TIDMBKY
RNS Number : 0796P
Berkeley Resources Limited
28 September 2011
BERKELEY RESOURCES LIMITED
ANNUAL FINANCIAL REPORT
30 JUNE 2011
ABN 40 052 468 569
CORPORATE DIRECTORY
Directors Bankers
Dr James Ross -- Chairman Australia and New Zealand
Mr Brendan James -- Managing Banking Group Ltd
Director 77 St Georges Terrace
Senor Jose Ramon Esteruelas Perth WA 6000
-- Non-Executive Share Registry
Mr Henry Horne -- Non-Executive Australia
Mr Laurence Marsland -- Computershare Investor
Non-Executive Services Pty Ltd
Mr John (Ian) Stalker -- Level 2
Non-Executive 45 St Georges Terrace
Mr Matthew Syme -- Non-Executive Perth WA 6000
Company Secretary Telephone: +61 8 9323
Mr Sam Middlemas 2000
Registered Office Facsimile: +61 8 9323
Level 2, 91 Havelock Street 2033
West Perth WA 6005 United Kingdom
Australia Computershare Investor
Telephone: +61 8 9214 7585 Services Plc
Facsimile: +61 8 9214 7575 PO Box 82
Spanish Office The Pavilions
Berkeley Minera Espana, Bridgewater Road
S.A. Bristol BS99 7NH
Carretera de Madrid, 13-1(a) Telephone: +44 870 889
Santa Marta de Tormes 3105
37900 - Salamanca Stock Exchange Listings
Spain Australia
Telephone: +34 923 193903 Australian Securities
Website Exchange Limited
www.berkeleyresources.com.au Home Branch - Perth
Email 2 The Esplanade
info@berkeleyresources.com.au Perth WA 6000
Auditor United Kingdom
Stantons International London Stock Exchange
Level 1 - AIM
1 Havelock Street 10 Paternoster Square
West Perth WA 6005 London EC4M 7LS
Solicitors ASX/AIM Code
Hardy Bowen Lawyers BKY - Fully paid ordinary
Level 1, 28 Ord Street shares
West Perth WA 6005 BKYO - $0.75 Listed options
(ASX only)
Nominated Advisor and
Broker
RBC Europe Limited
Riverbank House
2 Swan Lane
London EC4R 3BF
CONTENTS
Page
Directors' Report 3-19
Statement of Comprehensive Income 20
Statement of Financial Position 21
Statement of Cash Flows 22
Statement of Changes in Equity 23
The following sections are available in the full version of the
Annual Financial Report on Berkeley Resources Limited's
website:
www.berkeleyresources.com.au
Notes to the Financial Statements
Directors' Declaration
Auditor's independence Declaration
Independent Auditor's Report
DIRECTORS' REPORT The Directors of Berkeley Resources Limited
submit their report on the Consolidated Entity consisting of
Berkeley Resources Limited ("Company" or "Berkeley" or "Parent")
and the entities it controlled at the end of, or during, the year
ended 30 June 2011 ("Consolidated Entity" or "Group").
DIRECTORS
The names of Directors in office at any time during the
financial year or since the end of the financial year are:
Dr James Ross - Non-Executive Chairman since 14 January 2011
(previously Non-Executive)
Mr Brendan James - Managing Director (appointed 6 June 2011)
Senor Jose Ramon Esteruelas - Non-Executive Director
Mr Henry Horne - Chief Financial Officer appointed Executive
Director on 11 October 2010 and Acting Managing Director from 14
January 2011 until 6 June 2011, remains as a Non-Executive
Director
Mr Laurence Marsland - appointed Non-Executive Director 25
August 2011
Mr Ian Stalker - Managing Director until 14 January 2011 then
Non-Executive Director
Mr Matthew Syme - Non-Executive Director
Dr Robert Hawley - Non-Executive Chairman until resigned 14
January 2011
Mr Sean James - Non-Executive Director until resigned 1 October
2010
Mr Scott Yelland - Chief Operating Officer/Executive Director
until resigned 30 June 2011
Unless otherwise disclosed, Directors held their office from 1
July 2010 until the date of this report.
CURRENT DIRECTORS AND OFFICERS
James Ross AM
Non-Executive Chairman
Qualifications - B.Sc. (Hons.), PhD, FAusIMM, FAICD
Dr Ross is a leading international geologist whose technical
qualifications include an honours degree in Geology at UWA and a
PhD in Economic Geology from UC Berkeley. He first worked with
Western Mining Corporation Limited for 25 years, where he held
senior positions in exploration, mining and research. Subsequent
appointments have been at the level of Executive Director, Managing
Director and Chairman in a number of small listed companies in
exploration, mining, geophysical technologies, renewable energy and
timber. His considerable international experience in exploration
and mining includes South America, Africa, South East Asia and the
Western Pacific.
Dr Ross is a Director of Kimberley Foundation Australia Inc, and
chairs its Science Advisory Council. He also chairs the Boards of a
geoscience research centre and two foundations concerned with
geoscience education in Western Australia.
He was appointed a Director of Berkeley Resources Limited on 4
February 2005 and appointed Non-Executive Chairman on 14 January
2011. He has not been a Director of another listed company in the
three years prior to the end of the financial year.
Brendan James
Managing Director (appointed 6 June 2011)
Qualifications - B. Met. Eng. (Hons)
Mr Brendan James is a metallurgical engineer, with an
exceptional background in developing, commissioning and optimising
a number of large uranium, copper and gold operations. His
technical background includes outstanding senior management
experience in uranium mining and processing, project management,
redesigning and commissioning previously decommissioned operations,
biological heap leaching and hydrometallurgy. This background is
complemented by five years' experience in financial markets, on
both the buy and sell sides. Mr James is highly qualified to lead
Berkeley through the optimisation, financing, development and
commissioning of the Salamanca Uranium Project, and to advance
Berkeley's strong organic growth opportunities. He will be based in
Spain.
Jose Ramon Esteruelas
Non-Executive Director
Qualifications - BEcon.,LLB., PDipBus
Senor Esteruelas is an economist with vast experience in the
managerial field whose senior executive roles have included
Director General of Correos y Telegrafos (the Spanish postal
service), Chief Executive Officer of Compania Espanola de
Transformadora de Tabaco en Rama S.A. (Cetarsa), (the leading
transformer tobacco company in Spain) and Executive Chairman of
Minas de Almaden y Arrayanes SA (formerly the world's largest
mercury producer).
Senor Esteruelas was appointed a Director of Berkeley Resources
Limited on 16 November 2006. Senor Esteruelas has not held any
other directorships of listed companies in the last three
years.
Henry Horne
Non-Executive Director
Qualifications - BComm. (Financial Accounting and Business
Economics)
Mr Horne was appointed Chief Financial Officer of Berkeley on 23
April 2010, before being appointed an Executive Director on 11
October 2010 and Acting Managing Director from 14 January 2011
until 6 June 2011, he remains on the board as a Non-Executive
Director. Mr Horne is an international mining executive who holds a
degree in Financial Accounting and Business Economics from the
University of Stellenbosch (South Africa) and has more than 29
years' experience in the mining industry. This experience includes
senior management and executive postings at mines in Namibia, South
Africa, Ghana, Bulgaria, Chile and Russia with companies including
Gold Fields, Kinross Gold, Navan Mining and Highland Gold. Mr Horne
was the former Chief Executive Officer of Highland Gold in Russia
and also served on various Boards.
Mr Horne has wide general management experience with strong
financial, administrative and people management skills enhanced by
confident negotiating abilities. He has extensive experience of
African, Eastern European, Russian and North American financial
best practices. In addition he also has comprehensive financial and
technical knowledge and work experience within the gold and base
metal mining industries. In the last three years, Mr Horne was
previously on the board of Highland Gold Mining Limited until
January 2008.
Laurence Marsland
Non-Executive Director
Qualifications - B. App.Sc. Mech. Eng., M.S.M
Mr Marsland is an engineer with more than thirty years' of
diverse experience in the international mining industry, largely in
senior management and executive director roles. Since 2000 he has
worked extensively in Europe, including Spain.
Mr Marsland has a strong background in project management, and
in the acquisition and development of government owned mining
assets in Eastern Europe. He worked for Minproc Engineers for more
than 15 years in project engineering and engineering management of
mining projects in Australia, West African, Latin America and USA.
More recently he was Vice President, Project Development for
Gabriel Resources, then Executive Vice President and Chief
Operating Officer for Dundee Precious Metals Inc. where he was
responsible for the development and operation of its mining assets
after renegotiating the acquisition of the substantial Chelopech
gold-copper mine from the Bulgarian Government. He is currently a
partner in PLC Partners S.A., a private company incorporated to
pursue resource development opportunities.
Mr Marsland is an Australian citizen, and resides in Sofia,
Bulgaria. He has a Bachelor of Applied Science in Mechanical
Engineering from Curtin University and an MSc in Management from
Stanford University Graduate School of Business. Mr Marsland was
appointed a Director of Berkeley Resources Limited on 25 August
2011. He has not held any other directorships of listed companies
in the last three years.
Matthew Syme
Non-Executive Director
Qualifications - B.Com, CA
Mr Syme is a Chartered Accountant and has over 20 years
experience as a senior executive of a number of companies in the
Australian resources and media sectors. He was a Manager in a major
international Chartered Accounting firm before spending 3 years as
an equities analyst in a large stockbroking firm. He was then Chief
Financial Officer of Pacmin Mining Limited, a successful Australian
gold mining company, as well as a number of other resources
companies.
Mr Syme was appointed a director of Berkeley Resources Limited
on 27 August 2004, and was the Managing Director of the Company
until the appointment of Mr Stalker in November 2009. Mr Syme
continues on the Board as a Non-Executive Director.
During the three year period to the end of the financial year,
the only other listed company board that Mr Syme held was as the
Managing Director of Sierra Mining Limited (appointed 1 July 2010 -
present).
John (Ian) Stalker
Non-Executive Director
Qualifications - BSc (Chemical Engineering)
Mr Ian Stalker is a chemical engineer, with an outstanding
history in developing and managing a number of mining projects
around the world over the past 35 years. He has considerable
experience in the uranium sector and in mining operations in
Europe, Africa and Spain and has successfully managed eight mining
projects throughout the world through feasibility study,
development and construction phases.
Mr Stalker was the Managing Director of Berkeley from 30
November 2009 until 14 January 2011 when he resigned as Managing
Director and remains on the board as a Non-Executive. He was
formerly Chief Executive Officer of the London and Toronto Listed
UraMin, until its acquisition by Areva in August 2007 for US $2.5
billion, and was subsequently CEO of Niger Uranium Ltd an AIM
listed Company from 2008-2010. Prior to joining UraMin, Mr Stalker
was at Gold Fields Ltd, where he was a Vice President and
responsible for all of the company's projects in Australia and
Europe in 2004.
Mr Stalker is a non-executive director of the AIM listed
Vatukoula Gold Mines plc, AIM and TSX listed Polo Resources Ltd,
ASX and TSX listed Elemental Minerals Limited and Forum Uranium
Corp, and is CEO of TSX listed Brazilian Gold Corp.
Robert Samuel (Sam) Middlemas
Company Secretary
Qualifications - B.Com, PGradDipBus, CA
Mr Middlemas isa Chartered Accountant with more than 15 years'
experience in various financial roles with a number of listed
public companies operating in the resource sector. He is the
principal of a corporate advisory company which provides financial
and company secretarial services specialising in capital raisings
and initial public offerings. Previously Mr Middlemas worked for an
international accountancy firm. His fields of expertise include
corporate secretarial practice, financial and management reporting
in the mining industry, treasury and cash flow management and
corporate governance. Mr Middlemas was appointed Company Secretary
on 1 July 2010.
PRINCIPAL ACTIVITIES
The principal activities of the Consolidated Entity during the
year consisted of mineral exploration. There was no significant
change in the nature of those activities.
EMPLOYEES
2011 2010
-------------------------------------- ----- -----
The number of full time equivalent
people employed by the Consolidated
Entity at balance date 44 37
DIVIDENDS
No dividends have been declared, provided for or paid in respect
of the financial year ended 30 June 2011 (2010: nil).
EARNINGS PER SHARE
2011 2010
Cents Cents
------------------------ -------- --------
Basic loss per share (10.75) (11.08)
------------------------ -------- --------
Diluted loss per share (10.75) (11.08)
CORPORATE STRUCTURE
Berkeley Resources Limited is a company limited by shares that
is incorporated and domiciled in Australia. The Company has
prepared a consolidated financial report including the entities it
acquired and controlled during the financial year.
CONSOLIDATED RESULTS
2011 2010
$000's $000's
----------------------------------- --------- ---------
Loss of the Consolidated Entity
before income tax expense (16,315) (14,241)
Income tax expense - -
----------------------------------- --------- ---------
Net loss (16,315) (14,241)
Net loss attributable to minority
interest - -
----------------------------------- --------- ---------
Net loss attributable to members
of Berkeley Resources Limited (16,315) (14,241)
=================================== ========= =========
REVIEW OF OPERATIONS AND ACTIVITIES
The year ending June 2011 has been a turbulent and
transformational period for the company, driven by both external
and internal events.
A high level of commitment to the Feasibility Study timetable
associated with the Co-operation Agreement with ENUSA continued
through much of the year and was accompanied by a similar level of
Corporate activity. For example, a non-binding MOU was signed with
the Korea Electric Power Corporation (KEPCO) to finance and develop
the SUP was announced on the 10(th) August. However, on 29th
October 2010, a potential takeover bid by OAO Severstal (Severstal)
was announced, subject to financial, technical and legal due
diligence and the KEPCO financing proposal fell away. By the 29th
December 2010, Berkeley and Severstal were unable to agree terms
upon which Severstal could make an agreed bid for the Company, and
the exclusivity granted to Severstal expired in January.
The Company then proceeded with an equity raising of $55 million
at a price of $1.70 per share for the issue of 32,360,000 new
shares prior to the decision to advance to exploitation of the
Salamanca Uranium Project on 17 January. This placement to
institutional investors was completed in March 2011, following
shareholder approval for the second tranche of the issue.
On the 11th March 2011 the global nuclear industry was impacted
by the tragic events in Japan and the consequential effects on the
Fukushima Nuclear Power Stations. The Company then experienced a
more substantial challenge when ENUSA, the Company's consortium
partners in the Salamanca State Reserves, failed to form the JV
Company 'Newco' by the required date of the 27th May 2011. This
followed the submission to ENUSA of a restricted Feasibility Study,
limited to the State Reserves Mineral Resources, on 23 February
2011, as required under the Co-operation Agreement. Discussion with
ENUSA is ongoing.
Looking forward, our opinion based on industry consensus, is
that the events of Fukushima have done little to alter the long
term supply-demand drivers of the uranium industry, demonstrated by
the continued strength of and term uranium prices. In addition, the
Company continues to work with ENUSA towards developing and
implementing options that will provide higher levels of confidence,
and reduce risks, for both companies, in progressing towards
production.
One of the positives of the year ending June 2011 was
commencement of a Retortillo scoping study based on heap leach,
with the potential to transform Berkeley into a multi-project
company. The Retortillo project is expected to remain independent
from the proposed project with ENUSA, and will source its
production from Berkeley's 100% owned resources, currently
totalling 31.7Mlb of uranium. The Company has recently reported
that the Retortillo preliminary feasibility study has been
initiated, targeting a production rate of between 1.5 to 2.5Mlb per
annum. Completion of the preliminary feasibility study is expected
mid November 2011, following submissions for licensing and
permitting in October 2011.
Sustainable Development - Health, Safety, Environment and
Community
Sustainable Development, including environmental responsibility,
radiological protection and community awareness, engagement and
support are paramount considerations for Berkeley. As a result,
Berkeley has established a strong Health Safety Environment &
Community (HSEC) team supported by the consultants Golder
Associates, Ingemisa SA, Aquaterra, Salamanca University and Paulka
Radiation & Environment.
Salamanca Uranium Project
The broader Salamanca Uranium Project (SUP) incorporates the
Aguila Area deposits (Sageras, Palacios and Majuelos) and nearby
Quercus Processing Plant, the more distant deposits at Alameda and
Villar, and the Company's 100% owned resources at Retortillo and
prospective licenses contiguous with the State Reserves.
Under the terms of the Co-operation Agreement with ENUSA the
feasibility study was to be based solely on resources within the
State Reserves (the Mining Domain Feasibility Study "MDFS"). In
accord with the Co-operation Agreement, Berkeley paid ENUSA EUR1
million in December 2010 to extend the completion of the MDFS by
one year to 26 November 2011. The Company then advised ENUSA of its
decision to progress to the exploitation phase when the decision to
exploit was announced on the 17th January, 2011, and submitted the
MDFS on 18th February 2011.
The decision to exploit was to trigger the formation of a joint
venture company, Newco, owned 90% by Berkeley and 10% by ENUSA,
with the right to exploit Uranium Mineral Resources within the
State Reserves. The parties agreed to the target date of 27th May,
2011 to form Newco after ENUSA, as a partner in the Consortium,
verified the content of the MDFS. This in turn was to lead to a
payment of EUR20 million to ENUSA by Berkeley, within 30 days of
the formation of Newco.
On Monday 23rd May, 2011, ENUSA informed Berkeley of its
concerns regarding a number of aspects of the MDFS. The Company
responded, supporting the MDFS and requesting formation of Newco by
the agreed deadline. However, Newco was not incorporated in time
and after receiving further information from ENUSA, Berkeley has
taken advice on its legal alternatives under the Co-operation
Agreement, from the Madrid office of a leading international legal
firm. ENUSA and Berkeley have conducted a number of subsequent
meetings with the principal objective of reconciling differing
views about the purpose and content of the restricted MDFS and the
impact of these differences on the timing of forming Newco.
Discussions between the parties are ongoing. Both companies have
declared a commitment to this process and believe that there are
several constructive options to address the differences. However,
Berkeley also recognises the possibility that satisfactory
agreement between the parties may not be achieved, and therefore
continues to assess its alternatives.
Geology and Exploration Review
During the calendar year to June 2011, operations were planned
to achieve the following targets:
1- Convert most of the Inferred Resources included in the State
Reserves into Measured and Indicated (M+I).
2- Obtain metallurgical samples from Sageras, Alameda South and
Retortillo deposits.
3- Increase the "near to mine" resources (State Reserves and
Retortillo)
To achieve this target, Berkeley has drilled 220 holes totalling
15,541m on projects within the Salamanca Province. The table below
shows the breakdown by drill type and area.
Number of Total Number DDH Number
holes (m) holes DDH (m) holes RC RC (m)
------------ ---------- ------- ------------ ------ ------------ -------
Alameda
South 62 4,832 20 1,775 42 3,057
------------ ---------- ------- ------------ ------ ------------ -------
Mimbre 14 876 0 14 876
------------ ---------- ------- ------------ ------ ------------ -------
Sageras 99 6,044 21 1,393 78 4,651
------------ ---------- ------- ------------ ------ ------------ -------
Retortillo 35 2,679 23 1,875 12 804
------------ ---------- ------- ------------ ------ ------------ -------
Palacios 10 1,111 0 10 1,111
------------ ---------- ------- ------------ ------ ------------ -------
Total 220 15,542 64 5,042 156 10,499
------------ ---------- ------- ------------ ------ ------------ -------
State Reserves
During the first part of the year, Berkeley was focused on
upgrading and improving the Mineral Resource Estimates within the
Salamanca State Reserves. In the first quarter 7,207m were drilled,
resulting in a 10% increase in Sageras and Alameda South resources,
with 93% of these resources falling within the Indicated and
Measured Categories. The current Mineral Resource Estimate for all
deposits is tabulated below.
U(3) U(3) U(3) U(3)
Deposit Resource Tonnes O(8) O(8) O(8) Category Berkeley O(8)
(%)
Name Category (Mt) (ppm) (t) (Mlbs) (%) * (Mlbs)
============ =========== ======= ====== ======= ======= ========= ========= =======
Measured 5.6 400 2,240 4.9 22% 90% 4.4
------------------------ ------- ------ ------- ------- --------- --------- -------
Indicated 8.7 463 4,031 8.9 40% 90% 8.0
------------------------ ------- ------ ------- ------- --------- --------- -------
Subtotal
M+I 14.3 439 6,271 13.8 62% 90% 12.4
------------------------ ------- ------ ------- ------- --------- --------- -------
Inferred 9.8 387 3,794 8.4 38% 90% 7.5
------------------------ ------- ------ ------- ------- --------- --------- -------
Aguila
Area Total 24.1 418 10,065 22.2 100% 90% 20.0
============ =========== ======= ====== ======= ======= ========= ========= =======
Indicated 18.5 446 8,251 18.2 75% 90% 16.4
------------------------ ------- ------ ------- ------- --------- --------- -------
Inferred 5.8 482 2,798 6.2 25% 90% 5.6
------------------------ ------- ------ ------- ------- --------- --------- -------
Alameda
Area Total 24.3 455 11,049 24.4 100% 90% 21.9
============ =========== ======= ====== ======= ======= ========= ========= =======
Villar
Area Inferred 5.0 446 2,239 4.9 100% 90% 4.4
============ =========== ======= ====== ======= ======= ========= ========= =======
Indicated 5.2 531 2,759 6.1 27% 100% 6.1
------------------------ ------- ------ ------- ------- --------- --------- -------
Inferred 14.7 505 7,430 16.4 73% 100% 16.4
------------------------ ------- ------ ------- ------- --------- --------- -------
Retortillo
Area Total 19.9 512 10,190 22.5 100% 100% 22.5
============ =========== ======= ====== ======= ======= ========= ========= =======
Gambuta
Area Inferred 11.3 371 4,192 9.2 100% 100% 9.2
============ =========== ======= ====== ======= ======= ========= ========= =======
Measured 5.6 400 2,240 4.9 6% 4.4
------------------------ ------- ------ ------- ------- --------- --------- -------
Indicated 32.4 464 15,041 33.2 40% 30.4
------------------------ ------- ------ ------- ------- --------- --------- -------
Subtotal
M+I 38.0 455 17,282 38.1 46% 34.9
------------------------ ------- ------ ------- ------- --------- --------- -------
Inferred 46.6 439 20,453 45.1 54% 43.1
------------------------ ------- ------ ------- ------- --------- --------- -------
Berkeley Total 84.6 446 37,735 83.2 100% 78.0
------------ ----------- ------- ------ ------- ------- --------- --------- -------
* Berkeley has agreed to acquire 90% of the ENUSA State Reserves
and deposits therein by, inter alia, completing a feasibility study
and paying EUR20m. For full details of the Agreement, the
Berkeley's announcement dated 10thDecember 2008.
As a result from this campaign, and apart from the mentioned
resources, new mineralized areas were uncovered in North West area
of Sageras, with the mineralization still open to that side.
Additional drilling later in the year was focused on upgrading
the remaining Inferred Resources at Alameda South, Palacios and
Sageras and identifying additional potential.
Metallurgical Diamond Drilling
A further objective of the Company was to provide sufficient
material for the ongoing tank leach and column leach metallurgical
testwork programs. This required a diamond drill campaign of 5,000m
involving up to 6 diamond drill rigs. A total of 5,000 kg of
representative ore grade material was acquired for each of the
Alameda, Sageras and Retortillo deposits.
Near Mine Exploration Drilling
After completing the metallurgical diamond drilling, RC rigs
were focused on drilling exploration targets at the margins of the
Sageras and Alameda South Deposits. At both deposits additional new
mineralisation has been identified, in previously undrilled areas
and in areas with very sparse drilling.
At Sageras, follow up drilling has extended the mineralization
over 250 metres to the north-west where it is still open. At
Alameda, which is the largest unexploited resource, a short RC
program of 12 holes for 714m was completed during March to test for
possible extensions in a structural corridor on the eastern side of
the deposit. A narrow zone of high grade mineralisation has been
discovered with a strike length of >200m and intersections of up
to 8m @ 1,819ppm U3O8 in hole ASR-094.
Mimbre
A very wide spaced drill campaign was planned at the Mimbre
Prospect (200m x 400m grid). This project lies 1km south of the
Alameda South Deposit in a concealed and highly prospective
corridor. A total of 34 wide spaced (1km x 1km) holes were drilled
in the 1990's by ENUSA at Espeja approximately 10km south of the
Alameda South deposit in the same corridor. Significantly, 40% of
these holes intersected uranium mineralization with grades up to
1,700 ppm U3O8, and some intersections in excess of 10m.
Berkeley has completed 14 holes for 876m within that portion of
the prospect covered by the Alameda State Reserve and a further 16
holes are planned in the contiguous 100% Berkeley licence to the
south. Encouraging results from hole ASR-082 were previously
reported (4m@ 472ppm U(3) O(8) from 17m).
Retortillo
During the year a 10,000m RC drill program was designed and
permitted by the authorities for the Retortillo & Santidad
deposits. The objectives of the program are to increase the size of
the current resource and upgrade the inferred resources. Drilling
commenced in early July, 2011, and is expected to be finishing by
November.
Regional
Permission to drill on a number of projects within the Salamanca
State Reserves and other Berkeley Licences has been granted by the
authorities giving the company significant drill capacity for the
coming year. Several projects have been upgraded by field work and
provide high quality, drill ready targets. These include strong
radiometric anomalies with outcropping mineralisation at Carpio and
Villar East, and other targets beneath Tertiary cover at Nil,
Cuellar and Los Prados,close to the Aguila site.
Corporate Developments
During the period under review the Company made a number of
appointments to strengthen its Management team, as the Company
advanced toward its transformation from an exploration based
company to a project development and production based
organisation.
The decision was made by the Board of Directors to reinstate
Mathew Syme as a Non-Executive Director considering the significant
increase in corporate activity early in the financial year. On the
11th October 2010, CFO Henry Horne was appointed an Executive
Director of the company. On the 30th December 2010 the Managing
Director, Ian Stalker, resigned due to personal reasons. Henry
Horne was appointed as Acting Managing Director until a permanent
appointment was made.
On the 14th January, 2011, the Company announced the appointment
of Dr James Ross AM as Chairman of the Company with immediate
effect, following the retirement of Dr Robert Hawley CBE from the
Board due to health reasons. Dr Ross had been a Non-Executive
Director of Berkeley for the last six years and closely involved
with its exploration and development activities. Dr Ross is a
leading international geologist with more than forty five years
experience in exploration, development and mining, including twenty
five years with Western Mining Corporation Limited. Subsequent
appointments have been at the level of Executive Director, Managing
Director and Chairman with a number of ASX listed companies
including Aerodata, World Geoscience, Odin Mining and Investments,
Tanganyka Gold and Renewable Energy. Dr Ross is a Director of
Kimberley Foundation Australia Inc, a member of the Technology and
Industry Council which advises the Western Australian Government on
Science and Innovation, and Chairs organisations devoted to
education and research.
On the 11th March, 2011, the Company announced the appointment
of Mr Brendan James to become Managing Director and Chief Executive
Officer of the Company, effective 6th June, 2011. Mr James is a
metallurgical engineer, with an exceptional background in
developing, commissioning and optimising a number of large uranium,
copper and gold operations. His technical background includes
outstanding senior management experience in uranium mining and
processing, project management, redesigning and commissioning
previously decommissioned operations, biological heap leaching and
hydrometallurgy. This background is complemented by five years
experience in financial markets, on both the buy and sell sides. Mr
James is highly qualified to lead Berkeley through the
optimisation, financing, development and commissioning of the
Salamanca Uranium Project, and to advance Berkeley's strong organic
growth opportunities. He is based in Spain.
Mr Scott Yelland, the Company's Chief Operating Officer resigned
from the Company for family reasons on June 30th. He also resigned
from the Board with immediate effect. His responsibilities were
covered by the recent appointment of Mr Francisco Bellon del Rosal
as Project Manager for the Salamanca Uranium Project. Mr Bellon del
Rosal has subsequently been promoted to General Manager Operations,
effective July 1st 2011.
In addition, Mr Henry Horne resigned from his executive position
as Chief Financial Officer of the Company, however he will remain
as a Non-executive Director of the Company. Mr Sam Middlemas, the
Company Secretary, will act as Chief Financial Officer until a
permanent replacement is recruited.
Business Strategies and Prospects
The Consolidated Entity currently has the following business
strategies and prospects over the medium to long term:
-- to conduct studies into the feasibility of exploiting the
Salamanca Uranium Project in Spain, with the objective of
restarting the mining operations by the end of 2014
-- to continue to explore its portfolio of mineral permits in
Spain; and
-- continue to examine new opportunities in minerals and energy
exploration and development.
Risk Management
The Board is responsible for the oversight of the Consolidated
Entity's risk management and control framework. Responsibility for
control and risk management is delegated to the appropriate level
of management with the Managing Director having ultimate
responsibility to the Board for the risk management and control
framework.
Arrangements put in place by the Board to monitor risk
management include monthly reporting to the Board in respect of
operations and the financial position of the Group.
SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS
Other than as disclosed below, there were no significant changes
in the state of affairs of the Consolidated Entity during the
year.
-- On 29 October 2010 a potential takeover bid by OAO Severstal
was announced subject to financial, technical and legal due
diligence. The Company granted Severstal a right to subscribe for
shares in Berkeley and an exclusivity period which was extended to
29 December 2010. The Company was unable to agree final bid terms,
and Severstal's rights lapsed on 14 January 2011;
-- On 26 November 2010, 3.5 million shares were issued to
Resource Capital Fund at $1.45 per share for net proceeds of
$4.8m;
-- On 30 December 2010 the Managing Director Ian Stalker
resigned from his position. Mr Henry Horne was appointed acting
Managing Director until a replacement was found. Mr Stalker
remained on the board as a Non-Executive Director;
-- On 14 January 2011 Dr James Ross AM was appointed Chairman
following the retirement of Dr Robert Hawley CBE from the board due
to health reasons;
-- In March 2011, the Company completed an equity raising of $55
million at a price of $1.70 per share for the issue of 32,360,000
new shares, via a placement to institutional investors, following
shareholder approval for the second tranche of the issue;
-- The Company appointed Mr Brendan James as Managing Director
on 6 June 2011;
-- On 30 June 2011 Mr Scott Yelland resigned from his position
as Chief Operating Officer and Mr Henry Horne resigned as Chief
Financial Officer. Mr Horne continues on the board as a Non
Executive Director.
SIGNIFICANT POST BALANCE DATE EVENTS
Since the end of the financial year, the following events have
significantly affected, or may significantly affect, the operations
of the Consolidated Entity, the results of those operations, or the
state of affairs of the Consolidated Entity in future financial
years:
Following shareholder approval on 20 September 2011, the Company
has issued 2,000,000 Incentive Options to Mr Brendan James each
with an exercise price of 41 cents, with an expiry date of 1 May
2016. All the Options will vest on 30 May 2014, or on the date a
Change of Control event occurs.
In addition to the above, a further 1,000,000 options have been
issued to employees under the Berkeley Employee Option Scheme each
with an expiry date of 21 September 2015, vesting in three equal
tranches on 21 September 2012, 21 September 2013 and 21 September
2014 at an exercise price of 41 cents.
On 25 August 2011 Laurence Marsland was appointed Non Executive
Director of the company.
Other than the above there are no matters or circumstances,
which have arisen since 30 June 2011 that have significantly
affected or may significantly affect:
-- the operations, in financial years subsequent to 30 June
2011, of the Consolidated Entity;
-- the results of those operations, in financial years
subsequent to 30 June 2011, of the Consolidated Entity; or
-- the state of affairs, in financial years subsequent to 30
June 2011, of the Consolidated Entity.
ENVIRONMENTAL REGULATION AND PERFORMANCE
The Consolidated Entity's operations are subject to various
environmental laws and regulations under the relevant government's
legislation. Full compliance with these laws and regulations is
regarded as a minimum standard for all operations to achieve.
Instances of environmental non-compliance by an operation are
identified either by external compliance audits or inspections by
relevant government authorities.
There have been no significant known breaches by the
Consolidated Entity during the financial year.
LIKELY DEVELOPMENTS AND EXPECTED RESULTS
It is the Board's current intention that the Consolidated Entity
will continue with development of its Spanish uranium projects. The
Company will also continue to examine new opportunities in mineral
exploration, including uranium.
All of these activities are inherently risky and the Board is
unable to provide certainty that any or all of these activities
will be able to be achieved. In the opinion of the Directors, any
further disclosure of information regarding likely developments in
the operations of the Consolidated Entity and the expected results
of these operations in subsequent financial years may prejudice the
interests of the Company and accordingly no further information has
been disclosed.
INFORMATION ON DIRECTORS' INTERESTS IN SECURITIES OF
BERKELEY
Interest in Securities at the
Date of this Report
$1.35 $1.25
Ordinary $0.75 Listed Incentive Incentive
Shares(i) Options(ii) Options(iii) Options(iv)
---------------- ----------- ------------- --------------- ---------------
James Ross 315,000 257,500 - -
---------------- ----------- ------------- --------------- ---------------
Brendan James - - - -
---------------- ----------- ------------- --------------- ---------------
Jose Ramon
Esteruelas - 500,000 - -
---------------- ----------- ------------- --------------- ---------------
Henry Horne - - 416,666 -
---------------- ----------- ------------- --------------- ---------------
Laurence
Marsland - - - -
---------------- ----------- ------------- --------------- ---------------
Matthew Syme 2,168,105 1,069,002 - -
---------------- ----------- ------------- --------------- ---------------
Ian Stalker - 900,000 - 1,000,000
---------------- ----------- ------------- --------------- ---------------
Notes
(i) "Ordinary Shares" means fully paid ordinary shares in the
capital of the Company.
(ii) "$0.75 Listed Options" means an option to subscribe for 1
Ordinary Share in the capital of the Company at an exercise price
of $0.75 each on or before 15 May 2013.
(iii) "$1.35 Incentive Options" means an option to subscribe for
1 Ordinary Share in the capital of the Company at an exercise price
of $1.35 each on or before 19 June 2013.
(iv) "$1.25 Incentive Options" means an option to subscribe for
1 Ordinary Share in the capital of the Company at an exercise price
of $1.25 each on or before 1 December 2013.
SHARE OPTIONS
At the date of this report the following options have been
issued over unissued capital:
Listed Options
-- 11,989,428 listed options at an exercise price of $0.75 each
that expire on 15 May 2013.
Unlisted Options
-- 1,960,000 unlisted options at an exercise price of $1.86 each
that expire on 5 August 2011 (all options lapsed on 5 August
2011).
-- 495,834 unlisted options at an exercise price of $1.00 each
that expire on 19 June 2012.
-- 1,000,000 unlisted options at an exercise price of $1.25 each
that expire on 1 December 2013.
-- 2,311,666 unlisted options at an exercise price of $1.35 each
that expire on 18 June 2014.
These options do not entitle the holders to participate in any
share issue of the Company or any other body corporate. During the
financial year, there were 1,666,666 new shares issued as a result
of the exercise of unlisted options, and a further 681,288 new
shares issued as a result of exercise of the listed options. There
were 3,298,334 unlisted options that lapsed during the year. Since
30 June 2011, there have been no new shares issued as a result of
the exercise of any listed or unlisted options on issue.
MEETINGS OF DIRECTORS
The following table sets out the number of meetings of the
Company's Directors and the Audit Committee and Remuneration
Committee held during the year ended 30 June 2011, and the number
of meetings attended by each director.
Audit
Board Committee Remuneration
Meetings Meetings Audit Committee Remunaration
Number Board Number Committee Meetings Committee
Eligible Meetings Eligible Meetings Number Meetings
to Number to Number Eligible Number
Attend Attended Attend Attended to Attend Attended
------------ --------- --------- ---------- ---------- ------------- -------------
Current
Directors
James Ross 21 21 1 1 2 2
------------ --------- --------- ---------- ---------- ------------- -------------
Brendan
James 2 2
------------ --------- --------- ---------- ---------- ------------- -------------
Jose Ramon
Esteruelas 21 21 2 2
------------ --------- --------- ---------- ---------- ------------- -------------
Henry Horne 18 18
------------ --------- --------- ---------- ---------- ------------- -------------
Laurence
Marsland - -
------------ --------- --------- ---------- ---------- ------------- -------------
Ian Stalker 21 19 2 1
------------ --------- --------- ---------- ---------- ------------- -------------
Matthew
Syme 21 20 1 1 2 2
------------ --------- --------- ---------- ---------- ------------- -------------
Former
Directors
Robert
Hawley 14 11 1 1
------------ --------- --------- ---------- ---------- ------------- -------------
Scott
Yelland 21 21
------------ --------- --------- ---------- ---------- ------------- -------------
Sean James 2 1 1 1
------------ --------- --------- ---------- ---------- ------------- -------------
REMUNERATION REPORT (AUDITED) (30 JUNE 2011 YEAR END)
This report details the amount and nature of remuneration of
each director and executive officer of the Company.
Details of Key Management Personnel
The Key Management Personnel of the Group during or since the
end of the financial year were as follows:
Directors
James Ross Non-Executive Chairman since 14 January 2011
(previously Non-Executive)
Brendan James Managing Director (appointed 6 June 2011)
Henry Horne Chief Financial Officer, appointed Executive
Director 11 October 2010 and Acting Managing Director until 6 June
2011 then Non-Executive Director
Ian Stalker Managing Director until 14 January 2011 then
Non-Executive Director
Jose Ramon Esteruelas Non-Executive Director
Laurence Marsland Non-Executive Director (appointed 25 August
2011)
Matthew Syme Non-Executive Director
Robert Hawley Non-Executive Chairman until resignation 14
January 2011
Scott Yelland Chief Operating Officer / Executive Director
(resigned 30 June 2011)
Sean James Non-Executive Director (resigned 1 October 2010)
Executives
Sam Middlemas Company Secretary (Appointed 1 July 2010)
Franscisco Bellon del Rosal General Manager Operations
(Appointed 9 May 2011)
There were no other key management personnel of the Company or
the Group. Unless otherwise disclosed, the Key Management Personnel
held their position from 1 July 2010 until the date of this
report.
REMUNERATION REPORT (AUDITED) (30 JUNE 2011 YEAR END)
(Continued)
Remuneration Policy
The remuneration policy for the Group's Key Management Personnel
(including the Managing Director) has been developed by the Board
taking into account:
-- the size of the Group;
-- the size of the management team for the Group;
-- the nature and stage of development of the Group's current
operations; and
-- market conditions and comparable salary levels for companies
of a similar size and operating in similar sectors.
In addition to considering the above general factors, the Board
has also placed emphasis on the following specific issues in
determining the remuneration policy for key management
personnel:
-- the Group is currently focused on undertaking exploration
activities with a view to expanding and developing its resources.
In line with the Group's accounting policy, all exploration
expenditure prior to a feasibility study is expensed. The Group
continues to examine new business opportunities in the energy and
resources sector;
-- risks associated with resource companies whilst exploring and
developing projects; and
-- other than profit which may be generated from asset sales (if
any), the Group does not expect to be undertaking profitable
operations until sometime after the successful commercialisation,
production and sales of commodities from one or more of its current
projects, or the acquisition of a profitable mining operation.
Remuneration Policy for Executives
The Group's remuneration policy is to provide a fixed
remuneration component and a performance based component (options
and a cash bonus, see below). The Board believes that this
remuneration policy is appropriate given the considerations
discussed in the section above and is appropriate in aligning Key
Management Personnel objectives with shareholder and business
objectives.
Performance Based Remuneration - Incentive Options
The Board has chosen to issue incentive options to Key
Management Personnel as a key component of the incentive portion of
their remuneration, in order to attract and retain the services of
the Key Management Personnel and to provide an incentive linked to
the performance of the Company. The Board considers that each Key
Management Personnel's experience in the resources industry will
greatly assist the Company in progressing its projects to the next
stage of development and the identification of new projects. As
such, the Board believes that the number of incentive options
granted to Key Management Personnel is commensurate to their value
to the Company.
The Board has a policy of granting options to Key Management
Personnel with exercise prices at and/or above market share price
(at time of agreement). As such, incentive options granted to Key
Management Personnel will generally only be of benefit if the Key
Management Personnel perform to the level whereby the value of the
Company increases sufficiently to warrant exercising the incentive
options granted.
Other than service-based vesting conditions, there are no
additional performance criteria on the incentive options granted to
Key Management Personnel, as given the speculative nature of the
Group's activities and the small management team responsible for
its running, it is considered the performance of the Key Management
Personnel and the performance and value of the Company are closely
related.
Performance Based Remuneration - Cash Bonus
In addition, some Key Management Personnel are entitled to an
annual cash bonus upon achieving various key performance
indicators, to be determined by the Board. On an annual basis,
after consideration of performance against key performance
indicators, the Board determines the amount, if any, of the annual
cash bonus to be paid to each Key Management Personnel.
Impact of Shareholder Wealth on Key Management Personnel
Remuneration
The Board does not directly base remuneration levels on the
Company's share price or movement in the share price over the
financial year. However, as noted above, a number of Key Management
Personnel have received options which generally will only be of
value should the value of the Company's shares increase
sufficiently to warrant exercising the incentive options
granted.
REMUNERATION REPORT (AUDITED) (30 JUNE 2011 YEAR END)
(Continued)
As a result of the Group's exploration and new business
activities, the Board anticipates that it will retain future
earnings (if any) and other cash resources for the operation and
development of its business. Accordingly the Company does not
currently have a policy with respect to the payment of dividends,
and as a result the remuneration policy does not take into account
the level of dividends or other distributions to shareholders (eg
return of capital).
Impact of Earnings on Key Management Personnel Remuneration
As discussed above, the Group is currently undertaking
exploration activities, and does not expect to be undertaking
profitable operations until sometime after the successful
commercialisation, production and sales of commodities from one or
more of its current projects.
Accordingly the Board does not consider current or prior year
earnings when assessing remuneration of Key Management
Personnel.
Remuneration Policy for Non-Executive Directors
The Board policy is to remunerate Non-Executive Directors at
market rates for comparable companies for time, commitment and
responsibilities. Given the current size, nature and risks of the
Company, incentive options have been used to attract and retain
Non-Executive Directors. The Board determines payments to the
Non-Executive Directors and reviews their remuneration annually,
based on market practice, duties and accountability. Independent
external advice is sought when required.
The maximum aggregate amount of fees that can be paid to
Non-Executive Directors is subject to approval by shareholders at a
General Meeting. Fees for Non-Executive Directors are not linked to
the performance of the economic entity. However, to align
Directors' interests with shareholder interests, the Directors are
encouraged to hold shares in the Company and Non-Executive
Directors have received incentive options in order to secure their
services and as a key component of their remuneration.
General
Where required, Key Management Personnel receive superannuation
contributions (or foreign equivalent), currently equal to 9% of
their salary, and do not receive any other retirement benefit. From
time to time, some individuals have chosen to sacrifice part of
their salary to increase payments towards superannuation.
All remuneration paid to Key Management Personnel is valued at
cost to the company and expensed. Incentive options are valued
using the Binomial option valuation methodology. The value of these
incentive options is expensed over the vesting period.
REMUNERATION REPORT (AUDITED) (30 JUNE 2011 YEAR END)
(Continued)
Key Management Personnel Remuneration
Details of the nature and amount of each element of the
remuneration of each Director and executive of the Company or Group
for the financial year are as follows:
Percentage
of Total
Other Remuneration
Salary Post Share-Based Non-Cash that Percentage
& Fees Employ-ment Payments Benefits Total Consists of Performance
2011 $ Benefits $ $ (9) $ $ Options % Related %
----------- -------- ------------ ------------ --------- ---------- ------------- ------------
Directors
James Ross 138,025 2,100 - - 140,125 - -
----------- -------- ------------ ------------ --------- ---------- ------------- ------------
Brendan
James (1) 25,000 1,500 - - 26,500 - -
----------- -------- ------------ ------------ --------- ---------- ------------- ------------
Henry Horne
(2) 349,649 9,025 415,982 40,682 815,338 51% -
----------- -------- ------------ ------------ --------- ---------- ------------- ------------
Scott
Yelland 286,891 13,127 15,442 33,505 348,965 4% -
----------- -------- ------------ ------------ --------- ---------- ------------- ------------
Ian Stalker
(3) 278,043 - 724,886 - 1,002,929 72% -
----------- -------- ------------ ------------ --------- ---------- ------------- ------------
Jose Ramon
Esteruelas 69,488 - - - 69,488 - -
----------- -------- ------------ ------------ --------- ---------- ------------- ------------
Matthew
Syme 35,000 - - - 35,000 - -
----------- -------- ------------ ------------ --------- ---------- ------------- ------------
Robert
Hawley
(4) 73,677 - - - 73,677 - -
----------- -------- ------------ ------------ --------- ---------- ------------- ------------
Sean James
(5) 7,334 - - - 7,334 - -
----------- -------- ------------ ------------ --------- ---------- ------------- ------------
Executives
Sam
Middlemas
(6) 170,011 - - - 170,011 - -
----------- -------- ------------ ------------ --------- ---------- ------------- ------------
Franscisco
Bellon del
Rosal (7) 23,996 2,394 - - 26,390 - -
----------- -------- ------------ ------------ --------- ---------- ------------- ------------
2010
----------- -------- ------------ ------------ --------- ---------- ------------- ------------
Directors
Robert
Hawley 101,923 - - - 103,923 - -
----------- -------- ------------ ------------ --------- ---------- ------------- ------------
Ian Stalker 174,655 17,465 1,051,182 11,900 1,255,202 83.7 -
----------- -------- ------------ ------------ --------- ---------- ------------- ------------
Matthew
Syme 237,018 13,125 - 9,302 259,445 - -
----------- -------- ------------ ------------ --------- ---------- ------------- ------------
Scott
Yelland 239,426 38,440 - - 277,866 - -
----------- -------- ------------ ------------ --------- ---------- ------------- ------------
Sean James 43,581 - - - 43,581 - -
----------- -------- ------------ ------------ --------- ---------- ------------- ------------
James Ross 101,100 2,700 - - 103,800 - -
----------- -------- ------------ ------------ --------- ---------- ------------- ------------
Jose Ramon
Esteruelas 79,063 - - - 79,063 - -
----------- -------- ------------ ------------ --------- ---------- ------------- ------------
Stephen
Dattels(8) - - - - -
----------- -------- ------------ ------------ --------- ---------- ------------- ------------
Executives
Henry Horne 53,537 - 13,908 7,132 74,577 18.6 -
----------- -------- ------------ ------------ --------- ---------- ------------- ------------
Clint - - - - - - -
McGhie
----------- -------- ------------ ------------ --------- ---------- ------------- ------------
Notes
(1) Mr James joined the Company as Managing Director on 6 June
2011.
(2) Mr Horne joined the Company as Chief Financial Officer on 8
February 2010, was appointed as a Non-Executive Director on 11
October 2010 and Acting Managing Director from 14 January 211 to 30
June 2011 and continues on the Board as a Non-Executive director
(833,334 options were cancelled at this time leading to a P&L
reversal of $196,873 for options that had not yet vested - not
included in the table above - the Black Scholes value at the date
of cancellation was $81,666).
(3) Mr Stalker was appointed Managing Director on 30 November
2009 until 14 January 2011 when he moved to the role of
Non-Executive Director (2,000,000 options were cancelled at this
time leading to a P&L reversal of $1,321,240 not included in
the table above - the Black Scholes value at the date of
cancellation was $2,476,700).
(4) Mr Hawley resigned from the Board on 14 January 2011.
(5) Mr James resigned from the Board on 1 October 2010.
(6) Mr Middlemas was appointed Company Secretary on 1 July 2010
replacing Mr McGhie.
(7) Mr Bellon del Rosal was appointed Project Manager on 9 May
2011 and promoted to General Manager Operations on 30 June
2011.
(8) Mr Dattels was appointed as a non-executive Director of the
Company on 15 May 2009.
(9) Other Non-Cash Benefits includes payments made for
car-parking and insurance premiums on behalf of the Directors,
including Directors & Officers insurance, and in some
instances, working directors insurance.
REMUNERATION REPORT (AUDITED) (30 JUNE 2011 YEAR END)
(Continued)
Options Granted to Key Management Personnel
There were no options granted to any of the Key Management
Personnel of the Company or Group during the financial year.
Options granted during the prior year are as follows:
Grant Total
Date Value of
Exercise Fair Options
Issuing Grant Expiry Price Value No. Granted No.
2010 Entity Date Date $ $ Granted $ Vested
--------- ----------- ---------- ---------- --------- ------- ---------- ---------- ----------
Berkeley
Ian Resources
Stalker Ltd 1/4/2010 1/12/2013 1.25 0.8626 1,000,000 862,600 1,000,000
Berkeley Resources
Ltd 1/4/2010 1/12/2014 1.25 0.9437 1,000,000 943,700 -
Berkeley Resources
Ltd 1/4/2010 1/12/2015 1.25 1.0068 1,000,000 1,006,800 -
--------------------- ---------- ---------- --------- ------- ---------- ---------- ----------
Berkeley
Henry Resources
Horne Ltd 18/6/2010 18/6/2014 1.35 0.5538 416,666 230,750 416,666
Berkeley Resources
Ltd 18/6/2010 18/6/2014 1.35 0.5538 416,667 230,750 -
Berkeley Resources
Ltd 18/6/2010 18/6/2014 1.35 0.5538 416,667 230,750 -
--------------------- ---------- ---------- --------- ------- ---------- ---------- ----------
Notes
(i) For details on the valuation of the options, including
models and assumptions used, please refer to Note 19 to the
financial statements. In the case of the options issued to Mr
Stalker and to Mr Horne during 2010, the unvested options for each
lapsed at 30 June 2011.
(ii) In addition to the above, at 30 June 2010, 333,333 $1.86
Incentive Options issued to Mr Yelland on 6 August 2007 had
vested.
(iii) Apart from those noted above, during the financial year
there were no options exercised or lapsed.
Employment Contracts with Directors and Executive Officers
Mr Brendan James, Managing Director, has a contract of
employment with Berkeley Resources Limited dated 10 March 2011. The
contract specifies the duties and obligations to be fulfilled by
the Managing Director. The contract has a rolling term and may be
terminated by the Company by giving three months notice. No amount
is payable in the event of termination for neglect of duty or gross
misconduct. Mr James receives a fixed remuneration component of
$300,000 per annum plus 9% superannuation and the provision of
accommodation in Spain and a motor vehicle.
Following shareholder approval on 20 September 2011, Mr James
was granted 2,000,000 unlisted incentive options exercisable at
$0.41 each on or before 1 May 2016 (36 months vesting period).
Mr Ian Stalker, terminated his employment contract as Managing
Director on 30 December 2010, and entered into a new letter
agreement as a Non-Executive Director. The letter specifies the
duties and obligations to be fulfilled as a Non-Executive Director,
and the remuneration is fixed at $50,000 per annum. The letter also
includes a consultancy arrangement which provides for a consultancy
fee at the rate of $1,200 per day, on an as required basis. The
consultancy arrangement has a rolling term and may be terminated by
the Company by giving 1 months notice.
Mr Henry Horne, terminated his employment contract as Chief
Financial Officer and Acting Managing Director on 30 June 2011, and
entered into a new letter agreement as a Non-Executive Director.
The letter specifies the duties and obligations to be fulfilled as
a Non-Executive Director, and the remuneration is fixed at $50,000
per annum. The letter also includes a consultancy arrangement which
provides for a consultancy fee at the rate of $1,200 per day, on an
as required basis. The consultancy arrangement has a rolling term
and may be terminated by the Company by giving 1 months notice.
The Board granted Mr Horne 1,250,000 unlisted options
exercisable at $1.35 each on or before 18 June 2014 on his
appointment. The unvested 833,334 options lapsed on 30 June
2011.
REMUNERATION REPORT (AUDITED) (30 JUNE 2011 YEAR END)
(Continued)
Employment Contracts with Directors and Executive Officers
(Continued)
Dr James Ross AM, Non-Executive Chairman, has a letter of
engagement with Berkeley Resources Limited that was updated on 15
January 2011. The letter specifies the duties and obligations to be
fulfilled by the Chairman. Dr Ross receives a fixed remuneration
component of $100,000 per annum inclusive of superannuation. The
letter also includes a consultancy arrangement which provides for a
consultancy fee at the rate of $1,200 per day for technical
geological work done. The consultancy arrangement has a rolling
term and may be terminated by the Company by giving 1 months
notice.
Senor Jose Ramon Esteruelas, Non-Executive Director, was
appointed a Director of the Company on 1 November 2006. Senor
Esteruelas has a letter of employment with Berkeley Resources
Limited dated 16 November 2006. Senor Esteruelas receives a fixed
remuneration component of EUR48,000 per annum. The letter also
includes a consultancy agreement which provides for a consultancy
fee of EUR1,000 per day. The consultancy agreement has a rolling
term and may be terminated by Senor Esteruelas or by the Company by
giving 1 months notice.
Mr Laurence Marsland was appointed a Non-Executive Director on
25 August 2011. He has a letter engagement specifying the duties
and obligations to be fulfilled as a Non-Executive Director, and
the remuneration is fixed at $50,000 per annum. The letter also
includes a consultancy arrangement which provides for a consultancy
fee at the rate of $1,200 per day, on an as required basis. The
consultancy arrangement has a rolling term and may be terminated by
the Company by giving 1 months notice.
Mr Matthew Syme has a letter engagement dated 1 February 2010
relating to his appointment as a Non-Executive Director. The letter
specifies the duties and obligations to be fulfilled as a
Non-Executive Director, and the remuneration is fixed at $50,000
per annum. The letter also includes a consultancy arrangement which
provides for a consultancy fee at the rate of $1,200 per day, on an
as required basis. The consultancy arrangement has a rolling term
and may be terminated by the Company by giving 1 months notice.
Mr Sam Middlemas has a letter agreement dated 31 May 2010 and
revised 26 October 2010 relating to his services as Company
Secretary. The letter specifies the duties and obligations to be
fulfilled as Company Secretary, and the monthly remuneration is
fixed at $9,600 for 8 days work per month. The letter also includes
a consultancy arrangement which provides for additional work to be
charged at the rate of $1,200 per day, on an as required basis. The
consultancy arrangement has a rolling term and may be terminated by
the Company by giving 3 months notice and termination payment.
Exercise of Options Granted as Remuneration
During the financial year ended 30 June 2011, there were no new
options granted as remuneration. There were no options that were
exercised during the financial year by Key Management Personnel
(2010: Nil).
AUDITOR'S AND OFFICERS' INDEMNITIES AND INSURANCE
Under the Constitution the Company is obliged, to the extent
permitted by law, to indemnify an officer (including Directors) of
the Company against liabilities incurred by the officer in that
capacity, against costs and expenses incurred by the officer in
successfully defending civil or criminal proceedings, and against
any liability which arises out of conduct not involving a lack of
good faith.
During the financial year, the Company has paid an insurance
premium to insure Directors and officers of the Company against
certain liabilities arising out of their conduct while acting as a
Director or Officer of the Company. The net premium paid was
$25,874. Under the terms and conditions of the insurance contract,
the nature of liabilities insured against cannot be disclosed.
The Company has not, during or since the end of the financial
year, indemnified or agreed to indemnify an auditor of the Company
or of any related body corporate against any liability
incurred.
NON-AUDIT SERVICES
There were no non-audit services provided by the auditor (or by
another person or firm on the auditor's behalf) during the
financial year.
AUDITOR'S INDEPENDENCE DECLARATION
The auditor's independence declaration is on page 58 of the
Annual Financial Report.
ROUNDING OFF
The Group is of a kind referred to in ASIC Class Order 98/100
dated 10 July 1998 and in accordance with that Class Order, amounts
in the consolidated financial statements and directors' report have
been rounded off to the nearest thousand dollars, unless otherwise
stated.
This report is made in accordance with a resolution of the
Directors made pursuant to section 298(2) of the Corporations Act
2001.
For and on behalf of the Directors
BRENDAN JAMES
Managing Director
27 September 2011
The information in this report that relates to Exploration
Results, Mineral Resources or Ore Reserves is based on information
compiled by Dr James Ross, who is a Fellow of The Australian
Institute of Mining and Metallurgy and an employee of Berkeley
Resources Limited. Dr Ross has sufficient experience which is
relevant to the style of mineralisation and type of deposit under
consideration and to the activity which he is undertaking to
qualify as a Competent Person as defined in the 2004 Edition of the
'Australasian Code for Reporting of Exploration Results, Mineral
Resources and Ore Reserves'. Dr Ross consents to the inclusion in
the report of the matters based on his information in the form and
context in which it appears.
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2011
Consolidated
2011 2010
Note $000's $000's
Revenue from continuing
operations 2 1,291 713
Administration costs (2,015) (1,468)
Exploration costs (15,272) (10,732)
Business development
costs - (344)
Other share based payments
expense 3 (319) (1,489)
Cancellation of royalty - (921)
---------------------------------- ---- -------- --------
Loss before income tax
expense (16,315) (14,241)
Income tax expense 4 - -
---------------------------------- ---- -------- --------
Loss after income tax
expense (16,315) (14,241)
---------------------------------- ---- -------- --------
Other Comprehensive Income
Exchange differences
arising on translation
of foreign operations (795) (1,743)
Income tax on other comprehensive
income - -
---------------------------------- ---- -------- --------
Total Comprehensive Loss (17,110) (15,984)
================================== ==== ======== ========
Loss attributable to:
Non controlling interest - 1
Members of Berkeley Resources
Limited (16,315) (14,242)
---------------------------------- ---- -------- --------
Loss after income tax
expense (16,315) (14,241)
================================== ==== ======== ========
Total comprehensive loss
attributable to:
Non controlling interest - 1
Members of Berkeley Resources
Limited (17,110) (15,985)
---------------------------------- ---- -------- --------
Total Comprehensive Loss (17,110) (15,984)
================================== ==== ======== ========
Basic loss per share
(cents per share) 23 (10.75) (11.08)
Diluted loss per share
(cents per share) 23 (10.75) (11.08)
The above Statement of Comprehensive Income should be read in
conjunction with the accompanying Notes
STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2011
Consolidated
2011 2010
Note $000's $000's
---------------------------- ----- -------- --------
ASSETS
Current Assets
Cash and cash equivalents 24(b) 50,600 10,244
Trade and other receivables 5 700 193
Total Current Assets 51,300 10,437
---------------------------- ----- -------- --------
Non-current Assets
Exploration expenditure 6 13,647 12,843
Property, plant and
equipment 7 438 482
Other financial assets 8 115 215
---------------------------- ----- -------- --------
Total Non-current Assets 14,200 13,540
---------------------------- ----- -------- --------
TOTAL ASSETS 65,500 23,977
---------------------------- ----- -------- --------
LIABILITIES
Current Liabilities
Trade and other payables 9 1,188 1,694
Provisions 10 - 22
Other financial liabilities 11 109 273
---------------------------- ----- -------- --------
Total Current Liabilities 1,297 1,989
---------------------------- ----- -------- --------
TOTAL LIABILITIES 1,297 1,989
---------------------------- ----- -------- --------
NET ASSETS 64,203 21,988
============================ ===== ======== ========
EQUITY
Equity attributable
to equity holders of
the Company
Issued capital 12 117,624 58,618
Reserves 13 3,472 4,834
Accumulated losses 14 (56,893) (41,464)
---------------------------- ----- -------- --------
TOTAL EQUITY 64,203 21,988
============================ ===== ======== ========
The above Statement of Financial Position should be read in
conjunction with the accompanying Notes
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2011
Consolidated
2011 2010
Note $000's $000's
------------------------------ ---- -------- --------
Cash flows from operating
activities
Payments to suppliers
and employees (18,099) (10,037)
Interest received 1,266 334
Grant received - 359
------------------------------ ---- -------- --------
Net cash inflow/(outflow)
from operating activities 24 (16,833) (9,344)
------------------------------ ---- -------- --------
Cash flows from investing
activities
Payments for exploration (1,698) (91)
Security bond deposit - 172
Proceeds from sale
of exploration assets 60 -
Payments for property,
plant and equipment (147) (271)
------------------------------ ---- -------- --------
Net cash inflow/(outflow)
from investing activities (1,785) (190)
------------------------------ ---- -------- --------
Cash flows from financing
activities
Proceeds from issue
of shares 61,974 8,369
Transaction costs
from issue of shares
and options (2,968) (28)
------------------------------ ---- -------- --------
Net cash inflow from
financing activities 59,006 8,341
------------------------------ ---- -------- --------
Net increase/(decrease)
in cash and cash equivalents
held 40,388 (1,193)
Cash and cash equivalents
at the beginning of
the financial year 10,244 11,480
Effects of exchange
rate changes on cash
and cash equivalents (32) (43)
------------------------------ ---- -------- --------
Cash and cash equivalents
at the end of the
financial year 24 50,600 10,244
============================== ==== ======== ========
The above Statement of Cash Flows should be read in conjunction
with the accompanying Notes
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2011
Foreign
Option Currency Non
Issued Premium Translation Accumu-lated Controlling Total
Capital Reserve Reserve Losses Interest Equity
Consolidated $000's $000's $000's $000's $000's $000's
--------------- -------- -------- ------------ ------------- ------------ ---------
As at 1 July
2009 49,391 6,552 (185) (28,502) 1 27,257
Net loss for
the period - - - (14,240) (1) (14,241)
Other
Comprehensive
Income:
Exchange
differences
arising on
translation
of foreign
operations - - (1,743) - - (1,743)
--------------- -------- -------- ------------ ------------- ------------ ---------
Total
comprehensive
loss - - (1,743) (14,240) (1) (15,984)
--------------- -------- -------- ------------ ------------- ------------ ---------
Transactions
with owners,
recorded
directly in
equity
Issue of
shares 9,255 - - - - 9,255
Share issue
costs (28) - - - - (28)
Share based
payments
exercised - (1,278) - 1,278 - -
Cost of share
based
payments - 1,488 - - - 1,488
As at 30 June
2010 58,618 6,762 (1,928) (41,464) - 21,988
=============== ======== ======== ============ ============= ============ =========
As at 1 July 2010 58,618 6,762 (1,928) (41,464) - 21,988
Net loss for the
period - - - (16,315) - (16,315)
Other Comprehensive
Income: Exchange
differences arising
on translation of
foreign operations - - (795) - - (795)
Total comprehensive
loss - - (795) (16,315) - (17,110)
Transactions with
owners, recorded
directly in equity
Issue of shares 62,264 - - - - 62,264
Share issue costs (3,258) - - - - (3,258)
Share based payments
exercised - (886) - 886 - -
Cancellation of
incentive options:
Unvested Options (1,568) (1,568)
Cost of share
based payments - 1,887 - - 1,887
As at 30 June
2011 117,624 6,195 (2,723) (56,893) - 64,203
======================= ======= ======== ======== ========= =========
The above Statement of Changes in Equity should be read in
conjunction with the accompanying Notes
The following sections are available in the full version of the
Annual Financial Report on Berkeley Resources Limited's
website:
www.berkeleyresources.com.au
Notes to the Financial Statements
Directors' Declaration
Auditor's independence Declaration
Independent Auditor's Report
This information is provided by RNS
The company news service from the London Stock Exchange
END
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