Mr Stephen Hunt, in his capacity as
Chairman. Under an established Performance Rights Plan, following shareholder approval, Mr Hunt was also issued
10,000,000 Performance Rights in the following tranches and subject to vesting conditions:
Tranche 1 – 2,500,000 Performance Rights vest on completion of the Prefeasibility Study (as defined by the
JORC Code) on the Namangale Project to be achieved by 31 March 2017.
Tranche 2 – 2,500,000 Performance Rights vest on the execution of an Off-Take Agreement in respect of the
Namangale Project for a minimum of 50% of the minimum production contemplated in the Pre-Feasibility
Study to be achieved by 30 June 2017.
Tranche 3 – 2,500,000 Performance Rights vest on the execution of contracts for finance sufficient to fund the
commissioning of mining operations at Namangale Project to be achieved by 30 September 2017.
Tranche 4 – 2,500,000 Performance Rights vest on the commencement of mining, and processing of first ore
recovered from the Namangale Project to be achieved by 31 March 2019.
On 21 March 2016, the Company entered into an agreement with Mr Alwyn Vorster, in his capacity as Non-Executive
Director to commence from 1 April 2016 at $48,000 per annum, excluding any additional consulting services.
Under an established Performance Rights Plan, subject to shareholder approval, Mr Vorster will be issued 8,000,000
Performance Rights in the following tranches subject to vesting conditions:
Tranche 1 – 2,000,000 Performance Rights vest on completion of the Pre-Feasibility Study (as defined by the
JORC Code) on the Namangale Project to be achieved by 31 March 2017.
Tranche 2 – 2,000,000 Performance Rights vest on the execution of an Off-Take Agreement in respect of the
Namangale Project for a minimum of 50% of the minimum production contemplated in the Pre-Feasibility
Study to be achieved by 30 June 2017.
Tranche 3 – 2,000,000 Performance Rights vest on the execution of contracts for finance sufficient to fund the
commissioning of mining operations at Namangale Project to be achieved by 30 September 2017.
Tranche 4 – 2,000,000 Performance Rights vest on the commencement of mining, and processing of first ore
recovered from the Namangale Project to be achieved by 31 March 2019.
These Performance Rights remain subject to shareholder approval however if this is not obtained, a cash payment of
the same value will be made on the vesting of each tranche.
Page | 16
Volt Resources Limited ABN 28 106 353 253
Directors’ Report
Remuneration Report (Cont.)
Remuneration of key management personnel
2016
Short term benefits
Post-employment
benefits
Cash
salary
and fees
$
Consult-
ing
$
36,530
92,500
12,000
179,500
54,500
4,400
141,030
238,400
106,670
131,236
8,000
12,000
237,906
20,000
378,936
258,400
Non-
monetary
benefits
$
-
-
-
-
-
-
-
-
Super-
annuation
$
3,470
-
-
3,470
-
12,373
12,373
15,843
Retirement
Benefits
$
-
-
-
-
-
-
-
-
Non-executive Directors
Matthew Bull
Adrien Wing*
Alwyn Vorster**
Sub-total non-executive
directors
Executive Directors
Alan Armstrong
Stephen Hunt
Sub-total executive
directors
Total Key Management
Personnel
Share based
payments
Performance
rights/
options
$
114,500
98,000
40,000
Total
$
334,000
245,000
56,400
252,500
635,400
98,000
40,000
212,670
195,609
138,000
408,279
390,500
1,043,679
Performance
related
%
34.3
40.0
70.9
46.1
20.4
* Amounts shown as remuneration for Mr Wing are fees paid to Northern Star Nominees Pty Ltd (“Northern Star”), a Company controlled
by Mr Wing, which provides company secretarial, accounting, financial and general management services as well as administrative support
to the Company. The amounts include payments for services provided by Mr Wing.
** The options issued to Mr Vorster were issued while he was a consultant, before his appointment as a Director.
2015
Short term benefits
Post-employment
benefits
Cash
salary
and fees
$
Cash
bonus
$
Non-executive Directors
Matthew Bull
Adrien Wing*
Robert Hemphill
Julian Jarman
Sub-total non-executive
directors
Executive Directors
Alan Armstrong
Alex Neuling**
Sub-total executive
directors
Total Key Management
Personnel
3,044
38,600
33,733
33,611
108,988
35,000
42,326
77,326
186,314
-
-
-
-
-
-
-
-
-
Non-
monetary
benefits
$
-
-
-
-
-
-
-
-
-
Super-
annuation
$
289
-
-
3,193
3,482
-
-
-
3,482
Retirement
Benefits
$
-
-
-
-
-
-
-
-
-
Share based
payments
Performance
rights/
options
$
-
20,100
-
-
Total
$
3,333
58,700
33,733
36,804
20,100
132,570
20,100
-
55,100
42,326
20,100
97,426
40,200
229,996
Performance
related
%
-
34.2
-
-
-
36.5
-
* Amounts shown as remuneration for Mr Wing are fees paid to Northern Star Nominees Pty Ltd (“Northern Star”), a Company controlled
by Mr Wing, which provides company secretarial as well as administrative support to the Company. The amounts include payments for
services provided by Mr Wing.
** Amounts shown as remuneration for Mr Neuling are fees paid to Erasmus Consulting Pty Ltd (“Erasmus”), a Company controlled by Mr
Neuling, which provides company secretarial, accounting, financial and general management services as well as administrative support to
the Company. The amounts include payments for services provided by Mr Neuling, Mrs Natalie Madden and by other members of staff
employed or retained by Erasmus.
Page | 17
Volt Resources Limited ABN 28 106 353 253
Directors’ Report
Remuneration Report (Cont.)
Share Based Compensation
Options
Details of options over ordinary shares provided as remuneration to each Director of Volt Resources Limited and each of
the key management personnel of the parent entity and Group are set out below. When exercised, each option is
convertible into one ordinary share of Volt Resources Limited.
Terms and conditions of share-based payment arrangements affecting remuneration of key management personnel in
the current financial year or future financial years:
Grant date
26/11/2012
27/05/2014
25/02/2015
07/08/2015
01/04/2016
07/04/2016
Number
2,200,000
9,000,000
6,000,000
3,000,000
2,000,000
2,000,000
Vesting date
26/11/2012
27/05/2014
25/02/2015
07/08/2015
01/04/2016
07/04/2016
Expiry date
30/11/2016
31/12/2017
31/12/2017
31/12/2017
31/12/2017
31/12/2017
Exercise price Grant date fair value
$0.25
$0.02
$0.02
$0.02
$0.02
$0.02
$0.006
$0.0048
$0.0067
$0.0055 (M Bull)
$0.02 (A Vorster)
$0.02 (S Hunt)
%
vested
100
100
100
100
100
100
Details of options granted as compensation to key management personnel during the current financial year:
During the financial year
Name
Matthew Bull
Alwyn Vorster *
Stephen Hunt
No. granted
No. vested
3,000,000
2,000,000
2,000,000
3,000,000
2,000,000
2,000,000
% of grant
vested
100%
100%
100%
% of grant
forfeited
n/a
n/a
n/a
% of
compensation
for the year
consisting of
options
4.9%
70.9%
20.4%
* The options issued to Mr Vorster were issued while he was a consultant, before his appointment as a Director. During
the year, there were no options exercised that were granted to key management personnel as part of their compensation.
The following table summarises the value of options granted, exercised or lapsed during the financial year, in relation to
options granted to key management personnel as part of their remuneration:
Matthew Bull (i)
Alwyn Vorster (ii)
Stephen Hunt (ii)
Value of options granted at
the grant date (i)
$
16,500
40,000
40,000
Value of options exercised
at the exercise date
$
-
-
-
Value of options lapsed at
the date of lapse
$
-
-
-
(i) The value of options granted during the financial year is calculated as at the grant date using the Black-Scholes model.
(ii) The value of listed options granted during the financial year is based on the ASX market price at the time of grant.
Performance Rights
3,000,000 performance rights each have been issued to Mr Alan Armstrong, Matthew Bull and Adrien Wing during the
2016 financial year. Based upon a valuation of the performance rights at the grant date an amount of $98,000 has been
included in remuneration for each of the recipients. These performance rights targets were met and have been converted
into shares during the financial year. 10,000,000 performance rights were issued to Mr Stephen Hunt for nil value due to
non-market performance conditions and these remain outstanding at the date of this report.
Page | 18
Volt Resources Limited ABN 28 106 353 253
Directors’ Report
Remuneration Report (Cont.)
Key management personnel equity holdings
Fully paid ordinary shares of Volt Resources Limited
Balance at
beginning of
period *
Issued as
remuneration
Ord
30 June 2016
Directors
Alan Armstrong
Matthew Bull
Adrien Wing
Stephen Hunt
Alwyn Vorster
30 June 2015
Directors
Alan Armstrong
Matthew Bull
Adrien Wing
Alex Neuling
Robert Hemphill
Julian Jarman
Ord
500,000
-
3,000,000
-
378,788
3,878,788
Balance at
beginning of
period *
Ord
Issued as
remuneration
Ord
-
-
3,000,000
682,000
174,250
3,250,001
7,106,251
On Exercise of
Options/Perf Rights
Net Other Change
Balance at end of
period*
Ord
Ord
Ord
3,000,000
3,000,000
1,000,000
-
-
500,000
838,885
1,700,056
4,173,454
1,136,363
4,000,000
3,838,885
5,700,056
4,173,454
1,515,151
7,000,000
8,348,758
19,227,546
On Exercise of
Options/Perf Rights
Net Other Change
Balance at end of
period*
Ord
Ord
Ord
-
-
-
-
-
-
-
500,000
500,000
-
-
-
-
-
500,000
-
3,000,000
682,000
174,250
3,250,001
7,606,251
-
-
-
-
-
-
-
-
-
-
-
-
-
* or when appointed/resigned
Share options of Volt Resources Limited
Balance at
beginning of
period *
Granted as
remune-
ration
Exercised
Net change
Other
Balance at
end of
period *
Exercisable
Options
vested
during the
year
Not
Exercisable
Vested as at end of period
30 June 2016
Directors
Alan Armstrong
3,000,000
-
Matthew Bull
Adrien Wing
Stephen Hunt
Alwyn Vorster
-
3,000,000
9,000,000
-
-
-
2,000,000
2,000,000
12,000,000
7,000,000
-
-
-
-
-
-
-
-
3,000,000
3,000,000
3,000,000
3,000,000
850,028
9,850,028
9,850,028
-
-
2,000,000
2,000,000
2,000,000
2,000,000
850,028
19,850,028
19,850,028
-
-
-
-
-
-
-
3,000,000
-
2,000,000
2,000,000
7,000,000
* or when appointed/resigned
Page | 19
Volt Resources Limited ABN 28 106 353 253
Directors’ Report
Remuneration Report (Cont.)
Share options of Volt Resources Limited (Cont.)
Vested as at end of period
Balance at
beginning of
period *
Granted as
remune-
ration
Exercised
Net change
Other
Balance at
end of
period *
Exercisable
Not
Exercisable
-
-
3,000,000
-
6,000,000
3,000,000
3,350,000
3,350,000
3,000,000
-
-
-
15,700,000
6,000,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
3,000,000
3,000,000
-
-
9,000,000
9,000,000
3,350,000
3,350,000
3,350,000
3,350,000
3,000,000
3,000,000
21,700,000
21,700,000
-
-
-
-
-
-
-
Options
vested
during the
year
3,000,000
-
3,000,000
-
-
-
6,000,000
30 June 2015
Directors
Alan Armstrong
Matthew Bull
Adrien Wing
Alex Neuling
Robert Hemphill
Julian Jarman
* or when appointed/resigned
All share options issued to key management personnel were made in accordance with the provisions of the employee
share option plan. During the financial year, no options were exercised by key management personnel (2015: nil).
For details of the employee share option plan and of share options granted during the 2016 and 2015 financial years,
please refer to Note 13.
Other transactions with key management personnel of the Group
During the 2015 financial year, the Group has paid $3,800 to MB Exploration Pty Ltd, a company related to Mr Matthew
Bull, for consulting services on normal commercial terms. For 2016, consulting arrangements have been included with
the remuneration disclosures above.
During the 2015 financial year, the Group paid $19,080 as a placement fee, on normal commercial terms to Alignment
Capital Pty Ltd. In addition, from April 2014 Alignment Capital Pty Ltd (a related party of Mr Julian Jarman) was paid
$5,000 per month as an ongoing retainer for corporate advisory services on normal commercial terms. Mr Jarman
resigned as a Director on 1 June 2015.
During the 2016 financial year, the Group paid $4,950 as an underwriting fee, on normal commercial terms to Mr Stephen
Hunt.
End of Remuneration Report
Signed in accordance with a resolution of the Directors made pursuant to s.298 (2) of the Corporations Act 2001.
On behalf of the Directors
Stephen Hunt
Chairman
29 September 2016
Page | 20
AUDITOR’S INDEPENDENCE DECLARATION
As lead auditor for the audit of the consolidated financial report of Volt Resources Limited (formerly
Mozambi Resources Limited) for the year ended 30 June 2016, I declare that to the best of my knowledge
and belief, there have been no contraventions of:
a)
b)
the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
any applicable code of professional conduct in relation to the audit.
Perth, Western Australia
29 September 2016
L Di Giallonardo
Partner
HLB Mann Judd (WA Partnership) ABN 22 193 232 714
Level 4, 130 Stirling Street Perth WA 6000. PO Box 8124 Perth BC 6849 Telephone +61 (08) 9227 7500. Fax +61 (08) 9227 7533.
Email: hlb@hlbwa.com.au. Website: http://www.hlb.com.au
Liability limited by a scheme approved under Professional Standards Legislation
HLB Mann Judd (WA Partnership) is a member of
International, a worldwide organisation of accounting firms and business advisers.
Page | 21
INDEPENDENT AUDITOR’S REPORT
To the members of Volt Resources Limited (formerly Mozambi Resources Limited)
Report on the Financial Report
We have audited the accompanying financial report of Volt Resources Limited (“the company”), which
comprises the consolidated statement of financial position as at 30 June 2016, the consolidated
statement of profit or loss, the consolidated statement of comprehensive income, the consolidated
statement of changes in equity and the consolidated statement of cash flows for the year then ended,
notes comprising a summary of significant accounting policies and other explanatory information, and
the directors’ declaration of the Group comprising the company and the entities it controlled at the
year’s end or from time to time during the financial year.
Directors’ responsibility 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 Note 1(c), the directors also state, in accordance with Accounting Standard AASB 101: Presentation of
Financial Statements, the consolidated financial statements comply with International Financial
Reporting Standards.
Auditor’s responsibility
Our responsibility is to express an opinion on the financial report based on our audit. We conducted our
audit in accordance with Australian Auditing Standards. Those standards require that we comply with
relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain
reasonable assurance about whether the financial report is free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
the financial report. The procedures selected depend on the auditor’s judgement, including the
assessment of the risks of material misstatement of the financial report, whether due to fraud or error.
In making those risk assessments, the auditor considers internal control relevant to the Group’s
preparation of the financial report that gives a true and fair view in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Group’s internal control.
An audit also includes evaluating the appropriateness of
accounting policies used and the reasonableness of accounting estimates made by the directors, as well
as evaluating the overall presentation of the financial report.
Our audit did not involve an analysis of the prudence of business decisions made by directors or
management.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our audit opinion.
HLB Mann Judd (WA Partnership) ABN 22 193 232 714
Level 4, 130 Stirling Street Perth WA 6000. PO Box 8124 Perth BC 6849 Telephone +61 (08) 9227 7500. Fax +61 (08) 9227 7533.
Email: hlb@hlbwa.com.au. Website: http://www.hlb.com.au
Liability limited by a scheme approved under Professional Standards Legislation
HLB Mann Judd (WA Partnership) is a member of
International, a worldwide organisation of accounting firms and business advisers.
Page | 22
Independence
In conducting our audit, we have complied with the independence requirements of the Corporations Act
2001.
Auditor’s opinion
In our opinion:
(a)
the financial report of Volt Resources Limited 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 2016 and its
performance for the year ended on that date; and
(ii) complying with Australian Accounting Standards and the Corporations Regulations 2001; and
(b)
the financial report also complies with International Financial Reporting Standards as disclosed in
Note 1(c).
Report on the Remuneration Report
We have audited the Remuneration Report included in the directors’ report for the year ended 30 June
2016. 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.
Auditor’s opinion
In our opinion, the Remuneration Report of Volt Resources Limited for the year ended 30 June 2016
complies with section 300A of the Corporations Act 2001.
HLB Mann Judd
Chartered Accountants
Perth, Western Australia
29 September 2016
L Di Giallonardo
Partner
Page | 23
Volt Resources Limited ABN 28 106 353 253
Directors’ Declaration
1.
In the opinion of the directors of Volt Resources Limited (formerly Mozambi Resources Limited) (the
‘Company’):
a.
the accompanying financial statements and notes and the additional disclosures are in
accordance with the Corporations Act 2001 including:
i.
ii.
giving a true and fair view of the Consolidated Entity’s financial position as at 30 June
2016 and of its performance for the year then ended; and
complying with Australian Accounting Standards (including the Australian Accounting
Interpretations) and the Corporations regulations 2001; and
b.
there are reasonable grounds to believe that the Company will be able to pay its debts as and
when they become due and payable.
2.
3.
The financial statements and notes thereto are in accordance with International Financial Reporting
Standards issued by the International Accounting Standards Board.
This declaration has been made after receiving the declarations required to be made to the directors
in accordance with Section 295A of the Corporations Act 2001 for the financial year ended 30 June
2016.
This declaration is signed in accordance with a resolution of the Board of Directors.
Stephen Hunt
Chairman
29 September 2016
Page | 24
Volt Resources Limited
Consolidated statement of profit or loss for the year ended 30 June 2016
Note
Consolidated
2016
$
2
2
3
9
Revenue
Office costs
Corporate management costs
Corporate compliance costs
Evaluation expenses
Marketing and investor relations
Share based payments
Other gains and losses
Foreign exchange gain / (loss)
Other expenses
Loss before income tax
Income tax expense
Loss after tax from continuing operations
Discontinued operations
Loss after tax from continuing operations
Net loss for the year
Loss attributable to:
Owners of the parent
Non-controlling interests
2015
$
4,781
(37,987)
(256,159)
(74,050)
(32,008)
(47,621)
(216,200)
-
16,428
(19,330)
(662,146)
-
24,100
(53,877)
(627,620)
(428,417)
-
(223,210)
(1,773,609)
(73,670)
(40,282)
(129,990)
(3,326,575)
-
(3,326,575)
(662,146)
(479,980)
-
(3,806,555)
(662,146)
(3,812,285)
5,730
(3,806,555)
(658,310)
(3,836)
(662,146)
Loss from continuing operations per share (cents per share)
Basic loss per share
Diluted loss per share
4
4
Loss from discontinued operations per share (cents per share)
Basic loss per share
Diluted loss per share
4
4
(0.57)
(0.57)
(0.08)
(0.08)
(0.27)
(0.27)
-
-
The accompanying notes form part of these financial statements.
Page | 25
Volt Resources Limited
Consolidated statement of other comprehensive income
for the year ended 30 June 2016
Consolidated
2016
$
2015
$
Loss for the year
(3,806,555)
(662,146)
Other comprehensive income
Items that may be reclassified to profit or loss:
Exchange differences on translating foreign
operations
Other comprehensive loss for the year net of
income tax
(25,829)
(25,829)
255
255
Total comprehensive loss for the year
(3,832,384)
(661,891)
Total comprehensive loss attributable to:
Owners of the parent
Non-controlling interests
(3,838,114)
5,730
(3,832,384)
(658,055)
(3,836)
(661,891)
The accompanying notes form part of these financial statements.
Page | 26
Volt Resources Limited
Consolidated statement of financial position as at 30 June 2016
Note
Consolidated
2016
$
2015
$
Current Assets
Cash and cash equivalents
Trade and other receivables
Prepayments
Total Current Assets
Non-Current Assets
Trade and other receivables
Other financial assets
Deferred exploration expenditure
Total Non-Current Assets
Total Assets
Current Liabilities
Trade and other payables
Total Current Liabilities
Total Liabilities
Net Assets
Equity
Issued capital
Reserves
Accumulated losses
Parent entity interest
Non-controlling interests
Total Equity
5
6
6
7
9
10
11
12
7,617,762
104,120
103,973
7,825,855
2,400
20,000
10,750,378
10,772,778
18,598,633
1,108,067
1,108,067
1,108,067
554,125
16,823
-
570,948
-
224,475
478,703
703,178
1,274,126
159,924
159,924
159,924
17,490,566
1,114,202
51,722,526
3,830,516
32,466,385
2,903,738
(37,846,371)
(34,034,086)
17,706,671
(216,105)
17,490,566
1,336,037
(221,835)
1,114,202
The accompanying notes form part of these financial statements.
Page | 27
Consolidated statement of changes in equity for the year ended 30 June 2016
Volt Resources Limited
Consolidated
Balance as at 1 July 2014
Loss for the year
Exchange differences arising on translation of foreign operations
Total comprehensive Loss for the year
Shares issued during the year
Less transaction costs
Recognition of share-based payments
Balance at 30 June 2015
Issued
Capital
$
31,758,385
-
-
-
839,200
(131,200)
-
32,466,385
Accumulated
Losses
$
(33,375,776)
(658,310)
-
(658,310)
-
-
-
(34,034,086)
Reserves
$
2,758,783
-
255
255
-
-
144,700
2,903,738
Total
$
1,141,392
(658,310)
255
(658,055)
839,200
(131,200)
144,700
1,336,037
Non-
controlling
interests
$
(217,999)
(3,836)
-
(3,836)
-
-
-
(221,835)
Total
$
923,393
(662,146)
255
(661,891)
839,200
(131,200)
144,700
1,114,202
Balance as at 1 July 2015
32,466,385
(34,034,086)
2,903,738
1,336,037
(221,835)
1,114,202
Loss for the year
Exchange differences arising on translation of foreign operations
Total comprehensive Loss for the year
Shares issued during the year
Less transaction costs
Recognition of share-based payments
Balance at 30 June 2016
-
-
-
19,968,609
(712,468)
-
51,722,526
(3,812,285)
-
(3,812,285)
-
-
-
(37,846,371)
-
(25,829)
(25,829)
-
-
952,607
3,830,516
(3,812,285)
(25,829)
(3,838,114)
19,968,609
(712,468)
952,607
17,706,671
5,730
-
5,730
(3,806,555)
(25,829)
(3,832,384)
- 19,968,609
(712,468)
-
952,607
-
(216,105) 17,490,566
The accompanying notes form part of these financial statements.
Page | 28
Consolidated statement of cash flows for the year ended 30 June 2016
Volt Resources Limited
Cash flows from operating activities
Payments to suppliers and employees
Note
Consolidated
2016
$
Inflows/(Outflows)
2015
$
(1,386,523)
(354,068)
Net cash applied to operating activities
5
(1,386,523)
(354,068)
Cash flows from investing activities
Payments for exploration expenditure
Payments for acquisition of subsidiary
Payments for deposits and bonds
Payment for other financial assets
Interest received
Net cash applied to investing activities
Cash flows from financing activities
Proceeds from share issues
Share issue costs
Net cash provided by financing activities
(3,038,679)
(23,688)
(342,002)
(22,400)
-
-
-
(178,275)
24,100
4,781
(3,378,981)
(197,182)
12,341,609
(512,468)
11,829,141
688,000
(97,700)
590,300
Net increase in cash and cash equivalents
7,063,637
39,050
Cash and cash equivalents at the beginning of the year
Cash and cash equivalents at the end of the year
5
554,125
7,617,762
515,075
554,125
The accompanying notes form part of these financial statements
Page | 29
Volt Resources Limited
Notes to the Financial Statements for the Year ended 30 June 2016
1.
Statement of significant accounting policies
Basis of Preparation
(a)
These financial statements are general purpose financial statements, which have been prepared in accordance
with the requirements of the Corporations Act 2001, Accounting Standards and Interpretations and comply
with other requirements of the law.
The accounting policies detailed below have been consistently applied to all of the years presented unless
otherwise stated. The financial statements are for the Group consisting of Volt Resources Limited and its
subsidiaries.
The financial statements have also been prepared on a historical cost basis. Cost is based on the fair values of
the consideration given in exchange for assets.
The Company is a listed public company, incorporated in Australia. The entity’s principal activities are mineral
exploration in Tanzania (as more fully described in the Directors’ Report & Note 16).
Going Concern
The financial report has been prepared on a going concern basis, which contemplates the continuity of normal
business activity and the realisation of assets and the settlement of liabilities in the normal course of business.
Adoption of new and revised standards
(b)
Standards and Interpretations applicable to 30 June 2016
In the year ended 30 June 2016, the Directors have reviewed all of the new and revised Standards and
Interpretations issued by the AASB that are relevant to the Group and effective for the current annual
reporting period.
As a result of this review, the Directors have determined that there is no impact, material or otherwise, of the
new and revised Standards and Interpretations on the Group’s business and, therefore, no change is necessary
to Group accounting policies.
The Directors have also reviewed all new Standards and Interpretations that have been issued but are not yet
effective for the year ended 30 June 2016. As a result of this review the Directors have determined that there
is no impact, material or otherwise, of the new and revised Standards and Interpretations on the Group’s
business and, therefore, no change necessary to Group accounting policies.
Statement of Compliance
(c)
The financial report was authorised for issue on 29 September 2016.
The financial report complies with Australian Accounting Standards, which include Australian equivalents to
International Financial Reporting Standards (AIFRS). Compliance with AIFRS ensures that the financial report,
comprising the financial statements and notes thereto, complies with International Financial Reporting
Standards (IFRS).
Basis of Consolidation
(d)
The consolidated financial statements incorporate the financial statements of the Company and entities
controlled by the Company and its subsidiaries. Control is achieved when the Company:
• has power over the investee;
•
is exposed, or has rights, to variable returns from its involvement in with the investee; and
• has the ability to its power to affect its returns.
The Company reassesses whether or not it controls an investee if facts and circumstances indicate that there
are changes to one or more of the three elements listed above.
Page | 30
Volt Resources Limited
Notes to the Financial Statements for the Year ended 30 June 2016
Consolidation of a subsidiary begins when the Company obtains control over the subsidiary and ceases when the
Company loses control of the subsidiary. Specifically income and expenses of a subsidiary acquired or disposed
of during the year are included in the consolidated statement of profit or loss from the date the Company gains
control until the date when the Company ceases to control the subsidiary.
Profit or loss and each component of other comprehensive income are attributed to the owners of the Company
and to the non-controlling interests. Total comprehensive income of subsidiaries is attributed to the owners of
the Company and to the non-controlling interests even if this results in the controlling interest having a deficit
balance.
When necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting
policies in line with the Group’s accounting policies.
All intragroup assets and liabilities, equity, income, expenses and cash flows relating to transactions between
members are eliminated in full on consolidation.
Critical accounting judgements and key sources of estimation uncertainty
(e)
The application of accounting policies requires the use of judgements, estimates and assumptions about carrying
values of assets and liabilities that are not readily apparent from other sources. The estimates and associated
assumptions are based on historical experience and other factors that are considered to be relevant. Actual
results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions are recognised in the
period in which the estimate is revised if it affects only that period, or in the period of the revision and future
periods if the revision affects both current and future periods.
Share-based payment transactions:
The Group measures the cost of equity-settled transactions by reference to the fair value of the equity
instruments at the date at which they are granted. The fair value is determined using the Black and Scholes
formula taking into account the terms and conditions upon which the instruments were granted.
(f)
Revenue Recognition
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the
revenue can be reliably measured. The following specific recognition criteria must also be met before revenue
is recognised:
(i) Interest income
Interest revenue is recognised on a time proportionate basis that takes into account the effective yield on the
financial asset.
(g)
Borrowing Costs
Borrowing costs are recognised as an expense when incurred except those that relate to the acquisition,
construction or production of qualifying assets where the borrowing cost is added to the cost of those assets
until such time as the assets are substantially ready for their intended use or sale.
(h)
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and
rewards of ownership to the lessee. All other leases are classified as operating leases.
Operating lease payments are recognised as an expense on a straight-line basis over the lease term, except
where another systematic basis is more representative of the time pattern in which economic benefits from the
leased asset are consumed.
(i)
Cash and cash equivalents
Cash comprises cash at bank and in hand. Cash equivalents are short term, highly liquid investments that are
readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.
Page | 31
Volt Resources Limited
Notes to the Financial Statements for the Year ended 30 June 2016
Trade and other receivables
(j)
Trade receivables are measured on initial recognition at fair value and are subsequently measured at amortised
cost using the effective interest rate method, less provision for impairment. Trade receivables are generally due
for settlement within periods ranging from 15 days to 30 days.
Impairment of trade receivables is continually reviewed and those that are considered to be uncollectible are
written off by reducing the carrying amount directly. An allowance account is used when there is objective
evidence that the Group may not be able to collect all amounts due according to the original contractual terms.
Factors considered by the Group in making this determination include known significant financial difficulties of
the debtor, review of financial information and significant delinquency in making contractual payments to the
Group. The impairment allowance is set equal to the difference between the carrying amount of the receivable
and the present value of estimated future cash flows, discounted at the original effective interest rate. Where
receivables are short-term discounting is not applied in determining the allowance.
The amount of the impairment loss is recognised in the statement of profit or loss within other expenses. When
a trade receivable for which an impairment allowance had been recognised becomes uncollectible in a
subsequent period, it is written off against the allowance account. Subsequent recoveries of amounts previously
written off are credited against other expenses in the statement of profit or loss.
Derecognition of financial assets and financial liabilities
(k)
(i) Financial assets
A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is
derecognised when:
the rights to receive cash flows from the asset have expired;
the Group retains the right to receive cash flows from the asset, but has assumed an obligation to pay
them in full without material delay to a third party under a ‘pass-through’ arrangement; or
the Group has transferred its rights to receive cash flows from the asset and either:
(a)
(b)
has transferred substantially all the risks and rewards of the asset, or
has neither transferred nor retained substantially all the risks and rewards of the asset,
but has transferred control of the asset.
When the Group has transferred its rights to receive cash flows from an asset and has neither transferred nor
retained substantially all the risks and rewards of the asset nor transferred control of the asset, the asset is
recognised to the extent of the Group’s continuing involvement in the asset. Continuing involvement that takes
the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of
the asset and the maximum amount of consideration received that the Group could be required to repay.
When continuing involvement takes the form of a written and/or purchased option (including a cash-settled
option or similar provision) on the transferred asset, the extent of the Group’s continuing involvement is the
amount of the transferred asset that the Group may repurchase, except that in the case of a written put option
(including a cash-settled option or similar provision) on an asset measured at fair value, the extent of the Group’s
continuing involvement is limited to the lower of the fair value of the transferred asset and the option exercise
price.
(ii) Financial liabilities
A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires.
When an existing financial liability is replaced by another from the same lender on substantially different terms,
or the terms of an existing liability are substantially modified, such an exchange or modification is treated as a
derecognition of the original liability and the recognition of a new liability, and the difference in the respective
carrying amounts is recognised in profit or loss.
Page | 32
Volt Resources Limited
Notes to the Financial Statements for the Year ended 30 June 2016
(l)
Impairment of financial assets
The Group assesses at each reporting date whether a financial asset or group of financial assets is impaired.
Financial assets carried at amortised cost
(i)
If there is objective evidence that an impairment loss on loans and receivables carried at amortised cost has
been incurred, the amount of the loss is measured as the difference between the asset’s carrying amount and
the present value of estimated future cash flows (excluding future credit losses that have not been incurred)
discounted at the financial asset’s original effective interest rate (i.e. the effective interest rate computed at
initial recognition). The carrying amount of the asset is reduced either directly or through use of an allowance
account.
The amount of the loss is recognised in profit or loss.
The Group first assesses whether objective evidence of impairment exists individually for financial assets that
are individually significant, and individually or collectively for financial assets that are not individually significant.
If it is determined that no objective evidence of impairment exists for an individually assessed financial asset,
whether significant or not, the asset is included in a group of financial assets with similar credit risk
characteristics and that group of financial assets is collectively assessed for impairment. Assets that are
individually assessed for impairment and for which an impairment loss is or continues to be recognised are not
included in a collective assessment of impairment.
If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related
objectively to an event occurring after the impairment was recognised, the previously recognised impairment
loss is reversed. Any subsequent reversal of an impairment loss is recognised in profit or loss, to the extent that
the carrying value of the asset does not exceed its amortised cost at the reversal date.
(ii) Financial assets carried at cost
If there is objective evidence that an impairment loss has been incurred on an unquoted equity instrument that
is not carried at fair value (because its fair value cannot be reliably measured), or on a derivative asset that is
linked to and must be settled by delivery of such an unquoted equity instrument, the amount of the loss is
measured as the difference between the asset’s carrying amount and the present value of estimated future cash
flows, discounted at the current market rate of return for a similar financial asset.
(iii) Available-for-sale investments
If there is objective evidence that an available-for-sale investment is impaired, an amount comprising the
difference between its cost (net of any principal repayment and amortisation) and its current fair value, less any
impairment loss previously recognised in profit or loss, is transferred from equity to profit or loss for the period.
Reversals of impairment losses for equity instruments classified as available-for-sale are not recognised in profit.
Reversals of impairment losses for debt instruments are reversed through profit or loss if the increase in an
instrument's fair value can be objectively related to an event occurring after the impairment loss was recognised
in profit or loss.
(m)
Foreign currency translation
Both the functional and presentation currency of Volt Resources Limited and its Australian subsidiaries is
Australian dollars. Each entity in the Group determines its own functional currency and items included in the
financial statements of each entity are measured using that functional currency.
Transactions in foreign currencies are initially recorded in the functional currency by applying the exchange rates
ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are
retranslated at the rate of exchange ruling at the reporting date.
All exchange differences in the consolidated financial report are taken to profit or loss.
Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the
exchange rate as at the date of the initial transaction.
Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the
date when the fair value was determined. Translation differences on assets and liabilities carried at fair value
are reported as part of the fair value gain or loss.
Page | 33
Volt Resources Limited
Notes to the Financial Statements for the Year ended 30 June 2016
The functional currency of foreign operations through Dugal Resources Lda and Xiluva Mozambi Lda, is
Mozambique New Metical (MZN).
As at the balance date the assets and liabilities of these subsidiaries are translated into the presentation currency
of Volt Resources Limited at the rate of exchange ruling at the reporting date and their statements of
comprehensive income are translated at the weighted average exchange rate for the year.
The exchange differences arising on the translation are taken directly to a separate component of equity, being
recognised in the foreign currency translation reserve.
On disposal of a foreign entity, the deferred cumulative amount recognised in equity relating to that particular
foreign operation is recognised in profit or loss.
(n)
Income tax
Current tax assets and liabilities for the current and prior periods are measured at the amount expected to be
recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are
those that are enacted or substantively enacted by the reporting date.
Deferred income tax is provided on all temporary differences at the reporting date between the tax bases of
assets and liabilities and their carrying amounts for financial reporting purposes.
Deferred income tax liabilities are recognised for all taxable temporary differences except:
when the deferred income tax liability arises from the initial recognition of goodwill or of an asset or
liability in a transaction that is not a business combination and that, at the time of the transaction,
affects neither the accounting profit nor taxable profit or loss; or
when the taxable temporary difference is associated with investments in subsidiaries, associates or
interests in joint ventures, and the timing of the reversal of the temporary difference can be controlled
and it is probable that the temporary difference will not reverse in the foreseeable future.
Deferred income tax assets are recognised for all deductible temporary differences, carry-forward of unused tax
assets and unused tax losses, to the extent that it is probable that taxable profit will be available against which
the deductible temporary differences and the carry-forward of unused tax credits and unused tax losses can be
utilised, except:
when the deferred income tax asset relating to the deductible temporary difference arises from the
initial recognition of an asset or liability in a transaction that is not a business combination and, at the
time of the transaction, affects neither the accounting profit nor taxable profit or loss; or
when the deductible temporary difference is associated with investments in subsidiaries, associates or
interests in joint ventures, in which case a deferred tax asset is only recognised to the extent that it is
probable that the temporary difference will reverse in the foreseeable future and taxable profit will be
available against which the temporary difference can be utilised.
The carrying amount of deferred income tax assets is reviewed at each reporting date and reduced to the extent
that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred
income tax asset to be utilised.
Unrecognised deferred income tax assets are reassessed at each reporting date and are recognised to the extent
that it has become probable that future taxable profit will allow the deferred tax asset to be recovered.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year
when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or
substantively enacted at the reporting date.
Income taxes relating to items recognised directly in equity are recognised in equity and not in profit or loss.
Deferred tax assets and deferred tax liabilities are offset only if a legally enforceable right exists to set off current
tax assets against current tax liabilities and the deferred tax assets and liabilities relate to the same taxable entity
and the same taxation authority.
Page | 34
Volt Resources Limited
Notes to the Financial Statements for the Year ended 30 June 2016
Tax consolidation legislation
Volt Resources Limited and its 100% owned Australian resident subsidiary have implemented the tax
consolidation legislation. Current and deferred tax amounts are accounted for in each individual entity as if each
entity continued to act as a taxpayer on its own.
Volt Resources Limited recognises both its own current and deferred tax amounts and those current tax
liabilities, current tax assets and deferred tax assets arising from unused tax credits and unused tax losses which
it has assumed from its controlled entities within the tax consolidated group.
Assets or liabilities arising under tax funding agreements with the tax consolidated entities are recognised as
amounts payable or receivable from or payable to other entities in the Group. Any difference between the
amounts receivable or payable under the tax funding agreement are recognised as a contribution to (or
distribution from) controlled entities in the tax consolidated group.
Other taxes
(o)
Revenues, expenses and assets are recognised net of the amount of GST except:
when the GST incurred on a purchase of goods and services is not recoverable from the taxation
authority, in which case the GST is recognised as part of the cost of acquisition of the asset or as part of
the expense item as applicable; and
receivables and payables, which are stated with the amount of GST included.
The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables
or payables in the statement of financial position.
Cash flows are included in the statement of cash flows on a gross basis and the GST component of cash flows
arising from investing and financing activities, which is recoverable from, or payable to, the taxation authority
are classified as operating cash flows.
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the
taxation authority.
Property, plant and equipment
(p)
Plant and equipment is stated at cost less accumulated depreciation and any accumulated impairment losses.
Depreciation is calculated on a straight-line basis over the estimated useful life of the assets as follows:
Plant and equipment – over 3 years
The assets' residual values, useful lives and amortisation methods are reviewed, and adjusted if appropriate, at
each financial year end.
(i) Impairment
The carrying values of plant and equipment are reviewed for impairment at each reporting date, with
recoverable amount being estimated when events or changes in circumstances indicate that the carrying value
may be impaired.
The recoverable amount of plant and equipment is the higher of fair value less costs to sell and value in use. In
assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax
discount rate that reflects current market assessments of the time value of money and the risks specific to the
asset.
For an asset that does not generate largely independent cash inflows, recoverable amount is determined for the
cash-generating unit to which the asset belongs, unless the asset's value in use can be estimated to be close to
its fair value.
An impairment exists when the carrying value of an asset or cash-generating units exceeds its estimated
recoverable amount. The asset or cash-generating unit is then written down to its recoverable amount.
For plant and equipment, impairment losses are recognised in profit or loss for the year as a separate line item.
Page | 35
Volt Resources Limited
Notes to the Financial Statements for the Year ended 30 June 2016
(ii) Derecognition and disposal
An item of property, plant and equipment is derecognised upon disposal or when no further 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 profit or loss in the year the asset is derecognised.
(q)
Financial assets
Financial assets in the scope of AASB 139 Financial Instruments: Recognition and Measurement are classified as
either financial assets at fair value through profit or loss, loans and receivables, held-to-maturity investments,
or available-for-sale investments, as appropriate. When financial assets are recognised initially, they are
measured at fair value, plus, in the case of investments not at fair value through profit or loss, directly
attributable transactions costs. The Group determines the classification of its financial assets after initial
recognition and, when allowed and appropriate, re-evaluates this designation at each financial year-end.
All regular way purchases and sales of financial assets are recognised on the trade date i.e. the date that the
Group commits to purchase the asset. Regular way purchases or sales are purchases or sales of financial assets
under contracts that require delivery of the assets within the period established generally by regulation or
convention in the marketplace.
(i) Financial assets at fair value through profit or loss
Financial assets classified as held for trading are included in the category ‘financial assets at fair value through
profit or loss’. Financial assets are classified as held for trading if they are acquired for the purpose of selling in
the near term. Derivatives are also classified as held for trading unless they are designated as effective hedging
instruments. Gains or losses on investments held for trading are recognised in profit or loss.
(ii) Held-to-maturity investments
Non-derivative financial assets with fixed or determinable payments and fixed maturity are classified as held-to-
maturity when the Group has the positive intention and ability to hold to maturity. Investments intended to be
held for an undefined period are not included in this classification. Investments that are intended to be held-to-
maturity, such as bonds, are subsequently measured at amortised cost. This cost is computed as the amount
initially recognised minus principal repayments, plus or minus the cumulative amortisation using the effective
interest method of any difference between the initially recognised amount and the maturity amount. This
calculation includes all fees and points paid or received between parties to the contract that are an integral part
of the effective interest rate, transaction costs and all other premiums and discounts. For investments carried at
amortised cost, gains and losses are recognised in profit or loss when the investments are derecognised or
impaired, as well as through the amortisation process.
(iii) Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not
quoted in an active market. Such assets are carried at amortised cost using the effective interest method. Gains
and losses are recognised in profit or loss when the loans and receivables are derecognised or impaired, as well
as through the amortisation process.
(iv) Available-for-sale investments
Available-for-sale investments are those non-derivative financial assets that are designated as available-for-sale
or are not classified as any of the three preceding categories. After initial recognition available-for sale
investments are measured at fair value with gains or losses being recognised as a separate component of equity
until the investment is derecognised or until the investment is determined to be impaired, at which time the
cumulative gain or loss previously reported in equity is recognised in profit or loss.
The fair value of investments that are actively traded in organised financial markets is determined by reference
to quoted market bid prices at the close of business on the reporting date. For investments with no active
market, fair value is determined using valuation techniques. Such techniques include using recent arm’s length
market transactions; reference to the current market value of another instrument that is substantially the same;
discounted cash flow analysis and option pricing models.
Page | 36
Volt Resources Limited
Notes to the Financial Statements for the Year ended 30 June 2016
(r)
Intangible assets
Intangible assets acquired separately
Intangible assets acquired separately are recorded at cost less accumulated amortisation and impairment.
Amortisation is charged on a straight-line basis over their estimated useful lives. The estimated useful life and
amortisation method is reviewed at the end of each annual reporting period, with any changes in these
accounting estimates being accounted for on a prospective basis.
Subsequent to initial recognition, intangible assets acquired in a business combination are reported at cost less
accumulated amortisation and accumulated impairment losses, on the same basis as intangible assets acquired
separately.
(s)
Impairment of assets
The Group assesses at each reporting date whether there is an indication that an asset may be impaired. If any
such indication exists, or when annual impairment testing for an asset is required, the Group makes an estimate
of the asset’s recoverable amount. An asset’s recoverable amount is the higher of its fair value less costs to sell
and its value in use and is determined for an individual asset, unless the asset does not generate cash inflows
that are largely independent of those from other assets or groups of assets and the asset's value in use cannot
be estimated to be close to its fair value. In such cases the asset is tested for impairment as part of the cash-
generating unit to which it belongs. When the carrying amount of an asset or cash-generating unit exceeds its
recoverable amount, the asset or cash-generating unit is considered impaired and is written down to its
recoverable amount.
In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax
discount rate that reflects current market assessments of the time value of money and the risks specific to the
asset. Impairment losses relating to continuing operations are recognised in those expense categories consistent
with the function of the impaired asset unless the asset is carried at revalued amount (in which case the
impairment loss is treated as a revaluation decrease).
An assessment is also made at each reporting date as to whether there is any indication that previously
recognised impairment losses may no longer exist or may have decreased. If such indication exists, the
recoverable amount is estimated. A previously recognised impairment loss is reversed only if there has been a
change in the estimates used to determine the asset’s recoverable amount since the last impairment loss was
recognised. If that is the case the carrying amount of the asset is increased to its recoverable amount. That
increased amount cannot exceed the carrying amount that would have been determined, net of depreciation,
had no impairment loss been recognised for the asset in prior years. Such reversal is recognised in profit or loss
unless the asset is carried at revalued amount, in which case the reversal is treated as a revaluation increase.
After such a reversal the depreciation charge is adjusted in future periods to allocate the asset’s revised carrying
amount, less any residual value, on a systematic basis over its remaining useful life.
(t)
Trade and other payables
Trade payables and other payables are carried at amortised cost and represent liabilities for goods and services
provided to the Group prior to the end of the financial year that are unpaid and arise when the Group becomes
obliged to make future payments in respect of the purchase of these goods and services. Trade and other
payables are presented as current liabilities unless payment is not due within 12 months.
(u)
Borrowings
All loans and borrowings are initially recognised at the fair value of the consideration received less directly
attributable transaction costs.
After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortised cost
using the effective interest method.
Gains and losses are recognised in profit or loss when the liabilities are derecognised.
Page | 37
Volt Resources Limited
Notes to the Financial Statements for the Year ended 30 June 2016
Provisions
(v)
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past
event, it is probable that an outflow of resources embodying economic benefits will be required to settle the
obligation and a reliable estimate can be made of the amount of the obligation.
When the Group expects some or all of a provision to be reimbursed, for example under an insurance contract,
the reimbursement is recognised as a separate assets but only when the reimbursement is virtually certain. The
expense relating to any provision is presented in the statement of profit or loss net of any reimbursement.
Provisions are measured at the present value or management’s best estimate of the expenditure required to
settle the present obligation at the end of the reporting period.
If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that
reflects the risks specific to the liability.
When discounting is used, the increase in the provision due to the passage of time is recognised as an interest
expense.
(w)
Issued capital
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.
(x)
Earnings per share
Basic earnings per share is calculated as net profit or loss attributable to members of the parent, adjusted to
exclude any costs of servicing equity (other than dividends) and preference share dividends, divided by the
weighted average number of ordinary shares, adjusted for any bonus element.
Diluted earnings per share is calculated as net profit or loss attributable to members of the parent, adjusted for:
costs of servicing equity (other than dividends) and preference share dividends;
the after tax effect of dividends and interest associated with dilutive potential ordinary shares that have
been recognised as expenses; and
other non-discretionary changes in revenues or expenses during the period that would result from the
dilution of potential ordinary shares; divided by the weighted average number of ordinary shares and
dilutive potential ordinary shares, adjusted for any bonus element.
(y)
Segment reporting
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 Board of Directors of Volt Resources
Limited.
(z)
Non-current assets (or disposal groups) held for sale and discontinued operations
Non-current assets (or disposal groups) are classified as held for sale if their carrying amount will be recovered
principally through a sale transaction rather than through continuing use and a sale is considered highly
probable. They are measured at the lower of their carrying amount and fair value less costs to sell, except for
assets such as deferred tax assets, assets arising from employee benefits, financial assets and investment
property that are carried at fair value and contractual rights under insurance contracts, which are specifically
exempt from this requirement.
An impairment loss is recognised for any initial or subsequent write-down of the asset (or disposal group) to fair
value less costs to sell. A gain is recognised for any subsequent increases in fair value less costs to sell of an asset
(or disposal group), but not in excess of any cumulative impairment loss previously recognised. A gain or loss
not previously recognised by the date of the sale of the non-current asset (or disposal group) is recognised at
the date of derecognition.
Page | 38
Volt Resources Limited
Notes to the Financial Statements for the Year ended 30 June 2016
Non-current assets (including those that are part of a disposal group) are not depreciated or amortised while
they are classified as held for sale. Interest and other expenses attributable to the liabilities of a disposal group
classified as held for sale continue to be recognised.
Non-current assets classified as held for sale and the assets of the disposal group classified as held for sale are
presented separately from the other assets in the statement of financial position. The liabilities of a disposal
group classified as held for sale are presented separately from other liabilities in the statement of financial
position.
A discontinued operation is a component of the entity that has been disposed of or is classified as held for sale
and that represents a separate major line of business or geographical area of operations, is part of a single co-
ordinated plan to dispose of such a line of business or area of operations, or is a subsidiary acquired exclusively
with a view to resale. The results of discontinued operations are presented separately in the statement of profit
or loss.
(aa)
Business combinations
The acquisition method of accounting is used to account for all business combinations, including business
combinations involving entities or business under common control, regardless of whether equity instruments or
other assets are acquired. The consideration transferred for the acquisition of a subsidiary comprises the fair
value of the assets transferred, the liabilities incurred and the equity interests issued by the group. The
consideration transferred also includes the fair value of any contingent consideration arrangement and the fair
value of any pre-existing equity interest in the subsidiary. Acquisition-related costs are expensed as incurred.
Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are, with
limited exceptions, measured initially at their fair values at the acquisition date. On an acquisition-by-acquisition
basis, the group recognises any non-controlling interest in the acquiree either at fair value or at the non-
controlling interest’s proportionate share of the acquiree’s net identifiable assets.
The excess of the consideration transferred, the amount of any non-controlling interest in the acquiree and the
acquisition-date fair value of any previous equity interest in the acquiree over the fair value of the group’s share
of the net identifiable assets acquired is recorded as goodwill. If those amounts are less than the fair value of
the net identifiable assets of the subsidiary acquired and the measurement of all amounts has been reviewed,
the difference is recognised directly in profit or loss as a bargain purchase.
Where settlement of any part of cash consideration is deferred, the amounts payable in the future are
discounted to their present value as at the date of exchange. The discount rate used is the entity’s incremental
borrowing rate, being the rate at which a similar borrowing could be obtained from an independent financier
under comparable terms and conditions.
Contingent consideration is classified as either equity or a financial liability. Amounts classified as a financial
liability are subsequently remeasured to fair value with changes in fair value recognised in profit or loss.
(bb)
Share-based payment transactions
(i) Equity settled transactions:
The Group provides benefits to employees (including senior executives) of the Group in the form of share-based
payments, whereby employees render services in exchange for shares or rights over shares (equity-settled
transactions).
The cost of these equity-settled transactions with employees is measured by reference to the fair value of the
equity instruments at the date at which they are granted. The fair value is determined by an external valuer using
a Black-Scholes model.
In valuing equity-settled transactions, no account is taken of any performance conditions, other than conditions
linked to the price of the shares of Volt Resources Limited (market conditions) if applicable.
The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over the
period in which the performance and/or service conditions are fulfilled, ending on the date on which the relevant
employees become fully entitled to the award (the vesting period).
Page | 39
Volt Resources Limited
Notes to the Financial Statements for the Year ended 30 June 2016
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 Group’s best estimate of the number
of equity instruments that will ultimately vest. 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.
The statement of comprehensive income charge or credit for a period represents the movement in cumulative
expense recognised as at the beginning and end of that period.
No expense is recognised for awards that do not ultimately vest, except for awards where vesting is only
conditional upon a market condition.
If the terms of an equity-settled award are modified, as a minimum an expense is recognised as if the terms had
not been modified. In addition, an expense is recognised for any modification that increases the total fair value
of the share-based payment arrangement, or is otherwise beneficial to the employee, as measured at the date
of modification.
If 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, as described in the previous paragraph.
The dilutive effect, if any, of outstanding options is reflected as additional share dilution in the computation of
earnings/loss per share (see Note 4).
(cc)
Exploration and evaluation
Exploration and evaluation expenditures in relation to each separate area of interest are recognised as an
exploration and evaluation asset in the year in which they are incurred where the following conditions are
satisfied:
(i)
the rights to tenure of the area of interest are current; and
(ii) at least one of the following conditions is also met:
(a) the exploration and evaluation expenditures are expected to be recouped through successful
development and exploration of the area of interest, or alternatively, by its sale; or
(b) 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 assets are initially measured at cost and include acquisition of rights to explore,
studies, exploratory drilling, trenching and sampling and associated activities and an allocation of depreciation
and amortised of assets used in exploration and evaluation activities. General and administrative costs are only
included in the measurement of exploration and evaluation costs where they are related directly to operational
activities in a particular area of interest.
Exploration and evaluation assets are assessed for impairment when facts and circumstances suggest that the
carrying amount of an exploration and evaluation asset may exceed its recoverable amount. The recoverable
amount of the exploration and evaluation asset (for the cash generating unit(s) to which it has been allocated
being no larger than the relevant area of interest) is estimated to determine the extent of the impairment loss
(if any). Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the
revised estimate of its recoverable amount, but only to the extent that the increased carrying amount does not
exceed the carrying amount that would have been determined had no impairment loss been recognised for the
asset in previous years.
Where a decision has been made to proceed with development in respect of a particular area of interest, the
relevant exploration and evaluation asset is tested for impairment and the balance is then reclassified to
development.
Page | 40
Volt Resources Limited
Notes to the Financial Statements for the Year ended 30 June 2016
(dd)
Parent entity financial information
The financial information for the parent entity, Volt Resources Limited, disclosed in Note 20 has been prepared
on the same basis as the consolidated financial statements, except as set out below.
(i) Investments in subsidiaries, associates and joint venture entities
Investments in subsidiaries, associates and joint venture entities are accounted for at cost in the financial
statements of Volt Resources Limited. Dividends received from associates are recognised in the parent entity’s
profit or loss, rather than being deducted from the carrying amount of these investments.
(ii) Share-based payments
The Group measures the cost of equity-settled transactions with employees by reference to the fair value of the
equity instruments at the date at which they are granted. The fair value is determined using a Black-Scholes
model.
2.
Revenue and Expenses
(a) Revenue
Continuing Operations
Interest Income
(b) Expenses
Loss before income tax has been determined after charging:
Continuing Operations
Depreciation
Impairment loss recognised on other receivables
Share-based payments
Ordinary shares
Liability to be settled in ordinary shares
Performance rights
Options
Further details of share-based payments can be found in Note 13.
Consolidated
2016
$
2015
$
24,100
4,781
-
-
(2,548)
(19,087)
(698,500)
(440,000)
(294,000)
(341,109)
(1,773,609)
-
-
-
(216,200)
(216,200)
Page | 41
Volt Resources Limited
Notes to the Financial Statements for the Year ended 30 June 2016
3.
Income Tax
The prima facie income tax benefit on pre-tax accounting loss reconciles to
the income tax expense in the financial statements as follows:
Accounting loss before income tax
Income tax benefit calculated at 28.5% (2015: 30%)
Share based payments
Non-deductible expenses
Capital raising costs deductible
Income tax losses not brought to account
Consolidated
2016
$
2015
$
(3,806,555)
1,084,868
(505,479)
(20,996)
47,856
(606,249)
(662,146)
198,644
(64,860)
(5,726)
66,635
(194,693)
Income tax benefit from continuing operations reported in the consolidated
statement of profit or loss
Income tax benefit attributable to discontinued operations
-
-
-
-
The tax rate used in the above reconciliation is the corporate tax rate of 28.5% (2015: 30%) payable by Australian
corporate entities on taxable profits under Australian tax law for small businesses.
The Group has tax losses arising in Australia of $17,464,906 (2015: $15,004,046) that are available indefinitely for
offset against future taxable profits of the companies in which the losses arose. The availability of these losses is
subject to the satisfaction of either the same business or continuity of ownership tests.
Deferred tax assets have not been recognised in respect of these items because it is not sufficiently probable that
future taxable profit will be available against which the Group can utilise the benefits thereof.
4.
Loss per share
Basic / diluted loss per share – continuing operations:
Loss per share
Consolidated
2016
Cents per share
2015
Cents per share
(0.57)
(0.27)
Loss after tax (used in calculation of basic / diluted loss per share)
(3,326,575)
(658,310)
Basic / diluted loss per share – discontinued operations:
Loss per share
Loss after tax (used in calculation of basic / diluted loss per share)
(0.08)
(479,980)
-
-
Consolidated
2016
No.
2015
No.
Weighted average number of ordinary shares used as the denominator
in calculating basic / diluted loss per share
583,282,168
243,663,510
As the entity is loss-making in both the current and prior year, no potential ordinary shares are considered to be
dilutive as they would act to decrease the loss per share.
The options on issue (Note 11) represent potential ordinary shares but are not dilutive and accordingly have been
excluded from the weighted average number of ordinary shares and potential ordinary shares used in the
calculation of diluted earnings per share.
Page | 42
Volt Resources Limited
Notes to the Financial Statements for the Year ended 30 June 2016
5.
Cash and Cash Equivalents
Cash at bank and on hand
Cash at bank earns interest at floating rates based on daily bank deposit rates
(i) Reconciliation to Statement of Cash Flows:
Cash and cash equivalents
(ii) Reconciliation of loss for the year to net cash outflows from operating
activities
Loss for the year
Depreciation
Interest received
Non-capitalised exploration expenditure
Impairment of other assets
Foreign Exchange (gain)/loss
Share based payments
(Increase)/decrease in trade and other receivables
(Increase)/decrease in prepayments
Increase/(decrease) in creditors and accruals
Net cash used in operating activities
6.
Trade and Other Receivables
Other receivables – Current
Rental Bond – Non-current
7.
Other Financial Assets
Term deposit
Options to acquire shares/projects
Total
Page | 43
Consolidated
2016
$
7,617,762
2015
$
554,125
7,617,762
7,617,762
554,125
554,125
(3,806,555)
(662,146)
-
(24,100)
479,980
73,670
-
1,773,609
(87,297)
(103,973)
308,143
2,548
(4,781)
-
19,087
(16,428)
216,200
20,891
-
70,561
(1,386,523)
(354,068)
Consolidated
2016
$
2015
$
104,120
2,400
106,520
16,823
-
16,823
Consolidated
2016
$
2015
$
20,000
-
20,000
-
224,475
224,475
Volt Resources Limited
Notes to the Financial Statements for the Year ended 30 June 2016
Option to acquire shares in Nachi Resources Limited
On 22 May 2015, the Group signed a term sheet granting the option to acquire eighteen tenement applications in
Tanzania via the acquisition of 100% of the share capital of the entity that owns the tenements, Nachi Resources
Limited. The option was paid for with an initial consideration of 3,300,000 ordinary shares issued in the Company
at a value of $46,200, plus a cash payment of US$75,000.
Option to acquire exploration licences in Mozambique
On 10 February 2015, the Group signed a term sheet granting the option to acquire to prospective graphite
licences in the Balama-Montepuez province of Mozambique. The option was extended to 4 November 2015 and
allowed to lapse during the financial year.
8.
Property, Plant and Equipment
Cost
Accumulated depreciation
Net carrying amount
Consolidated
2016
$
2015
$
-
-
-
-
-
-
A reconciliation of movements in plant & equipment during the current & prior financial year is as follows:
Opening balance
Depreciation
Closing balance
9.
Deferred Exploration Expenditure
Opening balance
Acquisition of Tanzania graphite project (ii)
Expenditure during the year
Impairment – Bowen River and Carmilla coal tenements (i)
Closing balance
-
-
-
2,548
(2,548)
-
Consolidated
2016
$
2015
$
478,703
455,015
7,637,536
3,114,119
(479,980)
-
23,688
-
10,750,378
478,703
Capitalised exploration and evaluation expenditure represents the accumulated cost of acquisition and
subsequent expenditure cost on properties which are in the exploration and evaluation phase. Ultimate
recoupment of these costs is dependent on the successful development and commercial exploitation, or
alternatively sale, of the respective areas of interest.
Discontinued Operation
(i) During the year, tenements comprising the Australian Coal assets were relinquished and, accordingly,
the amounts previously capitalised in the financial report were written off. Due to these assets
representing a separate geographical segment per the segment reporting at Note 16, this represents a
discontinued operation. The loss after tax from discontinued operations was $479,980 (2015: $nil).
Page | 44
Volt Resources Limited
Notes to the Financial Statements for the Year ended 30 June 2016
Acquisition of Subsidiary
(ii) During the year, the Group acquired 100% of Nachi Resources Limited (a company registered in
Tanzania). As Nachi Resources Limited does not constitute a business, this transaction has been
accounted for as an asset acquisition, being the acquisition of exploration and evaluation assets.
The total consideration paid to acquire Nachi Resources Limited was as follows:
Consideration paid
Option fee carried forward from 30 June 2015
Cash consideration
Shares issued to vendors
Options issued to vendors
Other transaction costs – Shares issued
Other transaction costs – Options issued
Other transaction costs
Total consideration paid
Net tangible assets acquired
Other identifiable assets acquired – exploration and evaluation
Total identifiable assets acquired
Excess of consideration paid over identifiable assets acquired
10.
Trade & Other Payables
Trade Creditors & Accruals
Total Trade & Other Payables
$
142,034
322,722
6,895,000
150,000
93,500
15,000
19,280
7,637,536
-
7,637,536
7,637,536
-
Consolidated
2016
2015
$
$
1,108,067
159,924
1,108,067
159,924
Trade payables are non-interest bearing and are normally settled on 30-day terms.
11.
Contributed Equity
Share Capital
Ordinary shares issued and fully paid
906,180,471
308,645,421
51,722,526
32,466,385
Consolidated
Consolidated
2016
Shares
2015
Shares
2016
$
2015
$
Page | 45
Volt Resources Limited
Notes to the Financial Statements for the Year ended 30 June 2016
11. Contributed Equity (Cont.)
Movements in Share Capital during the current and prior financial years are as follows:
Ordinary Shares
Balance as at 30 June
2014
Placement
Consulting fees in lieu
of payment
Consulting fees in lieu
of payment
Consulting fees in lieu
of payment
Tanzania option
Placement
Less costs of issue
Balance as at 30 June
2015
Rights issue
Rights issue
Nachi acquisition
Consulting
Consulting
Options exercised
Consulting
Nachi acquisition
Placement
Performance rights
Options exercised
Consulting
Placement
Nachi acquisition
Corporate advisory
Placement
Performance rights
Options exercised
Performance rights
Options exercised
Placement
Options exercised (not
yet issued)
Less costs of issue
Balance as at 30 June
2016
Date
No.
Issue Price
$
212,541,987
31,758,385
24/12/14
52,999,998
$0.006
26/2/15
21/4/15
15/5/15
28/5/15
16/6/15
30/7/15
18/8/15
18/8/15
18/8/15
26/10/15
26/10/15
4/11/15
4/11/15
9/11/15
2/12/15
2/12/15
25/2/16
25/2/16
8/4/16
8/4/16
8/4/16
8/4/16
8/4/16
25/5/16
20/06/16
20/06/16
2,500,000
$0.008
5,881,868
various
588,235
3,300,000
30,833,333
$0.017
$0.014
$0.012
308,645,421
77,161,569
50,500,000
5,000,000
16,000,000
14,200,000
4,516,285
1,500,000
39,000,000
50,000,000
3,000,000
2,176,785
2,000,000
30,171,212
132,000,000
1,404,529
107,893,938
3,000,000
13,776
3,000,000
14,996,956
40,000,000
$0.012
$0.012
$0.017
$0.012
various
$0.02
$0.04
various
$0.035
nil
$0.02
$0.04
$0.033
$0.04
$0.04
$0.033
nil
$0.02
nil
$0.02
$0.10
318,000
20,000
75,000
10,000
46,200
370,000
(131,200)
32,466,385
925,843
606,000
85,000
192,000
322,500
90,250
60,000
1,563,500
1,750,000
-
43,536
80,000
995,650
5,280,000
44,000
3,560,500
-
276
-
299,939
4,000,000
69,615
(712,468)
906,180,471
51,722,526
Page | 46
Volt Resources Limited
Notes to the Financial Statements for the Year ended 30 June 2016
11. Contributed Equity (Cont.)
Options
The following options were in existence during the current and prior reporting periods:
Number
Grant date
475,000
2,200,000
50,000,000
9,000,000
26,499,999
2,000,000
5,000,000
6,000,000
50,000,000
20,000,000
1,000,000
3,000,000
48,441,667
38,580,785
24,208,784
6,125,000
1,041,667
11,750,000
12,500,000
2,000,000
1,500,000
3,500,000
4,200,000
4,200,000
4,200,000
4,200,000
2,000,000
02/08/2012
26/11/2012
27/05/2014
27/05/2014
26/02/2015
26/02/2015
20/02/2015
20/02/2015
19/03/2015
21/04/2015
15/05/2015
10/08/2015
10/08/2015
07/08/2015
18/08/2015
22/10/2015
22/10/2015
04/11/2015
11/11/2015
01/04/2016
07/04/2016
07/04/2016
25/05/2016
25/05/2016
25/05/2016
25/05/2016
20/06/2016
Fair value at
grant date
$
$0.0260
$0.0060
$0.0048
$0.0048
n/a
n/a
$0.0067
$0.0067
$0.001
$0.001
$0.001
$0.006
$0.005
N/A
N/A
$0.012
N/A
$0.02
N/A
$0.02
$0.025
$0.02
$0.029
$0.026
$0.024
$0.022
$0.09
Exercise price
$
Expiry date
$0.25
$0.25
$0.02
$0.02
$0.02
$0.02
$0.02
$0.02
$0.02
$0.02
$0.02
$0.02
$0.02
$0.02
$0.02
$0.02
$0.02
$0.02
$0.02
$0.02
$0.02
$0.02
$0.06
$0.08
$0.10
$0.12
$0.02
02/08/2016
30/11/2016
31/12/2017
31/12/2017
31/12/2017
31/12/2017
31/12/2017
31/12/2017
31/12/2017
31/12/2017
31/12/2017
31/12/2017
31/12/2017
31/12/2017
31/12/2017
31/12/2017
31/12/2017
31/12/2017
31/12/2017
31/12/2017
31/12/2017
31/12/2017
30/04/2019
30/04/2019
30/04/2019
30/04/2019
31/12/2017
The options carry no dividend or voting rights. Upon exercise, each option is convertible into one ordinary share
to rank pari passu in all respects with the Company’s existing fully paid ordinary shares. All options on issue
vested at the grant date.
The following table illustrates the number and weighted average exercise prices of and movements in share
options during the year:
2016
2015
Outstanding at the beginning of the year
Granted during the year
Forfeited during the year
Exercised during the year
Expired during the year
Outstanding at the end of the year
Exercisable at the end of the year
Weighted
average
exercise price
$0.02
$0.03
-
$0.02
-
$0.03
Weighted
average
exercise price
$0.03
$0.02
-
-
-
$0.02
Number
61,675,000
110,499,999
-
-
-
172,174,999
172,174,999
Number
172,174,999
170,672,452
-
(21,703,802)
-
321,143,649
321,143,649
Page | 47
Volt Resources Limited
Notes to the Financial Statements for the Year ended 30 June 2016
Share options exercised during the year
21,703,802 shares were issued during the year to 30 June 2016 as a result of the exercise of options (2015: nil).
Share options outstanding at the end of the year
The share options outstanding at the end of the year had a weighted average exercise price of $0.03 (2015:
$0.02) and a weighted average remaining contractual life of 571 days (2015: 910 days).
12.
Reserves
Share-based Payments Reserve
Balance at beginning of year
Share based payments
Balance at end of year
Consolidated
2016
$
2015
$
2,979,900
952,607
3,932,507
2,835,200
144,700
2,979,900
The share-based payments reserve has historically been used to record the fair value of share-based payments
made by the Company to employees and directors as part of their remuneration.
Foreign currency translation reserve
Balance at beginning of year
Currency translation differences
Balance at end of year
(76,162)
(25,829)
(101,991)
(76,417)
255
(76,162)
The foreign currency translation reserve is used to record exchange differences arising from the translation of
the financial statements of foreign subsidiaries.
Total Reserves
3,830,516
2,903,738
13.
Share-based Payments
Under an established Performance Rights Plan, Mr Matthew Bull, Mr Adrien Wing and Mr Alan Armstrong were
issued 3,000,000 Performance Rights each in the following tranches and subject to the following vesting
conditions:
Tranche 1 – 1,000,000 Performance Rights vest on the market capitalisation of the Company of $25 million
or more within 3 years of the issue date.
Tranche 2 – 1,000,000 Performance Rights vest on the market capitalisation of the Company of $40 million
or more within 4 years of the issue date.
Tranche 3 – 1,000,000 Performance Rights vest the Company successfully raising an aggregate of not less
than $5,000,000 for the purposes of development of the Tanzanian assets, working capital and other
opportunities.
These conditions were achieved during the financial year and 9,000,000 shares issued for nil consideration to
satisfy the terms of the Performance Rights.
Page | 48
Volt Resources Limited
Notes to the Financial Statements for the Year ended 30 June 2016
On 11 December 2015, the Company entered into a consultancy agreement with Mr Stephen Hunt, in his
capacities as Chairman. Under an established Performance Rights Plan, following shareholder approval, Mr Hunt
was also issued 10,000,000 Performance Rights in the following tranches and subject to vesting conditions:
Tranche 1 – 2,500,000 Performance Rights vest on completion of the Pre-Feasibility Study (as defined by
the JORC Code) on the Namangale Project to be achieved by 31 March 2017.
Tranche 2 – 2,500,000 Performance Rights vest on the execution of an Off-Take Agreement in respect of
the Namangale Project for a minimum of 50% of the minimum production contemplated in the Pre-
Feasibility Study to be achieved by 30 June 2017.
Tranche 3 – 2,500,000 Performance Rights vest on the execution of contracts for finance sufficient to
fund the commissioning of mining operations at Namangale Project to be achieved by 30 September
2017.
Tranche 4 – 2,500,000 Performance Rights vest on the commencement of mining, and processing of first
ore recovered from the Namangale Project to be achieved by 31 March 2019.
Summary of the Performance Rights issued during the year ended 30 June 2016 over Ordinary Shares:
Type
Expiry Date
Vesting Status Number
Market
Conditions
Fair Value $
Expensed
S Hunt - 1
S Hunt - 2
S Hunt - 3
S Hunt - 4
Other - 1
Other - 2
Other - 3
30/03/2017
30/06/2017
30/09/2017
31/03/2019
22/10/2018
22/10/2019
22/10/2018
Not yet vested 2,500,000
Not yet vested 2,500,000
Not yet vested 2,500,000
Not yet vested 2,500,000
1,000,000
Vested
1,000,000
Vested
1,000,000
Vested
No
No
No
No
Yes
Yes
Yes
n/a
n/a
n/a
n/a
$97,800
$91,200
$105,000
nil
nil
nil
nil
$97,800
$91,200
$105,000
The following share-based payments were made during the year:
Description
Consulting and corporate services (i)
Consulting and corporate services
Consulting and corporate services
Director remuneration (i)
Director remuneration
Director remuneration
Share issue costs
Acquisition of Tanzania graphite
project and exploration expenses
Acquisition of Tanzania graphite
project and exploration expenses
Security type
Unlisted Options
Listed Options
Ordinary shares
Unlisted Options
Listed Options
Performance Rights
Ordinary shares
Listed Options
Number
issued
14,250,000
14,250,000
33,604,529
3,000,000
2,000,000
13,000,000
1,500,00
8,250,000
Fair value
$
Vested expense
$
426,720
344,500
618,500
16,500
40,000
294,000
115,000
165,000
52,609
344,500
618,500
16,500
40,000
294,000
115,000
165,000
Ordinary shares
177,000,000
6,988,500
6,988,500
(i) The fair value of the equity settled unlisted share options granted during the current year is estimated as
at the date of grant using the Black Scholes model taking into account the terms and conditions upon
which the options were granted.
Expected volatility (%)
Risk-free interest rate (%)
Expected Option life (days)
Exercise price
Grant date share price
Tranche 1
100%
1.87%
1,079
$0.06
$0.05
Consultant Options
Tranche 2
100%
1.87%
1,079
$0.08
$0.05
Tranche 3
100%
1.87%
1,079
$0.10
$0.05
Tranche 4
100%
1.87%
1,079
$0.12
$0.05
Director
Options
M Bull
100%
1.87%
880
$0.02
$0.012
Page | 49
Volt Resources Limited
Notes to the Financial Statements for the Year ended 30 June 2016
14.
(a)
Financial Instruments
Capital risk management
The Group manages its capital to ensure that entities in the Group will be able to continue as a going concern
while maximising the return to stakeholders through the optimisation of the debt and equity balance.
The Group’s overall strategy remains unchanged from 2015.
The capital structure of the Group consists of debt, cash and cash equivalents and equity attributable to equity
holders of the parent, comprising issued capital, reserves and retained earnings.
None of the Group’s entities are subject to externally imposed capital requirements.
Operating cash flows are used to maintain and expand operations, as well as to make routine expenditures such
as tax, and general administrative outgoings.
Gearing levels are reviewed by the Board on a regular basis in line with its target gearing ratio, the cost of capital
and the risks associated with each class of capital.
(b) Categories of financial instruments
Financial assets
Loans and receivables
Cash and cash equivalents
Other financial assets
Financial liabilities
Trade & other payables
Consolidated
2016
$
2015
$
106,520
16,823
7,617,762
554,125
20,000
224,475
(1,108,067)
159,924
(c) Financial risk management objectives
The Group is exposed to market risk (including currency risk, fair value interest rate risk and price risk), credit risk,
liquidity risk and cash flow interest rate risk.
The Group seeks to minimise the effect of these risks, by using derivative financial instruments to hedge these risk
exposures where appropriate. The use of financial derivatives is governed by the Group’s policies approved by
the board of directors, which provide written principles on foreign exchange risk, interest rate risk, credit risk, the
use of financial derivatives and non-derivative financial instruments, and the investment of excess liquidity.
Compliance with policies and exposure limits is reviewed by management on a continuous basis. The Group does
not enter into or trade financial instruments, including derivative financial instruments, for speculative purposes.
(d) Market risk
The Group’s activities expose it primarily to the financial risks of changes in foreign currency exchange rates,
commodity prices and exchange rates. There has been no change to the Group’s exposure to market risks or the
manner in which it manages and measures the risk from the previous period.
Page | 50
Volt Resources Limited
Notes to the Financial Statements for the Year ended 30 June 2016
(e) Foreign currency risk management
The Group undertakes certain transactions denominated in foreign currencies, hence exposures to exchange rate
fluctuations arise. Exchange rate exposures are managed within approved policy parameters. No forward
contracts or other hedging instruments have been used during the current or prior year as the Group’s foreign
exchange exposure is not considered to be sufficiently material to justify such activities.
The carrying amounts of the Group’s foreign currency denominated monetary assets and monetary liabilities at
the balance date expressed in Australian dollars are as follows:
US dollars
Liabilities
Assets
2016
$
-
2015
$
-
2016
$
12,273
2015
$
-
Foreign currency sensitivity analysis
The Group is exposed to US Dollar (USD) currency fluctuations.
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 used when reporting foreign currency risk internally to
key management personnel and represents management’s assessment of the possible change in foreign exchange
rates. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts
their translation at the period end for a 10% change in foreign currency rates. A positive number indicates an
increase in profit or loss and other equity where the Australian Dollar strengthens against the respective currency.
For a weakening of the Australian Dollar against the respective currency there would be an equal and opposite
impact on the profit and other equity and the balances below would be negative.
Result for the year
Other equity
(f) Interest rate risk
USD Impact
2016
$
1,227
-
2015
$
-
-
As at and during the year ended on reporting date the Group had no significant interest-bearing assets or liabilities
other than liquid funds on deposit. As such, the Group’s income and operating cash flows (other than interest
income from funds on deposit) are substantially independent of changes in market interest rates. The Group’s
exposure to interest rate risk for each class of financial assets and liabilities is set out below.
Consolidated
2016
$
2015
$
Financial Assets
Cash assets
Floating interest
7,617,762
554,125
Group and Parent Company sensitivity
The sensitivity analyses below have been determined based on the exposure to interest rates at the balance date
and the stipulated change taking place at the beginning of the financial year and held constant through the
reporting period.
Page | 51
Volt Resources Limited
Notes to the Financial Statements for the Year ended 30 June 2016
At balance date, if interest rates had been 80 basis points higher or lower and all other variables were held
constant, the Group’s net result would increase or decrease by $60,942 (2015: $4,433). This is mainly attributable
to the Group’s exposure to interest rates on its variable rate cash holdings.
(g) Credit risk
The Group seeks to trade only with recognised, trustworthy third parties and it is the Group’s policy to perform
credit verification procedures in relation to any customers wishing to trade on credit terms with the Group. The
Group has no significant concentrations of credit risk.
(h) Liquidity risk
Prudent liquidity management involves the maintenance of sufficient cash, marketable securities, committed
credit facilities and access to capital markets. It is the policy of the board to ensure that the Group is able to meet
its financial obligations and maintain the flexibility to pursue attractive investment opportunities through keeping
committed credit lines available where possible, ensuring the Group has sufficient working capital and preserving
the 15% share issue limit available to the Company under the ASX Listing Rules.
Maturities of financial liabilities
Group - As at reporting date the Group had total financial liabilities of $668,067 (2015: $159,924), comprised of
non-interest-bearing payables to related parties, trade creditors and accruals with a maturity of less than 6
months.
(i) Net fair value
The carrying amount of financial assets and liabilities recorded in the financial statements approximate their fair
value as at 30 June 2016.
15. Commitments and Contingencies
In order to maintain and preserve rights of tenure to granted exploration tenements, the Group is required
to meet certain minimum levels of exploration expenditure.
As at reporting date these future minimum exploration expenditure commitments are as follows:
Not longer than 1 year
Longer than 1 year and not longer than 5 years
Longer than 5 years
Total
2016
$
279,418
838,256
-
1,117,674
2015
$
500,000
1,220,000
-
1,720,000
Page | 52
Volt Resources Limited
Notes to the Financial Statements for the Year ended 30 June 2016
16. Segment Reporting
a) Description
AASB 8 requires operating segments to be identified on the basis of internal reports about components of the
Group that are regularly reviewed by the chief operating decision maker in order to allocate resources to the
segment and to assess its performance.
The function of the chief operating decision maker is performed by the Board collectively. Information reported
to the Board for the purposes of resource allocation and assessment of performance is focused broadly on the
Group’s diversified activities across different sectors.
The Group’s reportable segments under AASB 8 are therefore as follows:
Mineral Exploration – Tanzania
Mineral Exploration – Australia
Information regarding the activities of these segments during the current and prior financial period is set out in
the following tables.
b) Segment revenues and results
Mineral Exploration – Tanzania
Mineral Exploration – Australia
Total for continuing operations
Investment income
Share based payments
Central administration costs and directors’ salaries
Loss before tax (continuing operations)
Segment revenue
Segment profit/(loss)
Year ended
2016
$
-
-
-
Year ended
2015
$
-
-
-
Year ended
2016
$
-
(479,980)
(479,980)
24,100
(1,773,609)
(1,577,066)
(3,806,555)
Year ended
2015
$
-
-
-
4,781
(216,200)
(450,727)
(662,146)
Segment assets and liabilities
Segment assets
Mineral Exploration – Tanzania
Mineral Exploration – Australia
Total segment assets
Unallocated
Consolidated total assets
Segment liabilities
Mineral Exploration – Tanzania
Mineral Exploration – Australia
Total segment liabilities
Unallocated
Consolidated total liabilities
2016
$
10,750,378
-
10,750,378
7,848,255
18,598,633
$
184,647
-
184,647
923,420
1,108,067
2015
$
-
478,703
478,703
795,423
1,274,126
$
-
-
-
159,924
159,924
Page | 53
Volt Resources Limited
Notes to the Financial Statements for the Year ended 30 June 2016
c) Other segment information
Impairment
Year ended
2016
$
-
-
-
Year ended
2015
$
-
-
-
Additions to non-current
assets
Year ended
2016
$
10,750,378
-
10,750,378
Year ended
2015
$
-
23,688
23,688
Mineral Exploration – Tanzania
Mineral Exploration – Australia
17. Subsidiaries
The consolidated financial statements include the financial statements of Volt Resources Limited and the
subsidiaries listed in the following table.
Name
Mine Mixers Pty Ltd
Dugal Pty Ltd
Dugal Resources Lda
Xiluva Mozambi Lda
Mozambi Resources Pty Ltd
Mozambi Ventures Lda
MNBB Pty Ltd
Blackall Capital Pty Ltd
Principal activity
Dormant
Dormant
Dormant
Dormant
Dormant
Dormant
Dormant
Dormant
Mozambi Graphite Pty Ltd
Dormant
Nachi Resources Limited
Graphite Exploration
Country of
Incorporation
Australia
Australia
Mozambique
Mozambique
Australia
Mozambique
Australia
Australia
Australia
Tanzania
% Equity Interest
2016
100
2015
100
100
70
80
100
80
100
100
100
100
100
70
80
100
80
100
100
100
-
Volt Resources Limited is the ultimate Australian parent entity and ultimate parent of the Group.
None of the non-wholly owned subsidiaries are considered to have material non-controlling interests to the
Group.
18. Auditor’s Remuneration
Amounts received or due and receivable by HLB Mann Judd for:
An audit or review of the financial report
31,000
25,000
31,000
25,000
Consolidated
2016
$
2015
$
Page | 54
Volt Resources Limited
Notes to the Financial Statements for the Year ended 30 June 2016
19. Key Management Personnel Remuneration
Total remuneration paid to key management personnel during the year:
Short-term benefits
Post-employment benefits
Share based payments
20. Parent Entity Information
Consolidated
2016
$
637,336
15,843
390,500
2015
$
186,314
3,482
40,200
1,043,679
229,996
The following details information related to the parent entity, Volt Resources Limited, at 30 June 2016. The
information presented here has been prepared using consistent accounting policies as presented in Note 1.
Financial position
Parent
Assets
Current Assets
Non-Current Assets
Total Assets
Liabilities
Current Liabilities
Total Liabilities
Equity
Issued capital
Reserves
Accumulated losses
Total Equity
Financial performance
Loss for the year
Total comprehensive loss for the year
There are no commitments in respect to the parent entity.
21. Subsequent Events
2016
$
7,818,413
2015
$
1,046,431
10,586,123
248,162
18,404,536
1,294,593
(913,970)
(159,924)
(913,970)
(159,924)
51,722,526
3,932,507
32,466,385
2,979,900
(38,164,467)
(34,311,616)
17,490,566
1,134,669
(3,852,851)
(658,817)
(3,852,851)
(658,817)
On 15 August 2016, Mr Adrien Wing resigned as Company Secretary and was replaced by Mr Stephen Brockhurst.
On 22 August 2016, Mr Alan Armstrong resigned as a director of the Company.
Since balance date the following equity issues have occurred:
- 46,474,723 shares issued upon the exercise of options
- 1,250,000 shares issued for marketing and consulting services in lieu of cash consideration
- 7,500,000 options for corporate advisory services exercisable at $0.12 on or before 12 August 2017
- 7,500,000 options for corporate advisory services exercisable at $0.14 on or before 12 August 2018
- 7,500,000 options for corporate advisory services exercisable at $0.16 on or before 12 August 2019
Page | 55
Volt Resources Limited
Additional ASX Information
The shareholder information set out below was applicable as at 6 September 2016.
1. Twenty largest holders of quoted equity securities
Rank Name
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
Kabunga Holdings Pty Ltd
HSBC Custody Nominees
CS Fourth Nominees Pty Limited
Citicorp Nominees Pty Limited
Gasmere Pty Ltd
Mr Hsien Michael Soo
Chata Holdings Pty Ltd
Gerard C Toscan Management
Dejul Trading Pty ltd
Mr Anthony Michael Malyniak
Mr Ian Hunter
S A Coupe Pty Limited
Ms Leticia Kokutengeneza
Mr John Richard Turner & Mrs Clare Frances Turner
Endjua Pty Ltd
Moultrie Super Fund Pty Ltd
Bring on Retirement Ltd
Mr Robert Adrian Jones
Mr Leslie Thomas King & Mrs Heather King
Gasmere Pty Ltd
Total Top 20
Other
Total Ordinary Shares On Issue
2. Substantial shareholders
Number of
units % of units
15.17
2.56
1.71
1.59
1.49
1.37
1.26
1.16
0.95
0.93
0.90
0.84
0.84
0.80
0.80
0.79
0.71
0.68
0.65
0.63
35.81
64.19
100%
144,164,203
24,305,351
16,223,409
15,127,509
14,151,515
13,012,500
12,000,000
11,026,750
9,000,000
8,857,928
8,531,933
8,000,000
7,946,698
7,580,000
7,570,500
7,500,000
6,720,545
6,469,105
6,200,000
5,972,956
340,360,902
610,046,792
950,407,694
The Company has not been notified of any substantial shareholders as at 6 September 2016.
3. Distribution of holders of equity securities
1 - 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
> 100,001
Total
Ordinary shares
251
236
244
1,487
1,015
3,233
Listed Options
40
33
20
130
239
462
559 shareholders held fewer than a marketable parcel of shares based on the share price at 6 September 2016.
Page | 56
Volt Resources Limited
Additional ASX Information
4. Voting rights
Subject to any rights or restrictions for the time being attached to any class or classes of shares, at meetings of
shareholders or classes of shareholders:
1.
2.
3.
each shareholder entitled to vote may vote in person or by proxy, attorney or representative;
on a show of hands, every person present who is a shareholder or a proxy, attorney or representative of a
shareholder has one vote; and
on a poll, every person present who is a shareholder or a proxy, attorney or representative of a
shareholder shall, in respect of each fully paid share held by him, or in respect of which he is appointed a
proxy, attorney or representative, have one vote for the share, but in respect of partly paid shares, shall
have such number of votes being equivalent to the proportion which the amount paid (not credited) is of
the total amounts paid and payable in respect of those shares (excluding amounts credited).
5. Twenty largest holders of Options
Rank Name
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
Kabunga Holdings Pty Ltd
BBD Custodians Pty Ltd
JBO Assets Pty Ltd
Red Marlin Pty Ltd
Mr John Richard Turner & Mrs Clare Frances Turner
Reid Machine Pty Ltd
Mr David Lachlan Wildy
Taka Custodians Pty Ltd
TWW Assets Pty Ltd
Moultrie Super Fund Pty Ltd
Bring on Retirement
Mr Laurie Barichello
Mr Steven John Bodey
Valplan Pty Ltd
Dr Tony Crea
Vassago Pty Ltd
Mr Brian Peter Bypass
Mr Floyd Barry Aquino
Mr Ian Hunter
Mr Anthony Michael Malyniak
Total Top 20
Other
Total Listed Options
Number of
units % of units
4.13
2.82
2.77
2.36
2.35
2.23
2.18
2.10
2.02
1.98
1.98
1.59
1.51
1.46
1.38
1.30
1.27
1.21
1.19
1.19
39.01
60.99
100%
10,421,835
7,115,000
6,978,571
5,940,000
5,932,000
5,634,167
5,501,000
5,284,167
5,103,571
5,000,000
5,000,000
4,000,000
3,813,856
3,670,000
3,467,500
3,281,250
3,166,667
3,061,028
3,000,000
3,000,000
98,370,612
153,820,814
252,191,426
Page | 57
Volt Resources Limited
Additional ASX Information
6. Unquoted equity security holdings greater than 20%
The Company has 29,500,000 unlisted options on issue as of 6 September 2016. The options do not carry a right
to vote at a general meeting of shareholders.
Expiry date
30/11/2016
31/12/2017
30/04/2019
30/04/2019
30/04/2019
30/04/2019
Exercise price
$0.25
$0.02
$0.06
$0.08
$0.10
$0.12
No. of options
2,200,000
10,500,000
4,200,000
4,200,000
4,200,000
4,200,000
29,500,000
No. of holders
4
5
1
1
1
1
7. Securities subject to voluntary escrow
No securities are subject to voluntary escrow.
8. On-market buy back
There is currently no on-market buy-back program for any of the Company’s listed securities.
9. Company secretary, registered and principal administrative office and share registry
The Company Secretary is Mr Stephen Brockhurst.
The Company’s registered and principal administration office is Level 11, London House, 216 St Georges Terrace,
Perth WA 6000.
The Company’s Share Registry is maintained by Advanced Share Registry Limited, 110 Stirling Hwy Nedlands WA
6009.
Page | 58
Volt Resources Limited
Additional ASX Information
10. Tenement listing
Status
Beneficial interest
Exploration
(prefix: “PL”)
licence
100%
Mining tenements held at 30 June 2016:
Tanzania
Project
Location
Tanzania
graphite
Tenement
Number
Tanzania, Africa PL10642,
PL10643,
PL10644,
PL10665,
PL10666,
PL10667,
PL10668,
PL10716,
PL10717,
PL10718,
PL10719
Beneficial interests held in farm-in or farm-out agreements at the end of the quarter
Farm-in agreements
The Company owns a 70% interest in Dugal Resources Lda, a Mozambican entity which holds a 100% interest in
the following licences:
Licence
3245L
3246L
Owner
Camal
Companhia Lda
Camal
Companhia Lda
Location
Tete province
&
Commodities
Copper, Zinc, Lead 18,240
Area (ha)
&
Tete province
Base Metals
20,240
Page | 59