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African Energy Resources Limited
AUSTRALIA AFR.AX 0,03 AU$ 10,00%
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2015 Annual Financial Report

Publié le 01 octobre 2015

Microsoft Word - 2015 Financial Report_AFR.docx




African Energy Resources Limited


ARBN 123 316 781


Financial Report 30 June 2015


African Energy Resources Limited

Financial Report 30 June 2015

Table of Contents

Corporate Directory

3

Directors' Report

4

Directors' Declaration

13

Independent Audit Report

14

Independence Declaration

16

Consolidated Statement of Profit or Loss and Other Comprehensive Income

17

Consolidated Statement of Financial Position

18

Consolidated Statement of Changes in Equity

19

Consolidated Statement of Cash Flows

20

Notes to the Consolidated Financial Statements

21


  1. Reporting entity 21

  2. Basis of preparation 21

  3. Significant accounting policies 21

  4. Financial risk management 26

  5. Determination of fair values 28

  6. Segment information 28

  7. Revenue from continuing operations 29

  8. Personnel expenses 29

  9. Professional & Corporate Expenses 29

  10. Income Taxes 30

  11. Earnings per share 30

  12. Trade and other receivables 31

  13. Property, plant and equipment 31

  14. Exploration and evaluation expenditure 31

  15. Recognised fair value measurements 32

  16. Investments in associates 33

  17. Deconsolidation of subsidiaries 34

  18. Trade and other payables 34

  19. Contributed equity 34

  20. Reconciliation of loss after income tax to net cash inflow from operating activities 35

  21. Parent Entity 35

  22. Related parties 35

  23. Share‐based payments 37

  24. Events occurring after the reporting period 38

  25. Contingencies and Commitments 38

African Energy Resources Limited Financial Report 30 June 2015 Corporate Directory

Directors Mr Alasdair Cooke

Executive Chairman


Dr Charles (Frazer) Tabeart Managing Director


Mr Gregory (Bill) Fry Executive Director


Mr Valentine Chitalu Non‐Executive Director


Mr Philip Clark Non‐Executive Director


Mr Vincent (Ian) Masterton‐Hume Non‐Executive Director


Mr Yan Zhao Alternate Director to Mr Hume


Mr Wayne Richard Trumble Non‐Executive Director


Mr John Dean (appointed 22 December 2014) Non‐Executive Director


Company Secretary Mr Daniel Davis


Registered Office Granite House, La Grande Rue St Martin, Guernsey GY1 3RS


Representative Office in Australia Suite 1, 245 Churchill Avenue Subiaco, Western Australia, 6008


Share Register Link Market Services Limited

Level 4 Central Park 152 St Georges Terrace Perth, Western Australia, 6000


Stock Exchange Listings Australian Securities Exchange (ASX: AFR) Botswana Stock Exchange (BSE: AFR)


Auditor BDO Audit (WA) Pty Limited

38 Station Street Subiaco, Western Australia, 6008


Solicitors Fairweather Corporate Lawyers

595 Stirling Highway

Cottesloe, Western Australia, 6011


Bankers HSBC Bank Australia Limited

190 St Georges Terrace

Perth, Western Australia, 6000


Website www.africanenergyresources.com

African Energy Resources Limited Financial Report 30 June 2015 Directors' Report

Your Directors present their report on the Consolidated Entity consisting of African Energy Resources Limited (Company) and its controlled entities for the financial year ended 30 June 2015.


  1. Directors and Company Secretary


    The Directors and the Company Secretary of the Company at any time during or since the end of the financial year are as follows.


    Mr Alasdair Cooke BSc (Hons), MAIG - Executive Chairman

    Mr Cooke has served as Chairman of the Board of the Company since its incorporation. Mr Cooke is a geologist with over 25 years' experience in the resource exploration industry throughout Australia and internationally. For the past 15 years Mr Cooke has been involved in mine development through various private and public resource companies, prior to which he held senior positions in BHP Billiton plc's international new business and reconnaissance group.


    Mr Cooke is a founding director of Mitchell River Group, which over the past ten years has established a number of successful ASX listed resources companies, including Panoramic Resources Limited, operating the Savannah and Lanfranchi nickel projects in Australia; Albidon Limited, operating the Munali Nickel Mine in Zambia, Mirabela Nickel Limited, operating the Santa Rita nickel project in Brazil; Exco Resources Limited, developing copper and gold resources in Australia; and Energy Ventures Limited.


    Other current directorships Special responsibilities

    Energy Ventures Limited Anova Metals Limited

    Executive Chairman Member of the remuneration committee


    Former directorships in the last three years Interests in shares and options

    Exco Resources Limited 50,003,683 shares 933,333 performance rights

    Dr Charles (Frazer) Tabeart PhD, BSc (Hons) ARSM, MAIG - Managing Director

    Dr Tabeart is a graduate of the Royal School of Mines with a PhD and Honours in Mining Geology. He has over 25 years' experience in international exploration and mining projects, including 16 years with WMC Resources. Whilst at WMC, Dr Tabeart managed exploration portfolios in the Philippines, Mongolia and Africa, gaining considerable experience in a wide variety of commodities and operating with staff from diverse cultural backgrounds.


    Dr Tabeart was appointed Managing Director of the Company in November 2007 after serving two years as General Manager. Under his stewardship the Company discovered and delineated the coal resource at the Sese Coal & Power Project and has since managed the strategic direction of company to focus upon the delivery of multiple coal‐fired power stations, captive coal‐mines and an export coal mine. He has overseen the acquisition of Mmamantswe and Mmamabula West Coal Projects that has grown the resource inventory of the Company to 8.7Bt of thermal coal.


    Other current directorships Special responsibilities

    Segue Resources Limited (appointed 1 September 2014) Managing Director


    Former directorships in the last three years Interests in shares and options

    none 4,774,100 shares

    1,933,333 performance rights


    Mr Gregory (Bill) Fry - Executive Director Mr Fry has more than 20 years corporate experience in the mining and resources industry, specialising in accounting, management, business development and general corporate activities. He has vast experience in project evaluation and development, project funding, management, finance and operations.


    Over the past 15 years, Mr Fry has been a Director of several private and public companies with activities ranging from funds management, minerals exploration, mining and quarrying. He has been an Executive Director of African Energy Resources since listing and is responsible for the Company's commercial and financial business programs.


    Other current directorships Special responsibilities

    Energy Ventures Limited Anova Metals Limited

    Member of the Audit committee


    Former directorships in the last three years Interests in shares and options

    Norrland Resources Limited 5,869,610 shares 1,266,667 performance rights

    Directors Report (continued)


    Mr Valentine Chitalu MPhil, BAcc, FCCA - Non‐Executive Director

    Mr Chitalu, a Zambian national and resident, is a Chartered Certified Accountant, Fellow of the Association of Chartered Certified Accountants (UK) and holds a practicing certificate from the Zambia Institute of Certified Accountants. He also holds a Masters Degree in Economics, Finance and Politics of Development and a Bachelor's Degree in Accounting and Finance.


    Mr Chitalu has been a Non‐Executive Director of African Energy Resources since listing and has assisted African Energy through his extensive business and Government contacts in the region.


    Other current directorships Special responsibilities

    CDC Group nil


    Former directorships in the last three years Interests in shares and options

    nil 2,251,425 shares

    400,000 performance rights


    Mr Philip Clark - Non‐Executive Director BE (Mining), MBA, MAUSIMM, GAICD Mr Clark brings a broad range of business skills to African Energy, with a particular focus on developing coal resources. He previously spent over 30 years working for BHP Billiton, culminating in five years as Vice President of Resource Development for BHP Billiton Energy Coal globally. He also held previous roles in coal mine management. Mr Clark is also the Chairman of Engineers Without Borders Australia Limited, a not‐for‐profit organisation which partners with developing communities, assisting them to gain access to the knowledge, resources and appropriate technologies to improve their livelihoods. During the past three years he has held no other public Directorships. Mr Clark is Chairman of the Company's Audit and Remuneration Committees.


    Other current directorships Special responsibilities

    Engineers Without Borders Australia Engineers Without Borders International City West Water

    Chairman of Audit & Risk Committee Chairman of Remuneration Committee


    Former directorships in the last three years Interests in shares and options

    nil 2,485,352 shares

    200,000 performance rights


    Mr Vincent Ian Masterton‐Hume ‐ Non‐Executive Director Mr Hume's career in the resources industry stretches back several decades, primarily in the fields of managed fund investments, capital raising and project development. He currently sits on the boards of Silver City Mines; TSX‐listed Golden Minerals; and ASX‐listed Iron Road. He is a former Director of ASX and TSX‐listed Marengo Mining.


    Mr Hume was a Founding Partner of The Sentient Group ('Sentient'), an independent private equity investment firm that specialises in the global resource industry. He remains an independent advisor to Sentient, following his retirement from the fund in 2008. Sentient manages in excess of US $2.3 billion in the development of metal, mineral and energy assets across the globe. Sentient's current investment portfolio includes projects in power generation, energy storage, potash, and base, precious and ferrous metals mining, covering countries as diverse as China, Brazil, Canada, Papua New Guinea, Finland, Australia, Kenya and Botswana.


    Prior to the founding of Sentient, Mr Hume was a consultant to AMP's Private Capital Division, working on the development of a number of Chilean mining investment joint ventures, as well as advising on a number of specific investments across a range of commodities and locations.


    Other current directorships Special responsibilities

    Silver City Mines Limited Golden Minerals Limited Iron Road Limited

    Member of Remuneration Committee


    Former directorships in the last three years Interests in shares and options

    Antofagasto Australia Limited Marengo Mining Limited

    4,157,606 shares 100,000 performance rights


    Mr Wayne Trumble ‐ Non‐Executive Director Mr Trumble is a senior executive with 35 years of specific industry expertise in electricity, investment and construction. For the twelve years to 2014, Mr Trumble was the Executive General Manager of Griffin Power Pty Ltd, reporting to the Board of the Griffin Group, where he led Griffin's move from fuel supplier to electricity generator. He was responsible for preparation of strategy and the development, execution and operation of Griffin's $1.2 billion Bluewaters coal fired project, providing 436 MW of base load power in Western Australia. Mr Trumble led the team

    Directors Report (continued)


    responsible for all aspects of the project development and construction including all required environmental approvals, negotiations of turn‐key EPC contract, off take contracts, grid interconnection and approval of project financing to a level of $1.0 billion.


    Prior to working at Griffin, Mr Trumble was the Managing Director of TransAlta Energy where he was responsible for the commissioning and operation of the 105MW Parkeston Power Station at Kalgoorlie.


    Other current directorships Special responsibilities

    Energy Made Clean Member of Audit & Risk Committee


    Former directorships in the last three years Interests in shares and options

    nil 327,273 shares

    1,000,000 performance rights


    Mr Yan Zhao ‐ Alternate Director Mr Zhao is an employee of Sentient Group where he has worked as part of the investment team since 2008. Prior to joining Sentient, Mr Zhao worked at Actis Capital in London, where he supported and worked on a wide range of investments with a special focus on natural resources. Prior to this, Yan was an Auditor in KPMG, involved in due diligence work on several Chinese companies listed in Hong Kong.


    Yan holds a Master in Finance from London Business School and a BSc in Economics from University of International Business and Economics in China. Yan has the certificate of CGA‐Canada, ACCA and CFA level III candidate.


    Current directorships Special responsibilities

    nil nil

    Former directorships in the last three years Interests in shares and options

    nil nil


    Mr John Dean ‐ Non‐Executive Director (appointed 22 December 2014) Mr Dean is an employee of First Quantum Minerals (FQM). Since joining FQM in 2011 he has fulfilled various roles within their mining operations including at FQM's Sentinel Copper Mine, its new flagship mine in Zambia. Prior to joining FQM, Mr Dean worked as an analyst in the energy and natural resource industries, possessing expertise in the valuation and commercial analysis of upstream oil and gas projects, as well as experience in electricity, natural gas, and crude oil markets.


    Mr Dean graduated with honours from the University of Louisville in the United States with a Bachelor of Science in Business Administration, and was later awarded a Masters of Business Administration with distinction from the University of Oxford.


    In addition to the Directorship, Mr Dean leads the team responsible for the development of power generation projects at the Sese Coal & Power Project under the recently signed joint venture with FQM.


    Current directorships Special responsibilities

    nil nil

    Former directorships in the last three years Interests in shares and options

    nil nil


    Mr Daniel Davis - Company Secretary

    Mr Davis is a member of CPA Australia who graduated from the University of Western Australia in 2001 with a Bachelor of Commerce majoring in Accounting and Finance. Mr Davis has worked in the resources sector for the past ten years specialising in African based explorers and producers. Mr Davis was appointed to the role of Company Secretary in 2009.


  2. Directors' Meetings

    The number of Directors' meetings and number of meetings attended by each of the Directors of the Company during the financial year were:


    Director

    Board of Directors

    Remuneration Committee

    Audit & Risk Committee

    Present

    Held

    Present

    Held

    Present

    Held

    Alasdair Cooke

    6

    6

    2

    2

    Charles Tabeart

    6

    6

    Gregory Fry

    6

    6

    5

    5

    Valentine Chitalu

    5

    6

    Philip Clark

    6

    6

    2

    2

    5

    5

    Vincent Masterton‐Hume

    6

    6

    2

    2

    Wayne Trumble

    6

    6

    5

    5

    John Dean (appointed 22 December 2014)

    3

    3

    Directors Report (continued)


  3. Review of Operations


    In October 2014, the Company completed a placement of 69,000,000 shares to First Quantum Minerals at AU$0.055 per share to raise approximately AU$3,800,000, with attaching options on a 1 for 5 basis exercisable at AU$0.10 within three years.


    In October 2014, African Energy entered a joint venture agreement with First Quantum Minerals (FQM) whereby FQM acquired a majority interest in Sese Coal & Power Project (Sese JV Agreement). An initial AU$8,000,000 invested by FQM to acquire 51% of Sese JV, was paid to African Energy as repayment of parent company loans. FQM will invest a further AU$12,000,000 by July 2016 to earn an additional 24% stake in the Sese JV, taking their interest to 75%. On earning 75% interest in the Sese JV, FQM will loan carry African Energy's 25% share of all development funding at Sese, with this loan to be repaid from AFR's share of future project cashflow. All Conditions Precedent to conclude the Sese JV Agreement were met in early January.


    In November 2014, the Company raised AU$3,757,870 by the issue of 68,324,910 shares at AU$0.055 per share in a 1 for 8 non‐renounceable rights issue. The Company repaid a loan facility to Macquarie Bank Limited of US$5,000,000 in December 2014.

    In February, Mmamabula West (PL56/2005) was granted a two‐year extension to 31st March 2017, triggering a final payment of US$1,500,000 to Asenjo.


    In June 2015, African Energy executed a binding term sheet with experienced South African project developer, TM Consulting, for the conditional sale of the Mmamantswe coal and power project. The Developer will form a bid consortium which will sole fund the preparation and submission of a bid into South Africa's coal‐fired base load IPP procurement programme using the Mmamantswe project. If the Mmamantswe bid is shortlisted, African Energy will transfer its interest in the Mmamantswe prospecting licence (PL069/2007) to the Developer for US$10,000,000. AFR will receive an additional US$10,000,000 should the shortlisted project reach financial close.


  4. Remuneration Report ‐ Audited This Remuneration Report outlines the remuneration arrangements which were in place during the year, and remain in place as at the date of this report, for the Directors and key management personnel of African Energy Resources Limited.


    The functional currency of the Company and each of the operating subsidiaries is US dollars which represents the currency of the primary economic environment in which the Consolidated Entity operates.


    The information provided in this remuneration report has been Audited as required by section 308(3c) of the Corporations Act 2001.


  5. Principles of Compensation

    The objective of the Group's executive reward framework is to ensure reward for performance is competitive and appropriate for the results delivered. The framework aligns executive reward with achievement of strategic objectives and the creation of value for shareholders, and conforms with market practice for delivery of reward. The Board ensures that executive reward satisfies the following key criteria for good reward governance practices:

    • competitiveness and reasonableness;

    • acceptability to shareholders;

    • performance linkage / alignment of executive compensation;

    • transparency; and

    • capital management.


      Alignment to shareholders' interests:

    • has economic profit as a core component of plan design;

    • focuses on sustained growth in shareholder wealth, consisting of dividends and growth in share price, and delivering constant return on assets as well as focusing the executive on key non‐financial drivers of value; and

    • attracts and retains high calibre executives.


      Alignment to program participants' interests:

    • rewards capability and experience;

    • reflects competitive reward for contribution to growth in shareholder wealth;

    • provides a clear structure for earning rewards; and

    • provides recognition for contribution.


      The framework provides a mix of fixed and variable pay, and a blend of short and long‐term incentives. As executives gain seniority with the Group, the balance of this mix shifts to a higher proportion of ''at risk'' rewards.


      The following table shows key performance indicators for the group over the last five years:


      2015

      2014

      2013

      2012

      2011

      Profit / (loss) for the year attributable to owners

      (5,105,959)

      (6,779,734)

      (12,547,719)

      (9,576,739)

      (4,927,071)

      Basic earnings / (loss) per share (cents)

      (0.90)

      (1.55)

      (3.58)

      (2.95)

      (1.70)

      Dividend payments

      Dividend payment ratio (%)

      Increase / (decrease) in share price (%)

      (4%)

      3%

      (61%)

      (71%)

      713%

      Total KMP incentives as percentage of profit / (loss) for the year (%)

      Directors Report (continued)


  6. Remuneration governance The Remuneration Committee provides advice on remuneration and incentive policies and practices and specific recommendations on remuneration packages and other terms of employment for Executive Directors, other senior executives and Non‐Executive Directors. The Corporate Governance Statement provides further information on the role of the Board.


    Mr Clark is the chairman of the remuneration committee.


  7. Non‐Executive Directors Fees and payments to Non‐Executive Directors reflect the demands which are made on, and the responsibilities of, the Directors. Non‐Executive Directors' fees and payments are reviewed annually by the Board.


    The current base remuneration was last reviewed with effect from 1 April 2015 and was set at AU$45,000 per annum.


  8. Executive Directors

    The executive pay and reward framework has two components:

    • base pay; and

    • long‐term incentive through participation in the African Energy Resources Performance Rights Plan.


      Base Pay

      Base pay is structured as a total employment cost package which may be delivered as a combination of cash and prescribed non‐financial benefits at the Remuneration Committee's discretion.


      Executives are offered a competitive base pay that comprises the fixed component of pay and rewards. Base pay for executives is reviewed annually to ensure the executive's pay is competitive with the market. There is no guaranteed base pay increases included in any executives' contract.


      Employee Performance Rights Plan

      In August 2012 the Board adopted an employee performance right share plan ('Plan') to enable the Company to issue Performance Rights to employees and Directors. The Plan was developed by the Board to provide an opportunity to employees to participate in the Company's future growth and provide an incentive to contribute to that growth. The Plan is further designed to assist in retaining employees. Performance Rights were chosen as they allow the Company to incentivise employees and Directors. The Remuneration Committee has determined performance hurdles that will apply to each Performance Right issued.


      Performance conditions are detailed in note 23.


      Service Contracts

      On appointment to the Board, Executive Directors enter into an executive service agreement with the Company. The agreement details the Board policies and terms, including compensation, relevant to the office of Director.


      The Company currently has service contracts in place with the following three Board members. All contracts with Executive Directors are for a two year term but can be terminated by either party with three months' notice. Details of the service agreements are listed below.


      Mr Alasdair Campbell Cooke ‐ Executive Chairman, the Company

    • Commencement date: 1 April 2015

    • Base salary is AU$$85,000

    • Termination payment is the equivalent of three months consulting fees

    • Mr Cooke's contract and remuneration is reviewed annually


      Dr Charles Frazer Tabeart ‐ Managing Director, the Company

    • Commencement date: 1 April 2015

    • Base salary is AU$$320,000

    • Termination payment is the equivalent of three months consulting fees

    • Dr Tabeart's contract and remuneration is reviewed annually


      Mr Gregory William Fry ‐ Executive Director, the Company

    • Commencement date: 1 April 2015

    • Base salary is AU$$160,000 Termination payment is the equivalent of three months consulting fees

    • Mr Fry's contract and remuneration is reviewed annually No other key management personnel have service contracts in place with the Consolidated Entity.

  9. Voting and comments made at the Company's 2014 Annual General Meeting

    The Company did not receive any specific feedback at the AGM or throughout the year on its remuneration practices.


  10. Directors and Executive Officers' Remuneration (Consolidated Entity) Details of the remuneration of the Directors of the Consolidated Entity (as defined in AASB 124 Related Party Disclosures) of the Consolidated Entity are set out in the following tables.


    The key management personnel of the Consolidated Entity are the Directors of African Energy Resources Limited.

    Directors Report (continued)


    Details of remuneration

    The following tables set out remuneration paid to key management personnel of the Consolidated Entity during the year.



    Key Management Personnel remuneration ‐ 2015

    Short term employee benefits

    Post‐ employment benefits


    Share based payments


    Total


    performance related

    Cash salary & fees


    Superannuation


    Shares

    Performance Rights

    US$

    US$

    US$

    US$

    Non‐Executive Directors


    9,290



    25,012


    2,218


    36,520


    Valentine Chitalu

    Philip Clark

    9,290

    25,012

    4,654

    38,956

    11%

    Vincent Masterton‐Hume

    9,290

    25,012

    34,302

    Wayne Trumble

    29,934

    10,620

    40,553

    John Dean

    20,928

    20,928

    Total Non‐Executive Directors

    78,730

    85,656

    6,872

    171,258

    3%

    Key Management Personnel


    125,927



    44,063


    22,183


    169,990


    Executive Directors

    Gregory Fry

    Charles Tabeart

    258,047

    45,021

    22,183

    303,069

    Alasdair Cooke

    80,098

    59,549

    139,647

    Total Key Management Personnel

    464,073

    148,632

    44,366

    612,705

    Total

    542,803

    234,288

    51,239

    783,963

    1%


    Key Management Personnel

    remuneration ‐ 2014

    Non‐Executive Directors


    Valentine Chitalu

    29,905

    2,088

    31,993

    Philip Clark

    13,800

    29,905

    43,705

    Michael Curnow

    29,905

    4,544

    34,448

    Vincent Masterton‐Hume

    18,797

    18,797

    Wayne Trumble

    6,951

    6,951

    Total Non‐Executive Directors

    20,751

    108,510

    6,632

    135,893

    Key Management Personnel

    Executive Directors

    Gregory Fry


    138,000



    29,905


    52,826


    220,731


    15%

    Charles Tabeart

    285,200

    53,828

    84,750

    423,779

    15%

    Alasdair Cooke

    70,259

    15,962

    86,221

    19%

    Total Key Management Personnel

    423,200

    153,992

    153,539

    730,731

    15%

    Total

    443,951

    262,503

    160,171

    866,624

    13%


    The Company and the Group currently have no performance based cash remuneration built into Director or executive packages. The total remuneration shown in the table above is fixed.


    The Group did not engage a remuneration consultant during the year.


  11. Share‐based compensation The establishment of the AFR Employee Performance Rights Plan was approved by shareholders at the 2012 Annual General Meeting. The Employee Performance Rights Plan is designed to provide long‐term incentives for key staff and consultants to deliver long‐term shareholder returns. Participation in the plan is at the Board's discretion and no individual has a contractual right to participate in the plan or to receive any guaranteed benefits.


    Rights are granted under the plan for no consideration. Rights granted under the plan carry no dividend or voting rights. When exercisable, each right is convertible into one ordinary share.


    shares issued

    shares issued

    Gregory Fry

    1/07/14

    333,334

    23,667

    Charles Tabeart

    1/07/14

    333,334

    23,667

    Philip Clark

    1/10/14

    100,000

    4,654

    Valentine Chitalu

    1/07/14

    33,333

    2,367

    KMP Date Vested Numberof

    Value of

    Directors Report (continued)



    On 28 November 2014, The Company issued 3,766,667 new performance rights to Directors following approval by shareholders at the 2014 annual general meeting. During the year 800,002 shares were issued to Directors upon vesting of performance rights. The balance of 6,899,999 remained unvested at 30 June 2015.


    Issue Date Expiry Date Vesting hurdle Issued in Year Unvested at 30 June 2015


    28‐Nov‐14

    27‐Nov‐19

    Formal execution of a 300MW Sese PPA or when FQM have made a formal financial commitment to a 300MW power station at Sese

    500,000

    500,000

    28‐Nov‐14

    27‐Nov‐19

    Financial close of a 300MW power station whereby all conditions are

    2,600,000

    2,600,000

    satisfied by all parties and all agreements are executed, or when FQM have

    made a formal financial commitment to a 300MW power station at Sese

    28‐Nov‐14

    27‐Nov‐19

    Formal execution of a PPA between the Sese JV company and ZESCO for

    the full output of a 300MW IPP at Sese

    300,000

    300,000

    28‐Nov‐14

    27‐Nov‐19

    continued service until 1 July 2015

    366,667

    366,667

    3,766,667

    3,766,667


  12. Additional Information

    Details of vesting profile of the rights granted as remuneration to each Key Management Personnel is detailed below.



    Type Year Granted


    Granted

    Value at Grant Date


    Expiry Date


    Vested in year


    Forfeited in year


    Max Value Yet to Vest


    Alasdair Cooke

    Rights

    2013

    500,000

    87,500

    30‐Sep‐17

    58,333

    Charles Tabeart

    Rights

    2013

    3,000,000

    525,000

    30‐Sep‐17

    333,334

    291,667

    Gregory Fry

    Rights

    2013

    2,000,000

    350,000

    30‐Sep‐17

    333,334

    175,000

    Valentine Chitalu

    Rights

    2013

    100,000

    17,500

    30‐Sep‐17

    33,333

    5,833

    Philip Clark

    Rights

    2013

    200,000

    35,000

    30‐Sep‐17

    100,000

    17,500

    Valentine Chitalu

    Rights

    2014

    466,667

    25,667

    27‐Nov‐19

    25,667

    Philip Clark

    Rights

    2014

    200,000

    11,000

    27‐Nov‐19

    11,000

    Vincent Masterton‐Hume

    Rights

    2014

    200,000

    11,000

    27‐Nov‐19

    11,000

    Wayne Trumble

    Rights

    2014

    1,100,000

    60,500

    27‐Nov‐19

    60,500

    Gregory Fry

    Rights

    2014

    600,000

    33,000

    27‐Nov‐19

    33,000

    Charles Tabeart

    Rights

    2014

    600,000

    33,000

    27‐Nov‐19

    33,000

    Alasdair Cooke

    Rights

    2014

    600,000

    33,000

    27‐Nov‐19

    33,000

  13. Directors' and Executives Interests


  14. Shares

    Balance at 30/06/2013

    Balance at 30/06/2014

    Purchases (Sales)

    Issued upon vesting of rights

    Issued in lieu of cash fee

    Balance at 30/06/2015

    Balance at Reporting Date

    Non‐executive Directors


    767,277


    1,205,969






    Michael Curnow

    Valentine Chitalu

    618,792

    1,024,150

    554,166

    33,334

    539,775

    2,151,425

    2,251,425

    Philip Clark

    374,286

    793,851

    951,767

    100,000

    539,774

    2,385,392

    2,485,392

    Vincent Masterton‐Hume

    1,330,001

    1,660,400

    1,857,432

    539,774

    4,057,606

    4,157,606

    Wayne Trumble

    227,273

    227,273

    327,273

    John Dean

    Executive Directors

    Alasdair Cooke

    34,002,925

    37,433,245

    11,157,560

    1,246,211

    49,837,016

    50,003,682

    Charles Tabeart

    2,011,689

    3,844,335

    (708,492)

    333,334

    971,590

    4,440,767

    4,774,100

    Gregory Fry

    4,389,478

    5,338,168

    (675,000)

    333,334

    539,774

    5,536,277

    5,869,610

    43,494,448

    51,309,985

    13,127,566

    800,002

    4,604,171

    68,635,756

    69,869,088

    Directors Report (continued)


  15. Performance Rights


    Balance at 30/06/2013

    Balance at 30/06/2014

    Issued on 28 Nov 2014

    Vested and converted to shares in 2015

    Balance at 30/06/2015

    Vested and exercisable


    Unvested

    Non‐executive Directors


    100,000







    Michael Curnow

    Valentine Chitalu

    100,000

    66,667

    466,667

    (33,334)

    500,000

    500,000

    Philip Clark

    200,000

    200,000

    200,000

    (100,000)

    300,000

    300,000

    Vincent Masterton‐Hume

    200,000

    200,000

    200,000

    Wayne Trumble

    1,100,000

    1,100,000

    1,100,000

    John Dean

    Executive Directors

    Alasdair Cooke

    500,000

    333,333

    600,000

    933,333

    933,333

    Charles Tabeart

    3,000,000

    2,000,000

    600,000

    (333,334)

    2,266,666

    2,266,666

    Gregory Fry

    2,000,000

    1,333,334

    600,000

    (333,334)

    1,600,000

    1,600,000

    5,900,000

    3,933,334

    3,766,667

    (800,002)

    6,899,999

    6,899,999


  16. Other related party transactions The terms and conditions of the transactions with Directors, key executives and associates and their related entities were no more favourable than those available, or which might reasonably be expected to be available, on similar transactions to non‐Director related entities on an arm's length basis.


  17. Charges from Charges to


    2015

    US$

    2014

    US$

    2015

    US$

    2014

    US$

    319,370

    578,417

    Mitchell River Group Pty Ltd Provision of a fully serviced office and admin staff Alasdair Cooke, Frazer Tabeart, Gregory Fry


    At 30 June 2015 the company had a payable outstanding to Mitchell River Group of US$7,863 (30 June 2014: US$46,834).


    This is the end of the Audited remuneration report.


  18. Principal Activities The principal activity of the Consolidated Entity during the course of the financial year consisted of evaluation and exploration of coal and energy projects in southern Africa.


  19. Results and Dividends

    The Consolidated Entity's loss after tax attributable to members of the Consolidated Entity for the financial year ended 30 June 2015 was US$5,105,959 (loss in 2014: US$ 6,779,734).


    No dividends have been paid or declared by the Company during the year ended 30 June 2015.


  20. Loss Per Share

    The basic loss per share for the Consolidated Entity for the year was 0.90 cents per share (2014: 1.55 cents).


  21. Events Subsequent to Reporting Date

    On 2 September 2015 the Company announced an extension to 30 September 2015 of the time period to complete certain conditions precedent for the sale of Mmamantswe coal and power project.


    Other than the aforementioned events, no matters or circumstances have arisen since the end of the financial year which have significantly affected or may significantly affect the operations, results or state of affairs of the Group in future financial years which have not been disclosed publicly at the date of this report.


  22. Likely Developments and Expected Results

    The Group will continue to pursue activities within its corporate objectives. Further information about likely developments in the operations of the Group and the expected results of those operations in the future financial years has not been included in this report because disclosure would likely result in unreasonable prejudice to the Group.


  23. Significant Changes in the State of Affairs In the opinion of the Directors, other than stated under Review of Operations, and Events Subsequent to Reporting Date, there were no significant changes in the state of affairs of the Group that occurred during the financial year under review and subsequent to the financial year end.

    Directors Report (continued)


  24. Environmental Regulations

    The Consolidated Entity's operations are not subject to any significant environmental regulations under either Commonwealth or State legislation or under the legislation of African countries in which it operates. However, the Board believes there are adequate systems in place for the management of its environmental requirements and is not aware of any breach of those environmental requirements as they apply.


    The Group recognises its responsibility to rehabilitate areas affected by its exploration activities and made provision for rehabilitation in the Statement of Financial Position.


    The Company is not subject to the reporting requirements of both the Energy Efficiency Opportunities Act 2006 and the National Greenhouse and Energy Reporting Act 2007.


  25. Indemnification and Insurance of Officers and Auditors


  26. Indemnification

    An indemnity agreement has been entered into with each of the Directors and Company Secretary of the Company named earlier in this report. Under the agreement, the Company has agreed to indemnify those officers against any claim or for any expenses or costs which may arise as a result of work performed in their respective capacities to the extent permitted by law. There is no monetary limit to the extent of this indemnity.


  27. Insurance

    During the financial year, the Company has taken out an insurance policy in respect of Directors' and officers' liability and legal expenses' for Directors and officers.


  28. Corporate Structure African Energy Resources Limited is a Company limited by shares that is incorporated and domiciled in Guernsey. The Company is listed on the Australian Securities Exchange and Botswana Stock Exchange under code AFR.


  29. Non‐Audit Services



    2015

    US$

    2014

    US$

    5,114

    5,114

    BDO Audit (WA) Pty Ltd: Other assurance services



    The company may decide to employ the auditor on assignments additional to their statutory audit duties where the auditor's expertise and experience with the company and/or the group are important.


    During the year, there were no non‐Audit services provided by BDO Audit (WA) Pty Limited (2014: US$5,114).


  30. Lead Auditor's Independence Declaration

  31. The lead Auditor's Independence Declaration is set out on page 16 and forms part of the Directors' report for the financial year ended 30 June 2015.



    Charles Frazer Tabeart Managing Director

    Perth, 30 September 2015

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