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BKY Berkeley Energia Limited

14.50
-0.15 (-1.02%)
Last Updated: 08:07:56
Delayed by 15 minutes
Share Name Share Symbol Market Type Share ISIN Share Description
Berkeley Energia Limited LSE:BKY London Ordinary Share AU000000BKY0 ORD NPV (DI)
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  -0.15 -1.02% 14.50 14.20 14.80 14.65 14.50 14.65 0.00 08:07:56
Industry Sector Turnover Profit EPS - Basic PE Ratio Market Cap
Gold Ores 0 -1.37M -0.0031 -87.10 120.37M

Berkeley Energia Limited 2017 Annual Report (2128S)

29/09/2017 8:24am

UK Regulatory


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RNS Number : 2128S

Berkeley Energia Limited

29 September 2017

BERKELEY ENERGIA LIMITED

2017

ANNUAL REPORT | INFORME ANUAL

ABN 40 052 468 569

 
 Directors                          AIM/ASX Code 
  Mr Ian Middlemas Chairman          BKY - Fully paid ordinary 
  Mr Paul Atherley Managing          shares 
  Director                           Auditor 
  Mr Nigel Jones Non-Executive       Spain 
  Director                           Ernst & Young Espana 
  Mr Adam Parker Non-Executive 
  Director                           Australia 
  Mr Robert Behets Non-Executive     Ernst and Young - Perth 
  Director                           Solicitors 
  Company Secretary                  Spain 
  Mr Dylan Browne                    Herbert Smith Freehills 
  Other KMP                          Spain LLP 
  Mr Francisco Bellón 
  Chief Operations Officer           Australia 
  Mr Javier Colilla Chief            DLA Piper Australia 
  Administration Officer             Bankers 
  Mr Paul Thomson Chief Financial    Spain 
  Officer                            Santander Bank 
  Mr Hugo Schumann Chief 
  Commercial Officer                 Australia 
  Spanish Office                     Australia and New Zealand 
  Berkeley Minera Espana,            Banking Group Ltd 
  S.L.                               Share Registry 
  Carretera SA-322, KM 30            United Kingdom 
  37495 Retortillo                   Computershare Investor 
  Salamanca, Spain                   Services PLC 
  Telephone: +34 923 193             The Pavilions, Bridgewater 
  903                                Road 
  Main Office                        Bristol BS99 6ZZ 
  Unit 1B, Princes House             Telephone: +44 370 702 
  38 Jermyn Street                   0000 
  London SW1Y 6DN 
  United Kingdom                     Australia 
  Telephone: +44 203 903             Computershare Investor 
  1930                               Services Pty Ltd 
  Registered Office                  Level 11 
  Level 9, 28 The Esplanade          172 St Georges Terrace 
  Perth WA 6000                      Perth WA 6000 
  Australia                          Telephone: +61 8 9323 
  Telephone: +61 8 9322 6322         2000 
  Website                            Facsimile: +61 8 9323 
  www.berkeleyenergia.com            2033 
  Email                              Nominated Adviser and 
  info@berkeleyenergia.com           Broker 
  Stock Exchange Listings            WH Ireland Limited 
  United Kingdom                     Telephone: +44 207 220 
  London Stock Exchange -            1666 
  AIM 
 
  Australia 
  Australian Securities Exchange 
  Limited 
 
 
 CONTENTS | CONTENIDO 
 
 Directors' Report 
 Consolidated Statement of Profit or 
  Loss and Other Comprehensive Income 
 Consolidated Statement of Financial 
  Position 
 Consolidated Statement of Cash Flows 
 Consolidated Statement of Changes 
  in Equity 
 
 The following sections are available in the full 
  version of the 2017 Annual Report on the Company's 
  website at www.berkeleyenergia.com 
 Notes to and forming part of the Financial 
  Statements 
 Directors' Declaration 
 Auditor's Independence Declaration 
 Independent Auditor's Report 
 Corporate Governance 
 Mineral Resources and Ore Reserves 
  Statement 
 ASX Additional Information 
 

The Company also advises that an Appendix 4G (Key to Disclosures: Corporate Governance Council Principles and Recommendations) and 2017 Corporate Governance Statement have been released today and are also available on the Company's website.

The Directors of Berkeley Energia Limited submit their report on the Consolidated Entity consisting of Berkeley Energia Limited ('Company' or 'Berkeley' or 'Parent') and the entities it controlled at the end of, or during, the year ended 30 June 2017 ('Consolidated Entity' or 'Group').

OPERATING AND FINANCIAL REVIEW

Operations

Highlights

Berkeley is a company focussed on developing Europe's largest uranium project, the Salamanca mine, whilst delivering sustainable jobs and fuelling Europe's clean energy future.

Subsequent to the end of the financial year, the Company entered into an investment agreement with the sovereign wealth fund of the Sultanate of Oman ('SGRF') agreeing to invest, subject to shareholder approval, up to US$120 million to fully fund the Salamanca mine into production.

The investment will position the fund as a long term strategic investor in the Company as well as a potential offtake partner.

Infrastructure works on site are progressing well. The road deviation programme is well advanced and land is now being cleared to allow for the installation of the processing plant.

The primary crusher, delivered to site in July 2017, and the secondary crusher, which is currently in Madrid, were fabricated by Sandvik in Finland. Vibramech, based in South Africa, is on track with the fabrication of the vibrating grizzly feeder and screens.

The recent arrival on site of the primary crusher marks a significant milestone for the Company as it evolves from the development phase to the construction phase.

Equipment procurement for realignment of the electrical power line has been completed and the line deviation will commence once the road construction has been completed.

Employment levels are increasing with nearly seventy employees and contractors now on site and this will rise to 450 when the mine is in production. Over 120 locals have now completed the Company's skills training programmes equipping them with the skills necessary for positions with the Company.

These rising levels of employment are already having a positive effect on a local community that has been badly affected by long term unemployment, especially amongst its youth.

The Company remains committed to environmental excellence and as part of the Environmental License and the Environmental Measures Plan will plant 30,000 young oak trees, a six fold increase on the number of older trees being cleared, greatly improving the ecological and agricultural value of the area. The agreement will come into force once the favourable report issued by the Environmental Territorial Service of Salamanca has been approved by the General Directorate of Natural Environment of the Castilla y León Regional Government.

This reforestation programme commenced earlier this year with an agreement with the highly supportive local municipality of Vitigudino which details the arrangements for the planting of the first 20,000 young oak trees over a 50 hectare plot.

The Company is currently evaluating quotes from a number of experienced mining contractors and is encouraged by the competitive bids received. A key focus is the management of cost escalation over the term of these and all major contracts and suppliers to the Company.

Capital and the main contractual operating costs were finalised following the completion of the Front End Engineering and Design ('FEED') being undertaken by AMEC Foster Wheeler and came in 1% below the Definitive Feasibility Study ('DFS') estimates, reinforcing the Salamanca mine's position at the bottom of the cost curve.

The next phase of the Company's exploration programme will focus on discovering additional deposits with similar characteristics to Zona 7. Following extensive structural mapping and the interpretation of regional geological structures, two areas have been selected for an intensive geochemical sampling programme incorporating the latest uranium exploration techniques, in addition to some others like radiometrics and radon emissions.

The Company has noted increased public tender activity by major global utilities looking to enter into long term uranium supply contracts in the medium to long term. The Company is actively pursuing both public and private off-take opportunities with global utilities in the ordinary course of business and will report regularly on how this progresses.

The Company's view is that whilst uranium prices may remain flat in the near term, from late 2018, when the Salamanca mine is scheduled to come into production, the market is expected to be dominated by US utilities looking to re-contract who will at the same time be competing with Chinese new reactor demand, which may lead to higher spot and term contract prices.

The Company currently has 2.75 million pounds of U(3) O(8) concentrate under long term contracts over the first six years of production. Potential exists to increase annual contracted volumes further as well as extend the existing supply contracts by a total of 1.25 million pounds.

Across the Company's portfolio, the average fixed price per pound of contracted and optional volumes is above US$42 per pound. This compares favourably with the current spot price of around US$20 per pound. The Company will continue to build its sales book as the market continues to improve.

US$120 million sovereign wealth fund strategic investment to bring Salamanca into production

Subsequent to the end of the year, the Company announced that it had entered into an investment agreement with SGRF agreeing to invest up to US$120 million to fully fund the Salamanca mine into production.

The investment will position SGRF as a long term strategic investor in the Company as well as a potential offtake partner, and is structured as:

-- an interest-free and unsecured convertible loan of US$65 million which can be converted into ordinary shares at 50 pence per share resulting in the fund owning approximately 28% of the Company; and

-- three tranches of options convertible at a weighted average price of 85 pence per share contributing a further US$55 million towards the later phases of the Company's development of the Salamanca mine resulting in the fund holding a further 9% of the Company.

SGRF will have the right to appoint a non-executive director to the Board and has the right to match future uranium off-take transactions on similar commercial terms subject to certain limitations on volume.

At the time of announcing the transaction, Managing Director, Paul Atherley, commented:

"We are delighted to welcome Oman's sovereign wealth fund as a long-term strategic investor in the Company and look forward to working closely with them to realise the full potential of the exciting Salamanca mine.

The Salamanca mine is one of the only major uranium mines in development in the world today at a time when spot uranium prices are at a decade low.

The project benefits from a rare combination of low up front capital cost and very low operating costs and due in part to its location in the heart of the European Union we are able to contract supply at prices well above the current spot price.

The fund's interest in matching our future off-take contracts will further enhance our revenue stream."

Primary Crusher Delivered to Site

The delivery of the primary crusher to site in July 2017 marked a key milestone in the construction of the mine.

The crusher is the first major piece of processing equipment to be delivered to site and its arrival marks the Company's transition from the development phase to the construction phase. The construction and commissioning phases are estimated to be completed during the second half of 2018.

The 400 tonne per hour crusher was manufactured by Sandvik Group in Finland, who have also fabricated the secondary crusher, which is currently in Madrid and will be delivered in the coming months. Sandvik is one of the world's leading suppliers of mining equipment and the crusher was one of the long lead items included in the use of proceeds from the equity raise completed in the fourth quarter of 2016.

Infrastructure development continues and major contracts being evaluated

Initial infrastructure development commenced in August 2016 with the re-routing of the existing electrical power line to service the mine and a five kilometre realignment of an existing road.

The road deviation continues to proceed as planned and will be completed in due course. The upgrade to the existing electrical power line will commence shortly and is expected to be completed by the end of the year. The deviation programme has been designed to create pedestrian footpaths and secure cattle paths in order to maximize the benefit to the local community.

The clearing of land where the processing plant, medium voltage substation, reagent storage facilities and buildings will be built, and the laydown area for mining and construction contractors, has commenced. Many of the trees being cleared from these plots of land are suffering from a fungal pest that prevents them from growing and are being replaced with young, healthy oak trees that will improve the ecological value of the area. The cleared trees have been used for biomass.

Quotes from a number of experienced mining contractors are currently being evaluated and the Company is encouraged by the competitiveness of the bids received. A key focus is the management of cost escalation over the term of these and all the major contracts with and suppliers to the Company.

Committed to the highest environmental standards

The Salamanca mine is being developed to the highest international standards and as such, the Company's commitment to the environment remains a priority.

The mine has been designed according to the very latest thinking on sustainable mining. The extraction and treatment areas will be continuously rehabilitated as operations progress and with minimum disturbance during operations. Once operations are complete, all areas utilised by the Company will be fully restored to a condition of increased agricultural value.

As part of the Environmental License and the Environmental Measures Plan over 30,000 young oak trees will be planted over an area of 75 to 100 hectares in the local area.

For every tree being cleared six will be planted in its place, which will greatly improve the ecological value of the area. The reforestation programme began earlier this year following an agreement with the highly supportive municipality of Vitigudino, as part of the Company's commitment to environmental excellence.

This agreement details the arrangements for the planting of 20,000 trees over a 50 hectare plot in the municipality of Vitigudino. This plot forms part of an area of more than 500 hectares owned by the municipality that is currently used by cattle farmers, despite its deteriorating ecological value.

The Company will make payments to the municipality of Vitigudino for the next three years to cover the costs of planting and maintaining the young trees and looks forward to entering into similar agreements with the municipalities of Retortillo, Villavieja and Villares de Yeltes.

Capital costs for Salamanca reduced by 1% to EUR82.3 million

The capital cost for the construction of the Salamanca mine has reduced to EUR82.3 million (US$93.8 million), a 1% reduction over previous estimates, confirming the project's status as one of the lowest cost uranium mine developments in the world today.

The project benefits from well-established EU infrastructure and a highly competitive cost environment combined with short lead times for major equipment items.

The estimate for bringing the mine into production was prepared as part of the FEED by the Amec Foster Wheeler Group, one of the world's largest engineering groups.

The FEED is the execution phase of the project during which the overall engineering and process design is translated into equipment procurement packages and awards to specialist sub-contractors. A number of Spain's most reputable engineering groups provided their input into the Company's study work, including Madrid IBX-35 listed companies Ferrovial and OHL.

The final capital costs reflect all detailed design work carried out during the FEED, and resulted in an update to the nature and quantity of materials required to build the Salamanca mine, with costs from contractors and suppliers being amended based on final bidding packages.

The Company will continue to pursue cost optimisation opportunities as it commences full construction this summer, which includes the evaluation of the indirect costs.

Exploration programme expanded targeting Zona 7 style deposits

The next phase of the Company's exploration campaign has commenced and will focus on discovering additional deposits with similar characteristics to Zona 7, which is located close to surface and without a strong radiometric anomaly present.

The discovery of the high grade extensions at the Zona 7 deposit in late 2014 transformed the economics of the mine and changed the Company's geological model for the region.

In parallel with the ongoing development on site, the Company continues to conduct further exploration programmes aimed at increasing the project's production profile or mine life.

Following extensive structural mapping and the interpretation of regional geological structures, two areas totalling 100 km(2) have been selected for an intensive geochemical sampling programme, which will include 2,500 samples on a 200m x 200m grid.

The programme will incorporate the latest uranium exploration techniques with samples being tested for mobile metal ions using the Ionic Leach(TM) technique. This highly sensitive technique can detect extremely low levels of uranium and other critical elements and is widely acknowledged to be the most adept at identifying subtle anomalies.

To complement the soil sampling/Ionic Leach(TM) programme, the Company will also undertake ground radiometric survey readings and radon emissions tests at each of the sample collection points.

Two field crews will be focussed on carrying out the planned exploration activities over the two priority areas during the coming months, with the goal of identifying drill targets.

In addition to this new exploration programme, the Company will continue with exploration below Zona 7, where previous high grade intercepts were found beneath the current defined resource, demonstrating continuity of mineralisation and potential for the resource to increase at depth.

Off-Take programme update and notable increase in public tender activity

The Company currently has 2.75 million pounds of U(3) O(8) concentrate under long term contracts over the first six years of production. Potential exists to increase annual contracted volumes further as well as extend the contracts by a total of 1.25 million pounds.

The Company has maintained its preference to combine fixed and market related pricing across its contracts in order to secure positive margins in the early years of production whilst ensuring the Company remains exposed to potentially higher prices in the future.

Across the portfolio, the average fixed price per pound of contracted and optional volumes is above US$42 per pound. This compares favourably with the current spot price of around US$20 per pound.

The Company notes an increase in public tender activity by major global utilities looking to enter into long term contracts in the medium to long term time horizon. The Company is actively pursuing both public and private off-take opportunities with global utilities in the ordinary course of business and will report regularly on progress.

The Company's view is that whilst uranium prices may remain flat in the near term, from late 2018, when Salamanca is scheduled to come into production, the market is expected to be dominated by US utilities looking to re-contract who will at the same time be competing with Chinese new reactor demand, which may lead to higher spot and term contract prices.

Major land acquisitions completed ahead of commencement of Salamanca mine construction

Following the US$30 million equity raise, the Company completed some key land acquisitions which will accelerate the development of its Salamanca mine.

The successful acquisition and lease of over five hundred hectares of land will allow for the completion of the initial infrastructure currently underway and the commencement of construction of the processing plant together with construction of a medium voltage substation, reagent storage facilities and buildings.

Commitment to the community

The Company continues to be committed to the rejuvenation of the local community and being a good neighbour and community business partner and stakeholder. The Company has already invested over EUR70 million in the area over the past decade and is planning to invest an additional EUR250 million in the coming years as the mine develops.

The Company has been by far the biggest investor in a rural community suffering from decades of under investment and high levels of unemployment, especially amongst its youth.

The Company has signed Cooperation Agreements with the highly supportive local municipalities, demonstrating its commitment to working collaboratively with the community.

To date, through these agreements, the Company has provided wifi networks for local villages, built play areas for children, repaired sewage water plants, upgraded sports facilities, and sponsored various sporting events and local festivals.

Employment and training

The policy of preferentially hiring and training local residents has been very well received with the training programmes continuing to be heavily oversubscribed; to date, over 120 locals have attended courses organised by the Company and 25% of residents from the local area have applied for jobs.

The Company has received over 21,000 applications for the first 200 direct jobs it will create. The mine will create over 450 jobs once in full production and the University of Salamanca has estimated that for this type of business there will be a multiplier factor of 5.1 indirect jobs for every direct job created, resulting in over 2,500 direct and indirect jobs being created as a consequence of the Company's investment in the area.

During the year, the Company added a further 20 employees to its team at the Salamanca mine bringing the total number of employees and contractors at site to close to 70.

The recently appointed candidates are carrying out activities such as fencing the project, preparing for the next exploration campaign, preparing the 50 hectare plot in Vitigudino for reforestation activities and readying other areas of the site to allow for imminent construction.

Training programmes will continue to run throughout the year to ensure that sufficient people from the local communities are qualified for jobs created during the construction and mining phases.

Permitting update

There is strong support for the Salamanca mine throughout all levels of government. To date, the Company has received more than 90 favourable reports and permits for the development of the mine.

The Urbanism Commission of Salamanca gave an Express Resolution for the granting of the Authorisation of Exceptional Land Use, with the licence to be formally issued in due course.

With the Mining Licence, Environmental Licence and the Authorisation of Exceptional Land Use already obtained, the remaining approval is the Construction Authorisation by the Ministry of Industry, Energy and Tourism for the treatment plant as a radioactive facility, which is currently in process.

Corporate

Board strengthened with the appointment of two Non-Executive Directors

Mr Nigel Jones and Mr Adam Parker were appointed as an independent Non-Executive Directors of the Company on 7 June 2017 and 14 June 2017 respectively.

Mr Jones has thirty years' experience in the international mining sector. He has considerable corporate development and marketing expertise, including being responsible for the negotiation of key uranium supply agreements for Rio Tinto.

Mr Jones spent two decades at Rio Tinto, where ultimately he held the position of Global Head of Business Development and prior to that Managing Director of Rio Tinto Marine, Head of Investor Relations and Marketing Director, Uranium.

Mr Parker joins the Company after a long and successful career in institutional fund management in the City of London spanning almost three decades, including being a co-founder of Majedie Asset Management, which today manages assets of approximately GBP14 billion.

He was instrumental in building Majedie Asset Management into the successful investment boutique that it is today. He managed funds including the Majedie UK Opportunities Fund, the Majedie UK Smaller Companies Fund and a quarter of the Majedie UK Focus Fund, which all outperformed their benchmarks during his tenure.

Mr Parker retired from Majedie Asset Management in 2015 and has no ongoing input or influence in the management of its investments, including the firm's current ownership of approximately 5.30% of the Company.

On 7 June 2017, Dr Jim Ross retired from the Board after over twelve years of excellent service.

Appointment of Chief Financial Officer

During the year, Mr Paul Thomson was appointed as CFO of the Company. Mr Thomson joined Berkeley having had many years of experience in the mining industry.

Mr Thomson was CFO of Aureus Mining Inc., a gold producer in West Africa, from 2011 to 2016 during which time the company evolved from an explorer, to a developer and then a gold producer. Prior to Aureus, he was in Business Development at Kazakhmys Plc. Mr Thomson is a chartered accountant who previously worked with Ernst & Young.

Mr Thomson's appointment has bolstered the finance department of the Company and his experience in his previous roles will be highly relevant as the Company prepares for construction.

US$30 million raised from London institutions in oversubscribed fundraise

During the year, the Company successfully raised US$30 million from London's generalist blue chip institutions who now constitute a significant portion of the share register. The placing was completed at a price of 45 pence per share, a slight discount to the share price at the time.

Proceeds from the raise are being used to accelerate the development of the Salamanca mine, including construction of the crushing circuit, the centralised processing facility and land acquisition. In addition, the funding allowed for the completion of the FEED activities, the commencement of construction and provide working capital.

This strong institutional support for this successful financing was a positive endorsement of the Salamanca mine.

Results of Operations

The Consolidated Entity's net loss after tax for the year ended 30 June 2017 was $16,049,740 (2016: $13,641,054). This loss is partly attributable to:

(i) Exploration and evaluation expenses of $11,045,135 (2016: $9,213,493), which is attributable to the Group's accounting policy of expensing exploration and evaluation expenditure incurred subsequent to the acquisition of the rights to explore and up to the successful completion of definitive feasibility studies and permitting for each separate area of interest. The increased exploration and evaluation expenditure for the year ended 30 June 2017 is a reflection of additional activities undertaken in the year.

(ii) Business development expenses of $2,697,276 (2016: $1,614,099) which includes the Groups investor relations activities including but not limited to public relations costs, marketing and digital marking, conference fees, travel costs, consultant fees, broker fees and stock exchange admission costs.

(iii) Non-cash share-based payments expense of $1,020,106 (2016: $1,713,364) was recognised in respect of incentive securities granted to directors, employees and key consultants. The Company's policy is to expense the incentive securities over vesting period (which for Performance Rights is generally the life of the security). The decrease in this expense is a direct result of less incentive securities on issue.

(iv) Recognition of interest income of $463,639 (2016: $237,065). The increase in interest income reflects the higher average cash position from 2016 to 2017.

Financial Position

At 30 June 2017, the Group had cash reserves of $34,814,971 and no debt. This puts the Group in an excellent financial position as the Company moves towards the development and construction of the Salamanca mine.

The Group had net assets of $48,466,610 at 30 June 2017 (2016: $26,301,977), an increase of 84% compared with the previous year. This increase is consistent with the higher cash balance and increased property plant and equipment. The increase is offset somewhat by the loss for the year, comprising: (i) the current year's net loss after income tax, and (ii) movement in reserves.

Business Strategies and Prospects for Future Financial Years

Berkeley's strategic objective is to create long-term shareholder value by becoming a uranium producer in the near term, through the ongoing development and construction of the Salamanca mine.

To achieve its strategic objective, the Company currently has the following business strategies and prospects:

-- Progress with seeking further offtake partners. The Company has maintained its preference to combine fixed and market related pricing across its contracts in order to secure positive margins in the early years of production whilst ensuring the Company remains exposed to potentially higher prices in the future;

-- Advance the Salamanca mine through the development phase into the main construction phase and then into production;

   --      Complete permitting so that construction of the radioactive facilities can commence; 

-- Continue to explore the Company's portfolio of tenements in Spain targeting further Zona 7 style deposits aimed at making new discoveries and converting some of the 29.6 million pounds of Inferred resources into the mine schedule with the objective of maintaining annual production at over 4 million pounds a year on an ongoing basis; and

   --      Assess other mine development opportunities at the Salamanca mine. 

As with any other mining projects, 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. The material business risks faced by the Company that are likely to have an effect on the Company's future prospects, and how the Company manages these risks, include but are not limited to the following:

The Group's projects are not yet in production - As a result of the substantial expenditures involved in mine development projects, mine developments are prone to material cost overruns versus budget. The capital expenditures and time required to develop new mines are considerable and changes in cost or construction schedules can significantly increase both the time and capital required to build the mine;

The Company may be adversely affected by fluctuations in commodity prices - The price of uranium fluctuates widely and is affected by numerous factors beyond the control of the Company. Future production, if any, from the Salamanca mine will be dependent upon the price of uranium being adequate to make these properties economic. The Company currently does not engage in any hedging or derivative transactions to manage commodity price risk, but as the Company's Project advances, this policy will be reviewed periodically;

The Company's activities are subject to Government regulations and approvals - Any material adverse changes in government policies or legislation of Spain that affect uranium mining, processing, development and mineral exploration activities, income tax laws, royalty regulations, government subsidies and environmental issues may affect the viability and profitability of the Salamanca mine. No assurance can be given that new rules and regulations will not be enacted or that existing rules and regulations will not be applied in a manner which could adversely impact the Group's mineral properties; and

Global financial conditions may adversely affect the Company's growth and profitability - Many industries, including the mineral resource industry, are impacted by these market conditions. Some of the key impacts of the current financial market turmoil include contraction in credit markets resulting in a widening of credit risk, devaluations and high volatility in global equity, commodity, foreign exchange and energy markets, and a lack of market liquidity. A slowdown in the financial markets or other economic conditions may adversely affect the Company's growth and ability to finance its activities.

With the Mining Licence, Environmental Licence and the Authorisation of Exceptional Land Use already obtained, the remaining approval is the Construction Authorisation by the Ministry of Industry, Energy and Tourism for the treatment plant as a radioactive facility, which is currently in process. Various appeals have been made against these permits and approvals, as allowed for under Spanish law, and the Company expects that further appeals will be made against these and future authorisations and approvals in the ordinary course of events. All appeals to date have been unsuccessful. The Company will continue to comply with its continuous disclosure obligations in relation to any such appeals.

The construction phase of the Salamanca mine will require substantial financing - Failure to complete and settle the SGRF transaction may result in delaying or the indefinite postponement of any development of the mine. 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 successful development of the Company's project will also be dependent on the granting of all permits necessary for the construction and production phases. As with any development project, there is no guarantee that the Company will be successful in applying for and maintaining all required permits and licences to complete construction and subsequently enter into production. All appeals to date have been unsuccessful and the Company has no reason to believe that future appeals will not also be unsuccessful. Should an appeal be made and advice is received that the appeal has some chance of success the Company will advise in the normal course of events.

DIRECTORS

The names of Directors in office at any time during the financial year or since the end of the financial year are:

   Mr Ian Middlemas      Chairman 
   Mr Paul Atherley         Managing Director 
   Mr Nigel Jones           Non-Executive Director (appointed 7 June 2017) 
   Mr Adam Parker         Non-Executive Director (appointed 14 June 2017) 
   Mr Robert Behets      Non-Executive Director 
   Dr James Ross         Non-Executive Director (retired 7 June 2017) 

Unless otherwise disclosed, Directors held their office from 1 July 2016 until the date of this report.

CURRENT DIRECTORS AND OFFICERS

Ian Middlemas

Chairman

Qualifications - B.Com, CA

Mr Middlemas is a Chartered Accountant, a member of the Financial Services Institute of Australasia and holds a Bachelor of Commerce degree. He worked for a large international Chartered Accounting firm before joining the Normandy Mining Group where he was a senior group executive for approximately 10 years. He has had extensive corporate and management experience, and is currently a director with a number of publicly listed companies in the resources sector.

Mr Middlemas was appointed a Director and Chairman of Berkeley Energia Limited on 27 April 2012. During the three year period to the end of the financial year, Mr Middlemas has held directorships in Apollo Minerals Limited (July 2016 - present), Cradle Resources Limited (May 2016 - present), Paringa Resources Limited (October 2013 - present), Prairie Mining Limited (August 2011 - present), Salt Lake Potash Limited (January 2010 - present), Equatorial Resources Limited (November 2009 - present), Piedmont Lithium Limited (September 2009 - present), Sovereign Metals Limited (July 2006 - present), Odyssey Energy Limited (September 2005 - present), Syntonic Limited (April 2010 - June 2017) and Papillon Resources Limited (May 2011 - October 2014).

Paul Atherley

Managing Director

Qualifications - B.Sc, MAppSc, MBA, ARSM

Mr Atherley is a Mining Engineer from Imperial College London and has held numerous senior executive and board positions during his career. He served as Executive Director of the investment banking arm of HSBC Australia where he undertook a range of advisory roles in the resources sector. He has completed a number of acquisitions and financings of resource projects in Australia, South East Asia, Africa and Western Europe, and has well-established relationships with European and Australian capital markets. As the Managing Director of ASX/AIM listed Leyshon Resources Limited, Mr Atherley was responsible for the exploration, development and successful sale of the Zheng Guang Gold-Zinc Project in Northern China.

Mr Atherley has developed strong connections within Chinese business, industry bodies and senior government officials, including the most senior levels of the state owned energy companies. Until recently he was the Chairman of the British Chamber of Commerce in China, Vice Chairman of the China Britain Business Council in London and served on the European Union Energy Working Group in Beijing. He has been a regular business commentator on China, hosting events in Beijing and appearing on CCTVNews and China Radio International.

Mr Atherley was appointed a director of Berkeley Energia Limited on 1 July 2015. During the three year period to the end of the financial year, Mr Atherley has also held directorships in Leyshon Resources Limited (May 2004 - present) and Leyshon Energy Limited (January 2014 - present).

Nigel Jones

Non-Executive Director

Qualifications - MA OXON (Alumnus of London Business School where Mr Jones completed a Corporate Finance Programme)

Mr Jones has thirty years' experience in the international mining sector. He has considerable corporate development and marketing expertise, including being responsible for the negotiation of key uranium supply agreements for Rio Tinto.

Mr Jones spent two decades at Rio Tinto, where ultimately he held the position of Global Head of Business Development and prior to that Managing Director of Rio Tinto Marine, Head of Investor Relations and Marketing Director, Uranium.

Mr Jones was recently appointed as Head of Private Side Capital Markets at ICBC Standard Bank, the global markets subsidiary of ICBC Bank, which is the world's largest bank by assets.

He was appointed a Director of Berkeley Energia Limited on 7 June 2017. He has not been a Director of another listed company in the three years prior to the end of the financial year.

Adam Parker

Non-Executive Director

Qualifications - MA.Chem (Hons), ASIP

Mr Parker joined the Company after a long and successful career in institutional fund management in the City of London spanning almost three decades, including being a co-founder of Majedie Asset Management, which today manages assets of approximately GBP14 billion.

Mr Parker began his career in 1987 at Mercury Asset Management (subsequently acquired by Merrill Lynch and now part of BlackRock) and left in 2002 when he co-founded Majedie Asset Management.

He was instrumental in building Majedie Asset Management into the successful investment boutique that it is today. He managed funds including the Majedie UK Opportunities Fund, the Majedie UK Smaller Companies Fund and a quarter of the Majedie UK Focus Fund, which all outperformed their benchmarks during his tenure.

He was appointed a Director of Berkeley Energia Limited on 14 June 2017. He has not been a Director of another listed company in the three years prior to the end of the financial year.

Robert Behets

Non-Executive Director

Qualifications - B.Sc (Hons), FAusIMM, MAIG

Mr Behets is a geologist with over 25 years' experience in the mineral exploration and mining industry in Australia and internationally. He was instrumental in the founding, growth and development of Mantra Resources Limited, an African focused uranium company, through to its acquisition by ARMZ for approximately A$1 billion in 2011. Prior to Mantra, Mr Behets held various senior management positions during a long career with WMC Resources Limited.

Mr Behets has a strong combination of technical, commercial and managerial skills and extensive experience in exploration, mineral resource and ore reserve estimation, feasibility studies and operations across a range of commodities, including uranium, gold and base metals. He is a Fellow of The Australasian Institute of Mining and Metallurgy, a Member of the Australian Institute of Geoscientists and was also previously a member of the Australasian Joint Ore Reserve Committee ('JORC').

Mr Behets was appointed a Director of the Company on 27 April 2012. During the three year period to the end of the financial year, Mr Behets has held directorships in Apollo Minerals Limited (October 2016 - present), Cradle Resources Limited (May 2016 to present), Equatorial Resources Limited (February 2016 to present), Piedmont Lithium Limited (February 2016 to present) and Papillon Resources Limited (May 2012 - October 2014).

Mr Dylan Browne

Company Secretary

Qualifications - B.Com, CA, AGIA

Mr Browne is a Chartered Accountant and Associate Member of the Governance Institute of Australia who is currently Company Secretary for a number of ASX and European listed companies that operate in the resources sector. He commenced his career at a large international accounting firm and has since been involved with a number of exploration and development companies operating in the resources sector including Papillon Resources Limited and Prairie Mining Limited. Mr Browne was appointed Company Secretary and Chief Financial Officer of the Company on 29 October 2015.

OTHER KMP

Mr Francisco Bellón del Rosal

Chief Operations Officer

Qualifications - M.Sc, MAusIMM

Mr Bellón is a Mining Engineer specialising in mineral processing and metallurgy with over 20 years' experience in operational and project management roles in Europe, South America and West Africa. He held various senior management roles with TSX listed Rio Narcea Gold Mines during a 10 year career with the company, including Plant Manager for El Valle/Carles process facility and Operations Manager prior to its acquisition by Lundin Mining in 2007. During this period, Mr Bellón was involved in the development, construction, commissioning and production phases of a number of mining operations in Spain and Mauritania including El Valle-Boinás / Carlés (open pit and underground gold-copper mines in northern Spain), Aguablanca (open pit nickel-copper mine in southern Spain) and Tasiast (currently Kinross' world class open pit gold mine in Mauritania). He subsequently joined Duro Felguera, a large Spanish engineering house, where as Manager of the Mining Business, he managed the peer review, construction and commissioning of a number of large scale mining operations in West Africa and South America in excess of US$1B. Mr Bellón joined Berkeley Energia Limited in May 2011.

Mr Javier Colilla Peletero

Chief Administration Officer

Qualifications - Econ (Hons), LLB (Hons), MBA

Mr Colilla is a Mineral Economist and Lawyer. With prior experience in auditing and insurance sectors, he has over 25 years' experience in the mining sector commencing as the Managing Director of an international drilling company in the early 1980's. He subsequently worked for Anglo American as General Manager of their Spanish subsidiaries, whilst also contributing as international staff member to several projects in Europe and South America. Mr Colilla held various executive management roles during a long career with the TSX listed Rio Narcea Gold Mines, including Vice President Business Development, Chief Financial Officer, Senior Vice President Corporate, as well as Administrator/Director of its subsidiaries. During this period, he was involved in all aspects of commercial, legal and joint venture management, permitting, stakeholder engagement, government liaison and project financing for a number of mining operations in Spain and internationally including El Valle-Boinás / Carlés, Aguablanca and Tasiast. Following the acquisition of Rio Narcea Gold Mines by Lundin Mining in 2007, Mr Colilla consulted on renewable energies projects and advised several international leading legal firms in the areas of public aid financing (domestic and international) and due diligence exercises in relation to Spanish mining companies being acquired by multinational mining groups. Mr Colilla joined Berkeley Energia Limited in April 2010.

Mr Paul Thomson

Chief Financial Officer

Qualifications - BA (Hons), CA

Mr Thomson is a chartered accountant with over two decades of experience in both the finance and the mining industries. Prior to joining the Company, he was CFO of Aureus Mining Inc., a gold producer in West Africa, from 2011 to 2016 during which time the company evolved from an explorer, to a developer and then to a gold producer. Before this he worked in Business Development at Kazakhmys Plc and for Ernst & Young in the energy corporate finance team. Mr Thomson is a member of the Institute of Chartered Accountants of Scotland ("ICAS") and holds a Corporate Finance Advanced Diploma ("ICAEW"). Mr Thomson joined Berkeley Energia in January 2017.

Mr Hugo Schumann

Chief Commercial Officer

Qualifications - MBA, CFA, B.Bus.Sci (Hons)

Mr Schumann commenced his career as a management consultant before moving into the natural resources sector, initially as part of an investing team in London focused on early stage mining projects and then working in corporate development functions for a number of listed mining and energy companies. He has a decade of experience in the financing and development of mining and energy projects globally across a range of commodities. He holds an MBA from INSEAD, is a CFA Charterholder and holds a Bachelor of Business Science (Finance CA) from the University of Cape Town. Mr Schumann joined Berkeley Energia Limited in July 2015.

PRINCIPAL ACTIVITIES

The principal activities of the Consolidated Entity during the year consisted of mineral exploration and development. There was no significant change in the nature of those activities.

DIVIDS

No dividends have been declared, provided for or paid in respect of the financial year ended 30 June 2017 (2016: nil).

EARNINGS PER SHARE

 
                                       2017     2016 
                                      Cents    Cents 
----------------------------------  -------  ------- 
 Basic and diluted loss per share    (6.88)   (7.47) 
----------------------------------  -------  ------- 
 

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.

(i) On 14 July 2016, the Company announced the results of the completed DFS which confirmed the Salamanca mine as one of the lowest cost producers capable of generating strong after tax cash flow through the current low in the uranium price cycle;

(ii) On 28 November 2016, the Company announced that it had signed a binding off-take agreement with Interalloys Trading Limited ('Interalloys') for the sale of the first production from the Salamanca mine. An average fixed price of US$43.78 per pound of contracted and optional volumes was agreed between the parties;

(iii) On 6 December 2016, the Company completed major land acquisitions at the Salamanca mine in order to accelerate the initial development infrastructure at the mine;

(iv) On 16 December 2016, the Company completed a placement of 53.6 million shares at an issue price of 45 pence per share to London's generalist blue chip institutions to raise gross proceeds of US$30 million;

(v) On 20 December 2016, the Company announced that the order of the first major items for the crushing circuit which came in more than 20% below estimates from the DFS; and

(vi) On 17 March 2017, the Company announced additional high grade intersections below the Zona 7 deposit at the Salamanca mine which reported grades consistent with, or higher than, the average grade of the Zona 7 resource.

SIGNIFICANT EVENTS AFTER THE BALANCE DATE

(i) On 6 July 2017, the Company announced that the capital cost for the construction of the Salamanca mine has reduced to EUR82.3 million (US$93.8 million), a 1% reduction over previous estimates, confirming the project's status as one of the lowest cost uranium mine developments in the world today;

(ii) On 12 July 2017, the Company announced that the primary crusher for the Salamanca mine had been delivered to site, marking a key milestone in the construction of the Salamanca mine; and

(iii) On 31 August 2017, the Company signed an investment agreement with SGRF agreeing to invest up to US$120 million to fully fund the Salamanca mine into production.

Other than as outlined above, as at the date of this report there are no matters or circumstances, which have arisen since 30 June 2017 that have significantly affected or may significantly affect:

   --      the operations, in financial years subsequent to 30 June 2017, of the Consolidated Entity; 

-- the results of those operations, in financial years subsequent to 30 June 2017, of the Consolidated Entity; or

-- the state of affairs, in financial years subsequent to 30 June 2017, 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.

In September 2012, Berkeley qualified for certification in accordance with ISO 14001 of Environmental Management, which sets out the criteria for an environmental management system, and UNE 22480 of Sustainable Mining Management, which allows for the systematic monitoring and tracking of sustainability indicators, and is useful in the establishment of targets for constant improvement. These certificates are renewed following annual audits established by the regulations, with the most recent audit successfully completed in July 2015.

INFORMATION ON DIRECTORS' INTERESTS IN SECURITIES OF BERKELEY

 
                             Interest in Securities at the Date 
                                       of this Report 
                      Ordinary Shares(i)      Incentive    Performance 
 Current Directors                          Options(ii)    Rights(iii) 
-------------------  -------------------  -------------  ------------- 
 Ian Middlemas                 9,300,000              -              - 
 Paul Atherley                 1,369,000      4,000,000      1,850,000 
 Nigel Jones                           -              -              - 
 Adam Parker                           -              -              - 
 Robert Behets                 2,490,000              -        480,000 
-------------------  -------------------  -------------  ------------- 
 

Notes

   (i)         "Ordinary Shares" means fully paid ordinary shares in the capital of the Company. 

(ii) "Incentive Options" means an unlisted option to subscribe for 1 Ordinary Share in the capital of the Company

(iii) "Performance Rights" means the right to subscribe to 1 Ordinary Share in the capital of the Company upon the completion of specific performance milestones by the Company.

SHARE OPTIONS AND PERFORMANCE RIGHTS

At the date of this report the following Incentive Options and Performance Rights have been issued over unissued Ordinary Shares of the Company:

   --     3,500,000 Incentive Options exercisable at GBP0.15 on or before 30 June 2018; 
   --     150,000 Incentive Options exercisable at GBP0.25 on or before 30 June 2018; 
   --     150,000 Incentive Options exercisable at GBP0.30 on or before 30 June 2018; 
   --     200,000 Incentive Options exercisable at GBP0.40 on or before 30 June 2018. 
   --     3,500,000 Incentive Options exercisable at GBP0.20 on or before 30 June 2019; 
   --     3,585,000 Performance Rights expiring on 31 December 2018; 
   --     100,000 Performance Rights expiring on 31 March 20019; and 
   --     4,925,000 Performance Rights expiring on 31 December 2019. 

These Incentive Options and Performance Rights do not entitle the holders to participate in any share issue of the Company or any other body corporate. During the year ended 30 June 2017, 200,000 Ordinary Shares were issued as a result of the exercise of 200,000 Incentive Options and no Ordinary Shares were issued as a result of the conversion of Performance Rights. Subsequent to the end of the financial year and up and until the date of this report, no Ordinary shares have been issued as a result of the exercise of Incentive Options or conversion of Performance Rights.

MEETINGS OF DIRECTORS

The following table sets out the number of meetings of the Company's Directors and the board committees held during the year ended 30 June 2017, and the number of meetings attended by each director. Subsequent to the end of the year the Board resolved to establish a Remuneration and Nomination Committee.

The Board as a whole currently performs the functions of an Audit Committee and Risk Committee, however this will be reviewed should the size and nature of the Company's activities change.

 
                                    Board Meetings                   Remuneration and Nomination Committee(i) 
                     --------------------------------------------  -------------------------------------------- 
 Current Directors    Number Eligible to Attend   Number Attended   Number Eligible to Attend   Number Attended 
-------------------  --------------------------  ----------------  --------------------------  ---------------- 
 Ian Middlemas                    3                      3                      -                      - 
 Paul Atherley                    3                      3                      -                      - 
 Nigel Jones                      -                      -                      -                      - 
 Adam Parker                      -                      -                      -                      - 
 Robert Behets                    3                      3                      -                      - 
-------------------  --------------------------  ----------------  --------------------------  ---------------- 
 

Notes

(i) Subsequent to the end of the year, the Company formally established a Remuneration and Nomination Committee.

REMUNERATION REPORT (AUDITED)

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 ('KMP') of the Group during or since the end of the financial year were as follows:

Directors

   Mr Ian Middlemas                               Chairman 
   Mr Paul Atherley                                  Managing Director 
   Mr Nigel Jones                                    Non-Executive Director (appointed 7 June 2017) 
   Mr Adam Parker                                  Non-Executive Director (appointed 14 June 2017) 
   Mr Robert Behets                                Non-Executive Director 
   Dr James Ross                                  Non-Executive Director (retired 7 June 2017) 

Other KMP

   Mr Francisco Bellón del Rosal        Chief Operations Officer 
   Mr Javier Colilla Peletero                  Chief Administrations Officer 
   Mr Hugo Schumann                           Chief Commercial Officer 
   Mr Paul Thomson                               Chief Financial Officer (appointed 12 January 2017) 
   Mr Dylan Browne                                Company Secretary 

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 2016 until the date of this report.

Remuneration Policy

The remuneration policy for the Group's KMP 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 development and construction activities; 
   --     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 and Nomination Committee

Subsequent to the end of the year and in response to the Company receiving at least 25% of votes cast against the Remuneration Report at the 2016 AGM, the Board resolved to establish an independent Remuneration and Nomination Committee ('Remcom') to oversee the Group's remuneration and nomination responsibilities and governance. The remuneration committee members consist of three independent non-executive directors being Mr Parker (as Chair), Mr Jones and Mr Behets.

The Remcom's role will be to determine the remuneration of the Company's Executives, oversee the remuneration of KMP, and approve awards under the Company's long-term incentive plan ('LTIP').

The Remcom will review the performance of Executives and KMP and set the scale and structure of their remuneration and the basis of their service/consulting agreements. In doing so, the Remcom will have due regard to the interests of shareholders.

In determining the remuneration of Executives and KMP, the Remcom will seek to enable the Company to attract and retain executives of the highest calibre. In addition, the Remcom will decides whether to grant incentives securities in the Company and, if these are to be granted, who the recipients should be.

Remuneration Policy for Executives

The Group's remuneration policy is to provide a fixed remuneration component and a performance based component (Incentive Options, Performance Rights and a cash bonuses, see below). The Board believes that this remuneration policy is appropriate given the considerations discussed in the section above and is appropriate in aligning KMP objectives with shareholder and business objectives.

Fixed Remuneration

Fixed remuneration consists of base salaries, as well as employer contributions to superannuation funds and other non-cash benefits. Non-cash benefits may include provision of motor vehicles, housing and health care benefits.

Fixed remuneration will be reviewed annually by the Remcom. The process consists of a review of Company and individual performance, relevant comparative remuneration externally and internally and, where appropriate, external advice on policies and practices.

Performance Based Remuneration - Short Term Incentive

Some KMP are entitled to an annual cash bonus upon achieving various key performance indicators ('KPI's'), as set by the Board. Having regard to the current size, nature and opportunities of the Company, the Board has determined that these KPI's will include measures such as successful completion of exploration activities (e.g. completion of exploration programmes within budgeted timeframes and costs), development activities (e.g. completion of feasibility studies and initial infrastructure), corporate activities (e.g. recruitment of key personnel and project financing) and business development activities (e.g. project acquisitions and capital raisings). 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 KMP. During the financial year, a total bonus sum of $680,465 (2016: $484,698) was paid, or is payable to KMP on achievement of KPIs as set by the Board (in future to be set by the Remcom) which included: (i) Completion of the investment agreement with SGRF; (ii) Completion of a positive DFS for the Salamanca mine; (iii) Completed the FEED for the Salamanca mine which reduced capital costs of the project by 1%; (iv) Conclusion of a number of off-take contracts for the sale of uranium production during the financial year; (v) Announcement of a key milestone in the construction of the Salamanca mine following the delivery of the primary crusher to site; (vi) Announcement of early stage construction activities at the Salamanca mine including land acquisition, the road deviation advancing, equipment procurement of the electrical power line and preliminary reagent supply agreement having been entered into; (vii) Announcement of further high grade intercepts below Zona 7 identified; and (viii) Completion of an oversubscribed placement of 53.6 million shares at an issue price of GBP0.45 per share to London blue chip institutions to raise US$30 million (GBP24 million).

Performance Based Remuneration - Long Term Incentive

The Group has adopted a LTIP comprising the 'Berkeley Performance Rights Plan' (the 'Plan') to reward KMP and key employees for long-term performance. Shareholders approved the Plan in April 2013 at a General Meeting of Shareholders and Performance Rights were issued under the Plan in May 2013 and March 2014. Shareholders approved the renewal of the Plan in July 2015.

The Plan provides for the issuance of unlisted performance share rights ('Performance Rights') which, upon satisfaction of the relevant performance conditions attached to the Performance Rights, will result in the issue of an Ordinary Share for each Performance Right. Performance Rights are issued for no consideration and no amount is payable upon conversion thereof.

To achieve its corporate objectives, the Company needs to attract and retain its key staff, whether employees or contractors. The Board believes that grants made to eligible participants under the Plan provides a powerful tool to underpin the Company's employment and engagement strategy, and that the implementation of the Plan will:

(a) enable the Company to recruit, incentivise and retain KMP and other eligible employees and contractors needed to achieve the Company's strategic objectives;

(b) link the reward of eligible employees and contractors with the achievements of strategic goals and the long term performance of the Company;

   (c)        align the financial interest of participants of the Plan with those of Shareholders; and 

(d) provide incentives to participants of the Plan to focus on superior performance that creates Shareholder value.

Performance Rights granted under the Plan to eligible participants will be linked to the achievement by the Company of certain performance conditions as determined by the Board from time to time. These performance conditions must be satisfied in order for the Performance Rights to vest. Upon Performance Rights vesting, Ordinary Shares are automatically issued for no consideration. If a performance condition of a Performance Right is not achieved by the expiry date then the Performance Right will lapse.

During the financial year, Performance Rights had been on issue or granted to certain KMP and other employees and consultants with the following performance conditions:

(a) Expanded Definitive Feasibility Study Milestone means delivery of a positive Definitive Feasibility Study incorporating Zona 7, and the Company making a decision to proceed to development of operation evidenced by the Board resolving to continue to develop the Project before 30 June 2017 (milestone was achieved on 14 July 2017 with the Performance Rights converting on 29 July 2017);

(b) Project Construction Milestone means completion of approximately 25% of the project development phase, as per the project development schedule and budget approved by the Board in accordance with the Definitive Feasibility Study before 31 December 2018;

(c) Finance Review Milestone means demonstrating the reduction in capital and operating costs of the Salamanca mine and a reduction to the overall financing requirement and cost of capital of the Company as approved by the board before 31 March 2019; and

(d) Production Milestone means achievement of first uranium production before 31 December 2019.

In addition, may provide unlisted Incentive Options to some KMP as part of their remuneration and incentive arrangements in order to attract and retain their services and to provide an incentive linked to the performance of the Group. The Board's policy is to grant Incentive Options to KMP with exercise prices at or above market share price (at time of agreement). As such, Incentive Options granted to KMP are generally only of benefit if the KMP has performed to the level whereby the value of the Company has increased sufficiently to warrant exercising the Incentive Options granted. No Incentive Options were issued to KMP during the current financial year.

Other than service-based vesting conditions (if any), there were no additional performance criteria on the Incentive Options granted to KMP, as given the speculative nature of the Group's activities and the small management team responsible for its running, it is considered that the performance of KMP and the performance and value of the Group are closely related.

The Company prohibits executives entering into arrangements to limit their exposure to Unlisted Options and Performance Rights granted as part of their remuneration package.

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. The maximum aggregate amount that may be paid to Non-Executive Directors is $350,000 during the financial year, as approved by shareholders at the a Meeting of Shareholders held on 6 May 2009. Director's fees paid to Non-Executive Directors accrue on a daily basis. Fees for Non-Executive Directors are not directly 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. Given the size, nature and opportunities of the Company, Non-Executive Directors may receive Incentive Options or Performance Rights in order to secure and retain their services.

Fees for the Chairman were set at $50,000 per annum (2016: $50,000) (including post-employment benefits).

Fees for Non-Executive Directors' were set at $30,000 per annum (2016: $30,000) (including post-employment benefits). These fees cover main board activities only. Non-Executive Directors may receive additional remuneration for other services provided to the Company, including but not limited to, membership of committees. From the 2018 financial year, Non-Executive Directors' will receive a fee of $45,000 per annum (including post-employment benefits) which reflects the transition of the Company from an explorer to a developer.

During the 2017 financial year, no Incentive Options or Performance Rights were granted to Non-Executive Directors.

The Company prohibits Non-Executive Directors entering into arrangements to limit their exposure to Incentive Options granted as part of their remuneration package.

Relationship between Remuneration and Shareholder Wealth

During the Group's exploration and development phases of its business, the Board anticipates that the Company 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 returns of capital. Therefore there was no relationship between the Board's policy for determining, or in relation to, the nature and amount of remuneration of KMP and dividends paid and returns of capital by the Company during the current and previous four financial years.

The Board does not directly base remuneration levels on the Company's share price or movement in the share price over the financial year and the previous four financial years. Discretionary annual cash bonuses are based upon achieving various non-financial KPIs as detailed under 'Performance Based Remuneration - Short Term Incentive' and are not based on share price or earnings. As noted above, a number of KMP have also been granted Performance Rights and Incentive Options, which generally will be of greater value should the value of the Company's shares increase (subject to vesting conditions being met), and in the case of options, increase sufficiently to warrant exercising the Incentive Options granted.

Relationship between Remuneration of KMP and Earnings

As discussed above, the Group is currently undertaking exploration and development 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 earnings during the current and previous four financial years when determining, and in relation to, the nature and amount of remuneration of KMP.

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 Performance Rights and Incentive Options in order to secure their services and as a key component of their remuneration.

General

Where required, KMP receive superannuation contributions (or foreign equivalent), currently equal to 9.5% 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 KMP is valued at cost to the company and expensed. Incentive Options and Performance Rights are valued using an appropriate valuation methodology. The value of these Incentive Options and Performance Rights is expensed over the vesting period.

KMP Remuneration

Details of the nature and amount of each element of the remuneration of each Director and other KMP of the Company or Group for the financial year are as follows:

 
                     Short-term 
                      Benefits                                Non-Cash                         Percentage 
              -----------------------                -------------------------- 
                                                      Share-Based 
                                                         Payments 
                                                                                                   of Total 
                                                                                              Remunerat-ion 
                                                                                                       that 
                                               Post                                                Consists    Percent-age 
                  Salary         Cash   Employ-ment                                             of Options/   Perform-ance 
                  & Fees    Incentive      Benefits           (6)                     Total          Rights        Related 
                                                                          Other 
                                                                       Non-Cash 
                                                                    Benefits(5) 
2017                   $            $             $             $             $           $               %              % 
------------  ----------  -----------  ------------  ------------  ------------  ----------  --------------  ------------- 
Directors 
Ian 
 Middlemas        45,600            -         4,332             -             -      49,932               -              - 
Paul 
 Atherley        459,754      422,852             -       309,294             -   1,191,900           25.95          61.43 
Nigel 
 Jones(1)          3,115            -             -             -             -       3,115               -              - 
Adam 
 Parker(2)         1,757            -             -             -             -       1,757               -              - 
Robert 
 Behets           27,398            -         2,603        31,424             -      61,425           51.16          51.16 
James 
 Ross(3)          25,634            -         2,435        23,347             -      51,416           45.41          45.41 
Other KMP 
Francisco 
 Bellón 
 del Rosal       281,791       86,705        19,808       178,366        45,197     611,867           29.15          43.32 
Javier 
 Colilla 
 Peletero        281,791       14,451        19,808       178,366        37,978     532,394           33.50          36.22 
Paul 
 Thomson(4)      151,564       21,143             -        24,980             -     197,687           12.64          23.33 
Hugo 
 Schumann        252,453       84,570             -       181,441             -     518,464           35.00          51.31 
Dylan Browne     109,451       50,744             -        81,623             -     241,818           33.75          54.74 
Total          1,640,308      680,465        48,986     1,008,841        83,175   3,461,775 
============  ==========  ===========  ============  ============  ============  ==========  ==============  ============= 
 

Notes

   (1)      Mr Jones was appointed a Director on 7 June 2017. 
   (2)      Mr Parker was appointed a Director on 14 June 2017. 
   (3)      Mr Ross retried as a Director on 7 June 2017. 
   (4)      Mr Thomson was appointed as Chief Financial Officer on 12 January 2017. 
   (5)      Other Non-Cash Benefits includes payments made for housing and car benefits. 

(6) Share-based payments are measured for by using a Black-Scholes valuation method and are expensed over the vesting period of the Performance Rights or Incentive Options issued. Performance Rights are linked to the achievement by the Company of certain performance conditions as determined by the Board from time to time with the Performance Rights only of any value to the holder if the performance conditions are satisfied prior to the expiry of the respective Performance Rights.

 
                     Short-term 
                      Benefits                                Non-Cash                         Percentage 
              -----------------------                -------------------------- 
                                                      Share-Based 
                                                         Payments 
                                                                                                   of Total 
                                                                                              Remunerat-ion 
                                                                                                       that 
                                               Post                                                Consists    Percent-age 
                  Salary         Cash   Employ-ment                                             of Options/   Perform-ance 
                  & Fees    Incentive      Benefits           (5)                     Total          Rights        Related 
                                                                          Other 
                                                                       Non-Cash 
                                                                    Benefits(4) 
2016                   $            $             $             $             $           $               %              % 
------------  ----------  -----------  ------------  ------------  ------------  ----------  --------------  ------------- 
Directors 
Ian 
 Middlemas        45,600            -         4,400             -             -      50,000               -              - 
Paul 
 Atherley(1)     456,218      225,344             -       439,874             -   1,121,436           39.22          59.32 
James Ross        27,398            -         2,603       (5,116)             -      24,885         (20.56)        (20.56) 
Robert 
 Behets           27,398            -         2,603        72,440             -     102,441           70.71          70.71 
Other KMP 
Francisco 
 Bellón 
 del Rosal       297,002       76,154        20,467       269,321        48,441     711,385           37.86          48.56 
Javier 
 Colilla 
 Peletero        297,002       76,154        18,770       269,321        46,431     707,678           38.06          48.82 
Hugo 
 Schumann        226,851       89,697             -       214,425             -     530,973           40.38          57.28 
Dylan 
 Browne(2)        98,066       17,349             -        68,215             -     183,630           37.15          46.60 
Clint 
 McGhie(3)             -            -             -        24,627             -      24,627          100.00         100.00 
------------  ----------  -----------  ------------  ------------  ------------  ----------  --------------  ------------- 
Total          1,475,535      484,698        48,843     1,353,107        94,872   3,457,055 
============  ==========  ===========  ============  ============  ============  ==========  ==============  ============= 
 

Notes

   (1)      Mr Atherley was appointed a Director with effect from 1 July 2015. 
   (2)      Mr Browne was appointed as Company Secretary on 29 October 2015. 

(3) Mr McGhie resigned as Company Secretary and Chief Financial Officer on 29 October 2015. Previously Mr McGhie provided services as the Company Secretary and Chief Financial Officer through a services agreement between Berkeley and Apollo Group Pty Ltd. Under the agreement up and until Mr McGhie's resignation date, Apollo Group Pty Ltd was paid, or was payable $72,500 (2015: $296,000) for the provision of administrative, company secretarial and accounting services, and the provision of a fully serviced office to the Company

   (4)      Other Non-Cash Benefits includes payments made for housing and car benefits. 

(5) Share-based payments are measured for by using a Black-Scholes valuation method and are expensed over the life of the Performance Rights issued. The Performance Rights are linked to the achievement by the Company of certain performance conditions as determined by the Board from time to time with the Performance Rights only of any value to the holder if the performance conditions are satisfied prior to the expiry of the respective Performance Rights.

Incentive Options and Performance Rights Granted to KMP

Details of Incentive Options and Performance Rights granted by the Company to each Key Management Personnel of the Group during the year ended 30 June 2017 are as follows:

 
                                                                               Grant Date                   No. Vested 
                                      Grant       Expiry                       Fair Value                   at 30 June 
 2017              Security(1)         Date         Date   Exercise Price               $   No. Granted           2017 
--------------  --------------  -----------  -----------  ---------------  --------------  ------------  ------------- 
 Other KMP 
 Paul Thomson       Rights        25 May 17    31 Mar 19                -           0.810       100,000              - 
     Rights        25 May 17    31 Dec 19                               -           0.810       300,000              - 
 --------------  -----------  -----------  ------------------------------  --------------  ------------  ------------- 
 

Notes

(1) For details on the valuation of the Unlisted Options and Performance Rights, including models and assumptions used, please refer to Note 16 to the financial statements.

Details of the value of Incentive Options granted, exercised or lapsed for each KMP of the Company or Group during the financial year are as follows:

 
                                                                           Value 
                         Value            Value         Value       of Incentive 
                  of Incentive     of Incentive    of options            Options         Percentage 
                       Options          Options      / rights           included    of remuneration 
                       granted        exercised        lapsed    in remuneration      that consists 
                        during           during        during            for the       of Incentive 
                      the year         the year      the year               year            Options 
 2017                        $                $             $                  $                  % 
--------------  --------------  ---------------  ------------  -----------------  ----------------- 
 Other KMP 
 Hugo Schumann               -   104,337(1),(2)             -                  -                  - 
--------------  --------------  ---------------  ------------  -----------------  ----------------- 
 

Notes

(1) On 23 December 2016, Mr Schumann exercised 100,000 Incentive Options. The value of the Incentive Options exercised is calculated by using the closing price on that date (A$0.82) less the exercise price GBP0.15 (A$0.26).

(2) On 23 December 2016, Mr Schumann exercised 100,000 Incentive Options. The value of the Incentive Options exercised is calculated by using the closing price on that date (A$0.82) less the exercise price GBP0.20 (A$0.34).

Employment Contracts with Directors and KMP

Current Directors

Mr Ian Middlemas, Non-Executive Chairman, has a letter of appointment dated 29 June 2015 confirming the terms and conditions of his appointment. Effective from 1 July 2013, Mr Middlemas has received a fee of $50,000 per annum inclusive of superannuation.

Mr Paul Atherley, Managing Director, is engaged under a consultancy deed with North Asia Metals Ltd ('NAML') dated 16 June 2015. The agreement specifies the duties and obligations to be fulfilled by Mr Atherley as Managing Director. There is 12 month rolling term and either party may terminate with three months written notice. No amount is payable in the event of termination for material breach of contract, gross misconduct or neglect. Effective 1 July 2016, NAML has received an annual consultancy fee of GBP275,000 and will be eligible for an annual bonus of up to GBP250,000 to be paid upon successful completion of key performance indicators as determined by the Board. In addition, NAML, subject to the Corporations Act, will be entitled to receive a payment equivalent to the annual consultancy fee in the event of a change in control clause being triggered by the Company.

Mr Nigel Jones, Non-Executive Director, has a letter of appointment with Berkeley Energia Limited dated 5 June 2017 confirming the terms and conditions of his appointment. Effective from his appointment date (being 7 June 2017), Mr Jones has received a fee of $45,000 per annum.

Mr Adam Parker, Non-Executive Director, has a letter of appointment with Berkeley Energia Limited dated 5 June 2017 confirming the terms and conditions of his appointment. Effective from 28 August 2017, Mr Parker will receive a fee of $45,000 per annum for his Board duties and $15,000 for chairing the Remcom.

Mr Robert Behets, Non-Executive Director, has a letter of appointment dated 29 June 2015 confirming the terms and conditions of his appointment. Effective 1 July 2015, Mr Behets has received a fee of $45,000 per annum inclusive of superannuation. Mr Behets also has a services agreement with the Company dated 18 June 2012, which provides for a consultancy fee at the rate of $1,200 per day for management and technical services provided by Mr Behets. Either party may terminate the agreement without penalty or payment by giving two months' notice.

Current other KMP

Mr Francisco Bellón del Rosal, has a contract of employment dated 14 April 2011 and amended on 1 July 2011, 13 January 2015 and 16 March 2017. The contract specifies the duties and obligations to be fulfilled by the Chief Operations Officer. The contract has a rolling term and may be terminated by the Company giving six months' notice, or 12 months in the event of a change of control of the Company. In addition to the notice period, Mr Bellón will also be entitled to receive an amount equivalent to statutory unemployment benefits (approximately EUR25,000) and statutory severance benefits (equivalent to 45 days remuneration per year worked from 9 May 2011 to 11 February 2012, and 33 days remuneration per year worked from 12 February 2012 until termination). No amount is payable in the event of termination for neglect of duty or gross misconduct. Mr Bellón receives a fixed remuneration component of EUR190,000 per annum plus compulsory social security contributions regulated by Spanish law, as well as the provision of accommodation in Salamanca and a motor vehicle.

Mr Javier Colilla Peletero, has a contract of employment dated 1 July 2010 and amended on 12 December 2011 13 January 2015 and 22 March 2017. The contract specifies the duties and obligations to be fulfilled by the Chief Administration Officer. The contract has a rolling term and may be terminated by the Company giving six months notice, or 12 months in the event of a change of control of the Company or if the position becomes redundant. In addition to the notice period, Mr Colilla will also be entitled to receive an amount equivalent to statutory unemployment benefits (approximately EUR25,000) and statutory severance benefits (equivalent to 45 days remuneration per year worked from 1 July 2010 to 11 February 2012, and 33 days remuneration per year worked from 12 February 2012 until termination). No amount is payable in the event of termination for neglect of duty or gross misconduct. Mr Colilla receives a fixed remuneration component of EUR190,000 per annum plus compulsory social security contributions regulated by Spanish law, as well as an allowance for the use of his private motor vehicle.

Mr Paul Thomson, Chief Financial Officer, is engaged under a consultancy deed with Inverey Limited ('Inverey') dated 12 January 2017. The agreement specifies the duties and obligations to be fulfilled by Mr Thomson as the Chief Financial Officer. The Company may terminate the agreement with three months written notice. No amount is payable in the event of termination for material breach of contract, gross misconduct or neglect. Inverey receives an annual consultancy fee of GBP190,000 and will be eligible for a cash incentive of up to GBP50,000 to be paid upon successful completion of key performance indicators as determined by the Managing Director and Board of Directors. In addition Inverey will be entitled to receive a payment incentive worth the annual consultancy fee in the event of a change of control clause being triggered with the Company.

Mr Hugo Schumann, Chief Commercial Officer, is engaged under a consultancy deed with Meadowbrook Enterprises Limited ('Meadowbrook') which was updated on 15 May 2016. The agreement specifies the duties and obligations to be fulfilled by Mr Schumann as the Chief Commercial Officer. The Company may terminate the agreement with three months written notice. No amount is payable in the event of termination for material breach of contract, gross misconduct or neglect. Meadowbrook receives an annual consultancy fee of GBP150,000 and will be eligible for a cash incentive of up to GBP50,000 to be paid upon successful completion of key performance indicators as determined by the Managing Director and Board of Directors.

Mr Dylan Browne, Company Secretary, has a letter of appointment dated 29 October 2015 confirming the terms and conditions of his appointment. Mr Browne's appointment letter is terminable pursuant to the Company's Constitution. Mr Browne receives a fee of GBP5,500 per annum pursuant to this appointment letter. In addition Candyl Limited ('Candyl'), a company of which Mr Browne is a director and shareholder, has a consultancy agreement with the Company, which specifies the duties and obligations to be fulfilled by Mr Browne as the Company Secretary. Either party may terminate the agreement with three months written notice. No amount is payable in the event of termination for material breach of contract, gross misconduct or neglect. Candyl receives an annual consultancy fee of GBP60,500.

Equity instruments held by Key Management Personnel

Incentive Options and Performance Right holdings of KMP

 
                                                                                                            Vested and 
                                                     Vested Options                                       exerciseable 
                         Held at        Granted as       and Rights         Net Other         Held at       at 30 June 
 2017                1 July 2016     Compen-sation        exercised           Changes    30 June 2017             2017 
-----------------  -------------  ----------------  ---------------  ----------------  --------------  --------------- 
 Directors 
 Ian Middlemas                 -                 -                -                 -               -                - 
 Paul Atherley         6,500,000                 -        (650,000)                 -       5,850,000        4,000,000 
 Mr Nigel Jones             -(1)                 -                -                 -               -                - 
 Mr Adam Parker             -(2)                 -                -                 -               -                - 
 Robert Behets           580,000                 -        (100,000)                 -         480,000                - 
 James Ross              200,000                 -                -                 -      200,000(3)                - 
 Other KMP 
 Francisco 
  Bellón del 
  Rosal                3,150,000                 -        (400,000)                 -       2,750,000        1,500,000 
 Javier Colilla 
  Peletero             3,150,000                 -        (400,000)                 -       2,750,000        1,500,000 
 Paul Thomson               -(4)           400,000                -                 -         400,000                - 
 Hugo Schumann         1,650,000                 -        (550,000)                         1,100,000                - 
 Dylan Browne            460,000                 -        (100,000)                 -         360,000                - 
-----------------  -------------  ----------------  ---------------  ----------------  --------------  --------------- 
 

Notes

   (1)      As at appointment date being 7 June 2017 
   (2)      As at appointment date being 14 June 2017 
   (3)      As at retirement date being 7 June 2017 
   (4)      As at appointment date being 12 January 2017 

Shareholdings of KMP

 
                               Held 
                                 at                                 Options                     Held at 
                             1 July             Granted    exercised/Rights      Net Other      30 June 
   2017                        2016    as Compen-sation           converted        Changes         2017 
-----------------------  ----------  ------------------  ------------------  -------------  ----------- 
 Directors 
 Ian Middlemas            9,300,000                   -                   -              -    9,300,000 
 Paul Atherley              854,000                   -             650,000   (135,000)(1)    1,369,000 
 Mr Nigel Jones                -(2)                   -                   -              -            - 
 Mr Adam Parker                -(3)                   -                   -              -            - 
 Robert Behets            2,390,000                   -             100,000              -    2,490,000 
 James Ross                 415,000                   -                   -              -   415,000(4) 
 Other KMP 
 Francisco Bellón 
  del Rosal                 403,200                   -             400,000   (103,200)(1)      700,000 
 Javier Colilla 
  Peletero                  650,000                   -             400,000   (239,445)(1)      810,555 
 Paul Thomson                  -(5)                   -                   -              -            - 
 Hugo Schumann                    -                   -             750,000   (750,000)(1)            - 
 Dylan Browne                     -                   -             100,000              -      100,000 
-----------------------  ----------  ------------------  ------------------  -------------  ----------- 
 

Notes

   (1)      On-market trades to meet personal tax obligations 
   (2)      As at appointment date being 7 June 2017 
   (3)      As at appointment date being 14 June 2017 
   (4)      As at retirement date being 7 June 2017 
   (5)      As at appointment date being 12 January 2017 

End of Remuneration Report.

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. Under the terms and conditions of the insurance contract, the nature of liabilities insured against cannot be disclosed.

To the extent permitted by law, the Company has agreed to indemnify its auditors, Ernst & Young, as part of the terms of its audit engagement agreement against claims by third parties arising from the audit (for an unspecified amount). No payment has been made to indemnify Ernst & Young during or since the financial year.

NON-AUDIT SERVICES

During the year, the Company's auditor, Ernst & Young, received, or is due to receive, $80,808 (2016: $72,898) for the provision of non-audit services. The Directors are satisfied that the provision of non-audit services is compatible with the general standard and independence for auditors imposed by the Corporations Act.

AUDITOR'S INDEPENCE DECLARATION

The auditor's independence declaration is on page 59 of the Annual Financial Report.

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

PAUL ATHERLEY

Managing Director

29 September 2017

Competent Persons Statement

The information in this report that relates to the FEED was extracted from the announcement entitled 'Capital costs for Salamanca reduced by 1% to EUR 82.3 million' dated 6 July 2017, which is available to view on Berkeley's Energia Limited's (Berkeley) website at www.berkeleyenergia.com.

Berkeley confirms that: a) it is not aware of any new information or data that materially affects the information included in the original announcement; b) all material assumptions and technical parameters underpinning the FEED results included in the original announcement continue to apply and have not materially changed; and c) the form and context in which the relevant Competent Persons' findings are presented in this announcement have not been materially modified from the original announcements.

The information in the original announcement that relates to the FEED costs is based on, and fairly represents, information compiled by Mr Francisco Bellon, a Competent Person who is a member of the Australasian Institute of Mining and Metallurgy. Mr Bellon is the Chief Operating Officer for Berkeley and a holder of shares, options and performance rights in Berkeley. Mr Bellon 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 2012 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'.

The information in this report that relates to the Definitive Feasibility Study, Ore Reserve Estimates, Mining, Uranium Preparation, Infrastructure, Production Targets and Cost Estimation is extracted from the announcement entitled 'Study confirms the Salamanca project as one of the world's lowest cost uranium producers' dated 14 July 2016, which is available to view on Berkeley's website at www.berkeleyenergia.com.

Berkeley confirms that: a) it is not aware of any new information or data that materially affects the information included in the original announcement; b) all material assumptions and technical parameters underpinning the Mineral Resources, Ore Reserve Estimate, Production Target, and related forecast financial information derived from the Production Target included in the original announcement continue to apply and have not materially changed; and c) the form and context in which the relevant Competent Persons' findings are presented in this report have not been materially modified from the original announcements.

The information in the original announcement that relates to the Definitive Feasibility Study is based on, and fairly represents, information compiled or reviewed by Mr. Jeffrey Peter Stevens, a Competent Person who is a Member of The Southern African Institute of Mining & Metallurgy, a 'Recognised Professional Organisation' ('RPO') included in a list posted on the ASX website from time to time. Mr. Stevens is employed by MDM Engineering (part of the Amec Foster Wheeler Group). Mr. Stevens has sufficient experience that is relevant to the style of mineralization and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'.

The information in the original announcement that relates to the Ore Reserve Estimates, Mining, Uranium Preparation, Infrastructure, Production Targets and Cost Estimation is based on, and fairly represents, information compiled or reviewed by Mr. Andrew David Pooley, a Competent Person who is a Member of The Southern African Institute of Mining and Metallurgy', RPO included in a list posted on the ASX website from time to time. Mr. Pooley is employed by Bara Consulting (Pty) Ltd. Mr. Pooley has sufficient experience that is relevant to the style of mineralization and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'.

The information in the original announcement that relates to the Mineral Resources for Zona 7 is based on, and fairly represents, information compiled or reviewed by Mr Malcolm Titley, a Competent Person who is a Member of The Australasian Institute of Mining and Metallurgy. Mr Titley is employed by Maja Mining Limited, an independent consulting company. Mr Titley 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 2012 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'.

Forward Looking Statement

Statements regarding plans with respect to Berkeley's mineral properties are forward-looking statements. There can be no assurance that Berkeley's plans for development of its mineral properties will proceed as currently expected. There can also be no assurance that Berkeley will be able to confirm the presence of additional mineral deposits, that any mineralisation will prove to be economic or that a mine will successfully be developed on any of Berkeley's mineral properties.

CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

FOR THE YEARED 30 JUNE 2017

 
                                                                                     Note           2017          2016 
                                                                                                       $             $ 
-----------------------------------------------------------------------------------  -----  ------------  ------------ 
 
Revenue and other income                                                               2         463,639       248,868 
Corporate and administration expenses                                                        (1,750,862)   (1,348,966) 
Exploration and evaluation expenses                                                         (11,045,135)   (9,213,493) 
Business Development expenses                                                                (2,697,276)   (1,614,099) 
Share-based payment expenses                                                         16(a)   (1,020,106)   (1,713,364) 
Loss before income tax                                                                      (16,049,740)  (13,641,054) 
Income tax benefit/ (expense)                                                          4               -             - 
-----------------------------------------------------------------------------------  -----  ------------  ------------ 
Loss after income tax                                                                       (16,049,740)  (13,641,054) 
-----------------------------------------------------------------------------------  -----  ------------  ------------ 
 
Other comprehensive income, net of income tax: 
Items that may be classified subsequently to profit or loss: 
Exchange differences arising on translation of foreign operations                              (344,395)       125,016 
-----------------------------------------------------------------------------------  -----  ------------  ------------ 
Other comprehensive income, net of income tax                                                  (344,395)       125,016 
-----------------------------------------------------------------------------------  -----  ------------  ------------ 
Total comprehensive loss for the year attributable to Members of Berkeley Energia 
 Limited                                                                                    (16,394,135)  (13,516,038) 
===================================================================================  =====  ============  ============ 
 
Basic and diluted loss per share (cents per share)                                    19          (6.88)        (7.47) 
-----------------------------------------------------------------------------------  -----  ------------  ------------ 
 

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 30 JUNE 2017

 
                              Note            2017           2016 
                                                 $              $ 
----------------------------  -----  -------------  ------------- 
ASSETS 
Current Assets 
Cash and cash equivalents     20(b)     34,814,971     11,348,057 
Trade and other receivables     5        1,478,139      7,301,108 
Total Current Assets                    36,293,110     18,649,165 
----------------------------  -----  -------------  ------------- 
 
Non-current Assets 
Exploration expenditure         6        7,945,014      7,788,515 
Property, plant and 
 equipment                      7        9,799,308      1,852,230 
Other financial assets          8          160,351        120,637 
----------------------------  -----  -------------  ------------- 
Total Non-current Assets                17,904,673      9,761,382 
----------------------------  -----  -------------  ------------- 
 
TOTAL ASSETS                            54,197,783     28,410,547 
----------------------------  -----  -------------  ------------- 
 
LIABILITIES 
Current Liabilities 
Trade and other payables        9        5,208,363      2,081,914 
Provisions                     10          522,810         26,656 
----------------------------  -----  -------------  ------------- 
Total Current Liabilities                5,731,173      2,108,570 
----------------------------  -----  -------------  ------------- 
 
TOTAL LIABILITIES                        5,731,173      2,108,570 
----------------------------  -----  -------------  ------------- 
 
NET ASSETS                              48,466,610     26,301,977 
============================  =====  =============  ============= 
 
EQUITY 
Equity attributable 
 to equity holders of 
 the Company 
Issued capital                 11      168,050,788    129,514,703 
Reserves                       12          106,965        428,677 
Accumulated losses                   (119,691,143)  (103,641,403) 
----------------------------  -----  -------------  ------------- 
 
TOTAL EQUITY                            48,466,610     26,301,977 
============================  =====  =============  ============= 
 

The above Statement of Financial Position should be read in conjunction with the accompanying Notes

CONSOLIDATED STATEMENT OF CASH FLOWS

FOR THE YEARED 30 JUNE 2017

 
                                       Note           2017          2016 
                                                         $             $ 
-------------------------------------  -----  ------------  ------------ 
 
Cash flows from operating activities 
Payments to suppliers and employees           (12,700,576)  (11,578,946) 
Interest received                                  460,344       289,672 
Rebates received                                         -        11,802 
-------------------------------------  -----  ------------  ------------ 
Net cash outflow from operating 
 activities                            20(a)  (12,240,232)  (11,277,472) 
-------------------------------------  -----  ------------  ------------ 
 
Cash flows from investing activities 
Exploration acquisition costs                            -      (12,050) 
Proceeds from sale of royalty 
 (note 6)                                        6,530,826             - 
Payments for property, plant 
 and equipment                                 (8,134,766)     (334,629) 
-------------------------------------  -----  ------------  ------------ 
Net cash outflow from investing 
 activities                                    (1,603,940)     (346,679) 
-------------------------------------  -----  ------------  ------------ 
 
Cash flows from financing activities 
Proceeds from issue of securities               39,755,838     9,594,812 
Transaction costs from issue 
 of securities                                 (2,217,177)      (20,131) 
Net cash inflow from financing 
 activities                                     37,538,661     9,574,681 
-------------------------------------  -----  ------------  ------------ 
 
Net decrease in cash and cash 
 equivalents held                               23,694,489   (2,049,470) 
Cash and cash equivalents at 
 the beginning of the financial 
 year                                           11,348,057    13,398,617 
Effects of exchange rate changes 
 on cash and cash equivalents                    (227,575)       (1,090) 
-------------------------------------  -----  ------------  ------------ 
Cash and cash equivalents at 
 the end of the financial year         20(b)    34,814,971    11,348,057 
=====================================  =====  ============  ============ 
 

The above Statement of Cash Flows should be read in conjunction with the accompanying Notes

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED 30 JUNE 2017

 
                                  Issued      Share-        Foreign     Accumulated          Total 
                                 Capital       Based       Currency          Losses         Equity 
                                            Payments    Translation 
                                             Reserve        Reserve 
                                       $           $              $               $              $ 
 As at 1 July 2016           129,514,703   2,768,536    (2,339,859)   (103,641,403)     26,301,977 
 Total comprehensive 
  loss for the period: 
 Net loss for the 
  year                                 -           -              -    (16,049,740)   (16,049,740) 
 Other Comprehensive 
  Income: 
  Exchange differences 
  arising on translation 
  of foreign operations                -           -      (344,395)               -      (344,395) 
 Total comprehensive 
  income/(loss)                        -           -      (344,395)    (16,049,740)   (16,394,135) 
 Transactions with 
  owners, recorded 
  directly in equity: 
 Issue of ordinary 
  shares                      39,745,489           -              -               -     39,745,489 
 Exercise of incentive 
  options                         57,623           -              -               -         57,623 
 Share issue costs           (2,217,177)           -              -               -    (2,217,177) 
 Adjustment for 
  performance rights 
  forfeited                            -   (224,128)              -               -      (224,128) 
 Transfer from share-based 
  payments reserve               950,150   (950,150)              -               -              - 
 Share-based payments                  -   1,196,961              -               -      1,196,961 
 As at 30 June 2017          168,050,788   2,791,219    (2,684,254)   (119,691,143)     48,466,610 
===========================  ===========  ==========  =============  ==============  ============= 
 
 As at 1 July 2015           119,358,591   2,106,668    (2,464,875)    (90,461,849)     28,538,535 
 Total comprehensive 
  loss for the period: 
 Net loss for the 
  year                                 -           -              -    (13,641,054)   (13,641,054) 
 Other Comprehensive 
  Income: 
  Exchange differences 
  arising on translation 
  of foreign operations                -           -        125,016               -        125,016 
 Total comprehensive 
  income/(loss)                        -           -        125,016    (13,641,054)   (13,516,038) 
 Transactions with 
  owners, recorded 
  directly in equity: 
 Issue of ordinary 
  shares                       6,936,308           -              -               -      6,936,308 
 Exercise of incentive 
  options                      2,712,500           -              -               -      2,712,500 
 Share issue costs              (28,696)           -              -               -       (28,696) 
 Expiry of incentive 
  options                              -   (461,500)              -         461,500              - 
 Transfer from share-based 
  payments reserve               536,000   (536,000)              -               -              - 
 Share-based payments                  -   1,659,368              -               -      1,659,368 
---------------------------  -----------  ----------  -------------  --------------  ------------- 
 As at 30 June 2016          129,514,703   2,768,536    (2,339,859)   (103,641,403)     26,301,977 
===========================  ===========  ==========  =============  ==============  ============= 
 

The above Statement of Changes in Equity should be read in conjunction with the accompanying Notes

This information is provided by RNS

The company news service from the London Stock Exchange

END

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