Focus Minerals Limited
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Focus Minerals Limited ABN 56 005 470 799 Interim Financial Report for the half year ended 30 June 2020 Page | 1 Table of Contents Corporate Information ...................................................................................................................................................... 3 Directors’ Report ............................................................................................................................................................... 4 Auditor’s Independence Declaration ............................................................................................................................... 6 Interim Financial Report ................................................................................................................................................... 7 Notes to the Consolidated Interim Financial Report .................................................................................................... 11 Directors’ Declaration ..................................................................................................................................................... 16 Independent Auditor’s Review Report .......................................................................................................................... 18 Page | 2 Corporate Information ABN 56 005 470 799 Directors Dianfei Pei Chairman - Non-Executive, Non-Independent Zhaoya Wang Director – Executive Gerry Fahey Director – Independent Zaiqian Zhang Director – Executive (Resigned 9 October 2020) Rodney Johns Director – Independent (Appointed 4 September 2020) Company Secretary Zaiqian Zhang (resigned 9 October 2020) Registered and Head Office Level 2 159 Adelaide Terrace East Perth WA 6004 PO Box 3233 East Perth WA 6892 Tel: +61 (0) 8 9215 7888 Fax: +61 (0) 8 9215 7889 Share Registry Auditor Computershare Investor Services Pty Ltd RSM Australia Partners Level 11 Level 32 – Exchange Tower 172 St Georges Terrace 2 The Esplanade Perth WA 6000 Perth WA 6000 Banks Stock Exchange Listing National Australia Bank Australian Securities Exchange (ASX) 100 St Georges Terrace ASX Symbol: FML Perth WA 6000 Bank of China Perth Branch Solicitors Ground Floor, 179 St Georges Terrace MinterEllison Perth WA 6000 Level 4, Allendale Square 77 St Georges Terrace Industrial and Commercial Bank of China Perth WA 6000 Level 28, St Martins Tower 44 St Georges Terrace Perth WA 6000 Page | 3 Focus Minerals Ltd – Financial Report for the half year ended 30 June 2020 Directors’ Report The Directors of Focus Minerals Limited (“Focus”) are pleased to present the Interim Financial Report for the half year ended 30 June 2020. Directors Dianfei Pei Chairman - Non-Executive, Non-Independent Zhaoya Wang Director - Executive Gerry Fahey Director - Independent Zaiqian Zhang Director – Executive (Resigned 9 October 2020) Rodney Johns Director – Independent (commenced 4 September 2020) Directors were in office for the whole of the half year and up to the dates of this report, unless otherwise indicated. Review of Operations Highlights During the six-month period ended 30 June 2020, Focus Minerals Ltd (“Focus”, “FML” or the “Company”) completed: • Released Mineral Resource for Wedge/Lancefield North - announced to the ASX on 24 January 2020, • Released Karridale Mineral Resource Update - announced to the ASX 28 January 2020, • Released Regional Laverton Results – announced to the ASX on 29 January 2020, • Released Beasley Creek South Results – announced to the ASX on 30 January 2020, • Released Corporate Presentation – announced to the ASX 18 February 2020, • Released Beasley Creek South Results – announced to the ASX on 28 April 2020. Coolgardie Gold Project Fifteen RC holes were drilled at Brilliant, Brilliant North, Emu Hill, Baileys and Ada during March 2020 for 1,995m (Announced 24 April 2020). A Mine License application was submitted for E15/986 – Treasure Island. Laverton Gold Project Resource drilling and drilling for Laverton Stage 1 PFS was completed at the following deposits in the first half of 2020: • Beasley Creek South 7,600m DD 1,176m RC • Beasley Creek 2,613m DD 852m RC • Karridale 537m DD EIA co-sponsored exploration drilling was completed at Lake Carey with 3 holes for 1,294m DD. Work is on track to deliver resource updates on stage 1 open pit deposits being considered by the PFS in the third Quarter 2020. Corporate For the six-month period ended 30 June 2020, Focus incurred a loss of $5.4 million (6 months ended 30 June 2019: $3.8 million). As at 30 June 2020, the Company has net assets of $82.8 million (31 December 2019: $88.2 million) and a cash balance of $20.8 million (31 December 2019: $27.8 million). Auditor’s Independence Declaration The declaration required under Section 307C of the Corporations Act 2001 is set out on Page 6. Page | 4 Focus Minerals Ltd – Financial Report for the half year ended 30 June 2020 Significant changes in the state of affairs There were no significant changes in the state of affairs of the consolidated entity during the financial half-year. Rounding of Amounts The Company is of a kind referred to in ASIC Legislative Instrument 2016/191, issued by the Australian Securities and Investments Commission, relating to the ‘rounding off’ of amounts in the Directors’ Report. Amounts in the Directors’ Report have been rounded off in accordance with that Class Order to the nearest thousand dollars, or in certain cases, to the nearest dollar. This report is made in accordance with a resolution of the directors, pursuant to section 306(3)(a) of the Corporations Act 2001. On behalf of the directors Dianfei Pei Chairman of the Board 13 October 2020 Jinan, Shandong, China Page | 5 AUDITOR’S INDEPENDENCE DECLARATION As lead auditor for the review of the financial report of Focus Minerals Limited for the half-year ended 30 June 2020, I declare that, to the best of my knowledge and belief, there have been no contraventions of: (i) the auditor independence requirements of the Corporations Act 2001 in relation to the review; and (ii) any applicable code of professional conduct in relation to the review. RSM AUSTRALIA PARTNERS Perth, WA TUTU PHONG Dated: 13 October 2020 Partner Focus Minerals Ltd – Financial Report for the half year ended 30 June 2020 CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME FOR THE HALF YEAR ENDED 30 JUNE 2020 Consolidated 6 months to 6 months to 30 June 30 June 2020 2019 $’000 $’000 Revenue from continuing operations 142 478 Other Income 151 343 Employee Expenses (650) (838) Depreciation Expenses (199) (108) Finance Costs (303) (369) Loss on disposal of tenements and plant and (2,434) (556) equipment Care and Maintenance Costs (760) (839) Corporate and Other Expenses (1,325) (1,045) Exploration Expenses - (899) Loss Before Income Tax (5,378) (3,833) Income Tax Expense - - Loss After Income Tax for the Period (5,378) (3,833) Other Comprehensive Income for the Period, Net of - - Tax Total Comprehensive Loss for the Period (5,378) (3,833) Earnings per Share Basic Loss per Share (Cents Per Share) (2.94) (2.10) Diluted Loss per Share (Cents Per Share) (2.94) (2.10) The accompanying notes form part of these financial statements. Page | 7 Focus Minerals Ltd – Financial Report for the half year ended 30 June 2020 CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2020 Consolidated 30 June 31 December 2020 2019 Notes $’000 $’000 Assets Current Assets Cash and Cash Equivalents 5,605 13,935 Short-term deposits 1,300 - Trade and Other Receivables 230 253 Total Current Assets 7,135 14,188 Non-Current Assets Restricted Cash 13,869 13,869 Plant and Equipment 843 905 Inventories 1,293 1,293 Right-of-use Assets 85 145 Exploration and Evaluation Assets 3 88,879 85,899 Total Non-Current Assets 104,969 102,111 Total Assets 112,104 116,299 Liabilities Current Liabilities Trade and Other Payables 1,610 682 Provisions 297 280 Lease Liabilities 88 122 Total Current Liabilities 1,995 1,084 Non-Current Liabilities Provisions 27,318 27,012 Lease Liabilities - 34 Total Non-Current Liabilities 27,318 27,046 Total Liabilities 29,313 28,130 Net Assets 82,791 88,169 Equity Issued Capital 4(a) 427,167 427,167 Reserves (7,178) (7,178) Accumulated Losses (337,198) (331,820) Total Equity 82,791 88,169 The accompanying notes form part of these financial statements Page | 8 Focus Minerals Ltd – Financial Report for the half year ended 30 June 2020 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE HALF YEAR ENDED 30 JUNE 2020 Issued Accumulated Reserves Total Capital Losses $’000 $’000 $’000 $’000 Balance as at 31 December 2019 427,167 (331,820) (7,178) 88,169 Total Comprehensive Loss for the period - (5,378) - (5,378) Balance as at 30 June 2020 427,167 (337,198) (7,178) (82,791) Balance as at 31 December 2018 427,167 (329,757) (7,178) 90,232 Total Comprehensive Loss for the period - (3,833) - (3,833) Balance as at 30 June 2019 427,167 (333,590) (7,178) 86,399 The accompanying notes form part of these financial statements. Page | 9 Focus Minerals Ltd – Financial Report for the half year ended 30 June 2020 CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE HALF YEAR ENDED 30 JUNE 2020 Consolidated 6 months to 6 months to 30 June 30 June 2020 2019 ’$000 ’$000 Cash Flows from Operating Activities Payments to Suppliers and Employees (Including GST) (1,377) (3,039) Royalties Paid - (3) Other Income 131 19 Interest Received 160 748 Bank charges (61) (53) Net Cash Outflow from Operating Activities (1,147) (2,328) Cash Flows from Investing Activities Acquisition of Plant and Equipment