ARBN 162 902 481
Audited Financial Report
For the year ended 30 June 2024
Table of Contents
Page
Corporate Directory
1
Report of the Directors
2 – 4
Independent Auditor’s Report
5 – 8
Auditor’s Independence Declaration
9
Statement of Profit and Loss and Other Comprehensive Income
10
Statement of Financial Position
11
Statement of Cash Flows
12
Statement of Changes in Equity
13
Notes to the Financial Statements
14 – 34
Zeta Resources Limited
Page 1 of 34
Corporate Directory
Zeta Resources Limited
Company ARBN: 162 902 481
www.zetaresources.limited
Directors (Non-Executive)
Peter Sullivan
Marthinus (Martin) Botha
André Liebenberg
Xi Xi
Registered Office
C/- Conyers Corporate Services (Bermuda) Limited
Clarendon House
2 Church Street
Hamilton HM 11
Bermuda
Company Registration Number: 46795
Australian Registered Office
Level 9, 1 York Street
Sydney NSW 2000
Australia
Telephone: +61 414 224 494
Canadian Office
ICM CA Research Limited
1800-510 West Georgia Street
Vancouver BC V6B 0M3
Canada
Telephone: +1 604 227 0458
Email: contactca@icm.limited
New Zealand Office
ICM NZ Limited
PO Box 25437
Wellington 6140
New Zealand
Email: contact@icmnz.co.nz
Investment Manager
ICM Limited
34 Bermudiana Road
Hamilton HM 11
Bermuda
Telephone: +1 441 542 9242
Email: contact@icm.limited
Secretary
ICM Limited
34 Bermudiana Road
PO Box HM 1748
Hamilton HM GX
Bermuda
General Administration
ICM Corporate Services (Pty) Limited
Alphen Estate
The Great Cellar
Peter Cloete Avenue
Constantia, 7800
Cape Town
South Africa
Auditor
Forvis Mazars in South Africa
Rialto Road
Grand Moorings Precinct
Century City, 7441
Cape Town
South Africa
Depository
JP Morgan Chase Bank NA
London Branch
25 Bank Street
Canary Wharf
London E14 5JP
United Kingdom
Registrar
Automic Pty Ltd
GPO Box 5193
Sydney NSW 2001
Australia
Telephone: +61 2 9698 5414
Stock Exchange Listing
The company’s shares are quoted on the Official List of
the Australian Securities Exchange. Ticker code: ZER
Zeta Resources Limited
Page 2 of 35
Report of the Directors
Directors present their report for Zeta Resources
Limited, including its subsidiaries Kumarina Resources
Pty Limited, Zeta Energy Pte. Ltd, Zeta Investments
Limited, Zeta Minerals Ltd and Horizon Gold Limited,
for the year ended 30 June 2024.
Directors
Zeta Resources Limited has a Board of four non-
executive, independent directors.
The names of directors in office at any time during or
since the end of the year are:
Peter Ross Sullivan
Marthinus (Martin) Botha
André Liebenberg
Xi Xi
Principal Activities
The principal activities of the Company are investing in
listed and unlisted resource focused investments.
No significant change in the nature of these activities
occurred during the year.
Operating and Financial Review
Operating results
The net loss attributable to the Company for the year to
30 June 2024 amounted to US$33,069,153.
Overview of operating activity
The company listed on the ASX on 12 June 2013.
During the year the Company has continued to build its
portfolio of resource investments by investing a further
US$14,109,842. Sales during the year resulted in a
realised gain of US$2,394,878. A decrease in the fair
value of the portfolio resulted in an unrealised loss
recognised in profit or loss at year end of
US$33,474,004.
Financial position
At the end of the year, the Company had
US$12,502,327 in cash and cash equivalents.
Investments at fair value totalled US$61,457,590, loans
to subsidiaries of US$3,257,368 and the investment in
subsidiaries was valued at US$30,526,746.
Going Concern
The financial statements have been prepared on a
going concern basis. The majority of the Company’s
assets consist of equity shares in listed companies
which in most circumstances are realisable within a
short timescale. The directors believe the Company will
be able to cover the commitments arising in the period
12 months from the date of approval of these financial
statements. The use of the going concern basis of
accounting is appropriate because there are no
material uncertainties related to events or conditions
that may cast significant doubt about the ability of the
Company to continue as a going concern. The
company has an accumulated loss of US$ 62,544,393
(2023: US$ 29,475,240). This is due to unrealised
losses on investments in the market. The company is
able to settle its liabilities as they fall due and shows a
positive net asset values for both financial years
presented. The directors have reviewed the company’s
cash flow forecast for the year up to 30 June 2025 and,
in the light of this review have a reasonable
expectation that the Company has adequate resources
to continue in operational existence for the
foreseeable future. Accordingly, the directors continue
to adopt the going concern basis in preparing the
accounts
Dividends
No dividends have been paid or declared since the
start of the year. No recommendation is made as to
dividends.
After Balance Date Events
On 12 July 2024 Zeta announced to market intentions
from its major shareholders UIL and GPLPF, who
together hold 95% of the Zeta shares in issue, that they
are considering acquiring the shares in Zeta that they
do not currently own by compulsory acquisition in
accordance with s103 of the Companies Act 1981 of
Bermuda.
Remuneration Report
The remuneration report is set out in the following
manner:
Policies used to determine the nature and
amount of remuneration
Details of remuneration
Share based compensation
Directors and executives interests
Remuneration Policy
The board of directors is responsible for remuneration
policies and the packages applicable to the directors of
the Company. The board remuneration policy is to
ensure that packages offered properly reflect a
person’s duties and responsibilities and that
remuneration is competitive and attracts, retains, and
motivates people of the highest quality.
The directors are remunerated for the services they
render to the Company and such services are carried
out under normal commercial terms and conditions.
Engagement and payment for such services are
Zeta Resources Limited
Page 3 of 34
approved by the other directors who have no interest
in the engagement of services.
At the date of this report the Company had not
entered into any packages with directors which include
performance-based components.
Details of Remuneration for Directors
The Company paid a total of $200,000 to directors for
the year ended 30 June 2024.
The Company had no employees as at 30 June 2024.
Share Based Compensation
There is currently no provision in the policies of the
Company for the provision of share-based
compensation to directors. The interest of directors in
shares and options is set out elsewhere in this report.
Directors’ Interests
The relevant interests of directors either directly or
through entities controlled by the directors in the
share capital of the Company and related body
corporates as at the date of this report are:
Director
Ordinary
shares
opening
balance
Net
change
Ordinary
shares
closing
balance
Peter R Sullivan
11,506,264
(1,108,256)
10,398,008
Martin Botha
775,000
–
775,000
André Liebenberg
–
–
–
Xi Xi
–
–
–
Meetings of Directors
There were four Board, and two Audit & Risk Committee
meetings held during the year ended 30 June 2024.
The attendance by the directors was as follows:
Board
Audit & Risk
Committee
Number of meetings held
during the year
4
2
Peter Sullivan
4
2
Martin Botha
4
2
André Liebenberg
3
2
Xi Xi
4
2
Board of Directors and Audit & Risk Committee
meetings require that any two directors or members
be present to form a quorum.
Due to the size of the board and the nature of the
Company’s operations, it does not have a separate
Remuneration Committee or a Nomination Committee.
Matters normally considered by these committees are
addressed by the full board. This includes addressing
succession issues and ensuring the board has the
appropriate balance of skills, experience,
independence, and knowledge of the entity to enable it
to discharge its duties and responsibilities effectively.
Loans to Directors
There were no loans entered into with directors during
the year under review.
Audit & Risk Committee
The Company has established a separately chaired
Audit & Risk Committee.
The Audit & Risk Committee (“committee”) comprises
all the independent directors of the Company and is
chaired by André Liebenberg. Its duties include
considering and recommending to the board for
approval the contents of the half yearly and annual
financial statements. The committee also provides an
opinion as to whether the annual report and accounts,
taken as a whole, are fair, balanced and
understandable and provide the information necessary
for shareholders to assess the Company’s
performance, business model and strategy.
The committee also reviews the external auditors’
report on the annual financial statements and is
responsible for reviewing and forming an opinion on
the effectiveness of the external audit process and
audit quality. Other duties include reviewing the
appropriateness of the Company’s accounting policies
and ensuring the adequacy of the internal control
systems and standards.
The committee meets at least twice a year. The
planned meetings are held prior to the board meetings
to approve the half yearly and annual results.
Representatives of the Investment Managers attend all
meetings.
Indemnifying Officers or Auditors
The Company has not, during or since the year ended,
in respect of any person who is or has been an officer
or the auditor of the Company or of a related body
corporate indemnified or made any relative agreement
for indemnifying against a liability incurred as an officer
or auditor, including costs and expenses in defending
legal proceedings.
Environmental Regulation
Both Horizon Gold Limited and Kumarina Resources
Pty Limited’s operations are subject to the Western
Australian Mining Act 1978 and the Environmental
Protection Act 1986 and the Environmental Protection
Amendment Act 2020 (WA).
The directors are not aware of any significant breaches
and no actions were initiated for breaches under the
Environmental Protection Act and the Western
Australian Mining Act during the year covered by this
report.
Zeta Resources Limited
Page 4 of 34
Application of Chapters 6, 6A, 6B and 6C of the
Corporations Act 2001
The Company is not subject to Chapters 6, 6A, 6B and
6C of the Corporations Act dealing with the acquisition
of its shares. In addition, neither the Bermuda
Companies Act nor the company’s Bye Laws prescribe
a regime for the conduct of takeovers or contain a
general prohibition on acquisitions of interests in
Bermuda companies beyond a certain threshold in the
same way as the Australian Corporations Act 2001
Non-audit Services
No non–audit services were performed by the auditors
of the company during the year.
On-market Buy Back Scheme
On 28 August 2023 the Company announced a new
on-market buy back for up to 54,400,000 shares, being
the remaining allowable shares under the 10/12 limit.
The buy-back commenced on 6 September 2023.
Since the commencement of the on-market buyback
scheme on 06 September 2023, Zeta Resources has
repurchased and cancelled 32,210,125 fully paid
ordinary shares under the current scheme.
Investment Management Agreement
The Company entered into an Investment
Management Agreement with ICM Limited on 3 June
2018. Management fees are payable at a rate of
0.125% of funds managed on the calculation date,
payable quarterly in arrears and pro-rated for any
period less than three months.
Performance fees are payable annually at year end on
the difference between adjusted equity funds (adjusted
for any dividends paid or accrued) on calculation date
less adjusted base equity funds (highwater mark)
previously used in the performance fee calculation
multiplied by 15%.
Either party may terminate the agreement with six
months’ notice.
The Company paid US$575,033 in management fees
during the reporting year.
Auditor’s Independence Declaration
A copy of the auditor’s independence declaration is
included in the Independent Auditor’s Report.
This report is signed in accordance with a resolution of
directors.
André Liebenberg
Director and Chair of the Audit & Risk Committee
25 September 2024
5
Independent Auditor’s Report
To the Shareholders of Zeta Resources Limited
Report on the Audit of the Financial Statements
Opinion
We have audited the financial statements of Zeta Resources Limited set out on pages 10 to 34, which
comprise the statement of financial position as at 30 June 2024, and the statement of profit or loss and
other comprehensive income, statement of changes in equity and statement of cash flows for the year
then ended, and notes to the financial statements, including material accounting policy information.
In our opinion, the financial statements present fairly, in all material respects, the financial position of
Zeta Resources Limited as at 30 June 2024, and its financial performance and cash flows for the year
then ended in accordance with IFRS Accounting Standards as issued by the International Accounting
Standards Board (IASB).
Basis for Opinion
We conducted our audit in accordance with International Standards on Auditing (ISAs). Our
responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit
of the Financial Statements section of our report. We are independent of the company in accordance
with the Independent Regulatory Board for Auditors’ Code of Professional Conduct for Registered
Auditors (IRBA Code) and other independence requirements applicable to performing audits of financial
statements in South Africa. We have fulfilled our other ethical responsibilities in accordance with the
IRBA Code and in accordance with other ethical requirements applicable to performing audits in South
Africa. The IRBA Code is consistent with the corresponding sections of the International Ethics
Standards Board for Accountants’ International Code of Ethics for Professional Accountants (including
International Independence Standards). We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our opinion.
6
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the separate financial statements of the current period. These matters were addressed in
the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and
we do not provide a separate opinion on these matters.
Matter
Audit response
Valuation of Unlisted investments (notes 5 and
19.4)
The company holds unlisted investments which
are measured at fair value through in profit or loss
in
accordance
with
IFRS
9,
Financial
Instruments.
In determining the fair value of the portfolio of
investments, which are not traded in an active
market, significant judgements and estimates are
applied by management in the application of their
fair value models. Various valuation methods are
used in determining the fair value of the
investments.
The valuation methods are subject to a high
degree of judgement and are complex, especially
for investments where there are limited to no
equity transactions during the year. Areas of
judgement include estimating the expected future
income from operations that are still in the
exploration phase, estimating the discount rates
based on the use of appropriate models and other
external risk factors.
Due to the significance of the balance and the
qualitative significance of these estimates, and
the sensitivity thereof to the unobservable
valuation inputs and assumptions that require
considerable judgement, the valuation of unlisted
investments is considered one of the most
significant aspects of the audit of the financial
statements.
Our audit procedures included, amongst others,
the following:
•
We assessed the competence, capabilities
and objectivity of the expert appointed by
management;
•
We assessed the valuation methodologies
applied for appropriateness against relevant
requirements of IFRS Accounting Standards
and industry practices;
•
We recalculated the mathematical accuracy
of the fair value models;
•
We
assessed
the
reasonability
and
appropriateness of the key inputs and
assumptions used in the valuation models;
•
We agreed, where applicable, the inputs to
relevant supporting documentation;
•
We
evaluated
the
completeness
and
appropriateness of the disclosures against
the requirements of IFRS 7 and IFRS 13.
Other Information
The directors are responsible for the other information. The other information comprises the information
included in the document titled “Zeta Resources Limited Annual Financial Report for the year ended 30
June 2024”, which includes the Report of the Directors. The other information does not include the
financial statements and our auditor’s report thereon.
7
Our opinion on the financial statements does not cover the other information and we do not express an
audit opinion or any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If,
based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the Directors for the Financial Statements
The directors are responsible for the preparation and fair presentation of the financial statements in
accordance with IFRS Accounting Standards as issued by the IASB, and for such internal control as the
directors determine is necessary to enable the preparation of financial statements that are free from
material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the company’s ability
to continue as a going concern, disclosing, as applicable, matters related to going concern and using
the going concern basis of accounting unless the directors either intend to liquidate the company or to
cease operations, or have no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole
are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with ISAs will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on
the basis of these financial statements.
As part of an audit in accordance with ISAs, we exercise professional judgement and maintain
professional scepticism throughout the audit. We also:
•
Identify and assess the risks of material misstatement of the financial statements, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting
a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may
involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal
control.
•
Obtain an understanding of internal control relevant to the audit in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the company’s internal control.
•
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the directors.
8
•
Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and
based on the audit evidence obtained, whether a material uncertainty exists related to events or
conditions that may cast significant doubt on the company’s ability to continue as a going concern.
If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s
report to the related disclosures in the financial statements or, if such disclosures are inadequate,
to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of
our auditor’s report. However, future events or conditions may cause the company to cease to
continue as a going concern.
•
Evaluate the overall presentation, structure and content of the financial statements, including the
disclosures, and whether the financial statements represent the underlying transactions and events
in a manner that achieves fair presentation.
We communicate with the directors regarding, among other matters, the planned scope and timing of
the audit and significant audit findings, including any significant deficiencies in internal control that we
identify during our audit.
We also provide the directors with a statement that we have complied with relevant ethical requirements
regarding independence, and to communicate with them all relationships and other matters that may
reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate
threats or safeguards applied.
From the matters communicated with the directors, we determine those matters that were of most
significance in the audit of the separate financial statements of the current period and are therefore the
key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes
public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter
should not be communicated in our report because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
In terms of the IRBA Rule published in Government Gazette Number 39475 dated 4 December 2015,
we report that Forvis Mazars has been the auditor of Zeta Resources Limited for 5 years.
Forvis Mazars
Partner: Nico Jansen
Registered Auditor
25 September 2024
Cape Town
Auditor’s Independence Declaration
In relation to our audit of the financial statements of Zeta Resources Limited for the year ended
30 June 2024, to the best of my knowledge and belief, there have been no contraventions of the
auditor independence requirements of the international standards on auditing (ISA) or any other
applicable code of professional conduct.
Forvis Mazars
Partner: Nico Jansen
Registered Auditor
25 September 2024
Cape Town
Zeta Resources Limited
Page 10 of 34
Statement of Profit and Loss and Other Comprehensive Income
June 2024
June 2023
for the year ended 30 June 2024
Notes
US$
US$
Income and investment returns
Revenue
11
70,035
21,490
Investment losses
11
(31,304,772)
(2,708,966)
Other income
12
51,858
-
Foreign exchange movements
12
(430,154)
592,740
Expenses
Directors fees
(200,000)
(200,000)
Interest expense
(2,974)
(864,198)
Management and consulting fees
13
(583,372)
(805,364)
Operating and administration expenses
14
(669,774)
(725,958)
Loss before tax
(33,069,153)
(4,690,256)
Taxation expense
15
–
345,465
Loss for the year
(33,069,153)
(4,344,791)
Total Comprehensive Loss for the Year
(33,069,153)
(4,344,791)
Loss per share
Basic and diluted loss per share
16
(0.06)
(0.01)
Zeta Resources Limited
Page 11 of 34
Statement of Financial Position
June 2024
June 2023
at 30 June 2024
Notes
US$
US$
Non–current assets
Investment in subsidiaries
4
30,526,746
27,857,738
Investments
5
61,457,590
111,381,126
Loans to subsidiaries
6
3,257,368
10,224,103
Current assets
Cash and cash equivalents
7
12,502,327
1,759,952
Other receivables
1,732
21,321
Total assets
107,745,763
151,244,240
Non–current liabilities
Other loans
8
(373,984)
(2,877,903)
Current liabilities
Trade and other payables
9
(403,896)
(637,862)
Tax payable
15
–
(963,266)
Total liabilities
(777,880)
(4,479,031)
Net Assets
106,967,883
146,765,209
Equity
Share capital
10
5,204
5,535
Share premium
10
169,507,072
176,234,914
Accumulated losses
(62,544,393)
(29,475,240)
Total Equity
106,967,883
146,765,209
Zeta Resources Limited
Page 12 of 34
Statement of Cash Flows
June 2024
June 2023
for the year ended 30 June 2024
Notes
US$
US$
Cash flows from operating activities
Cash utilised by operations
17.1
(1,639,874)
(3,060,846)
Interest received
12
65,879
17,666
Interest paid
–
(510,007)
Taxation paid
(963,266)
-
Dividends received
11
4,156
3,824
Net cash flows from operating activities
(2,533,125)
(3,549,363)
Cash flows from investing activities
Investments purchased
(14,109,842)
(37,748,822)
Investments sold
29,811,781
76,087,523
Increase in loan to subsidiaries from additional funding
(22,397,916)
(8,877,593)
Decrease in loan to subsidiaries from repayments
29,377,836
543,326
Net cash flows from investing activities
22,681,859
30,004,434
Cash flows from financing activities
Purchase of treasury shares
10
(6,728,173)
(353,437)
Increase in loan from parent from additional funding
17.2
–
242,583
Decrease in loan from parent from repayments
17.2
–
(14,540,761)
Decrease in loan from subsidiary from repayments
17.2
–
(3,695,143)
Increase in other loans from additional funding
17.2
-
13,473,982
Decrease in other loans from additional funding
17.2
(2,504,173)
-
Decrease in other loans from repayments
17.2
–
(19,998,110)
Net cash flows from financing activities
(9,232,346)
(24,870,886)
Net movement in cash and cash equivalents
10,916,388
1,584,185
Cash and cash equivalents at the beginning of the year
1,759,952
106,963
Effect of exchange rate fluctuations on cash held
(174,013)
68,804
Cash and Cash Equivalents at the End of the Year
7
12,502,327
1,759,952
Zeta Resources Limited
Page 13 of 34
Statement of Changes in Equity
Share
capital
Share
premium
Treasury
Shares
Accumulated
losses
Total
for the year ended 30 June 2024
Notes
US$
US$
US$
US$
US$
Balance at 30 June 2022
5,555
176,624,753
(36,422)
(25,130,449)
151,463,437
Purchase of treasury shares
–
–
(353,437)
–
(353,437)
Cancellation of treasury shares
10
(20)
(389,839)
389,859
–
–
Total comprehensive loss for the
year
–
–
–
(4,344,791)
(4,344,791)
Balance at 30 June 2023
5,535
176,234,914
–
(29,475,240)
146,765,209
Purchase of treasury shares
–
–
(6,728,173)
–
(6,728,173)
Cancellation of treasury shares
10
(331)
(6,727,842)
6,728,173
–
–
Total comprehensive loss for the
year
–
–
–
(33,069,153)
(33,069,153)
Balance at 30 June 2024
5,204
169,507,072
–
(62,544,393)
106,967,883
Zeta Resources Limited
Page 14 of 34
Notes to the Financial Statements
1.
Basis of Preparation
1.1
Corporate information
Zeta Resources Limited (“Zeta Resources” or “the Company”) is an investment company incorporated on 13 August
2012, listed on the Australian Securities Exchange and domiciled in Bermuda. The financial statements of the Company
as at and for the year ended 30 June 2024 comprise the Company only.
1.2
Basis of preparation
The financial statements for the year ended 30 June 2024 have been prepared in accordance with IFRS® Accounting
Standards as issued by the International Accounting Standards Board (IASB). The Company carries on the business of
an investment holding company, in accordance with IFRS 10. The purpose of the Company is to earn returns through
capital appreciation or investment income. The Company obtains funds from more than one investor and provides
investment management services. The Company is accordingly applying the consolidation exemption for investments in
subsidiaries and they will be recognised at fair value through profit and loss.
The financial statements were authorised for issue by the board of directors on 25 September 2024.
1.3
Basis of measurement
The financial statements provide information about the financial position, results of operations and changes in financial
position of the Company. They have been prepared on the historic cost basis except for those financial instruments at
fair value through profit or loss, which are measured at fair value. The financial statements are prepared on a going
concern basis.
1.4
Functional and presentation currency
The Company’s functional and presentation currency is United States dollars.
The board has determined by having regard to the currency of the Company’s share capital and that Zeta invests in
mining entities whose resources are valued in United States dollars, that United States dollars is the functional and
reporting currency.
1.5
Use of estimates and judgements
The preparation of financial statements in conformity with IFRS Accounting Standards requires management to make
judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of
assets, liabilities, income and expenses. 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 and in any future periods affected.
The key assumptions concerning the future and other key sources of estimation uncertainty that have a significant risk
of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year relate to
the valuation of unquoted investments, details of which are set out in note 20 and the classification of the subsidiaries
as investment entities. Details of the subsidiaries are set out in note 4. Subsidiaries that carry on business as
investment entities are designated as being at fair value through profit and loss on initial recognition.
Loans to subsidiaries are classified as financial assets carried at amortised cost. The loans are subject to impairment
testing as debt instruments (refer note 3.7). The impairments on the loans are determined separately to the fair value
of the investments in the subsidiaries as disclosed in note 4.
2.
Adoption of New and Revised Standards
2.1
Standards and interpretations adopted during the year
New or amended standards and interpretations that became effective in the current period that are adopted and
incorporated in the financial statements are:
Disclosure of accounting policies (Amendment to IAS 1 Presentation of Financial Statements) - Effective 1 January 2023
No other standards or interpretations effective during the year had a significant impact on the annual financial
statements.
Zeta Resources Limited
Page 15 of 34
2.2
New standards, amendments and interpretations effective for annual periods beginning after 1 January
2024 that have not been adopted
Classification of Liabilities as Current or Non-current (Amendment to IAS 1 Presentation of Financial Statements) –
Effective 1 January 2024.
Presentation & disclosure of information – (New standard IFRS 18) effective 1 January 2027
Lack of Exchangeability (Amendment to IAS 21) – effective 1 January 2025
General requirements for disclosure of sustainability-related information (New Standard IFRS S1) – Effective 1 January
2024
Climate-related disclosures (New Standard IFRS S2) – Effective 1 January 2024
IFRS S1 (General Requirements for Disclosure of Sustainability-related Financial Information) and IFRS S2 Climate-
related Disclosures standards which is effective for financials years beginning on or after 1 January 2024 is currently
being investigated to ensure that the reporting requirements are appropriately applied once effective and adopted by
the jurisdiction in which the company operates.
3.
Material Accounting Policy Information
The accounting policies detailed below have been consistently applied by the Company.
3.1
Investment income
Dividend income is recognised when the Company’s right to receive payment is established and is presented gross of
withholding taxes.
Gains or losses on the sale of investments are recorded on the trade date.
Investment income also comprises unrealised gains on changes in the fair value of financial assets at fair value through
profit or loss.
Interest income is recognised using the effective interest method.
3.2
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 Statement of Financial Position date.
The Company invests in various jurisdictions and is subject to typical source taxation such as withholding tax on passive
income (dividends, interest and royalties where applicable) and capital gains on immovable property.
The Company measures uncertainty by using the most likely amount and not the expected value method. The detail of
the judgements relating to the uncertain tax position is disclosed in note 15.
The Company has elected to be tax exempt in terms of local Bermudian legislation.
3.3
Foreign currency
Foreign currency transactions and balances
Transactions in foreign currencies are translated into the respective functional currency of the Company at exchange
rates at the dates of the transaction. Monetary assets and liabilities denominated in foreign currencies at the reporting
date are translated to the functional currency at the prevalent exchange rate at that date. The foreign currency gain or
loss on monetary items is the difference between the amortised cost in the functional currency at the beginning of the
period, adjusted for effective interest and principal payments during the period, and the amortised cost in foreign
currency translated at the prevalent exchange rate at the end of the period. The foreign currency gains or losses are
recognised as part of other income/(losses) in the Statement of Profit and Loss and Other Comprehensive Income.
Foreign currency changes are taken into account when fair valuing the equity instruments.
3.4
Earnings per share (“EPS”)
Basic EPS is calculated as the net resulting earnings attributable to members, adjusted to exclude 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 EPS is calculated as the net resulting earnings attributable to members, adjusted for:
•
costs of servicing equity (other than dividends) and preference share dividends;
Zeta Resources Limited
Page 16 of 34
•
the after tax effect of dividends and interest associated with potential dilutive 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 potential dilutive ordinary
shares, adjusted for any bonus element.
3.5
Financial instruments
Recognition and initial measurement
Trade receivables and debt securities issued are initially recognised when they are originated. All other financial assets
and financial liabilities are initially recognised when the entity becomes a party to the contractual provisions of the
instrument.
A financial asset (unless it is a trade receivable without a significant financing component) or financial liability is initially
measured at fair value plus, for an item not at fair value through profit and loss (“FVTPL”), transaction costs that are
directly attributable to its acquisition or issue. A trade receivable without a significant financing component is initially
measured at the transaction price.
Classification and subsequent measurement
Financial assets
A financial asset is measured at amortised cost if it meets both of the following conditions and is not designated as at
FVTPL:
•
it is held within a business model whose objective is to hold assets to collect contractual cash flows; and
•
its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on
the principal amount outstanding.
Financial assets at FVTPL
All investments are mandatorily measured at FVTPL.
Investments are subsequently measured at fair value. Net gains and losses include foreign exchange gains and losses.
Interest or dividend income are recognised in profit or loss separately.
Financial assets at amortised cost
Cash and cash equivalents, loans to subsidiaries and other loans meet the criteria for measurement at amortised cost.
These assets are subsequently measured at amortised cost using the effective interest method. The amortised cost is
reduced by impairment losses. Foreign exchange gains and losses, impairments and any gains or losses on
derecognition are recognised in profit or loss.
Financial assets are not reclassified subsequent to their initial recognition unless the entity changes its business model
for managing financial assets, in which case all affected financial assets are reclassified on the first day of the first
reporting period following the change in the business model.
Financial liabilities
The Company has adopted the following classifications for financial liabilities:
Financial liabilities are measured at amortised cost and subsequent to initial recognition, financial liabilities are
measured at amortised cost using the effective interest method.
Derecognition
The Company derecognises a financial asset when the contractual rights to the cash flows from the financial asset
expire, or when they transfer the financial asset in a transaction in which substantially all the risks and rewards of
ownership of the financial asset are transferred or in which the Company neither transfers nor retains substantially all
the risks and rewards of ownership and does not retain control of the financial asset.
The Company derecognises a financial liability when its contractual obligations are discharged, cancelled or expire.
Offsetting
Financial assets and liabilities are offset and the net amount presented in the statement of financial position when, and
only when, the Company currently has a legally enforceable right to set off the recognised amounts and it intends
either to settle on a net basis or to realise the asset and settle the liability simultaneously.
Zeta Resources Limited
Page 17 of 34
3.6
Impairment of assets
The Company recognises loss allowances for Expected Credit Losses (“ECLs”) on financial assets measured at amortised
cost.
The Company measures loss allowances at an amount equal to lifetime ECLs, except for the following, which are
measured at 12-month ECLs:
•
debt securities that are determined to have low credit risk at the reporting date; and
•
other debt securities and bank balances for which credit risk (i.e. the risk of default occurring over the expected life
of the financial instrument) has not increased significantly since initial recognition.
12-month ECLs are the portion of ECLs that result from default events that are possible within the 12 months after the
reporting date (or a shorter period if the expected life of the instrument is less than 12 months).
Loss allowances for trade receivables are always measured at an amount equal to lifetime ECLs.
Lifetime ECLs are the ECLs that result from all possible default events over the expected life of a financial instrument.
The maximum period considered when estimating ECLs is the maximum contractual period over which the Company is
exposed to credit risk.
The Company considers a financial asset to be performing when there is a low risk of default and no amounts are past
due.
The Company considers a financial asset to be underperforming when contractual payments are 30 days past due or
there has been a significant increase in credit risk since initial recognition. A significant increase in credit risk is
indicated by a significant decrease in the future prospects of the borrower’s operations, changes in the scope of
business or changes in the organisational structure that result in a significant change in the borrower’s ability to meet
its debt obligations.
The Company considers a financial asset in default when contractual payments are 90 days past due. However, in
certain cases, the Company may also consider a financial asset to be in default when internal or external information
indicates that the Company is unlikely to receive the outstanding contractual amounts in full before taking into account
any credit enhancements held by the Company.
A financial asset is written off when there is no reasonable expectation of recovering the contractual cash flows.
Measurement of ECLs
ECLs are a probability-weighted estimate of credit losses. Credit losses are measured as the present value of all cash
shortfalls (i.e. the difference between the cash flows due to the entity in accordance with the contract and the cash
flows that the Company expects to receive).
The ECL policy for loans provided to third parties and are repayable on demand, the probability of default is considered
minimal where there are sufficient liquid assets of the lender available at year-end to cover the loan. Where liquid
assets are not sufficient, the loan recoverability is assessed using a probability-weighted approach based on the timing
discussed with the lender for repayment to be expected.
Loss allowances for financial assets measured at amortised cost are deducted from the gross carrying amount of the
assets.
3.7
Share capital
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of ordinary shares and
share options are recognised as a deduction from equity.
3.8
Provisions and accruals
Provisions are recognised when the Company has a present legal or constructive obligation as a result of past events,
for which it is probable that an outflow of economic benefits will occur, and where a reliable estimate can be made of
the amount of the obligation. The expense relating to any provision is presented in the statement of comprehensive
income net of any reimbursement. If the effect of discounting is material, provisions are discounted. The discount rate
used is a pre-tax rate that reflects current market assessments of the time value of money and, where appropriate, the
risks specific to the liability.
Zeta Resources Limited
Page 18 of 34
4.
Investment in Subsidiaries
June 2024
US$
June 2023
US$
At fair value
Investment in Kumarina Resources Pty Limited ("Kumarina")
6,669,110
4,530,826
Investment in Zeta Energy Pte. Ltd. ("Zeta Energy")
1,982,997
1,700,000
Investment in Zeta Investments Limited ("Zeta Investments")
1
1
Investment in Zeta Minerals Ltd ("Zeta Minerals")
1
1
Investment in Horizon Gold Limited (“Horizon Gold”)
21,874,637
21,626,910
30,526,746
27,857,738
Investments in subsidiaries are held as part of the investment portfolio and consequently, in accordance with IFRS 10
are not consolidated but rather shown at fair value through profit and loss. Horizon Gold is measured using market
price. Kumarina is measured using a detailed cash flow forecast based on the Murrin Murrin mining plan.
Zeta Energy is measured using its net asset value. See note 19.4
The remaining investments in subsidiaries are fair valued by the directors at a nominal value due to the fact that they
hold no significant assets, nor do they have any significant value.
The Company had the following direct subsidiaries as at 30 June 2024:
30 June 2024
Number of
ordinary shares
Percentage of
ordinary shares
held
Kumarina incorporated in Australia
26,245,610
100%
Zeta Energy incorporated in Singapore
6,185,998
100%
Zeta Investments incorporated in Bermuda
1,000
100%
Zeta Minerals incorporated in the United Kingdom
100
100%
Horizon Gold incorporated in Australia
109,333,080
75%
30 June 2023
Number of
ordinary shares
Percentage of
ordinary shares
held
Kumarina incorporated in Australia
26,245,610
100%
Zeta Energy incorporated in Singapore
6,185,998
100%
Zeta Investments incorporated in Bermuda
1,000
100%
Zeta Minerals incorporated in the United Kingdom
100
100%
Horizon Gold incorporated in Australia
90,161,986
72%
The Company had the following indirect subsidiaries as at 30 June 2024:
30 June 2024
Number of
ordinary shares
Percentage of
ordinary shares
held
Pan Pacific Petroleum Pty Limited incorporated in Australia
581,942,846
100%
30 June 2023
Number of
ordinary shares
Percentage of
ordinary shares
held
Pan Pacific Petroleum Pty Limited incorporated in Australia
581,942,846
100%
Pan Pacific Petroleum Pty Limited is an Australian oil and gas exploration and production company, owned by Zeta
Energy.
Zeta Resources Limited
Page 19 of 34
5.
Investments
June 2024
US$
June 2023
US$
Financial assets at fair value through profit or loss
61,457,590
111,381,126
Equity securities at fair value
Listed ordinary shares
10,140,329
62,475,446
Unlisted ordinary shares
51,317,261
48,905,680
61,457,590
111,381,126
Cost of equity securities at fair value
Listed ordinary shares
81,246,266
101,648,751
Unlisted ordinary shares
51,786,120
48,851,853
133,032,386
150,500,604
Investments held by the Company at the reporting date
June 2024
Number of
shares
June 2023
Number of
shares
Listed
Hudbay Minerals Inc
–
5,506,952
Alliance Nickel Limited
259,913,451
259,638,451
Panoramic Resources Limited
453,969,532
253,969,532
Star Royalties Ltd.
11,739,300
10,651,300
Other investments*
136,634,244
134,391,394
Unlisted
Margosa Graphite Limited
27,861,844
27,861,844
Koumbia Bauxite Investments Ltd
38,624,342
32,934,658
Seacrest L.P.
32,221,800
32,221,800
Other investments*
1,161,511
496,331
*Other investments comprise of less than 5% of the Company’s gross assets assessed for 2024 and 2023.
During the reporting period the Company completed a total of 151 transactions (2023: 245 transactions) in
securities. See note 19.4 for disclosure of fair value determination of level 3 investments.
The Company had the following associate undertakings at as at 30 June 2024:
30 June 2024
Number of
ordinary shares
Percentage of
ordinary shares
held
Koumbia Bauxite Investments Ltd incorporated in Bermuda
38,624,342
45%
Alliance Nickel Limited incorporated in Australia
259,913,451
36%
Margosa Graphite Limited incorporated in Australia
27,861,844
31%
30 June 2023
Number of
ordinary shares
Percentage of
ordinary shares
held
Koumbia Bauxite Investments Ltd incorporated in Bermuda
32,932,659
39%
Alliance Nickel Limited incorporated in Australia
259,638,451
36%
Margosa Graphite Limited incorporated in Australia
27,861,844
32%
The associate undertakings are held as part of the investment portfolio and consequently are carried at fair value
through profit or loss.
Zeta Resources Limited
Page 20 of 34
6.
Loans to Subsidiaries
June 2024
US$
June 2023
US$
Loan to Kumarina
2,822,368
2,224,103
Loan to Zeta Energy
435,000
8,000,000
3,257,368
10,224,103
The loan to Kumarina, used for working capital is denominated in Australian dollars to the value of A$4.2 million
(30 June 2023: A$3.3 million) and is interest free. There are no fixed repayment terms. The loan is still performing as no
contractual breaches have occurred and the value of the assets in Kumarina is sufficient to cover all the liabilities.
The loan to Zeta Energy is denominated in United States dollars and is interest free. There are no fixed repayment
terms. The loan is still performing as no contractual breaches have occurred and the value of the assets in Zeta Energy
is sufficient to cover all the liabilities. During June 2024, the loan to Zeta Energy was partially repaid.
7.
Cash and Cash Equivalents
June 2024
US$
June 2023
US$
Cash balance comprises:
Cash at bank
12,502,327
1,759,952
8.
Other Loans
June 2024
US$
June 2023
US$
Loan from Pan Pacific Petroleum Pty Ltd (“PPP”)
373,984
377,903
Loan from Bermuda Commercial Bank Limited
–
2,500,000
373,984
2,877,903
The PPP loan is denominated in Australian dollars to the value of A$560,771 (30 June 2023: A$567,169) and is interest
free. There are no fixed repayment terms except that no repayment is due before 30 June 2025.
The Bermuda Commercial Bank loan was fully repaid during the year.
9.
Trade and Other Payables
June 2024
US$
June 2023
US$
Other liabilities
–
251,329
Amount owed to brokers
133,558
85,402
Accruals
270,338
301,131
403,896
637,862
The accruals are for audit, management, directors and administration fees payable.
Zeta Resources Limited
Page 21 of 34
10.
Share Capital and Share Premium
Authorised
5,000,000,000 ordinary shares of par value US$0.00001
Number of
shares
Share
capital
Share
premium
Issued
US$
US$
Ordinary shares
Balance as at 30 June 2022
565,512,224
5,555
176,624,753
Share cancellation – share buy-backs July 2022
(155,212)
(1)
(36,420)
Share cancellation – share buy-backs September 2022
(425,254)
(4)
(88,488)
Share cancellation – share buy-backs October 2022
(205,113)
(2)
(40,225)
Share cancellation – share buy-backs December 2022
(70,000)
(1)
(13,085)
Share cancellation – share buy-backs January 2023
(62,000)
(1)
(11,351)
Share cancellation – share buy-backs February 2023
(4,000)
–
(746)
Share cancellation – share buy-backs March 2023
(13,593)
–
(2,640)
Share cancellation – share buy-backs April 2023
(571,947)
(6)
(109,431)
Share cancellation – share buy-backs May 2023
(480,849)
(5)
(87,453)
Balance as at 30 June 2023
563,524,256
5,535
176,234,914
Share cancellation – share buy-backs July 2023
(57,971)
(1)
(11,812)
Share cancellation – share buy-backs August 2023
(755,163)
(8)
(154,435)
Share cancellation – share buy-backs September 2023
(31,794,492)
(317)
(6,502,164)
Share cancellation – share buy-backs October 2023
(319,979)
(3)
(29,523)
Share cancellation – share buy-backs November 2023
(57,486)
(1)
(5,304)
Share cancellation – share buy-backs December 2024
(2,929)
(0)
(538)
Share cancellation – share buy-backs January 2024
(135,542)
(1)
(24,066)
Balance as at 30 June 2024
530,400,694
5,204
169,507,072
11.
Investment Returns
June 2024
US$
June 2023
US$
Revenue
Dividend income
4,156
3,824
Interest income
65,879
17,666
70,035
21,490
Investment (losses)/gain
Derived from financial instruments measured at fair value
Realised gains
2,394,878
34,430,478
Realised losses
(225,646)
(4,158,425)
Unrealised fair value gains on revaluation of investments
4,649,678
11,953,595
Unrealised fair value losses on revaluation of investments
(38,123,682)
(44,934,614)
(31,304,772)
(2,708,966)
(31,234,737)
(2,687,476)
Zeta Resources Limited
Page 22 of 34
12.
Other income/foreign exchange movements
June 2024
US$
June 2023
US$
Foreign exchange gains
69,604
592,740
Foreign exchange losses
(499,758)
–
Total foreign exchange movement
(430,154)
592,740
Other income
51,858
-
13.
Management and Consulting Fees
June 2024
US$
June 2023
US$
Management and consulting fees
583,372
805,364
The Company entered into an investment management agreement with ICM Limited on 3 June 2018. Management
fees are payable at a rate of 0.5% per annum, of the net tangible assets managed on calculation date (last day of
quarter), payable quarterly in arrears.
Performance fees are payable annually at year end on the difference between adjusted equity funds (adjusted for any
dividends paid or accrued) on calculation date less adjusted base equity funds (used in the performance fee
calculation when it was last payable) multiplied by 15%. Performance fee for the year ended 30 June 2024 was nil
(2023: nil).
Either party may terminate the agreement with six months’ notice.
14.
Operating and Administration Expenses
June 2024
US$
June 2023
US$
Operating and administration expenses consist of:
Accounting fees
138,227
183,815
Audit fees
22,950
9,257
Australian Securities Exchange listing fees and regulatory costs
112,459
68,523
Brokerage
128,862
260,216
Other expenses
267,276
204,147
669,774
725,958
15.
Income tax
June 2024
US$
June 2023
US$
Taxation regarding the sale of Bligh Resources Limited
–
345,465
The Company has not raised deferred tax assets of US$16,146,632 (2023: US$ 8,813,354) on potential unrealised
Australian capital losses (at year-end amounting to US$53,822,105) (2023: US$29,377,846) where there are insufficient
capital gains of the same nature against which to utilise those losses. There is no expiration date on losses.
The Company is domiciled in Bermuda and has elected to be tax exempt in terms of local legislation. As such no tax is
payable.
In December 2021, the Organisation for Economic Co-Operation and Development (OECD) released the Global Anti-
Base Erosion (GLoBE) Model rules (“Pillar Two”), introducing a new “top-up” tax mechanism for multinational
enterprises (“MNEs”) that fall within the rules. MNEs will be liable to pay a top-up tax reflecting the difference between
their GLoBE effective tax rate per jurisdiction and the 15% minimum rate.
Zeta Resources Limited
Page 23 of 34
A multinational group will be in the scope of Pillar Two where it has annual revenue exceeding EUR750m in any two
out of the four periods preceding the tested period, according to the group’s consolidated financial statements. As at
30 June 2024, Pillar Two draft legislation has been released in Australia but not yet been enacted.
Zeta Resource Ltd is not a member of a MNE Group which has annual revenue exceeding EUR750m in the
consolidated financial statements of the ultimate parent entity. Zeta Resource Ltd is an investment entity and the
group’s consolidated annual revenue per its financial statements for the last four years is less than EUR750m. In
conclusion, Zeta Resource Ltd does not fall within the scope of Pillar Two.
16.
Earnings Per Share
June 2024
US$
June 2023
US$
Basic and diluted loss per share
(0.06)
(0.01)
Loss used in calculation of basic and diluted earnings per share
(33,069,153)
(4,344,791)
Weighted average number of ordinary shares outstanding during the year
used in calculation of basic and diluted earnings per share
532,900,284
564,563,216
17.
Notes to the Statement of Cash Flows
17.1
Cash utilised by operations
June 2024
US$
June 2023
US$
Loss for the year
(33,069,153)
(4,344,791)
Adjustments for:
Realised gains on investments
(2,169,232)
(30,272,053)
Fair value losses on revaluation of investments
33,474,004
32,981,019
Foreign exchange (losses)/gains
430,154
(592,740)
Dividend income
(4,156)
(3,824)
Interest income
(65,879)
(17,666)
Interest expense
–
864,198
Operating loss before working capital changes
(1,404,262)
(1,385,857)
Increase in trade and other receivables
(1,666)
(21,321)
Decrease in trade and other payables
(233,966)
(1,653,668)
(1,639,894)
(3,060,846)
17.2
Liabilities from financing activities
Loan from
Parent
US$
Loan from
Subsidiary
US$
Other Loan
US$
Total
US$
Balance as at 30 June 2022
–
3,743,623
23,742,404
27,486,027
Changes from financing cash flows
Repayment of loans
(14,540,761)
(3,695,143)
(19,998,110)
(38,234,014)
Advances of loans received
242,583
–
13,473,982
13,716,565
Other non-cash movements
Exchange rate fluctuations
(900,680)
(110,010)
565,824
(444,866)
Loan received from parent
15,003,715
–
–
15,003,715
Loan repaid to Somers Limited
–
–
(15,003,715)
(15,003,715)
Interest capitalised
195,143
61,530
97,518
354,191
Balance as at 30 June 2023
–
–
2,877,903
2,877,903
Zeta Resources Limited
Page 24 of 34
Changes from financing cash flows
Repayment of loans
–
–
(2,504,173)
(2,504,173)
Other non-cash movements
Exchange rate fluctuations
–
–
254
254
Balance as at 30 June 2024
–
–
373,984
373,984
18.
Going Concern
The financial statements have been prepared on a going concern basis. The majority of the Company’s assets consist of
equity shares in listed companies which in most circumstances are realisable within a short timescale. The directors
believe the Company will be able to cover the commitments arising in the period 12 months from the date of approval
of these financial statements. The use of the going concern basis of accounting is appropriate because there are no
material uncertainties related to events or conditions that may cast significant doubt about the ability of the Company
to continue as a going concern. After making enquiries, the directors have a reasonable expectation that the Company
has adequate resources to continue in operational existence for the foreseeable future. Accordingly, the directors
continue to adopt the going concern basis in preparing the accounts.
19.
Financial Risk Management
The board of directors, together with the Investment Manager, is responsible for the Company’s risk management. The
directors’ policies and processes for managing the financial risks are set out below. These financial risks are principally
related to the market (currency movements, interest rate changes and security price movements), liquidity and credit
and counterparty risk.
The accounting policies which govern the reported statement of financial position carrying values of the underlying
financial assets and liabilities, as well as the related income and expenditure, are set out in note 3 to the financial
statements. The policies are in compliance with IFRS Accounting Standards and best practice and include the valuation
of certain financial assets and liabilities at fair value through profit and loss
Categories of financial instruments
IFRS 9 contains three principal classification and measurement categories for financial assets: at amortised cost, fair
value through other comprehensive income, and fair value through profit and loss. The analysis of assets into their
categories as defined in IFRS 9 is set out in the following table.
The table below sets out the Company classification of each class of financial assets and liabilities. All assets and
liabilities approximate their fair values:
30 June 2024
Financial assets
mandatorily
measured at fair
value through
profit or loss
US$
Financial
assets/liabilities
measured at
amortised cost
US$
Total carrying
value
US$
Assets
Investments in subsidiaries
30,526,746
–
30,526,746
Investments
61,457,590
–
61,457,590
Loans to subsidiaries
–
3,257,368
3,257,368
Cash and cash equivalents
–
12,502,327
12,502,327
Other receivables
–
1,732
1,732
91,984,336
15,761,427
107,745,763
Liabilities
Trade and other payables
–
133,558
133,558
Other loans
–
373,984
373,984
–
507,542
507,542
Zeta Resources Limited
Page 25 of 34
30 June 2023
Financial assets
mandatorily
measured at fair
value through
profit or loss
US$
Financial
assets/liabilities
measured at
amortised cost
US$
Total carrying
value
US$
Assets
Investments in subsidiaries
30,526,746
–
30,526,746
Investments
61,457,590
–
61,457,590
Loans to subsidiaries
–
10,224,103
10,224,103
Cash and cash equivalents
–
1,759,952
1,759,952
Other receivables
–
21,321
21,321
139,238,864
12,005,376
151,244,240
Liabilities
Trade and other payables
–
336,731
336,731
Other loans
–
2,877,903
2,877,903
–
3,214,634
3,214,634
19.1
Market risks
The fair value of equity and other financial securities held in the Company’s portfolio fluctuate with changes in market
prices. Prices are themselves affected by movements in currencies, commodity prices, interest rates and by other
financial issues, including the market perception of future risks. The board of directors sets policies for managing
these risks within the Company’s objective and meets regularly to review full, timely and relevant information on
investment performance and financial results. The Investment Manager assesses exposure to market risks when
making each investment decision and monitors ongoing market risk within the portfolio.
The Company’s other assets and liabilities may be denominated in currencies other than United States dollars and
may also be exposed to interest rate risks. The Investment Manager and the board of directors regularly monitor
these risks. The Company does not normally hold significant cash balances. Borrowings are limited to amounts and
currencies commensurate with the portfolio’s exposure to those currencies, thereby limiting the Company’s exposure
to future changes in exchange rates.
Gearing may be short- or long-term, in United States dollars and foreign currencies, and enables the Company to take
a long-term view of the countries and markets in which it is invested without having to be concerned about short-term
volatility. Income earned in foreign currencies is converted to United States dollars on receipt. The board of directors
regularly monitors the effects on net revenue of interest earned on deposits and paid on gearing.
Currency exposure
The principal currencies to which the Company was exposed were the Australian dollar and Canadian Dollar. The
exchange rates applying against the United States dollar at 30 June 2024 and the average rates for the year were as
follows:
June 2024
Average 2024
June 2023
Average 2023
AUD – Australian dollar
0.6669
0.6563
0.6663
0.6727
CAD – Canadian dollar
0.7317
0.7381
0.7549
0.7432
Zeta Resources Limited
Page 26 of 34
The Company’s monetary assets and liabilities at 30 June 2024, by currency based on the currency of denomination
for loans and cash and cash equivalents, and on the currency of the primary trading market for equities, are shown
below:
30 June 2024
AUD
CAD
Investments in subsidiaries
42,799,921
–
Investments
16,106,996
3,396,672
Cash and cash equivalents
–
182,526
Loans to subsidiaries
4,232,000
–
Other loans
(560,771)
–
Net monetary assets
62,578,146
3,579,198
30 June 2023
AUD
CAD
Investments in subsidiaries
36,758,315
–
Investments
51,995,374
38,891,539
Cash and cash equivalents
184,484
1,854,928
Loans to subsidiaries
3,338,000
–
Other loans
(567,169)
–
Net monetary assets
91,709,004
40,746,467
Based on the financial assets and liabilities held, and exchange rates applying, at the reporting date, a weakening or
strengthening of the United States dollar against each of these currencies by 10% would have had the following
approximate effect on income after tax and on net asset value (NAV):
AUD
CAD
Total
Strengthening of the United States dollar
Increase in total comprehensive income for the year
ended 30 June 2024
4,107,312
264,184
4,371,496
Increase in total comprehensive income for the year
ended 30 June 2023
6,169,265
3,028,277
9,197,542
Weakening of the United States dollar
Decrease in total comprehensive income for the year
ended 30 June 2024
(4,107,312)
(264,184)
(4,371,496)
Decrease in total comprehensive income for the year
ended 30 June 2023
(6,169,265)
(3,028,277)
(9,197,542)
These analyses are broadly representative of the Company’s activities during the current year as a whole, although the
level of the Company’s exposure to currencies fluctuates in accordance with the investment and risk management
processes.
Zeta Resources Limited
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Interest rate exposure
The exposure of the financial assets and liabilities to interest rate risks at 30 June 2024 and at 30 June 2023 is shown
below:
30 June 2024
Within
one year
US$
Greater than
one year
US$
Total
US$
Exposure to floating rates:
Cash
12,502,327
–
12,502,327
Other loans
–
–
–
12,502,327
–
12,502,327
The Company is exposed to the bank’s commercial rates changes. Impact of floating rate exposures are considered
insignificant.
30 June 2023
Within
one year
US$
Greater than one
year
US$
Total
US$
Exposure to floating rates:
Cash
1,759,952
–
1,759,952
Other loans
–
(2,500,000)
(2,500,000)
1,759,952
(2,500,000)
(740,048)
Exposures vary throughout the year as a consequence of changes in the make-up of the net assets of the Company
arising out of the investment and risk management processes. The Company tends to limit its cash reserves and
interest earned is insignificant and therefore not sensitive to interest rate changes. The majority of borrowings are at a
fixed rate and not sensitive to interest rate risk.
Other market risk exposures
The portfolio of listed investments valued at US$32,012,876 at 30 June 2024 (30 June 2023: US$84,102,356) is exposed
to market price changes. The Investment Manager assesses these exposures at the time of making each investment
decision. An analysis of the portfolio by country is set out on note 21.
Price sensitivity risk analysis
A 10% decline in the market price of the listed investments held by the Company would result in an unrealised loss of
US$3,201,288. A 10% appreciation in the market price would have the opposite effect. See note 19.4 for unlisted
investment sensitivity analyses.
19.2 Liquidity risk exposure
The Company’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity
to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or
risking damage to the Company’s reputation. The Investment Manager reviews liquidity at the time of making each
investment decision.
The risk of the Company having insufficient liquidity is not considered by the board to be significant, given the amount
of quoted investments held in the Company’s portfolio.
Zeta Resources Limited
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The contractual maturities of the financial liabilities, based on the earliest date on which payment can be required, were
as follows:
30 June 2024
Three months
or less
US$
Three months
to one year
US$
More than
one year
US$
Total
US$
Trade and other payables
403,896
–
–
403,896
Other loans
–
–
373,984
373,984
403,896
–
373,984
777,880
30 June 2023
Three months
or less
US$
Three months
to one year
US$
More than
one year
US$
Total
US$
Trade and other payables
637,862
–
–
637,862
Other loans
50,000
527,903
2,550,000
3,127,903
687,862
527,903
2,550,000
3,765,765
19.3 Credit risk and counterparty exposure
The Company is exposed to potential failure by counterparties to deliver securities for which the Company has paid, or
to pay for securities which the Company has delivered. To mitigate against credit and counterparty risk broker
counterparties are selected based on a combination of criteria, including credit rating, balance sheet strength and
membership of a relevant regulatory body.
Cash and deposits are held with reputable banks. The Company has an ongoing contract with its custodians for the
provision of custody services. The contracts are reviewed regularly. Details of securities held in custody on behalf of the
Company are received and reconciled monthly.
Maximum exposure to credit risk
The Company has loan assets totalling US$3,257,368 (2023: US$10,224,103) and bank balances totalling
US$12,502,327 (2023: US$1,759,952) that are exposed to credit risk.
None of the Company’s financial assets are past due. The Company’s principal banker is Bermuda Commercial Bank
(rated by Fitch as BB+) and the Company’s principal custodian is JP Morgan Chase Bank (rated by Fitch as AA-).
19.4 Fair values of financial assets and liabilities
The assets and liabilities of the Company are, in the opinion of the directors, reflected in the statement of financial
position at fair value. Borrowings under loan facilities do not have a value materially different from their capital
repayment amount. Borrowings in foreign currencies are converted into United States dollars at exchanges rates ruling
at each valuation date.
Unquoted investments are valued based on professional assumptions and advice that is not wholly supported by prices
from current market transactions or by observable market data.
Valuation of financial instruments
The table below analyses financial assets measured at fair value at the end of the year by the level in the fair value
hierarchy into which the fair value measurement is categorised:
Level 1 The fair values are measured using quoted prices in active markets.
Level 2 The fair values are measured using inputs, other than quoted prices, that are included within level 1, that are
observable for the asset.
Level 3 The fair values are measured using inputs for the asset or liability that are not based on observable market
data. The directors make use of recognised valuation techniques and may take account of recent arms’ length
transactions in the same or similar investments.
The directors regularly review the principles applied by the Investment Manager to those valuations to ensure they
comply with the Company’s accounting policies and with fair value principles.
Zeta Resources Limited
Page 29 of 34
Level 3 financial instruments
Valuation methodology
The board of directors have satisfied themselves as to the methodology used, the discount rates and key assumptions
applied in the valuation of level 3 assets. The level 3 assets have each been assessed based on its industry, location and
business cycle. Where sensible, the directors have taken into account observable data and events to underpin the
valuations.
The level 3 investments are split between (a) unlisted companies, (b) investments in subsidiaries and (c) investments in
other rights.
(a)
Unlisted companies
Margosa Graphite Limited (“Margosa”) – Australia incorporated
The unlisted investment comprises an equity interest in Margosa, a mineral exploration and development
company focused on high grade vein graphite opportunities in Sri Lanka with granted licenses to a package of
highly prospective tenements. The most advanced project area is the Pathakada Graphite Project (“Pathakada
Project”) for which Margosa completed a JORC-2012 resource estimate in April 2020 of 1.72 million tonnes (“Mt”) at
a grade of 76.32%, implying a total graphitic content of 1.32 Mt.
The market approach has been used for the valuation of Margosa in the form of precedent transactions involving
Margosa shares at a price of A$0.19 per share (2023: A$0.21 per share). At period end the fair value of the
investment was US$3.6 million (2023:US$3.8 million).
Sensitivities: The fair value of Margosa is considered sensitive to price of precedent transactions. Possible
alternative prices represent a change of A$0.21 per share, which can cause a change of US$0.3 million in the fair
value of Zeta Resources’ equity interest in Margosa.
Koumbia Bauxite Investments Ltd (“KBI”) – Bermuda incorporated
The unlisted investment comprises an equity interest in a privately-owned company that will receive
commercialisation fees, from Alliance Mining Commodities Limited, over the bauxite produced and shipped from
the mine (part of the Koumbia Bauxite project) located in the Republic of Guinea, West Africa.
A discounted cash flow technique was used, with the expectation that production will start in the first half of 2025,
a long-term forecast aluminium price of US$2,600 per tonne and a discount rate of 12%. Commercialisation fees
are expected to be received for approximately 14 years from production, according to the expected production
timetable. At period end the fair value of the investment was US$47.1 million (2023: US$44.9 million.).
Sensitivities: The fair value of Zeta’s equity interest in KBI is sensitive to the long-term forecast Aluminium price, a
change of 10% in the price, can cause a change of US$6.1 million in the value. The value is also sensitive to the
discount rate used, a change of 2% in the discount rate, can cause a change of US$8.3 million in the value of
Zeta's equity interest.
(b)
Investments in subsidiaries
Kumarina Resources Pty (“Kumarina”) – Australia incorporated
Kumarina is a mineral exploration company with a gold project located at Murrin Murrin in Western Australia.
Kumarina’s primary focus has been the exploration and development of this project, which is located 50 km east
of Leonora in the north-eastern Goldfields. Kumarina is negotiating with Pan Pacific Petroleum Pty Limited (“PPP”)
to provide funding for the project. Kumarina acquired Golden Cliffs NL in October 2023.
A discounted cash flow has been prepared using the following assumptions: a long-term forecast gold price of
A$3,200 per ounce and discount rate of 12.45%. The forecast was done over a 15 month period, according to the
expected production timetable. At period end the fair value of the project was determined to be US$10.3 million,
with US$9.5 million attributable to Kumarina and US$0.9 million attributable to PPP. As the loan owed to Zeta
Resources is US$2.8 million, the investment value was determined to be US$6.7 million (2023: US$4.5 million).
Sensitivities: The fair value of Zeta’s equity interest in Kumarina is sensitive to the discount rate. A 2% change in
the discount rate would cause a movement of US$400,000. The fair value is also sensitive to the Gold price, a 10%
change in the long-term forecast Gold price could cause a US$3.2 million movement in value.
Zeta Resources Limited
Page 30 of 34
Zeta Energy Pte Limited
Valuation inputs: Zeta Energy is an investment holding entity located in Singapore. Its key assets are an investment
in Pan Pacific Petroleum Pty Limited (see note 4) and excess cash.
Zeta Resources has used a fair value valuation of net assets held by Zeta Energy to determine the value at the
period end. Zeta Energy’s value is derived from its investment in PPP. PPP holds a loan receivable from Zeta
Resources (see note 8) and an interest in the Murrin Murrin project (developed by Kumarina). See Kumarina’s
valuation methodology. At period end the fair value of Zeta Energy’s net assets was determined to be US$2million
(2023: US$1.7 million).
Sensitivities: Zeta Energy’s asset value is sensitive to the fair value of the investment in PPP. A possible alternative
to the fair value of PPP could cause change of US$133,000 in the fair value.
(c)
Other unlisted investments
The investment in Panoramic Resources Limited was transferred to level 3 and valued at nil (2023: US$15,168,184)
following the voluntary suspension from quotation and entering into administration on 13 December 2023.
Additional shares were purchased in the company to the value of US$ 6,376,006, with the view of enhancing
future capital returns.
Zeta Resources has further level 3 investments at fair value totalling US$649,646 (2023:US$200,004).
30 June 2024
Level 1
US$
Level 2
US$
Level 3
US$
Financial assets
Investments
10,140,329
–
51,317,261
Investments in subsidiaries
21,874,637
–
8,652,109
Zeta’s transfer policy is to record the transfer between levels on the date of any change in circumstance. The investment
in Panoramic Resources Limited was transferred from level 1 to level 3 as a result of the company entering into
administration.
The following table shows a reconciliation from opening balances to closing balances for fair value measurements in
level 3 investments of the fair value hierarchy:
Level 3
investments
US$
Level 3
investments in
subsidiaries
US$
Balance at 1 July 2023
48,905,680
6,230,828
Acquisitions at cost
2,887,453
–
Transfer from level 1
21,944,189
-
Total unrealised losses recognised in fair value through profit or loss on
investment transferred from level 1
(21,944,189)
-
Expiration of Options
(21,567)
-
Total (losses)/gains recognised in fair value through profit or loss
(454,305)
2,421,281
Balance at 30 June 2024
51,317,261
8,652,109
Zeta Resources Limited
Page 31 of 34
30 June 2023
Level 1
US$
Level 2
US$
Level 3
US$
Financial assets
Investments
62,475,446
–
48,905,680
Investments in subsidiaries
21,626,910
–
6,230,828
Level 3
investments
US$
Level 3
investments in
subsidiaries
US$
Balance at 1 July 2022
61,768,983
4
Acquisitions at cost
200,000
–
Expiration of Options
(689,949)
–
Capital return
(2,604,973)
–
Total (losses)/gains recognised in fair value through profit or loss
(9,768,381)
6,230,824
Balance at 30 June 2023
48,905,680
6,230,828
19.5 Capital risk management
The objective of the Company is stated as being to maximise shareholder returns by identifying and investing in
investments where the underlying value is not reflected in the market price. In pursuing this long-term objective, the
board of directors has a responsibility for ensuring the Company’s ability to continue as a going concern. It must
therefore maintain an optimal capital structure through varying market conditions. This involves the ability to issue and
buy back share capital within limits set by the shareholders in general meeting; borrow monies in the short- or long-
term; and pay dividends to shareholders out of current year earnings as well as out of brought forward reserves. The
company’s capital primarily consists out of its share capital invested by shareholders. The company monitors its capital
requirements on a regular basis after analysis of its liquidity and solvency. The company has maintained a positive
solvency and liquidity for 2023 and 2024 and are therefore satisfied that the capital structure is sound.
20.
Related Parties
20.1
Material related parties
Holding company
The company’s holding company is UIL which held 59.67% of the company’s issued share capital on 30 June 2024. UIL is
65.42% owned by General Provincial Life Pension Fund Limited. Somers Isles Private Trust Company Limited holds
100% of General Provincial Life Pension Fund Limited.
Entities controlled by these entities are considered related parties of the Company. Somers Limited is controlled by
Somers Isles Private Trust Company Limited.
Subsidiary companies
Wholly owned subsidiaries include Kumarina, Zeta Energy, Zeta Minerals and Zeta Investments. Zeta Resources holds
75% of Horizon Gold’s issued share capital. Pan Pacific Petroleum Pty Limited is a subsidiary of Zeta Energy.
Associate companies
Associates include Koumbia Bauxite Investment Ltd, Alliance Nickel Limited and Margosa Graphite Limited.
Key management personnel
Key management personnel and their close family members and entities which they control, jointly or over which they
exercise significant influence are considered related parties of the Company. The Company’s directors, as listed in the
director’s report are considered to be key management personnel of the Company.
Zeta Resources Limited
Page 32 of 34
20.2 Material related parties transactions
Nature of balances
June 2024
US$
June 2023
US$
Investments in related parties:
Kumarina
6,669,110
4,530,826
Zeta Investments
1
1
Zeta Energy
1,982,997
1,700,000
Zeta Minerals
1
1
Horizon Gold
21,874,637
21,626,910
Loans to related parties:
Kumarina
2,822,368
2,224,103
Zeta Energy
435,000
8,000,000
Loans from related parties:
Pan Pacific Petroleum
373,984
377,903
Trade and other payables:
ICM Limited
138,240
181,767
Directors
56,922
50,000
ICM Corporate Services (Pty) Ltd
33,249
43,576
Koumbia Bauxite investments Ltd
–
226,644
Nature of transactions
June 2024
US$
June 2023
US$
Interest relates to loans measured at amortised cost:
Interest charged by subsidiaries
–
61,530
Interest charged by the parent company
–
195,143
Interest charged by Somers Limited
–
84,010
Interest charged by GPLPF
–
449,186
Capital return from Koumbia Bauxite Investment Ltd
–
2,604,973
Management fees paid to ICM Limited
575,033
764,812
Accounting fees paid to ICM Corporate Services (Pty) Ltd
138,227
183,815
Fees paid to the directors:
Xi Xi
50,000
50,000
M Botha
50,000
50,000
P Sullivan
50,000
50,000
A Liebenburg
50,000
50,000
All fees paid to directors are deemed short term remuneration payments
Zeta Resources Limited
Page 33 of 34
21.
Segmental Reporting
The Company has five reportable segments, as described below, which are considered to be the Company’s
strategic investment areas. For each investment area, the Company’s chief operating decision maker (“CODM”)
(ICM Limited – investment manager) reviews internal management reports on at least a monthly basis. The
following summary describes each of the Company’s reportable segments:
Gold: investments in companies which explore or mine for gold
Nickel: investments in companies which explore or mine for nickel
Copper: investments in companies which explore or mine for copper
Mineral exploration: investments in companies which explore or mine for other minerals
Administration: activities relating to financing received which does not specifically relate to any one segment as
well as administrative activities
Information regarding the results of each reportable segment is included below. Performance is measured
based on segment profit before tax, as included in the internal management reports that are reviewed by the
Company’s CODM. Segment profit is used to measure performance as management believes that such
information is the most relevant in evaluating the performance of certain segments relative to other entities that
operate within these industries.
Information about reportable segments
Gold
Nickel
Copper
Mineral
exploration
Admin
Total
30 June 2024
US$
US$
US$
US$
US$
US$
External investment returns
(1,232,478)
(32,320,525)
3,358,377
(1,326,541)
286,430
(31,234,737)
Interest revenue
62,445
–
–
–
3,434
65,879
Interest expense
–
–
–
–
(2,974)
(2,974)
Reportable segment
(loss)/profit before tax
(1,174,273)
(32,269,042)
2,979,895
(1,351,879)
(1,253,854)
(33,069,153)
Reportable segment assets
32,095,215
6,413,550
201,222
54,113,718
14,922,058
107,745,763
Reportable segment
liabilities
(373,984)
–
–
(133,558)
(270,338)
(777,880)
Management fee expenses and foreign exchange losses arising from loans are attributed to the admin segment.
Gold
Nickel
Copper
Mineral
exploration
Admin
Total
30 June 2023
US$
US$
US$
US$
US$
US$
External investment returns
11,373,887
(15,740,636)
12,977,822
(11,300,131)
1,582
(2,687,476)
Interest revenue
–
–
–
–
17,666
17,666
Interest expense
–
–
–
–
(864,198)
(864,198)
Reportable segment
(loss)/profit before tax
11,301,390
(15,761,616)
12,749,282
(11,301,231)
(1,678,081)
(4,690,256)
Reportable segment assets
29,754,333
27,063,856
25,957,813
66,708,286
1,759,952
151,244,240
Reportable segment
liabilities
–
–
–
(85,402)
(4,393,629)
(4,479,031)
Management fee expenses and foreign exchange losses arising from loans are attributed to the admin segment.
During the year there were no transactions between segments which resulted in income or expenditure.
Zeta Resources Limited
Page 34 of 34
Geographic information
In presenting information on the basis of geography, segment revenue and segment assets are based on the
geographical location of the operating assets of the investment held by the Company.
Investment returns
June 2024
US$
June 2023
US$
Australia
(33,580,674)
(49,999)
Canada
799,907
11,861,870
Guinea
(536,196)
(6,833,912)
Peru
–
(466,340)
USA
568,980
(196,899)
Singapore
282,997
-
Sri Lanka
(238,055)
(4,883,905)
Other countries
1,468,304
(2,118,291)
(31,234,737)
(2,687,476)
Assets
June 2024
US$
June 2023
US$
Australia
38,527,799
62,897,619
Canada
1,988,550
14,393,774
Guinea
47,099,990
44,900,000
Peru
–
11,750,609
USA
13,778,902
4,970,233
Singapore
2,417,999
8,021,321
Sri Lanka
3,567,624
3,805,680
Other countries
364,899
505,004
107,745,763
151,244,240
22.
Events after the Reporting Date
On 12 July 2024 Zeta announced to market intentions from its major shareholders UIL and GPLPF, who together hold 95%
of the Zeta shares in issue, that they are considering acquiring the shares in Zeta that they do not currently own by
compulsory acquisition in accordance with s103 of the Companies Act 1981 of Bermuda.
The company provided loan funding to the value of US$6,000,000 to its shareholder company, UIL Limited.
The Company performed a review of events after the reporting date and determined that there were no other events
requiring recognition or disclosure in the financial statements.