TIDMGRX
RNS Number : 0002T
GreenX Metals Limited
15 March 2023
GreenX Metals Limited
Interim Financial Report for the Half-Year Ended 31 December
2022
ABN 23 008 677 852
CORPORATE DIRECTORY
DIRECTORS: BANKERS:
Mr Ian Middlemas Chairman National Australia Bank Ltd
Mr Benjamin Stoikovich Director Australia and New Zealand Banking
and CEO Group Ltd
Mr Garry Hemming Non-Executive
Director SHARE REGISTRIES:
Mr Mark Pearce Non-Executive Australia:
Director Computershare Investor Services
Pty Ltd
Level 11, 172 St Georges Terrace
Mr Dylan Browne Company Secretary Perth WA 6000
Tel: +61 8 9323 2000
PRINCIPAL OFFICES:
London: United Kingdom:
Unit 3C, 38 Jermyn Street Computershare Investor Services
London SW1Y 6DN PLC
United Kingdom The Pavilions, Bridgewater Road
Tel: +44 207 487 3900 Bristol BS99 6ZZ
Tel: +44 370 702 0000
Australia (Registered Office):
Level 9, 28 The Esplanade Poland:
Perth WA 6000 Komisja Nadzoru Finansowego (KNF)
Tel: +61 8 9322 6322 Plac Powstańców Warszawy
Fax: +61 8 9322 6558 1, skr. poczt. 419
00-950 Warszawa
Greenland: Tel: +48 22 262 50 00
ARC Joint Venture Company ApS
c/o Nuna Advokater STOCK EXCHANGE LISTINGS:
Box 59 Australia:
Qulilerfik 2, 6. Australian Securities Exchange
3900 Nuuk - ASX Code: GRX
SOLICITORS: United Kingdom:
Thomson Geer London Stock Exchange (Main Board)
- LSE Code: GRX
AUDITOR:
Ernst & Young - Perth Poland:
Warsaw Stock Exchange - GPW Code:
GRX
CONTENTS
Selected Financial Data
Directors' Report
Directors' Declaration
Consolidated Statement of Profit or Loss and other Comprehensive
Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Condensed Notes to the Consolidated Financial Statements
To view the following sections plus all figures and illustrations,
please refer to the full version of the Interim Financial Report
on our website at www.greenxmetals.com
Auditor's Independence Declaration
Independent Auditor's Review Report
SELECTED FINANCIAL DATA (CONVERTED INTO PLN AND EUR)
Half-Year Half-Year Half-Year Half-Year
Ended Ended Ended Ended
31 December 31 December 31 December 31 December
2022 2021 2022 2021
PLN PLN EUR EUR
---------------------------- -------------- ------------- ------------- -------------
Arbitration finance
facility income 15,028,789 3,894,441 3,174,012 845,178
Sale of land rights
at Debiensko - 1,898,507 - 412,017
Gas and property lease
revenue 418,291 295,966 88,341 64,231
Exploration and evaluation
expenses (2,093,485) (2,215,795) (442,135) (480,876)
Arbitration related
expenses (15,137,985) (3,600,413) (3,197,074) (781,368)
Net loss for the period (4,488,239) (5,697,421) (947,896) (1,236,464)
Net cash flows from
operating activities (4,264,524) (3,783,510) (900,648) (821,104)
Net cash flows from
investing activities (10,072,066) (3,455,331) (2,127,175) (749,882)
Net cash flows from
financing activities 3,267,631 13,053,025 690,109 2,891,414
Net increase in cash
and cash equivalents (11,068,959) 5,814,185 (2,337,714) 1,320,428
Basic and diluted loss
per share (Grosz/EUR
cents per share) (1.73) (2.41) (0.37) (0.52)
---------------------------- -------------- ------------- ------------- -------------
31 December 30 June 31 December 30 June
2022 2022 2022 2022
PLN PLN EUR EUR
--------------------------- -------------- ------------ ------------- -----------
Cash and cash equivalents 7,695,353 18,853,668 1,640,835 4,028,045
Total Assets 41,968,796 48,428,966 8,948,761 10,346,743
Total Liabilities (11,093,430) 11,961,183 (2,365,387) 2,555,481
Net Assets 30,875,366 36,467,783 6,583,374 7,791,262
Contributed equity 245,709,661 216,970,230 51,892,768 51,912,177
--------------------------- -------------- ------------ ------------- -----------
Figures of the consolidated statement of profit or loss and
other comprehensive income and consolidated statement of cash flows
have been converted into PLN and EUR by applying the arithmetic
average for the final day of each month for the reporting period,
as published by the National Bank of Poland (NBP). These exchange
rates were 3.1337 AUD:PLN and 4.7350 PLN:EUR for the six months
ended 31 December 2022, and 2.9010 AUD:PLN and 4.6078 PLN:EUR for
the six months ended 31 December 2021.
Assets and liabilities in the consolidated statement of
financial position have been converted into PLN and EUR by applying
the exchange rate on the final day of each respective reporting
period as published by the NBP. These exchange rates were: 2.9890
AUD:PLN and 4.6899 PLN:EUR on 31 December 2022, and 3.0873 AUD:PLN
and 4.6806 PLN:EUR on 30 June 2022.
DIRECTORS REPORT
The Directors of GreenX Metals Limited present their report on
the Consolidated Entity consisting of GreenX Metals Limited
(Company or GreenX) and the entities it controlled during the
half-year ended 31 December 2022 (Consolidated Entity or
Group).
DIRECTORS
The names and details of the Company's Directors in office at
any time during the half-year and until the date of this report
are:
Directors:
Mr Ian Middlemas Chairman
Mr Benjamin Stoikovich Director and CEO
Mr Garry Hemming Non-Executive Director
Mr Mark Pearce Non-Executive Director
Unless otherwise shown, all Directors were in office from the
beginning of the half-year until the date of this report.
OPERATING AND FINANCIAL REVIEW
Operations
Highlights during, and subsequent to, the half-year include:
-- During the period, the hearing for the international
arbitration claims against the Republic of Poland under both the
Energy Charter Treaty and the Australia-Poland Bilateral Investment
Treaty was concluded.
Combined arbitration hearing took place in front of the Arbitral
Tribunal in London under the UNCITRAL Arbitration Rules for
GreenX's claims against Poland.
Damages of up to GBP737 million (A$1.3 billion / PLN4.0 billion)
have been claimed including the assessed value of GreenX's lost
profits and damages related to both the Jan Karski and Debiensko
projects, and accrued interest related to any damages.
The Company has funded the Claim proceedings under its US$12.3
million Litigation Funding Agreement (LFA).
-- In November 2022, the Company announced highly encouraging
results from an initial site visit to Arctic Rift Copper Project
(ARC or Project).
Analysis of the site visit results is underway and will be key
to future work programs.
GreenX can earn up to 80% of the ARC copper project in
Greenland. ARC is a significant, large-scale project (5,774km(2)
license area) with historical exploration results and recent
analysis indicative of an extensive mineral system with potential
to host world-class copper deposits.
-- Subsequent to the half year, the Company announced a placing
to issue 12.4 million new ordinary shares to raise gross proceeds
of approximately GBP3.9 million (A$6.8 million) from new and
existing UK and European investors and some Australian investors
(Placing). Due to high demand, directors resolved to increase the
Placing to issue 14.1 million new ordinary shares to raise total
gross proceeds of approximately GBP4.4 million (A$7.7 million). The
Placing shares were issued on 14 March 2023.
-- On completion of the Placing, the Company will have cash reserves of A$10 million.
Dispute with the Polish Government
During the period, the Company reported the conclusion of the
hearing for the international arbitration claims (Claim) against
the Republic of Poland under both the Energy Charter Treaty (ECT)
and the Australia-Poland Bilateral Investment Treaty (BIT)
(together the Treaties). The hearing took place in London in
November 2022 and lasted two weeks.
Following completion of the hearing, the Arbitral Tribunal will
render an Award (i.e., the legal term used for a 'decision' by the
Tribunal) in due course with no specified date available for the
Tribunal decision.
As previously advised, the arbitration and hearing proceedings
in relation to the Claim are required to be kept confidential.
Details of the Claim
The Company's Claim against the Republic of Poland is being
prosecuted through an established and enforceable legal framework,
with GreenX and Poland agreeing to apply the United Nations
Commission on International Trade Law Rules (UNCITRAL) to the
proceedings. The arbitration claims are being administered through
the Permanent Court of Arbitration in the Hague.
The evidentiary hearing phase of the arbitration proceedings has
now been completed in front of the Arbitral Tribunal. With
completion of the hearing, the Arbitral Tribunal will render an
Award (i.e., a decision) in due course. There is no specified date
for an Award to be rendered. Subsequent to the end of the
half-year, the Company filed its post hearing brief with the
Tribunal. The Company's claims for damages against Poland are in
the amount of up to GBP737 million (A$1.3 billion/PLN4.0 billion),
which includes a revised assessment of the value of GreenX's lost
profits and damages related to both the Jan Karski and Debiensko
projects, and accrued interest related to any damages. The Claim
for damages has been assessed by independent external quantum
experts appointed by GreenX specifically for the purposes of the
Claim.
In July 2020, the Company announced it had executed the LFA for
US$12.3 million with Litigation Capital Management (LCM). The
facility is currently being drawn down to cover legal, tribunal and
external expert costs as well as defined operating expenses
associated with the Claim. The LFA is a limited recourse loan with
LCM that is on a "no win - no fee" basis.
In September 2020, GreenX announced that it had formally
commenced with the Claim by serving the Notices of Arbitration
against the Republic of Poland. In June 2021, GreenX announced that
it had formally lodged its Statement of Claim in the BIT
arbitration, including the first assessed claim for compensation.
The Company's Statement of Reply was submitted in July 2022 which
addressed various points raised by the Republic of Poland in their
Statement of Defence. The Statement of Reply also contained a
re-evaluation of the claim for damages based on consideration of
Poland's Statement of Defence.
GreenX's dispute alleges that the Republic of Poland has
breached its obligations under the applicable Treaties through its
actions to block the development of the Company's Jan Karski and
Debiensko projects in Poland which effectively deprived GreenX of
the entire value of its investments in Poland.
In February 2019, GreenX formally notified the Polish Government
that there exists an investment dispute between GreenX and the
Polish Government. GreenX's notification called for prompt
negotiations with the Government to amicably resolve the dispute
and indicated GreenX's right to submit the dispute to international
arbitration in the event of the dispute not being resolved
amicably.
GreenX's investment dispute with the Republic of Poland is not
unique, with international media widely reporting that the
political environment and investment climate in Poland has
deteriorated since the change in Government in 2015. As a result,
there are a significant number of International Arbitration claims
being bought against Poland.
Highly encouraging results from initial ARC site visit
During the period, GreenX and its joint-venture ( JV ) partner
Greenfields Exploration Ltd ( Greenfields ) announced the results
of from the first visit to ARC.
The results of this work program have demonstrated the
high-grade nature of the known copper sulphide mineralisation and
wider copper mineralization in fault hosted Black Earth zones and
adjacent sandstone units. The exact position of a native copper
fissure at the Neergaard Dal prospect was also identified.
Analysis of this new information is underway and will be key to
future work programs.
A logistical base in Greenland was also secured as part of the
site visit. The Company successfully established depots, and field
trialled its SHERP vehicles and advanced satellite communications
systems.
Share Placing to UK and European Investors
In March 2023, the Company announced the Placing to issue 12.4
million new ordinary shares to raise gross proceeds of
approximately GBP3.9 million (A$6.8 million) from new and existing
UK and European investors and some Australian investors. Due to
high demand, directors resolved to increase the Placing to issue
14.1 million new ordinary shares to raise total gross proceeds of
approximately GBP4.4 million (A$7.7 million). The Placing shares
were issued on 14 March 2023.
Results of Operations
The net loss of the Consolidated Entity for the half-year ended
31 December 2022 was $1,432,272 (31 December 2021: $1,963,939).
Significant items contributing to the current half-year loss and
the substantial differences from the previous half-year include to
the following:
(i) Arbitration related expenses of $4,830,784 (31 December
2021: $1,241,087) relating to the Claim against the Republic of
Poland. This has been offset by the arbitration funding income of
$4,795,937 (31 December 2021: $1,342,440);
(ii) Sale of land rights at Debiensko of nil (31 December 2021: $654,428);
(iii) Exploration and evaluation expenses of $668,066 (31
December 2021: $763,800), which is attributable to the Group's
accounting policy of expensing exploration and evaluation
expenditure incurred by the Group subsequent to the acquisition of
rights to explore and up to the commencement of a bankable
feasibility study for each separate area of interest;
(iv) Business development expenses of $132,578 (31 December
2021: $182,433) which includes expenses relating to the Group's
review of new business and project opportunities plus also investor
relations activities during the six months to 31 December 2022
including public relations, digital marketing, travel costs,
attendances at conferences and business development consultant
costs;
(v) Non-cash share-based payment expense of nil (31 December
2021: $1,203,339) due to incentive securities issued to key
management personnel and other key employees and consultants of the
Group as part of the long-term incentive plan to reward key
management personnel and other key employees and consultants for
the long-term performance of the Group. The expense results from
the Group's accounting policy of expensing the fair value
(determined using an appropriate pricing model) of incentive
securities granted on a straight-line basis over the vesting period
of the options and rights. During the prior period, the Company
issued 10,750,000 unlisted options which vested on issue; and
(vi) Revenue of $161,385 (31 December 2021: $111,664) consisting
of interest income of $27,901 (31 December 2021: $9,643) and the
receipt of $133,484 (31 December 2021: $102,021) of gas and
property lease income derived at Debiensko.
Financial Position
At 31 December 2022, the Group had cash reserves of $2,574,558
(30 June 2022: $ 6,106,847 ) and the US$12.3 million arbitration
facility (US$4.2 million available at 31 December 2022) placing it
in a good financial position to continue with exploration
activities at ARC and with the Claim. On completion of the Placing,
the Group will have cash reserves of A$10 million.
At 31 December 2022, the Company had net assets of $10,329,665
(30 June 2022: $ 11,812,416 ) an decrease of approximately 13%
compared with 30 June 2022. This is largely driven by the loss of
the half-year of $1,432,272 (31 December 2021: $1,963,939).
Business Strategies and Prospects for Future Financial Years
GreenX's strategy is to create long-term shareholder value
through the discovery, exploration, development and acquisition of
technically and economically viable mineral deposits. This also
includes pursuing the Claim against the Republic of Poland through
international arbitration in the short to medium term.
To date, the Group has not commenced production of any minerals,
nor has it identified an any Ore reserves in accordance with the
JORC Code. To achieve its objective, the Group currently has the
following business strategies and prospects over the medium to long
term:
-- Continue to enforce its rights through an established and
enforceable legal framework in relation to international
arbitration for the investment dispute between GreenX and the
Polish Government that has arisen out of certain measures taken by
Poland in breach of the Treaties;
-- Continue to assess corporate options for GreenX's investments in Poland;
-- Identify and assess other suitable business opportunities in the resources sector; and
-- Continue with exploration activities in Greenland.
All of these activities are inherently risky and the Board is
unable to provide certainty of the expected results of these
activities, or that any or all of these likely activities will be
achieved. Furthermore, GreenX will continue to take all necessary
actions to preserve the Company's rights and protect its
investments in Poland, if and as required. The material business
risks faced by the Group that could have an effect on the Group's
future prospects, and how the Group manages these risks, include
the following:
-- Litigation risk - All industries, including the mining
industry, are subject to legal and arbitration claims.
Specifically, and as noted above, the Company is continuing with it
its Claim against the Republic of Poland, and will strongly defend
its position and will continue to take all relevant actions to
pursue its legal rights in the Claim process. During the period,
the hearing for the Claim was completed with Tribunal to render an
Award (i.e., a decision) in due course with no specified date
available for the Tribunal decision. There is however no certainty
that the Claim will be successful. If the Claim is unsuccessful,
then this may have a material impact on the value of the Company's
securities.
-- Earn-in and joint venture contractual risk - The Company's
earn-in right to the Project is subject to the Earn-In Agreement
(EIA) with Greenfields as announced in October 2021. The Company's
ability to achieve its objectives is dependent on it and other
parties complying with their obligations under the Agreement. Any
failure to comply with these obligations may result in the Company
not obtaining its interests in the Project and being unable to
achieve its commercial objectives, which may have a material
adverse effect on the Company's operations and the performance and
value of the Shares. There is also the risk of disputes arising
with the Company's joint venture partner, Greenfields, the
resolution of which could lead to delays in the Company's proposed
development activities or financial loss.
If and when the Company earns in its interest in the Project, an
incorporated joint venture will be established between the Company
and Greenfields. The nature of the joint venture may change in
future, including the ownership structure and voting rights in
relation to the Project, which may have an effect on the ability of
the Company to influence decisions on the Project.
-- Operations in overseas jurisdictions risk - The Project is
located in Greenland, and as such, the operations of the Company
will be exposed to related risks and uncertainties associated with
the country, regional and local jurisdictions. Opposition to the
Project, or changes in local community support for the Project,
along with any changes in mining or investment policies or in
political attitude in Greenland and, in particular to the mining,
processing or use of copper, may adversely affect the operations,
delay or impact the approval process or conditions imposed,
increase exploration and development costs, or reduce profitability
of the Company. Moreover, logistical difficulties may arise due to
the assets being located overseas such as the incurring of
additional costs with respect to overseeing and managing the
Project, including expenses associated with taking advice in
relation to the application of local laws as well as the cost of
establishing a local presence in Greenland. Fluctuations in the
currency of Greenland may also affect the dealings and operations
of the Company.
Failure to comply strictly with applicable laws, regulations and
local practices relating to mineral rights applications and tenure,
could result in loss, reduction or expropriation of entitlements,
or the imposition of additional local or foreign parties as joint
venture partners with carried or other interests. Further, the
outcomes in courts in Greenland may be less predictable than in
Australia, which could affect the enforceability of contracts
entered into by the Company.
The Project is remotely located in an area that has an arctic
climate and that is categorised as an arctic desert, and as such,
the operations of the Company will be exposed to related risks and
uncertainties of arctic exploration, including adverse weather or
ice conditions which may and has prevented access to the Project,
which can impact exploration and field activities or generate
unexpected costs. It is not possible for the Company to predict or
protect the Company against all such risks.
The Company also had previous operations in Poland which may be
subject to regulations concerning protection of the environment,
including at the Debiensko and Kaczyce projects which have both
been relinquishment by the Company. As with all exploration
projects and mining operations, activities will have an impact on
the environment including the possible requirement to make good any
disturbed or damaged land.
Existing and possible future environmental protection
legislation, regulations and actions could cause additional
expense, capital expenditures and restrictions, the extent of which
cannot be predicted which could have a material adverse effect on
the Company's business, financial condition and results of
operations.
-- The Group's exploration and development activities will
require further capital - The exploration and any development of
the Company's exploration properties will require substantial
additional financing. Failure to obtain sufficient financing may
result in delaying or indefinite postponement of exploration and
any development of the Company's properties or even a loss of
property interest. There can be no assurance that additional
capital or other types of financing will be available if needed or
that, if available, the terms of such financing will be favourable
to the Company.
-- The Group's exploration properties may never be brought into
production - The exploration for, and development of, mineral
deposits involves a high degree of risk. Few properties which are
explored are ultimately developed into producing mines. To mitigate
this risk, the Company will undertake systematic and staged
exploration and testing programs on its mineral properties and,
subject to the results of these exploration programs, the Company
will then progressively undertake a number of technical and
economic studies with respect to its projects prior to making a
decision to mine. However, there can be no guarantee that the
studies will confirm the technical and economic viability of the
Company's mineral properties or that the properties will be
successfully brought into production.
-- The Group may be adversely affected by fluctuations in copper
prices - The price of copper fluctuates widely and is affected by
numerous factors beyond the control of the Group. Future
production, if any, from the Group's mineral properties will be
dependent upon copper prices being adequate to make these
properties economic. The Group currently does not engage in any
hedging or derivative transactions to manage commodity price risk.
As the Group's operations change, this policy will be reviewed
periodically going forward.
-- The Group may be adversely affected by competition within the
copper industry - The Group competes with other domestic and
international copper companies, some of whom have larger financial
and operating resources. Increased competition could lead to higher
supply or lower overall pricing. There can be no assurance that the
Company will not be materially impacted by increased competition.
In addition, the Group is continuing to secure additional surface
and mineral rights, however there can be no guarantee that the
Group will secure additional surface and mineral rights, which
could impact on the results of the Group's operations.
-- The Company may be adversely affected by fluctuations in
foreign exchange - Current and planned activities are predominantly
denominated in Stirling, Danish krone and/or Euros and the
Company's ability to fund these activates may be adversely affected
if the Australian dollar continues to fall against these
currencies. The Company currently does not engage in any hedging or
derivative transactions to manage foreign exchange risk. As the
Company's operations change, this policy will be reviewed
periodically going forward.
RELATED PARTY DISCLOSURE
Balances and transactions between the Company and its
subsidiaries, which are related parties to the Company, have been
eliminated on consolidation. There have been no other transactions
with related parties during the half-year ended 31 December 2022,
other than remuneration for Key Management Personnel and payments
of $144,000 (31 December 2021: $120,000) to Apollo Group Pty Ltd, a
Company of which Mr Mark Pearce is a Director and beneficial
shareholder, for the provision of serviced office facilities and
administration services. The amount is based on a monthly retainer
due and payable in advance, with no fixed term, and is able to be
terminated by either party with one month's notice. This item has
been recognised as an expense in the Statement of Profit or Loss
and other Comprehensive Income.
SUBSTANTIAL SHAREHOLDERS (shareholder with voting power of at
least 5%)
Substantial Shareholder notices have been received by the
following:
Substantial Shareholder Number of Shares/Votes Voting Power
---------------------------------------- ---------------------- ------------
CD Capital Natural Resources Fund III
LP 44,776,120 17.7%
---------------------------------------- ---------------------- ------------
ORDINARY SHARES HELD BY DIRECTORS'
At the Date of 31 December 2022 30 June 2022
this Report
------------------------ --------------- ----------------- -------------
Mr Ian Middlemas 11,660,000 11,660,000 11,660,000
Mr Benjamin Stoikovich 1,492,262 1,492,262 1,492,262
Mr Garry Hemming - - -
Mr Mark Pearce 3,300,000 3,300,000 3,300,000
------------------------ --------------- ----------------- -------------
SIGNIFICANT EVENTS AFTER THE REPORTING PERIOD
Subsequent to the half year, the Company announced the Placing
to issue 12.4 million new ordinary shares to raise gross proceeds
of approximately GBP3.9 million (A$6.8 million) from new and
existing UK and European investors and some Australian investors.
Due to high demand, directors resolved to increase the Placing to
issue 14.1 million new ordinary shares to raise total gross
proceeds of approximately GBP4.4 million (A$7.7 million). The
Placing shares were issued on 14 March 2023.
Other than as outlined above, there were no significant events
occurring after balance date requiring disclosure.
AUDITOR'S INDEPENCE DECLARATION
Section 307C of the Corporations Act 2001 requires our auditors,
Ernst and Young, to provide the Directors of GreenX Metals Limited
with an Independence Declaration in relation to the review of the
half-year financial report. This Independence Declaration is on
page 17 and forms part of this Directors' Report.
Signed in accordance with a resolution of the Directors.
BEN STOIKOVICH
Director
14 March 2023
Competent Persons Statement
The information in this announcement that relates to Exploration
Results for ARC is extracted from the ASX announcements dated 6
October 2021 , 22 January 2022, 20 July 2022, 4 August 2022, 11
August 2022 and 9 November 2022 which are available to view at
www.greenxmetals.com .
GreenX confirms that (a) it is not aware of any new information
or data that materially affects the information included in the
original announcements; (b) all material assumptions and technical
parameters underpinning the content in the relevant announcements
continue to apply and have not materially changed; and (c) the form
and context in which the Competent Person's findings are presented
have not been materially modified from the original
announcements.
Forward Looking Statements
This report may include forward-looking statements. These
forward-looking statements are based on GreenX's expectations and
beliefs concerning future events. Forward looking statements are
necessarily subject to risks, uncertainties and other factors, many
of which are outside the control of GreenX, which could cause
actual results to differ materially from such statements. GreenX
makes no undertaking to subsequently update or revise the
forward-looking statements made in this release, to reflect the
circumstances or events after the date of that release .
DIRECTORS' DECLARATION
In accordance with a resolution of the Directors of GreenX
Metals Limited, I state that:
In the reasonable opinion of the Directors and to the best of
their knowledge:
(a) the attached financial statements and notes thereto for the
period ended 31 December 2022 are in accordance with the
Corporations Act 2001, including:
(i) complying with Accounting Standard AASB 134 Interim
Financial Reporting and the Corporations Regulations 2001; and
(ii) giving a true and fair view of the financial position of
the Group as at 31 December 2022 and of its performance for the
half-year ended on that date; and
(b) The Directors Report, which includes the Operating and
Financial Review, includes a fair review of:
(i) important events during the first six months of the current
financial year and their impact on the half-year financial
statements, and a description of the principal risks and
uncertainties for the remaining six months of the year; and
(ii) related party transactions that have taken place in the
first six months of the current financial year and that have
materially affected the financial position or performance of the
Group during that period, and any changes in the related party
transactions described in the last annual report that could have
such a material effect; and
(c) there are reasonable grounds to believe that the Company
will be able to pay its debts as and when they become due and
payable.
On behalf of the Board
BEN STOIKOVICH
Director
14 March 2023
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE
INCOME
FOR THE HALF-YEARED 31 DECEMBER 2022
Note Half-Year Half-Year
Ended Ended
31 December 31 December
2022 2021
$ $
--------------------------------------------- ------ -------------- --------------
Revenue 4 (a) 161,385 111,664
Other income 4 (b) 4,795,937 1,996,868
Exploration and evaluation expenses (668,066) (763,800)
Employment expenses (181,183) (180,552)
Administration and corporate expenses (177,131) (248,223)
Occupancy expenses (412,360) (457,515)
Share-based payment expense - (1,203,339)
Business development expenses (132,578) (182,433)
Arbitration related expenses (4,830,784) (1,241,087)
Reversal of impairment - 131,207
Other 12,508 73,271
Loss before income tax (1,432,272) (1,963,939)
Income tax expense - -
--------------------------------------------- ------ -------------- --------------
Net loss for the period (1,432,272) (1,963,939)
============================================= ====== ============== ==============
Net loss attributable to members
of GreenX Metals Limited (1,432,272) (1,963,939)
============================================= ====== ============== ==============
Other comprehensive income
Items that may be reclassified subsequently
to profit or loss:
Exchange differences on translation
of foreign operations (50,479) (50,798)
--------------------------------------------- ------ -------------- --------------
Total other comprehensive loss for
the period (50,479) (50,798)
--------------------------------------------- ------ -------------- --------------
Total comprehensive loss for the
period (1,482,751) (2,014,737)
============================================= ====== ============== ==============
Total comprehensive loss attributable
to members of GreenX Metals Limited (1,482,751) (2,014,737)
============================================= ====== ============== ==============
Basic and diluted loss per share (cents
per share) (0.55) (0.83)
The above Consolidated Statement of Profit or Loss and other
Comprehensive Income should be read in conjunction with the
accompanying notes.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2022
31 December 30 June
2022 2022
Note $ $
----------------------------------- ------ -------------- -------------
ASSETS
Current Assets
Cash and cash equivalents 2,574,558 6,106,847
Trade and other receivables 5 2,682,639 2,149,578
----------------------------------- ------ -------------- -------------
Total Current Assets 5,257,197 8,256,425
Non-Current Assets
Exploration and evaluation assets 6 7,391,258 5,745,590
Property, plant and equipment 7 1,392,628 1,684,496
----------------------------------- ------ -------------- -------------
Total Non-Current Assets 8,783,886 7,430,086
TOTAL ASSETS 14,041,083 15,686,511
----------------------------------- ------ -------------- -------------
LIABILITIES
Current Liabilities
Trade and other payables 2,214,019 2,303,588
Other financial liabilities 8 (a) 326,030 315,808
Provisions 9 (a) 488,963 433,482
----------------------------------- ------ -------------- -------------
Total Current Liabilities 3,029,012 3,052,878
----------------------------------- ------ -------------- -------------
Non-Current Liabilities
Other financial liabilities 8 (b) 412,842 538,266
Provisions 9 (b) 269,564 282,951
----------------------------------- ------ -------------- -------------
Total Non-Current Liabilities 682,406 821,217
----------------------------------- ------ -------------- -------------
TOTAL LIABILITIES 3,711,418 3,874,095
----------------------------------- ------ -------------- -------------
NET ASSETS 10,329,665 11,812,416
=================================== ====== ============== =============
EQUITY
Contributed equity 10 78,410,052 78,410,052
Reserves 11 11,003,244 11,053,723
Accumulated losses (79,083,631) (77,651,359)
----------------------------------- ------ -------------- -------------
TOTAL EQUITY 10,329,665 11,812,416
=================================== ====== ============== =============
The above Consolidated Statement of Financial Position should be
read in conjunction with the accompanying notes.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE HALF-YEARED 31 DECEMBER 2022
Contributed Share-based Foreign Other Accumulated Total
Equity Payments Currency Equity Losses Equity
Reserve Translation
Reserve
$ $ $ $ $ $
---------------------------- ------------ ------------ ------------- ----------- -------------- -------------
Balance at 1 July
2022 78,410,052 4,558,339 287,891 6,207,493 (77,651,359) 11,812,416
Net loss for the period - - - - (1,432,272) (1,432,272)
Other comprehensive
income for the half-year
Exchange differences
on translation of
foreign operations - - (50,479) - - (50,479)
---------------------------- ------------ ------------ ------------- ----------- -------------- -------------
Total comprehensive
loss for the period - - (50,479) - (1,432,272) (1,482,751)
Balance at 31 December
2022 78,410,052 4,558,339 237,412 6,207,493 (79,083,631) 10,329,665
============================ ============ ============ ============= =========== ============== =============
Balance at 1 July
2021 79,332,108 - 345,909 - (73,993,904) 5,684,113
Net loss for the period - - - - (1,963,939) (1,963,939)
Other comprehensive
income for the half-year
Exchange differences
on translation of
foreign operations - - (50,798) - - (50,798)
---------------------------- ------------ ------------ ------------- ----------- -------------- -------------
Total comprehensive
loss for the period - - (50,798) - (1,963,939) (2,014,737)
Issue of shares 1,814,273 - - - - 1,814,273
Share issue costs (86,890) - - - - (86,890)
Issue of ARC Consideration
Performance Rights - 3,355,000 - - - 3,355,000
Recognition of share-based
payments - 1,203,339 - - - 1,203,339
---------------------------- ------------ ------------ ------------- ----------- -------------- -------------
Balance at 31 December
2021 81,059,491 4,558,339 295,111 - (75,957,843) 9,955,098
============================ ============ ============ ============= =========== ============== =============
The above Consolidated Statement of Changes in Equity should be
read in conjunction with the accompanying notes.
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE HALF-YEARED 31 DECEMBER 2022
Half-Year Half-Year
Ended Ended
31 December 31 December
2022 2021
$ $
------------------------------------------ ---- -------------- --------------
Cash flows from operating activities
Payments to suppliers and employees (1,481,931) (1,416,194)
Proceeds from property lease and
gas sales 92,114 102,021
Interest revenue from third parties 28,936 9,971
Net cash outflow from operating
activities (1,360,881) (1,304,202)
------------------------------------------------ -------------- --------------
Cash flows from investing activities
Payments for property, plant and
equipment - (248,614)
Proceeds from sale of land and
property - 185,851
Payments for arbitration related
expenses (1,316,530) (731,716)
Payments for exploration and expenditure (1,897,634) (396,597)
------------------------------------------------ -------------- --------------
Net cash outflow from investing
activities (3,214,164) (1,191,076)
Cash flows from financing activities
Proceeds from issue of shares - 899,273
Payments for share issue costs - (22,900)
Receipts from arbitration funding 1,187,056 937,828
Payments for lease liabilities (144,300) (134,388)
Net cash inflow from financing
activities 1,042,756 1,679,813
------------------------------------------------ -------------- --------------
Net decrease in cash and cash
equivalents (3,532,289) (815,465)
Cash and cash equivalents at the
beginning of the period 6,106,847 4,774,968
Cash and cash equivalents at
the end of the period 2,574,558 3,959,503
================================================ ============== ==============
The above Consolidated Statement of Cash Flows should be read in
conjunction with the accompanying notes.
CONDENSED NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE HALF-YEARED 31 DECEMBER 2022
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a) Statement of Compliance
The interim consolidated financial statements of the Group for
the half-year ended 31 December 2022 were authorised for issue in
accordance with the resolution of the Directors.
This general purpose financial report for the interim half-year
reporting period ended 31 December 2022 has been prepared in
accordance with Accounting Standard AASB 134 Interim Financial
Reporting and the Corporations Act 2001.
This interim financial report does not include all the notes of
the type normally included in an annual financial report.
Accordingly, this report is to be read in conjunction with the
annual report of GreenX Metals Limited for the year ended 30 June
2022 and any public announcements made by the Company and its
controlled entities during the interim reporting period in
accordance with the continuous disclosure requirements of the
Corporations Act 2001.
2. BASIS OF PREPARATION AND CHANGES TO THE GROUP'S ACCOUNTING POLICIES
(a) Basis of Preparation of Half-Year Financial Report
The consolidated financial statements have been prepared on the
basis of historical cost. Cost is based on the fair values of the
consideration given in exchange for assets. All amounts are
presented in Australian dollars.
(b) New Standards, interpretations and amendments thereof, adopted by the Group
The accounting policies and methods of computation adopted in
the preparation of the consolidated half-year financial report are
consistent with those adopted and disclosed in the company's annual
financial report for the year ended 30 June 2022 and the
comparative interim period, other than as detailed below.
In the current period, the Group has adopted all of the new and
revised Standards and Interpretations issued by the Australian
Accounting Standards Board (the AASB) that are relevant to its
operations and effective for annual reporting periods beginning on
or after 1 July 2022.
New and revised Standards and amendments thereof and
Interpretations effective for the current half-year that are
relevant to the Group include:
-- AASB 2020-3 Amendment to AASB 9 - Test for Derecognition of Financial Liabilities
-- Conceptual Framework and Financial Reporting
The Group has not early adopted any other standard,
interpretation or amendment that has been issued but is not yet
effective.
(c) Issued standards and interpretations not early adopted
Australian Accounting Standards and Interpretations that have
recently been issued or amended but are not yet effective have not
been adopted by the Company for the reporting period ended 31
December 2022. Those which may be relevant to the Company are set
out in the table below, but these are not expected to have any
significant impact on the Company's financial statements:
Standard/Interpretation Application Application
Date of Standard Date for
Company
AASB 2020-6 Amendments to Australian Accounting 1 January 1 July
Standards - Classification of Liabilities as 2023 2023
Current or Non-Current - Deferral of Effective
Date
------------------ ------------
AASB 2021-2 Amendments to Australian Accounting 1 January 1 July
Standards - Disclosure of Accounting Policies 2023 2023
and Definition of Accounting Estimates
------------------ ------------
AASB 2020-1 Amendments to Australian Accounting 1 January 1 July
Standards - Classification of Liabilities as 2024 2024
Current or Non-Current
------------------ ------------
AASB 2021-7(a-c) Amendments to Australian Accounting 1 January 1 July
Standards - Effective Date of Amendments to 2025 2025
AASB 10 and AASB 128 and Editorial Corrections
------------------ ------------
3. SEGMENT INFORMATION
AASB 8 requires operating segments to be identified on the basis
of internal reports about components of the Consolidated Entity
that are regularly reviewed by the chief operating decision maker
in order to allocate resources to the segment and to assess its
performance.
The Consolidated Entity operates in one segment, being mineral
exploration. This is the basis on which internal reports are
provided to the Chief Executive Officer for assessing performance
and determining the allocation of resources within the Consolidated
Entity.
Half-Year Half-Year
ended 31 ended
December
2022
$ 31 December
2021
$
------------------------------------------ ---- ------------- --------------
4. REVENUE AND OTHER INCOME
(a) Revenue
Interest Income 27,901 9,643
Gas and property lease revenue 133,484 102,021
------------------------------------------------ ------------- --------------
161,385 111,664
=============================================== ============= ==============
(b) Other income
Arbitration finance facility income 4,795,937 1,342,440
Gain on sale of land rights at Debiensko - 654,428
4,795,937 1,996,868
=============================================== ============= ==============
31 December 30 June
2022 2022
$ $
------------------------------------------ ---- ------------- --------------
5. TRADE AND OTHER RECEIVABLES
Trade receivables 78,808 30,744
Arbitration finance facility receivable 2,265,278 1,815,313
Interest receivable 2,882 4,019
Deposits/prepayments 184,975 193,705
GST and other receivables 150,696 105,797
------------------------------------------------ ------------- --------------
2,682,639 2,149,578
=============================================== ============= ==============
Arctic Rift
Copper Project
Note $
---------------------------------------- ------ ----------------
6. EXPLORATION AND EVALUATION ASSETS
Carrying amount at 1 July 2022 5,745,590
Earn-in expenditure(2) 1,645,668
Carrying amount at 31 December 2022(1) 7,391,258
================================================ ================
Note:
(1) The ultimate recoupment of costs carried forward for
exploration and evaluation is dependent on the successful
development and commercial exploitation or sale of the respective
areas of interest.
(2) GreenX will earn an interest of up 80% in ARC through an EIA
between Mineral Investment Pty Ltd ("MIPL"), a wholly owned
subsidiary of the Company. Other key terms of the EIA are included
in the 2022 Annual Report.
Land and Plant Right-of-use
Buildings and assets
equipment Total
$ $ $ $
7. PROPERTY, PLANT AND EQUIPMENT
Carrying amount at 1 July 2022 9,792 875,832 798,872 1,684,496
Write-off (8,998) - - (8,998)
Depreciation and amortisation (667) (150,883) (131,190) (282,740)
Foreign exchange differences (127) (3) - (130)
Carrying amount at 31 December 2022 - 724,946 667,682 1,392,628
============================================= ========== ========== ============ ============
- at cost 2,060 1,206,103 1,487,519 2,695,682
- accumulated depreciation and amortisation (2,060) (481,157) (819,837) (1,303,054)
31 December 30 June
2022 2022
$ $
--------------------------------- ---- ------------- ---------
8. OTHER FINANCIAL LIABILITIES
(a) Current:
Lease liability 326,030 315,808
(b) Non-Current:
Lease liability 412,842 538,266
======================================= ============= =========
31 December 30 June
2022 2022
$ $
----------------------------------------- ---- ------------- ---------
9. PROVISIONS
(a) Current Provisions:
Provisions for the protection against
mining damage at Debiensko(1) 248,533 206,380
Provision for closure of gas project(2) 209,984 203,481
Annual leave provision 30,446 23,621
488,963 433,482
============================================== ============= =========
(b) Non-Current Provisions:
Provisions for the protection against
mining damage at Debiensko(1) 269,564 282,951
269,564 282,951
============================================== ============= =========
Note:
(1) As Debiensko was previously an operating mine, the Group has
provided for the pay out of mining land damages to surrounding land
owners who have made a legitimate legal claim under Polish law.
(2) The Kaczyce 1 tenement which provides the Group with the
ability to extract gas expired on 28 January 2023 . The Group has
provided for the costs of its closure.
31 December 30 June
2022 2022
Note $ $
------------------------------------------- ------ ------------- -----------
10. CONTRIBUTED EQUITY
(a) Issued and Unissued Capital
228,355,089 (30 June 2022: 228,355,089) 10
fully paid ordinary shares (b) 75,810,040 75,810,040
Loan Note 2 exchangeable into fully
paid ordinary shares at $0.46 per share,
net of transaction costs(1) 2,600,012 2,600,012
Total Contributed Equity 78,410,052 78,410,052
=========================================== ====== ============= ===========
Note:
(1) On 2 July 2017, GreenX and CD Capital completed an
investment of US$2.0 million (A$2.6 million) in the form of the
non-redeemable, non-interest-bearing convertible Loan Note 2. The
Loan Note 2 is convertible into ordinary shares of GreenX at an
issue price of A$0.46 per share and is accounted for as equity (in
full).
Other key terms of the Loan Note 2 are included in the 2022
Annual Report.
(b) Movements in fully paid ordinary shares during the past six months
There were no movements in fully paid ordinary shares during the
past six months.
31 December 2022 30 June 2022
Note $ $
-------------------------------------- ------- ------------------ --------------
11. RESERVES
Share-based payments reserve 11 (a) 4,558,339 4,558,339
Foreign currency translation reserve 237,412 287,891
Other equity reserve 6,207,493 6,207,493
11,003,244 11,053,723
====================================== ======= ================== ==============
(a) Movements in share-based payments reserve during the past six months
There were no movements in share based payments during the past
six months.
12. CONTINGENT ASSETS AND LIABILITIES
There have been no changes to contingent assets or liabilities
since the date of the last annual report.
13. FINANCIAL INSTRUMENTS
The Group's financial assets and liabilities, which comprise of
cash and cash equivalents, trade and other receivables, trade and
other payables and other financial liabilities, may be impacted by
foreign exchange movements. At 31 December 2022 and 30 June 2022,
the carrying value of the Group's financial assets and liabilities
approximate their fair value.
14. DIVIDENDS PAID OR PROVIDED FOR
No dividend has been paid or provided for during the half-year
(31 December 2021: nil).
15. SIGNIFICANT EVENTS AFTER THE REPORTING PERIOD
Subsequent to the half year, the Company announced the Placing
to issue 12.4 million new ordinary shares to raise gross proceeds
of approximately GBP3.9 million (A$6.8 million) from new and
existing UK and European investors and some Australian investors.
Due to high demand, directors resolved to increase the Placing to
issue 14.1 million new ordinary shares to raise total gross
proceeds of approximately GBP4.4 million (A$7.7 million). The
Placing shares were issued on 14 March 2023.
Other than as outlined above, there were no significant events
occurring after balance date requiring disclosure.
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END
IR SFFSLIEDSESD
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