Artemis Resources Limited
("Artemis" or the "Company")
Interim Financial Report for the six months ended 31 December 2023
Artemis Resources Limited (ASX/AIM: ARV; FRA: ATY) the gold, copper and lithium focused resources company with projects in Western Australia, today announces its interim results for the six months ended 31 December 2023.
| Artemis Resources Ltd | |
| Guy Robertson, Chairman George Ventouras, Executive Director | info@artemisresources.com.au
|
| | |
| WH Ireland Limited (Nomad & Broker) | |
| Antonio Bossi / James Bavister / Isaac Hooper | Tel: +44 20 7220 1666 |
Highlights
· Significant mineralised lithium samples from the Osborne trend (Joint Venture ARV 49%)
· Groundwork commenced for lithium exploration on 100% owned ground with subsequent excellent results from rock chip samples
· Exploration Incentive Scheme (EIS) grant of $82,500 awarded for Lulu Creek gold project
· New target identified at Paterson Gold project
· The Company raised approximately A$2.0 million at $0.018 per share from institutional and sophisticated investors
Review of Operations
Artemis Resources Limited ('Artemis") is a gold, copper and lithium focused resource exploration company with projects in the West Pilbara and the Central Paterson Region of Western Australia. The Company's assets include the Carlow Project Gold-Copper-Cobalt resource as well as the Radio Hill processing plant ("Radio Hill"), both located within 35km radius of Karratha.
The primary focus during the half year was on lithium exploration.
Figure 1. Artemis Resources tenements
Karratha Lithium Project (ARV 100%)
Various programs of ground reconnaissance were completed during the half year. Numerous swarms of pegmatites were identified within and along the margins of the Andover mafic intrusive complex within 100% Artemis tenement E47/1746. Six sets of pegmatites were identified which featured elevated levels of lithium-caesium-tantalum (LCT) and rubidium mineralisation, including four pegmatite clusters considered highly prospective for economic mineralisation.
Figure 2. Pegmatite evaluation work area (yellow outline) in relation to Artemis tenure
Figure 3. LCT and Rb anomalous rock chip samples with priority areas for follow up
Over 90 outcrops of pegmatites have been identified to date with the largest outcropping pegmatite having a strike of 200m and average width more than 45m.
Mt Marie Lithium Prospect
Drone surveys were undertaken in the northern sector of tenement E47/1746 late in 2023 and subsequently a ground reconnaissance program was designed and conducted. 21 rock chip samples were submitted to the laboratory for assays with results peaking at 1.82% and 1.62% Li2O. Further ground work is planned for CY2024.
Figure 4. Mt Marie lithium prospect
Figure 5. Spodumene crystals located at the Mt Marie lithium prospect
Osborne Joint Venture (Artemis 49%)
Figure 6. Osborne joint venture tenement
Ground work continued on the Osborne JV tenement (ARV:49%, GRE:51%) with various soil and rock chip sampling programs having been completed. Two new pegmatite zones were identified within the Osborne JV next to the Osborne trend, 5km south-east of the Kobe lithium pegmatite discovery. Newly discovered trends, Wally and Maddox both extend over 1km with outcrops up to 100m Wide.
Significant mineralised lithium samples from the Osborne trend included:
· 2.4% Li2O from sample 23GT20-155
· 2.4% Li2O from sample 23GT30-232
· 2.36% Li2O, from sample 23GT24-021
· 1.64% Li2O, from sample 23GT20-693
· 1.5% Li2O from sample 23GT20-233
· 1.15% Li2O, from sample 23GT24-026
Three diamond drill holes totalling 1404m were completed with one hole located on the Kobe trend and two holes in the Osborne trend (Figure 6). The program was aimed at gathering stratigraphic and structural information relating to these pegmatite trends which will be used to refine a follow-up RC drill. Details of the completed drill program are as follows:
| Drill Hole Id | Easting | Northing | Azmith deg | Dip deg | EOHm | Prospect |
| 23GTDD001 | 493160 | 7691875 | 176 | -40 | 810.2 | South Zone |
| 23GTDD002 | 493509 | 7691879 | 195 | -50 | 279.2 | South Zone |
| 23GTDD003 | 485941 | 7693630 | 10 | -40 | 315.1 | Kobe |
Figure 7. Schematic Cross Section 23GTDD001
These results are further evidence of the consistency of the high grade lithium mineralisation on the Osborne JV tenement which provides the Company with confidence for the next phase of exploration activity.
The Kobe trend currently extends 1.5km into the Osborne JV tenure and the combined Osborne trends feature +4km of lithium strike mineralisation.
Greater Carlow Project (ARV 100%)
Lulu Creek IP - Gold Target
An Exploration Incentive Scheme (EIS) grant of $82,500 was awarded from the West Australian State Government to assist with drilling RC holes at the Lulu Creek gold project.
Through a previously conducted high-resolution dipole - dipole IP (induced polarisation) geophysics survey at Lulu Creek, high level chargeability anomalies that may represent disseminated sulphides within the exploration area were identified. Subject to further modelling and interpretation of the IP chargeability and resistivity bodies and a heritage survey across the prospect, drilling can be undertaken and is anticipated to be completed within H1 2024, once relevant approvals have been received.
Figure 8. Lulu Creek anomalies identified through IP Survey.
Paterson Gold Project
A detailed strategic review of the Company's 100% owned Paterson Gold Project in Western Australia commenced with the aim of establishing a development pathway to extract maximum value for shareholders. An independent technical review identified a new priority target, Apollo North. The review also identified that drill hole 22PTMRD011 intercepted the same lithotypes and similar mineralisation as Havieron and was considered to be typical of a 'near miss' at Havieron. Multiple options are currently being considered to advance the Project, including joint ventures and third party funding.
Competent Person's Statement
Exploration Results
The information in this report that relates to exploration results is based on, and fairly represents information supporting documentation prepared by Mr Oliver Hirst, a Competent Person who is a member of the Australian Institute of Mining and Metallurgy (AusIMM). Mr Hirst is a consultant geologist to Artemis Resources. Mr Hirst 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 Hirst Consents to the inclusion in this report of the matters based on his information in the form and context in which it appears.
| | | | | | | | |
Events subsequent to reporting date
Dr Simon Dominy resigned as a director on 9 January 2024. Mr Christopher Kelsall was appointed a director on 9 January 2024 and resigned on 12 March 2024.
Other than as outlined above, there were no events subsequent to the end of the period that would have a material effect on the Group's financial statements as at 31 December 2023.
Consolidated Statement of Profit or Loss and Other Comprehensive Income
For the Half-year Ended 31 December 2023
|
| | Consolidated | ||
|
| | 31 December |
| 31 December |
|
| | 2023 |
| 2022 |
|
| Notes | $ |
| $ |
| Other income | 3 | 37,940 | | 13,840 |
| | | | | |
| Personnel costs | | (316,112) | | (29,650) |
| Occupancy costs | | (16,687) | | (15,891) |
| Legal fees | | (9,156) | | (3,679) |
| Consultancy costs | | (203,705) | | (365,420) |
| Compliance and regulatory expenses | | (126,646) | | (123,138) |
| Directors' fees | | (235,497) | | (376,750) |
| Travel | | (24,248) | | (15,000) |
| Borrowing costs | | (3,045) | | (4,101) |
| Project and exploration expenditure written off | 6 | (20,353) | | (113,741) |
| Impairment expense | 7 | - | | (12,469,852) |
| Net fair value loss on financial instruments designated as fair value through profit or loss |
5 | (540,000) | | (3,128,849) |
| Share-based payments | 11 | (211,283) | | (373,300) |
| Marketing expenses | | (46,229) | | (47,322) |
| Depreciation and amortisation | | (72,710) | | (59,243) |
| Unrealised foreign exchange loss | | (2,321) | | (11,675) |
| Other expenses | | (41,637) | | (74,206) |
| LOSS BEFORE INCOME TAX | | (1,831,689) | | (17,197,977) |
| Income tax expense | | - | | - |
| LOSS FOR THE PERIOD | | (1,831,689) | | (17,197,977) |
| Other comprehensive income, net of tax | | - | | - |
| TOTAL COMPREHENSIVE LOSS FOR THE PERIOD | |
(1,831,689) | |
(17,197,977) |
| | | | | |
| Basic loss per share - cents | 4 | (0.11) | | (1.24) |
| Diluted loss per share - cents | 4 | (0.11) | | (1.24) |
The consolidated statement of profit or loss and other comprehensive income is to be read in conjunction with the accompanying notes
Consolidated Statement of Financial Position
As at 31 December 2023
| |
| Consolidated |
| |||||
| |
| 31 December | | 30 June |
| |||
| |
| 2023 | | 2023 |
| |||
| | Notes | $ | | $ |
| |||
| CURRENT ASSETS | |
| | |
| |||
| Cash and cash equivalents |
| 1,570,889 | | 1,703,016 |
| |||
| Other receivables |
| 121,365 | | 123,104 |
| |||
| Financial assets at fair value through profit or loss | 5 | 3,206,250 | | 3,746,250 |
| |||
| TOTAL CURRENT ASSETS |
| 4,898,504 | | 5,572,370 |
| |||
| |
| | | |
| |||
| NON-CURRENT ASSETS |
| | | |
| |||
| Plant and equipment | | 45,086 | | 57,266 |
| |||
| Right-of-use assets | | 97,564 | | 150,781 |
| |||
| Exploration and evaluation expenditure | 6 | 32,907,945 | | 32,054,704 |
| |||
| Development expenditure | 7 | 15,009,145 | | 14,950,070 |
| |||
| TOTAL NON-CURRENT ASSETS | | 48,059,740 | | 47,212,821 |
| |||
| TOTAL ASSETS | | 52,958,244 | | 52,785,191 |
| |||
| | | | | |
| |||
| CURRENT LIABILITIES | | | | |
| |||
| Trade and other payables | 8 | 1,225,834 | | 1,529,181 |
| |||
| Current lease liabilities | | 100,204 | | 103,382 |
| |||
| Employee benefits obligation | | 19,845 | | 14,734 |
| |||
| TOTAL CURRENT LIABILITIES | | 1,345,883 | | 1,647,297 |
| |||
|
| | | | |
| |||
| NON-CURRENT LIABILITIES |
|
|
| |
| |||
| Lease liabilities | | - | | 49,577 |
| |||
| Provisions | 9 | 5,723,259 | | 5,723,259 |
| |||
| TOTAL NON-CURRENT LIABILITIES | | 5,723,259 | | 5,772,836 |
| |||
| TOTAL LIABILITIES | | 7,069,142 | | 7,420,133 |
| |||
| NET ASSETS | | 45,889,102 | | 45,365,058 |
| |||
| | | | | |
| |||
| EQUITY | | | | |
| |||
| Share capital | 10 | 119,541,004 |
| 117,396,554 |
| |||
| Reserves | 11 | 487,655 |
| 389,358 |
| |||
| Accumulated losses |
| (74,139,557) |
| (72,420,854) |
| |||
| TOTAL EQUITY |
| 45,889,102 |
| 45,365,058 | | |||
The consolidated statement of financial position should be read in conjunction with the accompanying notes.
Consolidated Statement of Changes in Equity
For the Half-year Ended 31 December 2023
| Consolidated | Share capital | Accumulated losses | Reserves
| Total equity |
|
| $ | $ | $ | $ |
| Balance at 1 July 2023 | 117,396,554 | (72,420,854) | 389,358 | 45,365,058 |
| | | | | |
| Loss for the period | - | (1,831,689) | - | (1,831,689) |
| Other comprehensive income | - | - | - | - |
| Total comprehensive loss for the period |
- |
(1,831,389) |
- |
(1,831,689) |
| Issue of shares | 2,144,450 | - | - | 2,144,450 |
| Transfer to share-based payments reserve |
- |
- |
211,283 |
211,283 |
| Transfer from share-based payments reserve |
- |
112,986 |
(112,986) |
- |
| Balance at 31 December 2023 | 119,541,004 | (74,139,557) | 487,655 | 45,889,102 |
| | | | | |
| Consolidated | Issued capital | Accumulated losses | Reserves
| Total equity |
|
| $ | $ | $ | $ |
| Balance at 1 July 2022 | 114,927,239 | (58,330,600) | 2,725,913 | 59,322,552 |
| Loss for the period | - | (17,197,977) | - | (17,197,977) |
| Other comprehensive income | - | - | - | - |
| Total comprehensive loss for the period |
- |
(17,197,977) |
- |
(17,197,977) |
| Issue of shares | 83,359 | - | - | 83,359 |
| Transfer to share-based payments reserve |
- |
- |
373,300 |
373,300 |
| Transfer from share-based payments reserve |
- |
984,123 |
(984,123) |
- |
| Balance at 31 December 2022 | 115,010,598 | (74,544,454) | 2,115,090 | 42,581,234 |
The consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
Consolidated Statement of Cash Flows
For the Half-year Ended 31 December 2023
|
| | Consolidated | ||
|
| | 31 December 2023 |
| 31 December 2022 |
| | | $ |
| $ |
|
|
|
|
|
|
| CASH FLOWS FROM OPERATING ACTIVITIES |
|
|
|
|
| Receipts from customers | | - | | 15,149 |
| Payments to suppliers and employees | | (958,392) | | (1,486,233) |
| Interest received | | 2,260 | | - |
| NET CASH USED IN OPERATING ACTIVITIES |
| (956,132) | | (1,471,084) |
| | | | | |
| CASH FLOWS FROM INVESTING ACTIVITIES |
| | | |
| Payments for exploration and evaluation | | (1,203,507) | | (4,723,740) |
| Payments for property, plant and equipment | | - | | (17,293) |
| Proceeds on sale of investments | | - | | 2,209,711 |
| Payment for development expenditure | | (59,075) | | (402,867) |
| NET CASH USED IN INVESTING ACTIVITIES |
| (1,262,582) | | (2,934,189) |
|
|
| | | |
| CASH FLOWS FROM FINANCING ACTIVITIES |
| | | |
| Proceeds from issue of shares |
| 2,242,500 | | - |
| Cost of share issue |
| (98,050) | | - |
| Repayment of lease liabilities |
| (55,800) | | (35,541) |
| NET CASH FROM / (USED) IN FINANCING ACTIVITIES |
| 2,088,650 | | (35,541) |
| | | | | |
| Net decrease in cash held |
| (130,064) |
| (4,440,814) |
| Effects of exchange rate changes on the balance of cash held in foreign currencies |
| (2,063) | | (12,617) |
| Cash at the beginning of the period | | 1,703,016 | | 6,106,222 |
| CASH AT THE END OF THE PERIOD |
| 1,570,889 |
| 1,652,791 |
The consolidated statement of cash flows is to be read in conjunction with the accompanying notes.
Notes to the Financial Statements
For the Half-year Ended 31 December 2023
1. Statement of significant accounting policies
Basis of Preparation
The half-year financial report is a general-purpose financial report prepared in accordance with the requirements of the Corporations Act 2001 and AASB 134: Interim Financial Reporting. The Group is a for profit entity for financial reporting purposes under Australian Accounting Standards.
The half-year financial report does not include notes of the type normally included in an annual financial report. The half-year financial report is to be read in conjunction with the most recent annual financial report for the year ended 30 June 2023 and any public announcements made by the Group during the half-year in accordance with continuous disclosure requirements arising under the Corporations Act 2001 and the ASX Listing Rules.
The consolidated financial statements have been prepared on the basis of historical costs, except for the revaluation of certain non-current assets and financial instruments. Cost is based on the fair value of the consideration given in exchange for assets. All amounts are presented in Australian dollars, unless otherwise stated. The financial statements are presented in Australian dollars which is Artemis Resources Limited's functional and presentation currency.
These interim financial statements were authorised for issue on 14 March 2024.
New and revised Standards and amendments thereof and Interpretations effective for the current half-year that are relevant to the Group
The Group has adopted all of the new and revised Standards and Interpretations issued by the Australian Accounting Standards Board (the AASB) that are mandatory for the current reporting period that are relevant to its operations and effective for annual reporting periods beginning on or after 1 July 2023.
Going Concern
For the half-year ended 31 December 2023 the Group recorded a loss of $1,831,689 (2022: a loss of $17,197,977) and had net cash outflows from operating and investing activities of $2,218,714 (2022: $4,405,273). The 2023 half year loss includes a non cash fair value loss adjustment on its investment in GreenTech Metals Ltd of $540,000 and a non cash expense of $211,283 for share based payments.
The Directors believe that it is reasonably foreseeable that the Company and Group will continue as going concerns and that it is appropriate to adopt the going concern basis in the preparation of the financial report after consideration of the following factors:
· The Group has cash at bank of $1,570,889, liquid investments of $3,206,250 and net assets of $45,889,102 as at 31 December 2023;
· The Company has recently raised $2.03 million (before costs) and has the ability to raise further capital to enable the Group to meet scheduled exploration expenditure requirements;
· The Company has the ability to dispose of non-core assets and scale back certain parts of their activities that are non-essential so as to conserve cash; and
· The Group retains the ability, if required, to wholly or in part dispose of interests in mineral exploration and development assets, and liquid investments.
However, should the Company be unable to raise capital in a sufficiently timely basis and/or
reduce expenditure to the extent required, there exists a material uncertainty which may cast
significant doubt as to whether the Company and Group will continue as going concerns and therefore whether they will realise their assets and extinguish their liabilities in the normal course of business and at the amounts stated in the financial report.
Use of estimates and judgements
The preparation of financial statements 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. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised and in any future periods affected.
Impairment of development expenditure assets
At the end of each reporting period, an assessment is made as to whether there is any indication that an asset may be impaired. The assessment will include the consideration of external and internal sources of information including market conditions and asset specific matters. If such an indication exists, an impairment test is carried out on the asset by comparing the asset's carrying amount to its estimated recoverable amount, being the higher of fair value less costs to sell and value in use.
Where it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs.
Any excess of the asset's carrying amount over its recoverable amount is recognised immediately in statement of profit or loss and other comprehensive income.
The Directors have performed an impairment test during the period in relation to the Fox Radio Hill processing plant as detailed in note 7 and have determined that the recoverable value approximates the carrying value and no further impairment to this asset should be recognised at the half year.
2. SEGMENT INFORMATION
AASB 8 Operating Segments 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 Group's operating segments have been determined with reference to the monthly management accounts used by the Chief Operating Decision Maker to make decisions regarding the Group's operations and allocation of working capital. The Executive Director has been determined as the Chief Operating Decision Maker.
a. Description of segments
The Board has determined that the Group has two reportable segments, being mineral exploration activities and development expenditure. The Board monitors the Group based on actual versus projected expenditure incurred by area of interest. The internal reporting framework is the most relevant to assist the Board with making decisions regard the Group and its ongoing exploration activities.
2. SEGMENT INFORMATION (Continued)
b. Segment information provided to the Board:
| 31 December 2023 | | Exploration Activities | | | | ||||||||||||||||
| | |
Development |
Unallocated | | |||||||||||||||||
| | Carlow | Paterson | Lithium Projects | Activities Radio Hill | Corporate | Total |
| ||||||||||||||
| | $ | $ | $ | $ | $ | $ |
| ||||||||||||||
| Segment revenue | - | - | - | - | 37,940 | 37,940 |
| ||||||||||||||
| Segment expenses | (20,353) | - | - | - | (1,849,276) | (1,869,629) |
| ||||||||||||||
| Reportable segment loss | (20,353) | - | - | - | (1,811,336) | (1,831,689) |
| ||||||||||||||
| Reportable segment assets | 23,442,328 | 7,963,694 | 1,501,923 | 15,009,145 | 5,041,154 | 52,958,244 |
| ||||||||||||||
| Reportable segment liabilities | - | - | - | 5,723,259 | 1,345,882 | 7,069,141 |
| ||||||||||||||
|
| | | | | | |
| ||||||||||||||
| 31 December 2022 | | Exploration Activities | | | | ||||||||||||||||
| | |
Development |
Unallocated | |
| ||||||||||||||||
| | Carlow Castle | Paterson | Other Projects | Activities Radio Hill | Corporate | Total |
| ||||||||||||||
| | $ | $ | $ | $ | $ | $ |
| ||||||||||||||
| Segment revenue | - | - | - | - | 13,840 | 13,840 |
| ||||||||||||||
| Segment expenses | - | - | - | (12,469,852) | (4,741,965) | (17,211,817) |
| ||||||||||||||
| Reportable segment loss | - | - | - | (12,469,852) | (4,728,125) | (17,197,977) |
| ||||||||||||||
| Impairment expense | - | - | - | (12,469,852) | - | (12,469,852) |
| ||||||||||||||
| Reportable segment assets | 23,628,641 | 7,576,810 | - | 15,000,000 | 3,593,012 | 49,798,463 |
| ||||||||||||||
| Reportable segment liabilities | - | - | - | 5,223,259 | 1,993,970 | 7,217,229 |
| ||||||||||||||
3. REVENUE
| | Consolidated | ||
| | 31 December 2023 | | 31 December 2022 |
| | $ | | $ |
| Other income |
| | |
| Other income | 35,680 | | 13,840 |
| Interest received | 2,260 | | - |
| | 37,940 | | 13,840 |
4. LOSS per share
The calculation of basic loss and diluted loss per share at 31 December 2023 was based on the loss attributable to shareholders of the parent company of $1,831,689 (2022: $17,197,977):
| | Consolidated | ||
| | 31 December 2023 | | 31 December 2022 |
| | $ | | $ |
| Basic loss per share | (0.11) | | (1.24) |
| Diluted loss per share | (0.11) | | (1.24) |
| | | | |
|
| No of Shares | | No of Shares |
| Weighted average number of ordinary shares: | | | |
| Ordinary shares | 1,642,790,000 | | 1,390,555,594 |
| Ordinary shares fully diluted | 1,642,790,000 | | 1,390,555,594 |
| | | | |
5. financial assets AT FAIR VALUE THROUGH PROFIT OR LOSS
| | Consolidated | ||
| | 31 December 2023 | | 30 June 2023 |
| | $ | | $ |
| | | | |
| Other financial assets | 3,206,250 | | 3,746,250 |
| | | | |
| Opening balance | 3,746,250 | | 6,283,560 |
| Disposals - fair value loss¹ | - | | (4,596,060) |
| Fair value (loss)/gain² | (540,000) | | 2,058,750 |
| Closing balance | 3,206,250 | | 3,746,250 |
¹The Company sold Artemis' 70% joint venture interest in the Munni Munni platinum group metals project to Alien Metals Limited (LSE: UFO) (Alien), a company incorporated in the United Kingdom and listed on the London Stock Exchange (LSE), for 358,617,818 shares in UFO at GBP0.008 per share for an amount of $4,650,000. The sale realised a profit of $2,263,931 in the year ended 30 June 2022. The shares were sold in the year ended 30 June 2023 for $4,295,000, realising a loss of $2,294, 797. The Company also sold shares in Thor Mining in the year ended 30 June 2023 for $301,060, realising a loss of $91,552.
²The Company holds 6,750,000 shares in GreenTech Metals Ltd (ASX:GRE), which were marked to market value at 31 December 2023 at a carrying value of $3,206,250. This resulted in a fair value loss for the period of $540,000.
6. exploration and evaluation expenditure
| | Consolidated | ||
| | 31 December 2023 | | 30 June 2023 |
| | $ | | $ |
| | | | |
| Exploration and evaluation expenditure | 32,907,945 | | 32,054,704 |
Costs capitalised on areas of interest have been reviewed for impairment factors, such as resource prices, ability to meet expenditure going forward and potential resource downgrades. The Group has ownership or title to the areas of interest in respect of which it has capitalised expenditure and has reasonable expectations that its activities are ongoing.
The recoverability of the carrying amount of the exploration and evaluation assets is dependent on successful development and commercial exploration, or, alternatively, the sale of the respective area of interest.
Reconciliation of movement during the period:
| | Consolidated | ||
| | 31 December 2023 | | 30 June 2023 |
| | $ | | $ |
| Opening balance | 32,054,704 | | 27,323,626 |
| Expenditure capitalised in current period | 873,594 | | 5,466,846 |
| Exploration expenditure written off | (20,353) | | (735,768) |
| Closing balance | 32,907,945 | | 32,054,704 |
| | | | |
7. DEVELOPMENT EXPENDITURE
| | Consolidated | ||
| | 31 December 2023 | | 30 June 2023 |
| | $ | | $ |
|
Development expenditure | 15,009,145 | | 14,950,070 |
Reconciliation of movement during the period:
| Opening balance | 14,950,070 | | 27,420,924 |
| Additions | 59,075 | | - |
| Disposals | - | | (1,002) |
| Impairment1 | - | | (12,969,852) |
| Increase in rehabilitation provision2 | - | | 500,000 |
| Closing balance | 15,009,145 | | 14,950,070 |
1The Company's market capitalisation is below its net assets as at 31 December 2023. This represented an indicator of impairment and as a consequence the Company was required under accounting standards to test its development expenditure for impairment by comparing its recoverable value to its carrying value.
The Company determined the recoverable value based on fair value less costs of disposal of the Radio Hill processing Plant, the major component of the carrying amount of development expenditure. The estimate of fair value is a level 3 on the fair value hierarchy. Management engaged a third-party to value the plant as at 30 June 2023 and the expert valued the plant as $24.9 million on a replacement cost basis. Management adjusted the expert's valuation to reflect the most likely use of the plant and what management believed would be achieved in a market scenario, and determined the recoverable amount to be approximately $15 million. As a result, the Company recorded a provision for impairment of $12,969,852 in the year ended 30 June 2023 ($12,469,852 related to the half-year period to 31 December 2022). The directors have reviewed the assessment of the recoverable value of its asset at 31 December 2023 and determined that the realisable value of the asset is still approximately $15 million and as this approximates the carrying value of the asset as at 31 December 2023, have determined that no further impairment of this asset is required at this time.
2The increase of $500,000 in the provision at 30 June 2023 resulted from a revision in the discount rate used in the calculation of the present value of the future rehabilitation cost estimates.
8. trade and other payables
| | Consolidated | ||
| | 31 December 2023 | | 30 June 2023 |
| | $ | | $ |
| | | | |
| Trade and other payables | 1,225,834 | | 1,529,181 |
9. Provisions
| | Consolidated | ||
| | 31 December 2023 | | 30 June 2023 |
| | $ | | $ |
|
Provision for restoration and rehabilitation - non-current | 5,723,259 | | 5,723,259 |
Reconciliation of movement during the period:
| | Consolidated | ||
| | 31 December 2023 | | 30 June 2023 |
| | $ | | $ |
| Opening balance | 5,723,259 | | 5,223,259 |
| Additional restoration and rehabilitation provision | - | | 500,000 |
| Closing balance | 5,723,259 | | 5,723,259 |
The Company has reviewed the provision for restoration and rehabilitation in view of changes in inflation and discount rates and determined that no adjustment is required at half-year end.
10. SHARE CAPITAL
| | Consolidated | Consolidated | ||
| | 31 December 2023 | 30 June 2023 | 31 December 2023 | 30 June 2023 |
| | No. of Shares | No. of Shares | $ | $ |
| Issued and paid-up capital |
| | | |
| Ordinary shares, fully paid | 1,691,196,149 | 1,569,918,371 | 119,541,004 | 117,396,554 |
Reconciliation of movement during the period:
| | Shares | | $ |
| Opening balance 1 July 2022 | 1,388,330,984 | | 114,927,239 |
| Shares issued, Placement | 170,000,000 | | 2,548,102 |
| Shares issued, services rendered | 11,587,387 | | 185,359 |
| Cost of issue | - | | (264,146) |
| Closing balance 30 June 2023 | 1,569,918,371 | | 117,396,554 |
| | | | |
| Opening balance 1 July 2023 | 1,569,918,371 | | 117,396,554 |
| Issue of shares, placement1 | 112,777,778 | | 2,030,000 |
| Issue of shares, exercise of options2 | 8,500,000 | | 212,500 |
| Cost of issue | - | | (98,050) |
| Closing balance 31 December 2023 | 1,691,196,149 | | 119,541,004 |
1On 8 November 2023 the Company issued 112,777,778 shares at $0.018 per share to raise $2.03 million.
2The Company issued 8,500,000 shares on exercise of options. The options had an exercise price of $0.025 per option and an expiry date of 9 March 2026.
Ordinary Shares
Ordinary shares participate in dividends and are entitled to one vote per share at shareholders meetings. In the event of winding up the Company, ordinary shareholders rank after creditors and are entitled to any proceeds of liquidation in proportion to the number of shares held.
11. SHARE-BASED PAYMENT RESERVE
| | Consolidated | Consolidated | ||
| | 31 December 2023 | 30 June 2023 | 31 December 2023 | 30 June 2023 |
| | No. of options | No. of options | $ | $ |
| Share-based payments |
| | | |
| Options | 172,888,884 | 116,500,000 | 487,655 | 389,359 |
| | Options | | $ |
| Opening balance 1 July 2022 | 144,729,145 | | 2,695,313 |
| Options issued | 127,000,000 | | 496,734 |
| Options lapsed | (149,229,195) | | (2,802,688) |
| Closing balance 30 June 2023 | 116,500,000 | | 389,359 |
| | | | |
| Opening balance 1 July 2023 | 116,500,000 | | 389,359 |
| Free attaching options to share issue1 | 56,388,884 | | - |
| Options issued share-based payments2 | 16,000,000 | | 211,283 |
| Options exercised3 | (8,500,000) | | - |
| Options lapsed4 | (7,500,000) | | (112,987) |
| Closing balance 31 December 2023 | 172,888,884 | | 487,655 |
1During the period, 56,388,884 options were issued in relation to a capital raising completed on 8 November 2023. One free attaching option was issued for every two new shares. The options have an exercise price of $0.025 per option and an expiry date of 9 March 2026.
211,000,000 options were also issued on the same terms to a broker and an advisor related to the capital raising, and a further 5,000,000 to a consultant.
3During the period, 8,500,000 options were exercised. The options had an exercise price of $0.025 per option and an expiry date of 9 March 2026.
4During the period 7,500,000 options expired without being exercised. The options had an exercise price of 7c per option and an expiry date of 31 July 2023.
The unlisted options issued during the half-year were valued using the Black-Scholes model. The value of these options were determined on the date of grant using the following assumptions:
|
| Broker/ Consultant |
Consultant |
| Grant date | 29/10/2023 | 27/10/2023 |
| Exercise price ($) | 0.025 | 0.025 |
| Expected volatility (%) | 100 | 100 |
| Risk-free interest rate (%) | 4 | 4.4 |
| Expected life (years) | 2.36 | 2.42 |
| Share price at this date ($) | 0.023 | 0.023 |
| Fair value per option ($) | $0.0129 | $0.0131 |
| Number of options | 11,000,000 | 5,000,000 |
For the half-year ended 31 December 2023, the Group has recorded $211,283 in share-based payment expense (2022: $373,300).
Performance rights
No performance rights were issued during the current period or were outstanding at 31 December 2023.
12. FINANCIAL INSTRUMENTS
The Directors consider that the carrying amounts of financial instruments are a reasonable approximation of their fair values.
13. commitments, contingent liabilities and contingent assets
There are no contingent liabilities or contingent assets since the last annual reporting period.
14. Events subsequent to 31 December 2023
Mr Christopher Kelsall was appointed a director on 9 January 2024 and resigned on 12 March 2024. Dr Simon Dominy resigned as a director on 9 January 2024.
Other than as outlined above, there are no matters of circumstances that has arisen since the end of the period that have significantly affected or may significantly materially affect the operations of the Group, the results of those operations, or the state of affairs of the Group in future financial years.
This announcement was approved for release by the Board.
RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our Privacy Policy.