Annual Report 2005
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Annual Report 2005 Admiralty Resources NL Admiralty Resources NL is a Public Company listed on WKH $XVWUDOLDQ 6WRFN ([FKDQJH ZLWK GLYHUVLÀHG PLQHUDO interests in Chile, Argentina and Australia. The Company is focussing on the development of the Japonesa iron ore mines in Chile and the Rincon Salar in Argentina. Highlights for 2005 •Commencement of design and construction of Rincon Salar mines in Argentina for production by February 2007 •Acquisition of Chile iron ore joint venture in March 2005 and SURJUHVVWRZDUGVÀUVWVDOHLQ-DQXDU\ •Commencement of design and construction of mining plants in Chile The 2005 Annual Report provides an overview of • Several wholly owned entities. These are Admiralty Resources’ main operating activities for 6ROJROG 3W\ /LPLWHG $'< 5HVRXUFHV /LPLWHG the year ended 30th June 2005. *UHDWHU $XVWUDOLDQ *ROG 1/ 0RRQOLJKW 0LQLQJ 1/ 7KUHH 6WDU 0LQLQJ 1/ DQG )RUWXQH *OREDO ,QDGGLWLRQWRWKHÀQDQFLDOUHSRUWWKHDQQXDO Holdings Limited. report contains more detailed information in an appendix titled Supplementary Information. Solgold Admiralty Resources Group Structure Pty Limited The Admiralty Resources’ group comprises: • Admiralty Resources NL (ACN 010 195 972) Three ADY Star Mining Resources Limited which is the parent company of the Admiralty NL Resources Group. Admiralty Resources NL • The major operating companies. These include a 49% interest in the Chilean joint venture company Sociedad Contractual Minera Greater Fortune Global Australian Gold NL Santa Barbara and ADY Resources Limited Holdings Limited (owner of the Argentinian resources including Moonlight the Rincon Salar tenements). Mining NL Contents Ulexite Boric Acid Drill Hole Brine Salt Lake Iron ore Stock pile Argentina Rincon Salar Sociedad Contractual Minera Santa Admiralty Resources NL A.C.N. 010 195 972 Chairman’s Report ........................................ 4 Directors Professor J Ross Harper Directors’ Report........................................... 5 Phillip Thomas Anthony J Dickson Auditor’s Independence Declaration......... 14 Secretary Stephen C Prior Corporate Governance Statement.............15 5HJLVWHUHG2IÀFH c/- Prior & Co Pty Limited Schedule of Mining Tenements ................. 22 /HYHO4XHHQ6W Melbourne VIC 3000 Australia 6WDWHPHQWRI)LQDQFLDO3HUIRUPDQFH ........ 24 Tel: +61 3 9670 1838 )D[ 6WDWHPHQWRI)LQDQFLDO3RVLWLRQ................. 25 Principal Place of Business /HYHO4XHHQ6WUHHW 6WDWHPHQWRI&DVK)ORZV ........................... 26 Melbourne VIC 3000 Australia Tel: +61 3 9642 3535 1RWHVWRWKH)LQDQFLDO6WDWHPHQWV............ 27 )D[ Directors’ Declaration.................................54 Auditors Deloitte Touche Tohmatsu /HYHO*URVYHQRU3ODFH Independent Audit Report..........................55 *HRUJH6WUHHW Sydney NSW 2000 Australia Additional information for listed companies...................................................58 Lawyers Mallesons Stephen Jaques Supplementary Information ....................... 61 /HYHO*RYHUQRU3KLOOLS7RZHU )DUUHU3ODFH Sydney NSW 2000 Australia Bankers For more information about Macquarie Bank/ Westpac Banking Corporation Admiralty Resources visit us at Share Registry www.ady.com.au Computer Share Investor Services Pty Limited Securities Quoted Australian Stock Exchange Limited (ASX) Code - ADY (shares) Admiralty Resources NL 2005 Annual Report 3 Chairman’s Report 3URIHVVRU-5RVV+DUSHU&%( Director and Chairman of the Board It gives me pleasure to report on the activities of iron ore prices that increased by 71% in April this your company in a year that has seen substantial year and record levels of consumption of pig iron progress and change. I was appointed to the board and steel in China and elsewhere in the world. in March 2005 and elected chairman by the Board I would like to thank our joint venture partner in Chile of Directors. 0U/HRQDUGR)DUNDV.OHLQIRUKLVRQJRLQJHIIRUWV These are exciting times for the group. We have and committment. I would also like to thank my moved from being focused on exploration to being fellow directors for their dedication and hard work. focused on production. Our Argentinian operations continue at a rapid pace Consistent with moving to the design of the plant and with plans and funding in place to build a world class production phase we have engaged several senior lithium chloride facility. SURGXFWLRQSHUVRQQHO1RWDEO\ZHKDYHDSSRLQWHG We have put in place arrangements to raise some Dr Carlos Sorentino as director of technical services A$8.75 million in equity (through the exercise of in Argentina. His experience and credentials are impeccable and he is progressing our brine resource RSWLRQVJUDQWHGLQ'HFHPEHU ORDQIDFLOLWLHVRI A$6 million and leasing facilities of A$13 million SURGXFWLRQDQGRWKHUSURMHFWVDWDUDSLGSDFH which is adequate to meet our projected capital and As part of our corporate governance we have put in operating expenditure requirements. SODFHDGLUHFWRUV·FRGHRIFRQGXFWDQRFFXSDWLRQDO I look forward to meeting you at our annual general KHDOWK DQG VDIHW\SROLF\HQYLURQPHQWDO SROLF\ meeting to be held in Sydney on 29 November a directors share acquisition policy (that allows 2005. directors to acquire shares for up to 45 days after each six monthly result is published) and an audit <RXUVVLQFHUHO\ committee charter. 7KLV \HDU 'HORLWWH 7RXFKH 7RKPDWVX 6\GQH\ RIÀFH completed our audit. Professor J Ross Harper Our joint venture with Wyndham Explorations S.A. Chairman in Sociedad Contractual Minera Santa Barbara will EHWKHÀUVWSURMHFWWRJHQHUDWHLQFRPH7KLVSURMHFW has a very promising outlook due to currently high 4 Admiralty Resources NL 2005 Annual Report Directors’ Report Rincon Salar Southern view towards extinct volcano Phillip Thomas Managing Director The directors of Admiralty Resources NL present Mr Phillip Thomas BSc MBM AIG SIA aff the annual fi nancial report on the Company and the consolidated entity for the fi nancial year ended Managing Director 30 June 2005. In order to comply with the provisions Mr Thomas became a director of Admiralty of the Corporations Act 2001, the directors report Resources on 22 April 2003 and was appointed as as follows: Managing Director on 18 August 2004. Mr Thomas commenced his career working for the Control Directors Data Mining Centre as a consultant specialising in drill hole analysis and computer based exploration The names and particulars of the directors of the and mine applications. Subsequently he worked Company at any time during or since the end of the in the investment banking and asset management fi nancial year are: industries. Mr Thomas was the managing partner of Professor J Ross Harper LLB MA D Univ CBE Panopus Partners, a marketing strategy fi rm, prior to taking up his role with Admiralty Resources. Chairman of Directors Mr Thomas is an Associate member of the Australian Professor Harper was appointed to the Board on the Institute of Geoscientists. He holds a Bachelor 29 March 2005. Professor Harper holds a Bachelor of Science degree majoring in geology from the of Laws and Master of Arts degrees from Glasgow Australian National University, and a Master University. He was awarded an Honorary Doctorate of Business (Marketing) degree from Monash for services to Law at Glasgow University in 2002. University. Professor Harper is an Emeritus Professor of Law at Strathclyde University and was awarded a CBE for public and political services in 1986. Admiralty Resources NL 2005 Annual Report 5 Mr Anthony Dickson %&RP//%//0&$)7,$ Mr Anthony Dickson Appointed on: 18 August 2004 Director (Non-Executive) Professor J Ross Harper Mr Dickson was appointed to the Board as a Appointed on: 29 March 2005 non-executive director on the 18 August 2004. 8WLOLVLQJKLVÀQDQFHDQGOHJDOH[SHUWLVH0U'LFNVRQ Company Secretary successfully designed and implemented substantial SURMHFWÀQDQFHDQGVWUXFWXUHGÀQDQFHWUDQVDFWLRQV The following person held the position of Company LQYROYLQJ$XVWUDOLDQ8QLWHG.LQJGRP8QLWHG6WDWHV 6HFUHWDU\DWWKHHQGRIWKHÀQDQFLDO\HDU and New Zealand organisations. Mr Stephen C Prior B.Com (Melb) CA 0RVW UHFHQWO\ KH ZDV HQJDJHG E\ (UQVW <RXQJ Mr Prior is the senior partner in a Melbourne Australia for four years as Principal where he &KDUWHUHG $FFRXQWLQJ ÀUP 3ULRU &R 3W\ /LPLWHG successfully executed numerous large transactions and was appointed company secretary on 13 for his clients. Mr Dickson has been employed by September 2004. two international banks implementing structured ÀQDQFHWUDQVDFWLRQVDQGDVVHQLRUWD[FRXQVHO Principal Activities Mr Dickson has completed postgraduate legal studies at the University of Sydney gaining a Master of The Company’s principal activities are the mining Laws degree. Mr Dickson is a Chartered Accountant of high value evaporates in Argentina and iron ore and was admitted as a non practising barrister of in Chile. The demand prospects for the evaporates the Supreme Court of New South Wales. and iron ore will continue to remain strong. We are excited with the pace with which the Chilean mines Mr Shane Mulcahy Dip App Chem are being advanced. We expect the joint venture to Former Director (resigned 31 March 2005) FRPSOHWHLWVÀUVWVDOHLQHDUO\ Mr Mulcahy was a director and consultant to Operating Results Admiralty Resources from 11 August 2002. He was a director until 31 March 2005 when he tendered The consolidated loss of the economic entity after his resignation to the Company. providing for income tax and eliminating outside HTXLW\LQWHUHVWVDPRXQWHGWR Mr Fank Edge Former Director (resigned 18 August 2004) Dividends Paid or Recommended Mr Edge was a director and consultant to the 1RGLYLGHQGVZHUHSDLGGXULQJWKH\HDUQRUDUHDQ\