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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Star Phoenix Group Ltd | LSE:STA | London | Ordinary Share | AU0000067084 | ORD NPV (DI) |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 1.05 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From May 2022 to May 2024
TIDMSTA
RNS Number : 6189Q
Star Phoenix Group Ltd
21 February 2023
Star Phoenix Group Ltd
("Star Phoenix" or the "Company")
21 February 2023
AUDITED ANNUAL REPORT FOR THE 12 MONTHSED 30 JUNE 2022
Star Phoenix (AIM: STA), an international company with an oilfield services business in Trinidad and an oil and gas interest in Indonesia, today releases its audited Annual Report for the 12 months ended 30 June 2022. A copy of the full Annual Report is available on the Company's website by clicking the link https://www.starphoenixgroup.com/investors/reports-presentations/ .
As a result of the publication of the Company's Annual Results, the trading in the Company's shares will be restored from 7.30am on 22 February 2023.
This announcement has been approved by Chairman Lubing Liu on behalf of the Company.
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Contact Details
WH Ireland Limited (Nominated
Star Phoenix Group Ltd Adviser and Broker)
Mu Luo (Company Secretary) James Joyce / Enzo Aliaj
e. admin@starphoenixgroup.com t. +44 (0)20 7220 1666
t. +61 8 6205 3012
The information contained within this announcement is considered to be inside information prior to its release, as defined in Article 7 of the Market Abuse Regulation No. 596/2014, and is disclosed in accordance with the Company's obligations under Article 17 of those Regulations.
The following has been directly extracted from the Audited Annual Report
Star Phoenix Group Ltd
and Controlled Entities
Annual Report 2022
for the year ended
30 June 2022
ABN: 88 002 522 009
An electronic version of this report is available on the Company's website www.starphoenixgroup.com
Contents
Directors' Report
Operational Review
Remuneration Report (Audited)
Auditor's Independence Declaration
Consolidated Statement of Profit or Loss and other Comprehensive Income as at 30 June 2022
Consolidated Statement of Financial Position as at 30 June 2022
Consolidated Statement of Changes in Equity as at 30 June 2022
Consolidated Statement of Cash Flows as at 30 June 2022
Notes to Consolidated Financial Statements
Directors' Declaration
Independent Audit Report to the Members
Additional Information
Corporate Directory
Directors' Report
The Directors of Star Phoenix Group Ltd ("SPG" or "the Company") and the entities it controls (together, the "Group") present the financial report for the year ended 30 June 2022.
Directors
The names and details of the Company's directors in office during the financial year and until the date of this report are as follows. The directors were in office during the entire period unless otherwise stated.
Name Position
Mr Lubing Liu Executive Chairman (Appointed on 1 June
2022), Chief Operating Officer
===============================================
Dr Mu (Robin) Luo Executive Director (Ceased to be Non-Executive
Director on 1 June 2022)
===============================================
Mr Zhiwei Gu Non-Executive Director (Ceased to be
Executive Chairman on 31 May 2022)
===============================================
Mr Lubing Liu: Executive Chairman and Chief Operating Officer
Qualifications: BSc
==================================
Interest in shares 1,726,077 ordinary shares
and options:
==================================
Directorships held None
in other listed entities
during the past three
years
==================================
Mr Lubing Liu has 25 years of global experience in petroleum
exploration, development, production, joint venture operations
and new ventures. Prior to joining the Company, Mr Liu held
various subsurface leader roles, including Chief Reservoir
Engineer with Melbana Energy Limited, Vice President of Exploration
and Petroleum Technology with Sinopec East Puffin Pty Ltd,
and principal petroleum engineering leader roles with other
international exploration and production and energy service
companies including ConocoPhillips, CNOOC, Woodside, RPS
and LR. Mr Liu is experienced in petroleum engineering and
has extensive IOR/EOR (waterflood inclusive) and gas cycling
experience having worked at the Xijiang24-3/30-2/24-1 oilfields,
Liuhua 11-1 oilfield and Penglai oilfield in China, the Chinguetti
oilfield in Mauritania, Block 95 in Peru, Goodwyn gas field,
Thylacine & Geographe gas field and Longtom gas field in
Australia. Mr Liu holds a BSc in Petroleum Engineering from
the Southwest Petroleum University, China. He is a Member
of the Society of Petroleum Engineers.
Dr Mu (Robin) Luo: Executive Director
Qualifications: BSc, MSc, PhD
=========================
Interest in shares None
and options:
=========================
Directorships held None
in other listed entities
during the past three
years
=========================
Dr Luo is a senior oil and gas professional with over 35
years' experience working for leading international E&P and
oilfield services companies. He has worked on various giant
conventional and unconventional projects across all levels
from research to operations. He most recently worked as a
principal development geophysicist to Inpex Corporation,
leading a multi-billion Ichthys LNG project in Australia.
Prior to that, he was a post-doc in Waseda University, Tokyo,
and held principal roles with Sinopec Oil and Gas, PGS, Japan
Petroleum Exploration Company Limited, and Japan Oil, Gas
and Metals National Corporation. Dr Luo holds a PhD in Exploration
Geophysics from the Curtin University, Australia; MSc in
Geophysics from the University of Queensland, Australia;
and BSc in Geophysics from the Petroleum University of China.
He is a member of the Australian Society of Exploration Geophysicists,
the European Association of Geoscientists and Engineers,
and the Society of Exploration Geophysicists.
Mr Zhiwei Gu: Non - Executive Chairman
Qualifications: LL.B, LL.M., MSc
=================================
Interest in shares 5,489,793 ordinary shares
and options:
=================================
Directorships held None
in other listed entities
during the past three
years
=================================
Mr Gu is an experienced corporate lawyer, who has worked
with numerous companies seeking listings on various international
stock markets, including the Toronto Stock Exchange and the
Hong Kong Stock Exchange. He is currently a partner of Dentons,
one of the largest global law firms. Mr Gu has participated
in several venture capital and private equity investment
cases by various funds such as London Asia Fund, Warburg
Pincus, Korea Development Bank, China Venture Investment
Co., and China Cinda AMC. During his time with China National
Gold Group Corp., Mr Gu was in charge of mineral resources
merger and acquisition activities. Mr Gu holds an LLB from
Jilin University in China, an LLM from Northeast University
in China, and Master of Applied Finance from Macquarie University
in Australia. Mr Gu is a qualified lawyer and securities
practitioner in China.
Company Secretary
The following persons held the position of company secretary during the financial year:
-- Ms Evgenia Bezruchko (Resigned on 27 August 2021)
-- Mr Lubing Liu (Resigned on 1 June 2022)
-- Dr Mu (Robin) Luo (Appointed on 1 June 2022)
Ms Evgenia Bezruchko: Joint Company Secretary
Qualifications: BSc, MSc, MBA
=======================
Directorships held None
in other listed entities
during the past three
years
=======================
Ms Evgenia Bezruchko has 10 years experience in corporate
development and capital markets in natural resources sector.
Prior to joining SPG in 2012, Evgenia worked in corporate
broking and equity sales for an independent merchant bank
Brandon Hill Capital (formerly Fox-Davies Capital Limited),
covering a wide range of listed and private oil & gas and
mining companies. Evgenia holds a BSc in Pharmacology from
the University of Bristol, an MSc in Finance from the University
of Westminster and an MBA from the American InterContinental
University.
Results of operations
The Company's loss for the year to 30 June 2022 was US$1,525,546 (FY2021: loss of US$6,268,902). Loss for the year from continuing operations was US$1,299 ,369 (FY2021: US$1,863,582 loss) and Loss for the year from discontinued operations was (US$226,177) (FY2021: loss of US$4,405,320).
Dividends
No dividend was paid or declared by the Company during the year and up to the date of this report.
Corporate structure
Star Phoenix Group Ltd is a company limited by shares, which is incorporated and domiciled in Australia.
Nature of operations and principal activities
The principal activity of the Group during the financial year was oilfield services.
The Company's key focus remains on securing new opportunities to provide future growth and value for the Company and its shareholders. Over the last year, the Company has considered, reviewed and evaluated numerous projects and investment opportunities with a view of securing attractive targets.
The Company is pleased to report that it is currently in advanced discussions on a selected number of investment and joint venture opportunities and is focusing its efforts to progress to the next stage. The Board believes these new opportunities would offer shareholders exposure to significant plays in the energy sector and looks forward to sharing the details of these potentially value enhancing opportunities should they progress to binding deals.
Operational Review
LandOcean Energy Services Co Limited litigation
On 14 July 2021, the Company advised that its legal advisers Dentons UK and Middle East LLP have now filed an arbitration request in the London Court of International Arbitration ( the "Request"), which officially marks commencement of arbitration proceedings against LandOcean Energy Services Co Limited.
Pursuant to the Request, the Group is claiming various sums from LandOcean Energy Services Co Limited currently estimated in excess of US$8.4 million. There are additional claims of US$1.8 million that fall outside of the Request, and the Company is exploring options of bringing these claims separately in the courts of Trinidad and Tobago. These sums are owed to the Group by LandOcean Energy Services Co Limited pursuant to the sale and purchase agreement of Range Resources Trinidad Limited.
Oilfield services
Following the sale, in the prior year, of the upstream business (RRTL) which was by far the largest client of RRDSL, and given the continued challenging industry conditions, the Company completed an organizational restructure of RRDSL in order to substantially reduce overheads and the ongoing costs of the Group.
The Company has also been actively marketing the rigs and equipment. As a result, the Company sold four production rigs for a total sum of US$0.06 million. The Company continues the sale process of the remaining two production workover and five drilling rigs.
The Company is also considering its options with regards to its interests in Indonesia.
Management changes
On 27 August 2021, the company announced that the Directors made a decision to implement changes to the management team. As a result, a mutual agreement was reached for Mr Theo Eleftheriades, the Chief Financial Officer and Ms Evgenia Bezruchko, the Group Corporate Development Manager and Joint Company Secretary to cease their employment in their current roles. The Board of Directors have approved the non-Board appointment of Mr Harry Liu as Chief Financial Officer. All of the management changes came into effect on 1 September 2021.
On 31 August 2021, the company announced that Mr Lubing Liu will continue his role as company secretary.
On 31 May 2022, the board elected and appointed Mr Lubing Liu as Executive Chairman from 1 June 2022. The board appointed Dr Mu (Robin) Luo as Company Secretary and Executive Director from 1 June 2022. The Board approved Mr Zhiwei (Kerry) Gu's appointment as Executive Chairman will cease on 31 May 2022. Mr Gu will remain as a Non-Executive Director effective from 1 June 2022.
Director's Salaries and payments
On 07 September 2021, the company announced that the Board of Directors has approved delaying all directors' salaries and payments from 1 September 2021 subject to further review at the beginning of 2022 in accordance with the cash position of the Company at that particular time.
This has been taken as a cash conservation measure to preserve the Company's cash reserves whilst it seeks the collection of the monies owed to it by LandOcean Energy Services Co Limited, as updated in the Company's announcement of 14 July 2021.
Significant changes in the state of affairs
There have been no significant changes in the state of affairs of the Group during the financial year, other than as set out in this report.
A special general meeting
A special general Meeting was held on 10 December 2021 after the Company received a request from Beijing Sibo Investment Management LP, which holds approximately 17.3% of the votes that may be cast at a general meeting of the Company. The general meeting was held to consider the following resolutions:
1. Election of Director - Mr. Qu Guangsheng; 2. Election of Director - Mr. Deng Lian Jun; 3. Election of Director - Mr. Yang Chon Yi;
The Company called, arranged and held the Meeting to consider all the resolutions proposed pursuant to these requests and in accordance with the provisions of section 249D of the Corporations Act. Following the Extraordinary General Meeting, none of the resolutions was duly passed.
Likely developments and expected results of operations
The Company continues its search of new attractive acquisition opportunities to provide future growth and value for the Company and its shareholders. The Company is also seeking to complete the sale of its rigs and equipment in Trinidad to provide additional cashflow and strengthen the Company's financial position.
Update on RRDSL Claim
RRDSL, through its attorney ( Robin B. Ramoutar & Co), has submitted a claim at an amount of approximately TT$1.1 million ( GBP132,000 ) against 360 Oil and Gas Limited (the "Defendant") in the Supreme Court of Trinidad and Tobago (the "Claim") in respect of unpaid service fees from the Defendant. A Court date will be scheduled in due course.
Events after the reporting date
RRDSL Claim
On 28 July 2022, the company announced that RRDSL has won a claim at an amount of approximately TT$1.1 million (US $163,000 ) against 360 Oil and Gas Limited in the Supreme Court of Trinidad and Tobago in respect of unpaid service fees.
Arbitration commences against LandOcean Energy Services Co Limited
On 14 July 2021, the Company announced that its legal advisers Dentons UK and Middle East LLP have now filed an arbitration request in the London Court of International Arbitration, which officially marks commencement of arbitration proceedings against LandOcean Energy Services Co Limited.
Pursuant to the Request, the Group is claiming various sums from LandOcean Energy Services Co Limited currently estimated in excess of US$8.4 million. There are additional claims of US$1.8 million that fall outside of the Request, and the Company is exploring options of bringing these claims separately in the courts of Trinidad and Tobago. These sums are owed to the Group by LandOcean Energy Services Co Limited pursuant to the sale and purchase agreement of Range Resources Trinidad Limited. In accordance with the Australian Accounting Standards these amounts have not been recognised in the financial statements as contingent assets.
Claim Against Range Resources Trinidad Limited
On 4 August 2022, the company provided following update in relation to its wholly owned subsidiary in Trinidad, Resources Drilling Services Limited ("RRDSL").
RRDSL, through its attorney (Robin B. Ramoutar & Co), has submitted three claims at a total amount of approximately TT$14.9 million (US$2.21 million) against Range Resources Trinidad Limited ("RRTL" or the "Defendant") in the Supreme Court of Trinidad and Tobago in respect of breach of loan, service and equipment rental contracts from the Defendant (the "Claims"). A Court date will be scheduled in due course.
Arbitration proceedings Against LandOcean Energy Services Co Limited
On 22 August 2022, the company announced that the London Court of International Arbitration ("LCIA") issued a consent award on 12 August 2022 in relation to two of the four Stage 1 Claims. Under the consent award, LandOcean Energy Services Co Limited is required to make payment of US$301,265 to Star Phoenix by 16 September 2022, being 35 days from the date of the consent award.
The issuing of the consent award makes a successful conclusion of two of the four Stage 1 Claims. The Company will provide further updates on the remaining Stage 1 Claims in due course.
Environmental regulations and performance
The Group's operations are not regulated by any significant environmental regulation under a law of the Commonwealth or of a state or territory.
The Directors have considered compliance with the National Greenhouse and Energy Reporting Act 2007 which requires entities to report annual greenhouse gas emissions and energy use. The directors have assessed that there is no current reporting requirements, but may be required to do so in the future.
Share options
As at 30 June 2022, the Company had no unissued ordinary shares of Star Phoenix under option. During the year ended 30 June 2022 no ordinary shares of the Company were issued on the exercise of options (2021: nil).
Indemnifying directors and officers
In accordance with the constitution, except where prohibited by the Corporations Act 2001, every director, principal executive officer and secretary of the Company shall be indemnified out of the property of the Company against any liability incurred by him/her in his/her capacity as director, principal executive officer or secretary of the Company or any related corporation in respect of any act or omission whatsoever and howsoever occurring or in defending any proceedings whether civil or criminal.
During the financial year, the Company has paid premiums of US$12,431 to insure the Directors and Officers against certain liabilities arising out of the conduct of acting as an officer of the Company. Under the terms and conditions of the insurance contract, the nature of liabilities insured against and the premium paid cannot be disclosed.
Meetings of Directors
During the financial year, eight meetings of the board of directors were held. Attendances by each director during the year were as follows:
Director Board Meetings
Eligible to Attended
attend
============ =========
Zhiwei Gu 7 7
============ =========
Lubing Liu 7 7
============ =========
Mu Luo 7 7
============ =========
Proceedings on behalf of the company
No person has applied for leave of Court to bring proceedings on behalf of the Company or to intervene in any proceedings to which the Company is a party for the purpose of taking responsibility on behalf of the Company for all or any part of those proceedings.
The Company was not a party to any such proceedings during the year.
Corporate governance
In recognising the need for the highest standards of corporate behaviour and accountability, the Board has adhered to the principles of sound corporate governance. The Board of the Company and its subsidiaries are committed to achieving and demonstrating robust corporate governance practices which are appropriate for the Group's size and stage of development, and which facilitate the long-term performance and sustainability of the Company as well as protecting and enhancing the interests of its shareholders and other stakeholders.
During the year, the Directors adopted the UK's QCA Corporate Governance Code for Small and Mid-Size Quoted Companies (the "QCA Code"), in replacement of the ASX's Corporate Governance Council's Corporate Governance Principles and Recommendations 3rd Edition, as the basis for its corporate governance. The Corporate Governance Statement and Corporate Governance Plan are available on the Company's website www.starphoenixgroup.com.
Non-audit services
The total value of non-audit services provided by a related practice of BDO Audit (WA) Pty Ltd in respect to the Company's tax compliance is US$34,345 (2021: US$36,338).
The board of directors has considered the position and is satisfied that the provision of the non-audit services is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001. The directors are satisfied that the provision of non-audit services by the auditor did not compromise the auditor independence requirements of the Corporations Act 2001 for the following reasons:
1. all non-audit services have been reviewed by the Board to ensure they do not impact the impartiality and objectivity of the auditor; and
2. none of the services undermine the general principles relating to auditor independence as set out in APES 110 Code of Ethics for Professional Accountants.
Remuneration Report (Audited)
Remuneration policy
The remuneration policy of Star Phoenix Group has been designed to align director and executive objectives with shareholder and business objectives by providing a fixed remuneration component and offering specific long-term incentives based on key performance areas affecting the Group's financial results. The Board of Star Phoenix Group Limited believes the remuneration policy to be appropriate and effective in its ability to attract and retain the best executives and directors to run and manage the Group, as well as create alignment of goals between directors, executives and shareholders.
The Board's policy for determining the nature and amount of remuneration for Board members and senior executives of the Company is as follows:
The remuneration policy, setting the terms and conditions for the executive directors and other senior executives, was developed and approved by the Board.
Non-executive directors, executive directors and senior executives receive a base salary (which is based on factors such as length of service and experience), which is calculated on a total cost basis and includes any FBT charges related to employee benefits including motor vehicles, as well as employer contributions to superannuation funds where applicable.
Executive and non-executive directors can be employed by the Company on a consultancy basis on Board approval, with remuneration and terms stipulated in individual consultancy agreements.
The Company does not currently have a Remuneration Committee. In its absence, the full Board is responsible for the determination of the remuneration of Directors and senior executives and ensuring that such remuneration is appropriate and not excessive. Where considered necessary, the Board may engage a remuneration consultant to assist with setting and reviewing the Company's executive and non-executive remuneration policies to ensure the Company attracts and retains executives and Directors who will create value for shareholders. As the Company grows in size, it is planned that the Company will establish a separate remuneration committee with its own remuneration committee charter. No remuneration consultant has been used during the year.
The Board is also responsible for evaluating the performance of Directors and the senior executives. It is envisaged that once the Company is of a sufficient size to establish a Nomination Committee, that committee will be responsible for arranging the performance evaluation of the Board, its committees, and individual Directors on behalf of the Board. This evaluation will be based on specific criteria, including the business performance of the Company and its subsidiaries, whether strategic objectives are being achieved and the development of management and personnel. A formal performance evaluation was not undertaken during the financial year; however, the Company intends to undertake such review during the following financial year.
All remuneration paid to directors and executives is valued at the cost to the Company and expensed. Shares given to directors and executives are valued as the difference between the market price of those shares and the amount paid by the director or executive. Unlisted options are valued using the Black-Scholes methodology.
The Board policy is to remunerate non-executive directors at market rates for comparable companies taking into consideration time, commitment, and level of responsibility. Fees for non-executive directors are not linked to the performance of the Group. The directors are not required to hold any shares in the Company under the Constitution of the Company; however, to align directors' interests with shareholder interests, the directors are encouraged to hold shares in the Company.
Under the Company's share trading policy, all employees and directors of the Company and its related companies are prohibited from trading in the Company's shares or other securities if they are in possession of inside information.
The Board believes that it has implemented suitable practices and procedures that are appropriate for an organisation of this size and maturity.
Company performance, shareholder wealth and directors and executive's remuneration
No relationship exists between shareholder wealth, director and executive remuneration and Company performance.
Key Management Personnel
Name Position Appointed/Resigned
Mr Lubing Liu Executive Chairman Appointed as an Executive
Director on 1 March 2018
and as Joint Company Secretary
01 April 2020. Appointed
as Executive Chairman
from 1 June 2022.
======================= ================================
Dr Mu (Robin) Executive Director Appointed as Non-Executive
Luo Director on 11 January
2019 and as Company Secretary
and Executive Director
on 1 June 2022
======================= ================================
Mr Zhiwei Gu Non-Executive Director Appointed as Executive
Chaireman on 10 December
2018. Ceased to be Executive
Chaireman on 31 May 2022
and remain as a Non-Excutive
Director from 1 June 2022.
======================= ================================
Details of remuneration
The remuneration for the Key Management Personnel of the Group during the year was as follows:
2022 Short Term Benefits Post-employment Other Total
benefits Fees
(iv)
Cash One-off Termination Superannuation
salary payment benefits / pensions
& fees
======== ========= ============ ================ ======
Currency US$ US$ US$ US$ US$ US$
======== ========= ============ ================ ====== ========
Directors & Officers
Mr Gu (i) 159,399 - - - - 159,399
======== ========= ============ ================ ====== ========
Mr L Liu
(ii) 94,867 - - 3,525 - 98,392
======== ========= ============ ================ ====== ========
Dr Luo 20,041 - - - - 20,041
======== ========= ============ ================ ====== ========
Total 274,307 - - 3,525 - 277,832
======== ========= ============ ================ ====== ========
(i) Fees of US$159,399 paid to Mr Gu in his capacity as Executive Chairman. During the year, no incentives were in place for Mr Gu.
(ii) Fees paid to Mr L Liu comprised US$3,525 superannuation contributions and salary of US$29,989 and consulting fee of $64,878 in his capacity as Chief Operating Officer and Trinidad General Manager. During the year, no incentives were in place for Mr Liu.
2021 Short Term Benefits Post-employment Share Total
benefits based
payments
Cash One-off Termination Superannuation Options
salary payment benefits / pensions
& fees
======== ========= ============ ================ ==========
Currency US$ US$ US$ US$ US$ US$
======== ========= ============ ================ ========== ========
Directors & Officers
Mr Gu (i) 254,251 - - - 125,000 379,251
======== ========= ============ ================ ========== ========
Mr L Liu
(ii) 199,463 - - 29,397 39,452 228,860
======== ========= ============ ================ ========== ========
Dr Luo 55,222 - - - - 55,222
======== ========= ============ ================ ========== ========
Dr Meng - - - - - -
(iii)
======== ========= ============ ================ ========== ========
Total 508,936 - - 29,397 164,452 702,785
======== ========= ============ ================ ========== ========
(i) Fees paid to Mr Gu comprised US$254,251 received in his capacity as Executive Chairman, and 5,468,959 ordinary shares, for a subscription value of US$125,000, were issued to him for additional consulting work. During the year, no incentives were in place for Mr Gu.
(ii) Fees paid to Mr L Liu comprised US$29,397 superannuation contributions (part of the contributions was for prior year) and salary of US$199,463 in his capacity as Chief Operating Officer and Trinidad General Manager. Mr Liu was issued 1,726,077 shares, for a subscription value of US$39,452, for his consulting work. During the year, no incentives were in place for Mr Liu.
(iii) Dr Meng did not receive any remuneration in the year. Dr Meng ceased to be a director on 11 December 2020.
(iv) Other fees were directors' fees settled with the issue of shares. Please see notes above.
Equity instrument disclosures relating to Key Management Personnel
Share-based payments (year ended 30 June 2022)
No options were issued to key management personnel. All existing options expired in the financial year and there has not been an expense reversal.
Fully paid share holdings
The numbers of shares in the Company held during the financial year or at time of resignation by Key Management Personnel of the Company, including their personally related parties, are set out below.
2022 Balance Granted as Other Balance Balance
at the start Compensation Changes at the held indirectly
of the year end of
the year
Mr Gu 5,489,793 - - 5,489,793 -
============== ============== ========= ========== =================
Mr L Liu 1,726,077 - - 1,726,077 -
============== ============== ========= ========== =================
Dr Luo - - - - -
============== ============== ========= ========== =================
Total: 7,215,870 - - 7,215,870 -
============== ============== ========= ========== =================
Options held by Key Management Personnel
There were no options in the company held during the financial year or at time of resignation by Key Management Personnel of the Company, including their personally related parties.
Loans to Key Management Personnel
There were no loans made to directors of SPG and other Key Management Personnel of the Group, including their personally related parties during the 2021 or 2022 financial years.
Employment contracts of Directors and other Key Management Personnel
On appointment, Executive Directors and Other Key Management Personnel enter into an employment contract with the Company (or another company within the Group). This contract sets out their duties, remuneration and other terms of employment. These contracts may be terminated by either the Company or the employee as detailed below.
All non-executive directors are eligible to receive consulting fees for services provided to the Company over and above the services expected from a non-executive director.
Mr Lubing Liu as Chief Operating Officer, Trinidad General
Manager, Executive Director and Joint Company Secretary (appointed
as Joint Company Secretary on 1 April 2020)
Chief Operating Officer and Trinidad General Manager contract
Contract start 24 December 2019 to 31 May 2022
date:
=============================================
Base Payment: US$236,712 per annum
=============================================
Superannuation: US$22,488 per annum
=============================================
Notice period: 6 months
=============================================
Termination benefits: Payment in lieu of notice at Company option
for termination without cause
=============================================
Mr Lubing Liu as Executive Chairman
Executive Chairman contract (commenced 1 June 2022)
Contract date: 1 June 2022
=====================================
Base Payment: US$260,000 per annum
=====================================
Superannuation: 10% of base
=====================================
Notice period: 3 months
=====================================
Termination benefits: 3 months' salary plus superannuation
=====================================
Mr Zhiwei Gu as Executive Chairman
Executive Chairman contract (commenced 1 March 2020)
Contract start date: 1 March 2020 to 31 May 2022
=============================================
Base Payment: US$55,000 per annum
=============================================
Superannuation: No superannuation entitlement
=============================================
Notice period: 6 months
=============================================
Termination benefits: Payment in lieu of notice at Company
option for termination without cause
=============================================
Consulting services: Mr Gu provided additional executive
and consulting services over, and above
services rendered to the Company at
a rate of US$26,667 per month
=============================================
Mr Zhiwei Gu as Non-Executive Director (appointed 1 June
2022)
Contract start date: 1 June 2022
=============================================
Base Payment: US$55,000 per annum
=============================================
Superannuation: No superannuation entitlement
=============================================
Notice period: 3 months
=============================================
Termination benefits: 3 months' fees
------------------------ ---------------------------------------------
Dr Mu Luo as Non-Executive Director (appointed 11 January
2019)
Non-Executive Director contract
Contract start 11January 2019 to 31 May 2022
date:
===============================================
Base Payment: US$25,000 per annum (US$50,000 from 1 August
2019)
===============================================
Superannuation: No superannuation entitlement
===============================================
Termination benefits: None
===============================================
Dr Mu Luo as Company Secretary and Executive Director (appointed
1 June 2022)
Secretary and Executive Director contract (commenced 1 June
2022)
Contract start 1 June 2022
date:
========================================
Base Payment: US$180,000 per annum
========================================
Superannuation: 10% of base
========================================
Termination benefits: 3 months' salary plus superannuation
========================================
Additional information
The earnings of the consolidated entity for the five years to 30 June 2022 are summarised below:
2022 2021 2020 2019 2018
$'000 $'000 $'000 $'000 $'000
--------- --------- ---------- ---------- ----------
Revenue 3 99 8,539 12,357 13,059
--------- --------- ---------- ---------- ----------
EBITDA (1,470) (1,443) (19,073) (39,044) (6,000)
--------- --------- ---------- ---------- ----------
EBIT (1,195) (6,413) (20,542) (43,002) (10,951)
--------- --------- ---------- ---------- ----------
(Loss)/profit
after income
tax (1,337) (6,695) 47,952 (49,461) (17,530)
--------- --------- ---------- ---------- ----------
The factors that are considered to affect total shareholders return ('TSR') are summarised below:
2022 2021 2020 2019 2018
$'000 $'000 $'000 $'000 $'000
--------- --------- ------- --------- ---------
Share price
at financial
year end
(US$) 0.0115 0.0187 0.02 0.0004 0.002
--------- --------- ------- --------- ---------
Basic earnings
per share
(US$) (0.001) (0.046) 0.397 (0.552) (0.231)
--------- --------- ------- --------- ---------
Voting and comments made at the company's 2021 Annual General Meeting
Star Phoenix Group Ltd received 99.7% of "yes" votes on its remuneration report for the 2021 financial year. The Board believes that this reflects the conservative remuneration
practices of the company.
This is the end of the audited remuneration report.
Auditor's Independence Declaration
The auditor's independence declaration, as required under Section 307C of the Corporations Act 2001, for the year ended 30 June 2022 has been received and can be found on the following page.
This report is signed in accordance with a resolution of the Board of Directors.
Lubing Liu: Chairman
31 October 2022
Auditor's Independence Declaration
In accordance with Section 307C of the Corporations Act 2001, I am pleased to provide the following declaration of independence to the directors of Star Phoenix Group Ltd and Controlled Entities. As the lead audit partner for the audit of the financial report of Star Phoenix Group Ltd and Controlled Entities for the year ended 30 June 2022, I declare that, to the best of my knowledge and belief, there have been no contraventions of:
(i) the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
(ii) any applicable code of professional conduct in relation to the audit.
Name of Firm Mitchell Wilson & Partners Name of Partner Douglas Mitchell
Date
Address 883 Toorak Road
Camberwell VIC 3124, Australia
Consolidated Statement of Profit or Loss and other Comprehensive Income for the year ended 30 June 2022
The below consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes.
Note Consolidated
========================================= ==== ==========================
2022 (US$) 2021 (US$)
(Restated)*
========================================= ==== =========== =============
Revenue from continuing operations 3 - -
==== =========== =============
Operating expenses - -
==== =========== =============
Depreciation, depletion and amortisation - -
==== =========== =============
Cost of sales - -
==== =========== =============
Gross loss - -
==== =========== =============
Other income and expenses from continuing operations
Other income 3 - 87,899
==== =========== =============
Finance Income/(costs) 4b 2,792 4,603
==== =========== =============
Foreign exchange gain 3 (30,756) 6,226
==== =========== =============
General and administration expenses 4c (1,112,049) (1,809,084)
==== =========== =============
Impairment of assets 4d (55,326) (153,225)
==== =========== =============
Loss before income tax expense
from continuing operations (1,195,339) (1,863,582)
==== =========== =============
Income tax credit/(expense) - -
==== =========== =============
Loss after income tax expense
from continuing operations (1,195,339) (1,863,582)
==== =========== =============
Gain/(loss) from discontinued
operations, net of tax 6 (141 ,349 ) (4,405,320)
==== =========== =============
(Loss)/profit for the year attributable
to equity holders of Star Phoenix
Group Limited (1,336,247) (6,268,902)
==== =========== =============
Other comprehensive income
Items that may be reclassified
to profit or loss
==== =========== =============
Exchange differences on translation
of foreign operations 19c 59,920 11,322
==== =========== =============
Other comprehensive (loss)/income
for year, net of tax 59,920 11,322
==== =========== =============
Total comprehensive (loss)/profit
attributable to equity holders
of Star Phoenix Group Limited (1,276,767) (6,257,580)
==== =========== =============
Loss per share from continuing operations attributable to the
ordinary equity holders of the Company:
Basic and diluted (loss) per
share (cents per share) 9a (0.008) (0.013)
==== =========== =============
Earnings/(Loss) per share from attributable to the ordinary
equity holders of the Company:
Basic and diluted earnings/(loss)
per share (cents per share) 9a (0.001) (0.044)
----------------------------------------- ---- ----------- -------------
*Refer to note 2a for detailed information on restatement of
comparatives
Consolidated Statement of Financial Position as at 30 June 2022
The below consolidated statement of financial position should be read in conjunction with the accompanying notes.
Note Consolidated
==================================== ==== ============================= ===============
2022 (US$) 2021 (Restated 2020 (Restated
US$)* US$)*
==================================== ==== ============= ============== ===============
Assets
===============
Current Assets
===============
Cash and cash equivalents 10 758,346 1,911,072 3,164,752
==== ============= ============== ===============
Trade and other receivables 11 229,292 103,866 2,248,359
==== ============= ============== ===============
Assets of disposal group classified
as held for sale 7a 4,043,011 4,249,038 7,922,861
==== ============= ============== ===============
Total current assets 5,030,649 6,263,976 13,335,972
==== ============= ============== ===============
Non-Current Assets
===============
Right of use asset 12 - 63,333 183,333
==== ============= ============== ===============
Property, plant and equipment 14 - 83,624 100,349
==== ============= ============== ===============
Total non-current assets - 146,957 283,682
==== ============= ============== ===============
Total assets 5,030,649 6,410,933 13,619,654
==== ============= ============== ===============
Current liabilities
===============
Trade and other payables 15 4,505,946 4,849,906 4,791,791
==== ============= ============== ===============
Liabilities directly associated
with assets classified as held
for sale 7b 691,097 450,653 1,154,300
==== ============= ============== ===============
Provisions 17 5,796,048 5,796,048 5,991,944
==== ============= ============== ===============
Total current liabilities 10,993,091 11,096,607 11,938,035
==== ============= ============== ===============
Non-current liabilities
===============
Trade and other payables 15 - - 296,245
==== ============= ============== ===============
Total non-current liabilities - - 296,245
==== ============= ============== ===============
Total liabilities 10,993,091 11,096,607 11,234,280
==== ============= ============== ===============
Net assets/(liabilities) (5,962,442) (4,685,676) 1,385,374
==== ============= ============== ===============
Equity
===============
Contributed equity 18 388,570,504 388,570,504 388,383,974
==== ============= ============== ===============
Reserves 19 23,460,290 23,400,370 23,389,048
==== ============= ============== ===============
Accumulated losses (417,993,236) (416,656,550) (410,387,648)
==== ============= ============== ===============
Total equity/deficit (5,962,442) (4,685,676) 1,385,374
==== ============= ============== ===============
The above consolidated statement of financial position should be read in conjunction with the accompanying notes.
*Refer to not 2a for detailed information on restatement of comparatives
Consolidated Statement of Changes in Equity for the year ended 30 June 2022
The below consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
Note Contributed Accumulated Foreign Share-based Option Non-controlling Total
equity losses currency payment premium interests equity
translation reserve reserve
reserve
================ ==== =========== ============= =========== =========== ========== =============== ===========
(US$) (US$) (US$) (US$) (US$) (US$)
================ ==== =========== ============= =========== =========== ========== =============== ===========
Balance at 1
July
2020(Originally
reported) 388,383,974 (409,284,204) 3,015,222 8,316,464 12,057,362 2,488,818
==== =========== ============= =========== =========== ========== =============== ===========
Adjustment due
to prior period
error (Note 2a) (1,103,444) (1,103,444)
==== =========== ============= =========== =========== ========== =============== ===========
Balance at 1
July 2020 388,383,974 (410,387,648) 3,015,222 8,316,464 12,057,362 - 1,385,374
==== =========== ============= =========== =========== ========== =============== ===========
Exchange
difference
on translation
of foreign
operations - - 11,322 - - - 11,322
==== =========== ============= =========== =========== ========== =============== ===========
Loss
attributable
to members of
the company - (1,863,582) - - - - (1,863,582)
==== =========== ============= =========== =========== ========== =============== ===========
Gain/(Loss) from
discontinued
operations - (4,405,320) - - - - (4,405,320)
==== =========== ============= =========== =========== ========== =============== ===========
Total
comprehensive
loss for the
year - (6,268,902) 11,322 - - - (6,257,580)
==== =========== ============= =========== =========== ========== =============== ===========
Transactions with owners in their capacity as owners:
Issue of share
capital 18 186,530 - - - - - 186,530
==== =========== ============= =========== =========== ========== =============== ===========
Realisation of
FCTR on
disposal
of foreign
operation 19 - - (4,993,916) - - - (4,993,916)
==== =========== ============= =========== =========== ========== =============== ===========
Non-controlling - - - - - - -
interests
==== =========== ============= =========== =========== ========== =============== ===========
Balance at 30
June 2021 388,570,504 (416,656,550) 3,026,544 8,316,464 12,057,362 - (4,685,676)
==== =========== ============= =========== =========== ========== =============== ===========
Balance at 1
July 2021 388,570,504 (416,656,550) 3,026,544 8,316,464 12,057,362 -(4,685,676)
Exchange difference
on translation
of foreign operations - - 59,920 - - -59,920
=========== ============= ========= =========== ============ ===========
Loss from continuing
operations of
the company - (1,195,339) - - - -(1,195,339)
=========== ============= ========= =========== ============ ===========
Profit/(loss)
from discontinued
operations - (141,349) - - - -(141,349)
=========== ============= ========= =========== ============ ===========
Transfer reserves
to accumulated
loss 20,373,826 (8,316,464) (12,057,362) -
=========== ============= ========= =========== ============ ===========
Total comprehensive
loss for the
year - 19,037,138 59,920 (8,316,464) (12,057,362) -(1,276,767)
=========== ============= ========= =========== ============ ===========
Transactions with owners in their capacity as owners:
Issue of share
capital 18 - - - - - --
=========== ============= ========= =========== ============ ===========
Balance at 30
June 2022 388,570,504 (397,619,412) 3,086,464 - - -(5,962,442)
=========== ============= ========= =========== ============ ===========
Consolidated Statement of Cash Flows for the year ended 30 June 2022
The below consolidated statement of cashflows should be read in conjunction with the accompanying notes.
Note Consolidated
------------------------------------- ----- --------------------------
2022 (US$) 2021 (US$)
------------------------------------- ----- ------------ ------------
Cash flows from operating activities
Receipts from customers 150,000 218,088
----- ------------ ------------
Other Receipts (906) 72,763
----- ------------ ------------
Payments to suppliers and employees (1,590,220) (1,841,025)
----- ------------ ------------
Income taxes (paid)/received (12.970) (90,795)
----- ------------ ------------
Payment for exploration expenditure - (175,448)
----- ------------ ------------
Net cash outflow from operating
activities 22 (1,454,096) (1,816,417)
----- ------------ ------------
Cash flows from investing activities
Payment for property, plant & - -
equipment
----- ------------ ------------
Proceeds from disposal of property,
plant and equipment 278,902 330,065
----- ------------ ------------
Net cash inflow/(outflow) on - -
disposal of subsidiary
----- ------------ ------------
Net cash inflow from investing
activities 278,902 330,065
----- ------------ ------------
Cash flows from financing activities
Receipts from share issue - -
----- ------------ ------------
Interest and other finance income 2,231 191
----- ------------ ------------
Provision of short-term loan - -
----- ------------ ------------
Payments for principal element - -
of leases
----- ------------ ------------
Proceeds received from related
company - 277,328
----- ------------ ------------
Net cash inflow from financing
activities 2,231 277,519
----- ------------ ------------
Net (decrease)/increase in cash
and cash equivalents (1,172,964) (1,208,834)
Net foreign exchange differences 20,238 (44,846)
--- ------------ ------------
Cash and cash equivalents at
beginning of financial year 1,911,072 3,164,752
--- ------------ ------------
Cash and cash equivalents at
end of financial year 10 758,346 1,911,072
--- ------------ ------------
Notes to Consolidated Financial Statements
Note 1: Significant accounting policies
These financial statements are general purpose financial statements that have been prepared in accordance with Australian Accounting Standards, Australian Accounting Interpretations, other authoritative pronouncements of the Australian Accounting Standards Board and the Corporations Act 2001. Star Phoenix Group Ltd is a for-profit entity for the purpose of preparing the financial statements.
The financial statements cover the Group consisting of Star Phoenix Group Ltd and its controlled entities. Financial information for Star Phoenix Group Ltd as an individual entity is disclosed in Note 25. Star Phoenix Group Ltd is a listed public company, incorporated and domiciled in Australia.
The following is a summary of the material accounting policies adopted by the Group in the preparation of the financial statements. The accounting policies have been consistently applied, unless otherwise stated. The financial report was authorised for issue by the Directors on 17 February2023.
Basis of preparation
Historical cost convention
The financial statements have been prepared under the historical cost convention, except for, where applicable, the revaluation of financial assets and liabilities at fair value through profit or loss, financial assets at fair value through other comprehensive income, certain classes of property, plant and equipment.
Compliance with IFRS
The financial statements of Star Phoenix Group Ltd also comply with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB). The financial statements were approved by the Board of Directors on 17 February 2023.
Functional and presentation currency
Items included in the financial statements of each of the Group's entities are measured using the currency of the primary economic environment in which the entity operates (the "Functional Currency"). The consolidated financial statements are presented in United States Dollars (USD), which is Star Phoenix Group Ltd.'s functional and presentation currency.
Going concern
This report has been prepared on the going concern basis, which contemplates the continuity of normal business activity and the realisation of assets and settlement of liabilities in the normal course of business.
For the year ended 30 June 2022 the Group recorded a loss of US$1,362,820 (2021: a loss of US$6,257,580), had net cash outflows of US$1,172,964 (2021: cash outflows of US$1,208,834) and had a cash balance of US$758,346 (2021: cash balance of US$1,911,072).
As at the reporting date (17 February 2023), the company had a cash balance of approximately US$457,000. Management believe there are sufficient funds to meet the Group's working capital requirements for the next 6 months. The ability of the Group to continue as a going concern beyond that timeframe is dependent on securing additional funding through the issue of shares and/or debt to fund its activities. The Company is currently seeking other opportunities to further expand its operations in other geographic locations.
These conditions indicate a material uncertainty that may cast a significant doubt about the Group's ability to continue as a going concern and, therefore, it may be unable to realise its assets and discharge its liabilities in the normal course of business.
The Company is currently seeking other opportunities to expand its operations in other geographic locations and a successful investment in a new project may be used to raise additional capital and subsequently generate positive cash flows. The Company is also focusing on managing its existing cash reserves.
.
Should the Company not be able to continue as a going concern, it may be required to realise its assets and discharge its liabilities other than in the ordinary course of business, and at amounts that differ from those stated in the financial statements. The financial report does not include any adjustments relating to the recoverability and classification of recorded asset amounts or liabilities that might be necessary should the Company not continue as a going concern.
(a) Principles of consolidation
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Star Phoenix Group Ltd ("Parent Entity" or "Company") as at 30 June 2022 and the results of all subsidiaries for the year then ended. Star Phoenix Group Ltd and its subsidiaries together are referred to as the "Group".
Subsidiaries are all those entities (including special purpose entities) over which the Group has control. The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its investment with the entity and has the ability to affect those returns through its power to direct the activities of the entity.
Where controlled entities have entered or left the Group during the year, their operating results have been included/excluded from the date control was obtained or until the date control ceased. A list of controlled entities is contained in Note 13 to the financial statements. All controlled entities have a 30 June financial year-end.
All inter-company balances and transactions between entities in the Group, including any unrealised profits or losses have been eliminated on consolidation. Accounting policies of subsidiaries have been changed where necessary to ensure consistencies with those policies applied by the Group.
Associates are all entities over which the Group has significant influence but not control or joint control, generally accompanying a shareholding of between 20-50% of the voting rights. Investments in associates are accounted for in the consolidated financial statements using the equity method of accounting, after initially being recognised at cost.
(b) Income tax
The charge for current income tax expense is based on the profit for the year adjusted for any non-assessable or disallowed items. It is calculated using tax rates that have been enacted or are substantively enacted by the reporting date within each jurisdiction.
Deferred tax is accounted for using the liability method in respect of temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. No deferred income tax will be recognised from the initial recognition of an asset or liability, excluding a business combination, where there is no effect on accounting or taxable profit or loss.
Deferred tax is calculated at the tax rates that are expected to apply to the period when the asset is realised or the liability is settled. Deferred tax is credited in profit or loss except where it relates to items that may be credited directly to equity, in which case the deferred tax is adjusted directly against equity.
Deferred income tax assets are recognised to the extent that it is probable that future tax profits will be available against which deductible temporary differences can be utilised.
Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount and tax bases of investments in foreign operations where the company is able to control the timing of the reversal of the temporary differences and it is probable that the differences will not reverse in the foreseeable future.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities and when the deferred tax balances relate to the same taxation authority. Current tax assets and liabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.
Current and deferred tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive income or directly in equity, respectively.
The amount of benefits brought to account or which may be realised in the future is based on the assumption that no adverse change will occur in income taxation legislation and the anticipation that the Group will derive sufficient future assessable income to enable the benefit to be realised and comply with the conditions of deductibility imposed by the law.
(c) Property, plant and equipment
Owned assets
Plant and equipment are measured on the historical cost basis less accumulated depreciation and impairment losses.
The cost of fixed assets constructed within the Group includes the cost of materials, direct labour, borrowing costs and an appropriate proportion of fixed and variable overheads.
Subsequent costs are included in the asset's carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. All other repairs and maintenance are charged to profit or loss during the financial period in which they are incurred.
Depreciation
The depreciable amount of all fixed assets including capitalised lease assets is depreciated on a straight-line basis over their useful lives to the Group commencing from the time the asset is held ready for use. Leasehold improvements are depreciated over the shorter of either the unexpired period of the lease or the estimated useful lives of the improvements.
The depreciation rates used for each class of depreciable asset are:
Class of fixed Asset Depreciation Rate
Plant & equipment 11.25% - 33%
==================
Production equipment 10 - 20%
==================
Motor vehicles, furniture &
fixtures 25 - 33%
==================
Leasehold improvements 10 - 12.50%
==================
The residual values of the assets and their useful lives are reviewed and adjusted if appropriate at each reporting date.
The carrying amount of plant and equipment is reviewed annually by the directors to ensure it is not in excess of the recoverable amount from these assets. The recoverable amount is assessed on the basis of the expected net cash flows which will be received from the employment of the assets and subsequent disposal. The expected net cash flows have been discounted to their present values in determining recoverable amounts.
The carrying amount of the asset is written down to its recoverable amount if its carrying amount is greater than its estimated recoverable amount.
Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains or losses are included in profit or loss. When revalued assets are sold, amounts included in the revaluation reserve relating to that asset are transferred to accumulated losses.
(d) Exploration and evaluation expenditure and the recognition of assets
Acquisition costs for exploration and evaluation projects are accumulated in respect of each identifiable area of interest. These costs are only carried forward to the extent that they are expected to be recouped through the successful development of the area or where activities in the area have not yet reached a stage that permits reasonable assessment of the existence of economically recoverable reserves.
Accumulated costs in relation to an abandoned area are written off in full against profit in the year in which the decision to abandon the area is made.
A regular review is undertaken of each area of interest to determine the appropriateness of continuing to carry forward costs in relation to that area of interest.
The recoverability of the carrying amount of the exploration and evaluation assets is dependent on the successful development and commercial exploitation, or alternatively, sale of the respective areas of interest.
The carrying values of expenditures carried forward are reviewed for impairment at each reporting date when the facts, events or changes in circumstances indicate that the carrying value may be impaired.
Accumulated expenditures are written off to profit or loss to the extent to which they are considered to be impaired.
The group applies AASB 6 Exploration and Evaluation of Mineral Resources which is equivalent to IFRS 6. The carrying value of exploration and evaluation expenditure is historical cost less impairment.
(e) Financial instruments
The Group's financial instruments include cash and cash equivalents and trade and other receivables.
A financial asset shall be measured at amortised cost if it is held within a business model whose objective is to hold assets in order to collect contractual cash flows which arise on specified dates and that are solely principal and interest.
A debt investment shall be measured at fair value through other comprehensive income if it is held within a business model whose objective is to both hold assets in order to collect contractual cash flows which arise on specified dates that are solely principal and interest as well as selling the asset on the basis of its fair value.
All other financial assets are classified and measured at fair value through profit or loss unless the entity makes an irrevocable election on initial recognition to present gains and losses on equity instruments (that are not held-for-trading or contingent consideration recognised in a business combination) in other comprehensive income ('OCI').
Despite these requirements, a financial asset may be irrevocably designated as measured at fair value through profit or loss to reduce the effect of, or eliminate, an accounting mismatch. For financial liabilities designated at fair value through profit or loss, the standard requires the portion of the change in fair value that relates to the entity's own credit risk to be presented in OCI (unless it would create an accounting mismatch).
Simpler hedge accounting requirements are intended to more closely align the accounting treatment with the risk management activities of the entity. Impairment requirements use an 'expected credit loss' ('ECL') model to recognise an allowance. Impairment is measured using a 12-month ECL method unless the credit risk on a financial instrument has increased significantly since initial recognition in which case the lifetime ECL method is adopted. For receivables, a simplified approach to measuring expected credit losses using a lifetime expected loss allowance is available.
(f) Foreign currency transactions and balances
Functional and presentation currency
The functional currency of each entity within the Group is determined using the currency of the primary economic environment in which that entity operates.
Transaction and balances
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the date of the transaction. Foreign currency monetary items are translated at the year-end exchange rate. Non-monetary items measured at historical cost continue to be carried at the exchange rate at the date of the transaction.
Non-monetary items measured at fair value are reported at the exchange rate at the date when fair values were determined.
Exchange differences arising on the translation of monetary items are recognised in profit or loss
Exchange differences arising on the translation of non-monetary items are recognised directly in equity to the extent that the gain or loss is directly recognised in equity; otherwise the exchange difference is recognised in profit or loss.
(h) Provisions
Provisions for legal claims, service warranties and make good obligations are recognised when the Group has a present legal or constructive obligation as a result of past events, it is probable that an outflow of resources will be required to settle the obligation and the amount has been reliably estimated. Provisions are not recognised for future operating losses.
Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is determined by considering the class of obligations as a whole. A provision is recognised even if the likelihood of an outflow with respect to any one item included in the same class of obligations may be small.
Provisions are measured at the present value of management's best estimate of the expenditure required to settle the present obligation at the reporting date. The discount rate used to determine the present value reflects the current market assessments of the time value of money and the risk specific to the liability. The increase in the provision due to the passage of time is recognised as interest expense.
(i) Cash and cash equivalents
Cash and cash equivalents include cash on hand, deposits held at call with banks, other short-term highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to insignificant risk of changes in value, and bank overdrafts. Bank overdrafts are shown within short-term borrowings in current liabilities on the statement of financial position.
(j) Trade receivables
Trade receivables are initially recognised at fair value and subsequently measured at amortised cost using the effective interest method, less any allowance for expected credit losses. Trade receivables are generally due for settlement within 30 days.
The consolidated entity has applied the simplified approach to measuring expected credit losses, which uses a lifetime expected loss allowance. To measure the expected credit losses, trade receivables have been grouped based on days overdue.
Other receivables are recognised at amortised cost, less any allowance for expected credit losses.
(k) Revenue recognition
Revenue is recognised at an amount that reflects the consideration to which the consolidated entity is expected to be entitled in exchange for transferring goods or services to a customer. For each contract with a customer, the Group identifies the contract with a customer; identifies the performance obligations in the contract; determines the transaction price which takes into account estimates of variable consideration and the time value of money; allocates the transaction price to the separate performance obligations on the basis of the relative stand-alone selling price of each distinct good or service to be delivered; and recognises revenue when or as each performance obligation is satisfied in a manner that depicts the transfer to the customer of the goods or services promised.
Revenue from a contract to provide services is recognised over time as the services are rendered based on either a fixed price or an hourly rate.
Revenue from the sale of oil and gas and related products was recognised when the Group had transferred to the buyer control of the product. In the case of oil, this usually occurs at the time of lifting. Other revenue is recognised when control has passed.
(l) Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the Australian Tax Office. In these circumstances the GST is recognised as part of the cost of acquisition of the asset or as part of an item of the expense. Receivables and payables in the statement of financial position are shown inclusive of GST.
Cash flows are presented in the consolidated statement of cash flows on a gross basis, except for the GST component of investing and financing activities, which are disclosed as operating cash flows.
(m) Comparative figures
When required by Accounting Standards, comparative figures have been adjusted to conform to changes in presentation for the current financial year.
(n) Fair value estimation
The fair value of financial assets and financial liabilities must be estimated for recognition and measurement for disclosure purposes.
The fair value of financial instruments traded in active markets (such as publicly traded derivatives, and trading and available-for-sale securities) is based on quoted market prices at the reporting date. The quoted market price used for financial assets held by the Group is the current bid price.
The fair value of financial instruments that are not traded in an active market (for example over-the-counter derivatives) is determined using valuation techniques. The Group uses a variety of methods and makes assumptions that are based on market conditions existing at each reporting date.
The carrying value less impairment provision of trade receivables and payables are assumed to approximate their fair values due to their short-term nature. The fair value of financial liabilities for disclosure purposes is estimated by discounting the future contractual cash follows at the current market interest rate that is available to the Group for similar financial instruments.
(o) Investments in associates
Investments in associates are accounted for using the equity method of accounting in the consolidated financial statements.
Under the equity method, the investment in the associate is carried in the consolidated statement of financial position at cost plus post-acquisition changes in the Group's share of net assets of the associate.
After application of the equity method, the Group determines whether it is necessary to recognise any additional impairment loss with respect to the Group's net investment in the associate.
The Group's share of the associate post-acquisition profits or losses is recognised in the statement of profit or loss and other comprehensive income. The cumulative post-acquisition movements are adjusted against the carrying amount of the investment. When the Group's share of losses in the associate equals or exceeds its interest in the associate, including any unsecured long-term receivables and loans, the Group does not recognise further losses, unless it has incurred obligations or made payments on behalf of the associate.
The reporting dates of the associate and the Group are identical and the associate's accounting policies conform to those used by the Group for like transactions and events in similar circumstances.
(p) Trade and other payables
These amounts represent liabilities for goods and services provided to the Group prior to the end of financial year which are unpaid. The amounts are unsecured and are usually paid within 30 days of recognition unless alternative terms are agreed.
(q) Dividends
Provision is made for the amount of any dividend declared, being appropriately authorised and no longer at the discretion of the entity, on or before the end of the financial year but not distributed at reporting date.
(r) Contributed equity
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds.
(s) Earnings per share
Basic earnings per share
Basic earnings per share is calculated by dividing the profit or loss attributable to equity holders of the Company, excluding any costs of servicing equity other than ordinary shares, by the weighted average number of ordinary shares outstanding during the financial year, adjusted for bonus elements in ordinary shares issued during the year.
Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account the after income tax effect of interest and other financing costs associated with dilutive potential ordinary shares.
(t) Segment reporting
Operating segments are reported in a manner consistent with the internal reporting to the chief operating decision maker. The chief operating decision maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the Chief Executive Officer.
(u) Impairment of assets
Goodwill and intangible assets that have an indefinite useful life are not subject to amortisation and are tested annually for impairment, or more frequently if events or changes in circumstances indicate that they might be impaired. Other assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which they are separately identifiable cash inflows which are largely independent of the cash inflows from other assets or groups of assets (cash-generating units). Non-financial assets other than goodwill that suffered an impairment are reviewed for possible reversal of the impairment at the end of each reporting period.
(v) Share-based payments
The fair value of options granted is recognised as an expense with a corresponding increase in equity. The total amount to be expensed is determined by reference to the fair value of the options granted, which includes any market performance conditions and the impact of any non-vesting conditions but excludes the impact of any service and non-market performance vesting conditions.
(w) Employee benefits
Wages and salaries and annual leave
Liabilities for wages and salaries, including non-monetary benefits are recognised in current liabilities in respect of employees' services up to the reporting date and are measured at the amounts expected to be paid when the liabilities are settled.
Long service benefit
The liability for long service benefit is recognised in current and non-current liabilities, depending on the unconditional right to defer settlement of the liability for at least 12 months after the reporting date. The liability is measured as the present value of expected future payments to be made in respect of services provided by employees up to the reporting date using the projected unit credit method. Consideration is given to expected future wage and salary levels, experience of employee departures and periods of service.
(x) Leases
Except for short-term leases and leases of low-value assets, right-of-use assets and corresponding lease liabilities are recognised in the statement of financial position. Straight-line operating lease expense recognition is replaced with a depreciation charge for the right-of-use assets (included in operating costs) and an interest expense on the recognised lease liabilities (included in finance costs). In the earlier periods of the lease, the expenses associated with the lease under AASB 16 will be higher when compared to lease expenses under AASB 117. However, EBITDA (Earnings Before Interest, Tax, Depreciation and Amortisation) results improve as the operating expense is now replaced by interest expense and depreciation in profit or loss. For classification within the statement of cash flows, the interest portion is disclosed in operating activities and the principal portion of the lease payments are separately disclosed in financing activities.
(y) Borrowings
Loans and borrowings are initially recognised at the fair value of the consideration received, net of transaction costs. They are subsequently measured at amortised cost using the effective interest method.
Where there is an unconditional right to defer settlement of the liability for at least 12 months after the reporting date, the loans or borrowings are classified as non-current.
(z) Inventories
Inventories include consumable supplies and maintenance spares and are valued at the lower of cost and net realisable value. Cost is determined on a weighted average basis and includes direct costs and an appropriate portion of fixed and variable production overheads where applicable. Inventories determined to be obsolete or damaged are written down to net realisable value, being the estimated selling price less selling costs.
The directors evaluate estimates and judgements incorporated into the financial statements based on historical knowledge and best available current information. Estimates assume a reasonable expectation of future events and are based on current trends and economic data, obtained both externally and within the Group. Areas involving a higher degree of judgement or complexity, or areas where estimations and assumptions are significant to the financial statements are disclosed here.
(aa) Non-current assets classified as held for sale and discontinued operations
Non-current assets are classified as held for sale if their carrying amount will be recovered principally through a sale transaction rather than through continuing use. They are measured at the lower of their carrying amount and fair value less costs to sell. For non-current assets to be classified as held for sale, they must be available for immediate sale in their present condition and their sale must be highly probable.
An impairment loss is recognised for any initial or subsequent write down of the non-current assets to fair value less costs to sell. A gain is recognised for any subsequent increases in fair value less costs to sell of a non-current asset, but not in excess of any cumulative impairment loss previously recognised.
Non-current assets are not depreciated or amortised while they are classified as held for sale. Interest and other expenses attributable to the liabilities of assets held for sale continue to be recognised.
Non-current assets classified as held for sale are presented separately on the face of the consolidated statement of financial position, in current assets. The liabilities of disposal groups classified as held for sale are presented separately on the face of the statement of financial position, in current liabilities.
Discontinued operations
A discontinued operation is a component of the Group's business, the operations and cash flows of which can be clearly distinguished from the rest of the Group and which:
-- represents a separate major line of business or geographical area of operations;
-- is part of a single co-ordinated plan to dispose of a separate major line of business or geographical are of operations; and
-- is a subsidiary acquired exclusively with a view to resale.
Classification as a discontinued operation occurs at the earlier of disposal or when the operation meets the criteria to be classified as held-for-sale.
When an operation is classified as a discontinued operation, the comparative consolidated statement of profit or loss and other comprehensive income is re-presented as if the operation had been discontinued from the start of the comparative year.
(bb) Right-of-use asset
A right-of-use asset is recognised at the commencement date of a lease. The right-of-use asset is measured at cost, which comprises the initial amount of the lease liability, adjusted for, as applicable, any lease payments made at or before the commencement date net of any lease incentives received, any initial direct costs incurred, and, except where included in the cost of inventories, an estimate of costs expected to be incurred for dismantling and removing the underlying asset, and restoring the site or asset.
Right-of-use assets are depreciated on a straight-line basis over the unexpired period of the lease or the estimated useful life of the asset, whichever is the shorter. Where the Group expects to obtain ownership of the leased asset at the end of the lease term, the depreciation is over its estimated useful life. Right-of use assets are subject to impairment or adjusted for any remeasurement of lease liabilities.
Note 2: Significant estimates and judgements
Impairment of rigs and related equipment
The Company sold four production rigs for a total gain of US$83,543. The Company continues the sale process of the remaining four production and four drilling rigs.
Impairment was calculated on an individual rig basis base on best information available. The recoverable amount of these assets was estimated based on an indicative conditional offer received minus any significant costs involved in selling of the assets.
For the rest of workover/swabbing rigs, based on rigs sold to date the evidence suggests that a lower impairment percentage should apply. However, Management is of the opinion that given that negotiations for those are still at a premature stage, the same impairment percentage should apply.
Classification of assets held for sale
In accordance with AASB 5 Assets held for sale and discontinued operations, an entity shall classify a non-current assets as held for sale if its carrying amount will be recovered principally through a sale transaction rather than through continuing use. For this to be the case, the asset must be available for immediate sale in its present condition and that the sale must be highly probable. AASB 5 notes that the sale should be expected to qualify as a completed sale within 12 months from the date of classification.
Management note that the sales process has extended beyond the 12 months as a result of the impact of COVID-19 and the travel restrictions imposed by various governments meaning that potential vendors have not been able to physically inspect the relevant assets and that as a result the sales process has lasted longer than 12 months.
Management have judged that the impact of COVID-19 meets the criteria noted in AASB 5 regarding delays caused by events or circumstances beyond management's control and that they remain committed to completing the sales process as soon as practicable.
COVID-19 pandemic
The impact of the COVID-19 pandemic is ongoing. Other than as addressed in specific notes, there does not currently appear to be either any significant impact upon the financial statements or any significant uncertainties with respect to events or conditions which may impact the consolidated entity unfavourably as at the reporting date or subsequently as a result of the COVID-19 pandemic.
Note 2a: Restatement of comparatives
During the half year ended 31 December 2021, an error was discovered in the recognition of withholding tax payable relating to prior years. Detailed calculation were carried out in this period and this resulted in an increase of $1,103,444 in the withholding tax liability for the year ended 30 June 2020, an increase of $182,803 in the withholding tax liability for the year ended 30 June 2021. The impact of the restatement is noted below
30 June 2021 Correction 30 June 21
of (US$)
(US$) prior period Restated
Reported error
Trade and other payable
-(line item affected
Other
taxes payable)-Refer
Note 10 3,563,659 1,286,247 4,849,906
-------------- --------------- ------------
Gain/(loss) from discontinued
operations-net of
tax (4,222,517) (182,803) (4,405,320)
-------------- --------------- ------------
30 June 2020 Correction 30 June 20
of (US$)
(US$) prior period Restated
Reported error
Trade and other payable
-(line item affected
Other
taxes payable) 3,688,347 1,103,444 4,791,791
-------------- --------------- ------------
Gain/(loss) from discontinued
operations-net of
tax 53,191,671 (1,103,444) 52,088,227
-------------- --------------- ------------
Earnings per Share 30 June 30 June
2021 (US$) 2021 (US$)
Reported Adjusted
Basic earnings/(loss)
per share (0.012) (0.013)
------------ ------------
Diluted earnings/(loss)
per share (0.04) (0.044)
------------ ------------
Note 3: Revenue
Note Consolidated
-------------------------------------- ------ ------------------------
2022 (US$) 2021 (US$)
-------------------------------------- ------ ----------- -----------
From discontinued operations
Revenue from services to third
parties recognised over time 180,736 129,928
----------- -----------
Total revenue from discontinued
operations 180,736 129,928
----------- -----------
Other income from continuing operations
Foreign exchange gain (30,756) 6,226
----------- -----------
Government grant - 72,763
----------- -----------
Other income - 15,136
----------- -----------
Total other income - 87,899
----------- -----------
Other income from discontinued operations
Other income 8,894 450,089
----------- -----------
Total other income from discontinued
operations 8,894 450,089
----------- -----------
Revenue from third party services and sale of oil is solely generated in the Republic of Trinidad and Tobago.
Government grant relates to "cash flow boost" which is a support from the Australian government to eligible entities during the period associated with COVID-19. Other income from continuing operations relates to gain on settlement of employee liabilities.
Other income from discontinued operations relates to gain from disposal of assets and oil field service s .
Note 4: Expenses
Note Consolidated
--------------------------------------- ----- ------------------------
2022 (US$) 2021 (US$)
--------------------------------------- ----- ----------- -----------
a: Cost of sales - continuing operations
Costs of operations - -
----- ----------- -----------
Depreciation and amortisation - -
----- ----------- -----------
Total cost of sales from continuing - -
operations
----- ----------- -----------
a: Cost of sales - discontinued operations
Costs of production 4,443 45,794
----- ----------- -----------
Staff Costs 202,871 254,598
----- ----------- -----------
Depreciation and amortisation - -
----- ----------- -----------
Impairment of Receivables - 1,615,572
----- ----------- -----------
Impairment of Rigs and related
equipment 5 - 3,437,053
----- ----------- -----------
Total cost of sales from discontinued
operations 207,314 5,353,017
----- ----------- -----------
b: Finance costs - continuing operations
Foreign exchange loss /(Gain) - -
----- ----------- -----------
Interest (income)/expense (2,792) (4,603)
----- ----------- -----------
Interest on convertible note - -
----- ----------- -----------
Total finance costs from continuing
operations (2,792) (4,603)
----- ----------- -----------
b: Finance (income)/costs - discontinued operations
Interest expense - -
----- ----------- -----------
Foreign exchange (gain)/loss 37,241 275,309
----- ----------- -----------
Total finance (income)/costs
from discontinued operations 37,241 275,309
----- ----------- -----------
c: General and administration expenses - continuing operations
Directors' and officers' fees
and benefits 277,832 702,785
----- ----------- -----------
Legal fees 219,153 102,872
----- ----------- -----------
Business development, financial
and other consulting fees 188,046 361,066
----- ----------- -----------
Listing fees 105,354 146,216
----- ----------- -----------
Other expenses 321,664 496,145
----- ----------- -----------
Total general and administration
expenses from continuing operations 1,112,049 1,809,084
----- ----------- -----------
d: Asset values written down- continuing operations
Impairment of assets 11 55,326 153,225
----- ----------- -----------
Total Assets written down 55,326 153,225
----- ----------- -----------
Note 5: Impairment of non-current assets held for sale
Management is required to make judgements concerning the cause ,timing and amount of impairments.Management considers the impact of competitive conditions ,cost of capital ,funding ,obsolescence and discontinuance of services in its identification of impairment indicators.Key assumptions on which management use in the determination is fair value less costs to sell including binding sales agreements,projected revenues ,capital expenditures and cutomer base . No impairment assessment were undertaken for the year as at 30 June 2022. As a result, no impairment was recorded in relation to the rigs and related equipment. Refer to Impairment of rigs and related equipment in Note 4 and note 7a.
Note 6: Discontinued operations
In the prior year financial statements, the company has classified its business in Trinidad as discontinued. Therefore, the table presents the financial information for the group's operations in Trinidad.
The financial performance and cash flows of the Trinidad operations are shown below.
Note Consolidated
-------------------------------------- ----- -------------------------
2022 (US$) 2021 (US$)
-------------------------------------- ----- ----------- ------------
Revenue from third party services 3 180,736 129,928
----- ----------- ------------
Other income 8,894 450,089
----- ----------- ------------
Operating expenses 4a (4,443) (45,794)
----- ----------- ------------
Depreciation, depletion and - -
amortisation
----- ----------- ------------
Staff costs 4a (202,871) (254,598)
----- ----------- ------------
Administrative expenses (57,921) (86,052)
----- ----------- ------------
Insurance expense (65,886) (57,990)
----- ----------- ------------
Impairment of Rigs and related
equipment 7a - (3,437,053)
----- ----------- ------------
Impairment of Receivables - (1,615,572)
----- ----------- ------------
Finance income/(expense) (37,241) 92,506
----- ----------- ------------
Legal fees (22,740) (272,884)
----- ----------- ------------
Gain from disposal of assets 60,123 83,543
----- ----------- ------------
Taxation benefit - 608,557
----- ----------- ------------
Loss from dicontinued operations (141,349) (4,405,320)
----- ----------- ------------
Net cash (outflow)/inflow
from operating activities (281,699) (746,051)
----- ----------- ------------
Net cash Inflow/(outflow)
from investing activities 278,902 154,617
----- ----------- ------------
Net cash inflow from financing
activities - 277,328
----- ----------- ------------
Net cash (decrease)/increase
in cash generated by the subsidiary (2,797) (314,106)
----- ----------- ------------
Current period discontinued operations relate to Range Resources Drilling Service Ltd.
Gain/(loss) from discontinued operations, net of tax
Gain/(loss) from RRDSL (307,932) (4,405,320)
---------- ------------
Total Gain/(loss) from discontinued
operations, net of tax (307,932) (4,405,320)
---------- ------------
Note 7a: Assets of disposal group classified as held for sale
Note Consolidated
------------------------------- ------ ------------------------
2022 (US$) 2021 (US$)
------------------------------- ------ ----------- -----------
Current assets
Rigs and related inventory 3,175,977 3,635,878
----------- -----------
Property, plant and equipment 361,410 613,160
----------- -----------
Total current assets 3,537,387 4,249,038
----------- -----------
Total held for sale assets 3,537,387 4,249,038
----------- -----------
Disposal of rigs and related inventory held by Range Resources Drilling
Services
The Company has also been actively marketing the rigs and equipment. As a result, the Company sold production rigs for a total gain of US$10,816. The Company continues the sale process of the remaining three production and four drilling rigs.
During the period, no impairment charge was recognised by management in the year ended 30 June 2022 (2021: US$ 3,437,053) .
Note 7b: Liabilities directly associated with assets classified as held for sale
Note Consolidated
--------------------------------- ------ ------------------------
2022 (US$) 2021 (US$)
--------------------------------- ------ ----------- -----------
Current liabilities
Trade and other payables - -
------ ----------- -----------
Deferred tax liabilities 691,097 450,653
----------- -----------
Accrued expenditure - -
------ ----------- -----------
Total current liabilities 691,097 450,653
----------- -----------
Total held for sale liabilities 691,097 450,653
----------- -----------
Note 8: Auditor's remuneration
Note Consolidated
------------------------------------- ------ ------------------------
2022 (US$) 2021 (US$)
------------------------------------- ------ ----------- -----------
Remuneration of the auditor of the Parent Entity for:
Auditing or reviewing the financial
report by BDO Audit (WA) Pty
Ltd 52,203 80,750
----------- -----------
Non-audit services provided
by a related entity of BDO
Audit (WA) Pty Ltd in respect
to Parent Entity's tax compliance 34,345 36,338
----------- -----------
Total remuneration for the
Parent Entity 86,548 117,088
----------- -----------
Remuneration of the auditors of the subsidiaries
Auditing or reviewing the financial
report
by MHA Macintyre Hudson - 9,072
----------- -----------
Auditing or reviewing the financial
report by BDO Barbados - 7,500
----------- -----------
Auditing or reviewing the financial
report by BDO Trinidad - 11,142
----------- -----------
Auditing or reviewing the financial 5,925 -
report by Felicia Hosein &
Company Trinidad
------ ----------- -----------
Total remuneration for the
subsidiaries 5,925 27,714
----------- -----------
Note 9: Earnings/(Loss) per share
Note Consolidated
----------------------------------- ------ --------------------------
2022 (US$) 2021 (US$)
----------------------------------- ------ ------------ ------------
a: Basic loss per share
Loss per share from continuing
operations attributable to
the ordinary equity holders
of the company (0.008) (0.013)
------------ ------------
Loss per share attributable
to the ordinary equity holders
of the company (0.009) (0.044)
------------ ------------
Loss per share from discontinued
operations attributable to
the ordinary equity holders
of the company (0.001) (0.031)
------------ ------------
b: Diluted loss per share
Loss per share from continuing n/a n/a
operations attributable to
the ordinary equity holders
of the company
------ ------------ ------------
Loss per share attributable n/a n/a
to the ordinary equity holders
of the company
------ ------------ ------------
Loss per share from discontinued n/a n/a
operations attributable to
the ordinary equity holders
of the company
------ ------------ ------------
c: Reconciliation of gain/(loss) used in calculating earnings
per share
Basic/ Diluted loss per share
----------------------------------- ------ ------------ ------------
Loss from continuing operations
attributable to the ordinary
equity holders of the company (1,195,339) (1,863,582)
------------ ------------
Gain/(loss) attributable to
the ordinary equity holders
of the company (1,407,967) (6,694,656)
------------ ------------
Loss from discontinued operations
attributable to the ordinary
equity holders of the company (212,628) (4,831,074)
------------ ------------
d: Weighted average number of shares used as the denominator
Weighted average number of
ordinary shares used as the
denominator in calculating
basic EPS 150,876,970 146,267,513
------------ ------------
Note 10: Cash and cash equivalents
Note Consolidated
-------------------------- ------ ------------------------
2022 (US$) 2021 (US$)
-------------------------- ------ ----------- -----------
Cash at bank and on hand 758,346 1,911,072
----------- -----------
Risk exposure
Information about the Group's exposure to credit risk, foreign exchange risk and price risk is provided in Note 26.
Note 11: Trade and other receivables
Note Consolidated
----------------------------------- ------ ------------------------
2022 (US$) 2021 (US$)
----------------------------------- ------ ----------- -----------
Current
Trade receivables (i) 20 -
------ ----------- -----------
Taxes receivable 40,228 39,342
----------- -----------
Other receivables (ii) 138,763 13,182
----------- -----------
Prepayments 19,833 20,849
----------- -----------
Other taxes receivable 30,448 30,493
----------- -----------
Total trade and other receivables 229,292 103,866
----------- -----------
(i) Trade receivables are generally due for settlement within 30 days. They are presented as current assets unless collection is not expected for more than 12 months after the reporting date.
(ii) Other receivables comprise tribunal fees of GBP 90,000 paid on behalf LandOcean Energy Services Co Limited. This amount will deduct reimbursement from Dentons.
The consolidated entity has increased its monitoring of debt recovery as there is an increased probability of customers delaying payment, due to the COVID-19 pandemic. An impairment of US$55,326 (30 June 2021: $153,225) has been recognised relating to continuing operations and no impairment has been recognised relating to non-continuing operations in the year to 30 June 2022 (30 June 2021: $1,598,847).
Fair value approximates the carrying value of trade and other receivables at 30 June 2022 and 30 June 2021.
Risk exposure
Information about the Group's exposure to credit risk, foreign exchange risk and price risk is provided in Note 26.
Allowance for expected credit losses
The consolidated entity has recognised a loss in profit or loss in respect of the expected credit losses for the year ended 30 June 2022 as described above.
Note 12: Right-of-Use Asset
Note Consolidated
----------------------------------- ------ -------------------------
2022 (US$) 2021 (US$)
----------------------------------- ------ ------------ -----------
Non-current
Right-of-use asset - 63,333
----------- -----------
Total trade and other receivables - 63,333
----------- -----------
The amount relates to the office lease in Beijing, People's Republic of China, expiring on 31 August 2021. Amortisation of US$43,333 was recognised in the Income Statement with regards to the asset. The bond has been refunded to the company.
Note 13: Controlled entities
The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in accordance with accounting policy described in Note 1(a).
Controlled Entities Consolidated Country of Percentage Owned
Incorporation (%)
------------------------------------ --------------- ==================
30 June 30 June
2021 2020
------------------------------------ --------------- -------- --------
Subsidiaries of Star Phoenix Group Limited:
Range Resources (Barbados) Limited Barbados 100 100
--------------- -------- --------
SOCA Petroleum Limited Barbados 100 100
--------------- -------- --------
Range Resources Drilling Services
Limited Trinidad 100 100
--------------- -------- --------
West Indies Exploration Company
Limited Trinidad 100 100
--------------- -------- --------
Range Resources Trinidad Limited
(disposed of) Trinidad - 100
--------------- -------- --------
Range Resources West Coast
Limited Trinidad 100 100
--------------- -------- --------
Range Resources (Barbados) GY
Limited Barbados 100 100
--------------- -------- --------
Range Resources GY Shallow
Limited Trinidad 100 100
--------------- -------- --------
Range Resources GY Deep Limited Trinidad 100 100
--------------- -------- --------
Star Phoenix Group UK Limited United Kingdom 100 100
--------------- -------- --------
Range Resources HK Limited Hong Kong 100 100
--------------- -------- --------
PT Hengtai Weiye Oil and Gas Indonesia 60 60
--------------- -------- --------
PT Jasmine Oil and Gas Services Indonesia 60 60
--------------- -------- --------
PT Lubuk Kawai Raya (i) Indonesia 46.8 46.8
--------------- -------- --------
PT Aceh Timur Kawai Energi
(i) Indonesia 42.1 42.1
--------------- -------- --------
Georgian Oil Pty Ltd Australia 100 100
--------------- -------- --------
Shanghai AusQuality International
Trading Co. Ltd China 100 100
--------------- -------- --------
Junior Star Tec Limited China 100 100
--------------- -------- --------
(i) Indirect control of these entities was obtained with the acquisition of 60% of the share capital in PT Hengtai Weiye Oil and Gas
(ii) In the subsidiaries, only Star Phoenix Group UK Limited and the Chinese entities are continuing entities. The rest of the entities are discontinued.
Note 14: Property, Plant & Equipment
Consolidated Production Gathering Leasehold Motor vehicle,
equipment station improvement furniture, Total
and access and field fixtures
roads office & fittings
---------------- ----------- ---------- ------------ -------------- -----------
US$ US$ US$ US$ US$
----------- ---------- ------------ -------------- -----------
Year ended 30 June 2021
Opening net
book amount - - - 100,349 100,349
----------- ---------- ------------ -------------- -----------
Depreciation
charge - - - (16,725) (16,725)
----------- ---------- ------------ -------------- -----------
Closing net
book amount - - - 83,624 83,624
----------- ---------- ------------ -------------- -----------
At 30 June 2021
Cost 2,072,722 - - 323,402 2,396,124
----------- ---------- ------------ -------------- -----------
Accumulated
depreciation (2,072,722) - - (239,778) (2,312,500)
----------- ---------- ------------ -------------- -----------
Net book amount - - - 83,624 83,624
----------- ---------- ------------ -------------- -----------
Year ended 30 June 2022
Opening net
book amount - - - 83,624 83,624
----------- ---------- ------------ -------------- -----------
Depreciation
charge - - - (83,624) (83,624)
----------- ---------- ------------ -------------- -----------
Closing net - - - - -
book amount
----------- ---------- ------------ -------------- -----------
At 30 June 2022
Cost - - - 83,624 83,624
----------- ---------- ------------ -------------- -----------
Accumulated
depreciation - - - (83,624) (83,624)
----------- ---------- ------------ -------------- -----------
Net book amount - - - - -
----------- ---------- ------------ -------------- -----------
Note 15: Trade and other payables
Note Consolidated
----------------------------------- ------ ---------------------------
2022 (US$) 2021 (US$)
(Restated)
----------------------------------- ------ ------------ -------------
a: Current
Trade payables 244,136 304,455
------------ -------------
Sundry payables and accrued
expenses (i) 55,212 155,268
------------ -------------
Other payables (ii) 4,206,598 4,390,183
------------ -------------
Total 4,505,946 4,849,906
------------ -------------
b: Non-Current
Other payables - interest bearing - -
------ ------------ -------------
Other payables - non-interest - -
bearing
------ ------------ -------------
Total 4,505,946 4,849,906
------------ -------------
(i) Amount mainly relates to accrued expenditure from operations in Trinidad and Australia.
(ii) Amount mainly relates to withholding taxes payable as a result of debt eliminations.
Note 16: Deferred taxes
Accrued Total
Other interest
----------------------------------------- --------- ---------- -------
Deferred tax asset US$ US$ US$
-------------------------------
Movements: Year ended 30 June 2022
Opening balance - 30,493 30,493
--------- ---------- -------
Charged/(credited) - to profit or loss - (45) (45)
--------- ---------- -------
Closing net book amount (i) - 30,448 30,448
--------- ---------- -------
(i) Deferred tax asset is included in the asset held for sale (note 7a)
Fair value Accelerated Total
uplift on depreciation
business
combination
-------------------------------- -------------- -------------- ----------
Deferred tax liability US$ US$ US$
Movements: Year ended 30 June 2021
Opening balance - 1,154,300 1,154,300
-------------- -------------- ----------
Foreign currency movement - - -
-------------- -------------- ----------
Charged/(credited) - to profit
or loss - (703,647) (703,647)
-------------- -------------- ----------
Closing net book amount - 450,653 450,653
-------------- -------------- ----------
Movements: Year ended 30 June 2022
Opening balance - 450,653 450,653
-------------- -------------- ----------
Foreign currency movement - - -
-------------- -------------- ----------
Charged/(credited) - to profit
or loss - 240,444 240,444
-------------- -------------- ----------
Closing net book amount
(i) 691,097 691,097
-------------- ----------
(i) Deferred tax liability is included in liabilities directly associated with assets held for sale (note 7b)
Note 17: Provisions
Note Consolidated
--------------- ------ ------------------------
2022 (US$) 2021 (US$)
--------------- ------ ----------- -----------
Provision (i) 5,796,048 5,796,048
----------- -----------
Total 5,796,048 5,796,048
----------- -----------
( i) Provision relates to an estimate of the potential land taxes that may be payable by the Company on expired exploration licences in Trinidad. The determination of provisions involves management judgements about the probability of outcomes of future events and estimates on timing and amount of expected future cash flows.
The amount and timing of settlement in respect of land taxes are uncertain and dependent on factors that are not within management control as payment dates are uncertain.
Note 18: Contributed equity
Note Consolidated
--------------------------------- ------ ----------------------------
2022 (US$) 2021 (US$)
--------------------------------- ------ ------------- -------------
150,876,970 (2021: 150,876,970)
fully paid ordinary shares 409,614,906 409,614,906
------------- -------------
Share issue costs (21,044,402) (21,044,402)
------------- -------------
Total contributed equity 388,570,504 388,570,504
------------- -------------
Consolidated
---------------------- ------------------------------------------------------
2022 No. 2022 (US$) 2021 No. 2021 (US$)
---------------------- ------------ ------------ ------------ ------------
a: Fully paid ordinary shares
At the beginning
of reporting period 150,876,970 409,614,906 141,367,955 409,428,374
------------ ------------ ------------ ------------
Shares issued to
directors during
year - - 9,509,015 186,530
------------ ------------ ------------ ------------
Total contributed
equity 150,876,970 409,614,906 150,876,970 409,614,906
------------ ------------ ------------ ------------
At the date of this report, the Company's issued capital comprises 150,876,970 ordinary fully paid shares.
Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the Company in proportion to the number of and amounts paid on the shares held.
On a show of hands every holder of ordinary shares present at a meeting of the Company, in person or by proxy, is entitled to one vote and upon a poll each share is entitled to one vote.
On 4 January 2021, the Group announced to issue 7,195,036 shares to directors. During the year, the Group also issued announced a subscription of 2,313,979 new ordinary shares to management.
Note 19: Reserves
Note Consolidated
------------------------------ ------ ------------------------
2022 (US$) 2021 (US$)
------------------------------ ------ ----------- -----------
a: Share-based payment reserve
Balance 1 July 2021 8,316,464 8,316,464
----------- -----------
Share based payment expenses - -
------ ----------- -----------
Balance 30 June 2022 8,316,464 8,316,464
----------- -----------
The share-based payment reserve records items recognised as expenses on the fair valuation of shares and options issued as remuneration to employees, directors and consultants. For the year ended 30 June 2022 the amount was nil reflecting the fact that all options vested during the year.
Note Consolidated
------------------------------------------ ------ ------------------------
2022 (US$) 2021 (US$)
------------------------------------------ ------ ----------- -----------
b: Option premium reserve
Balance 1 July 2021 12,057,362 12,057,362
----------- -----------
Fair value movement of exercised - -
options that were originally classified
as a derivative liability
------ ----------- -----------
Balance 30 June 2022 12,057,362 12,057,362
----------- -----------
The option premium reserve is used to recognise the grant date fair value of options.
Note Consolidated
---------------------------------------- ------ ------------------------
2022 (US$) 2021 (US$)
---------------------------------------- ------ ----------- -----------
c: Foreign currency translation reserve
Balance 1 July 2021 3,026,544 3,015,222
----------- -----------
Currency translation differences
arising during the year 59,920 11,322
----------- -----------
Currency translation differences - -
arising due to disposal of subsidiary
------ ----------- -----------
Balance 30 June 2022 3,086,464 3,026,544
----------- -----------
The foreign currency translation reserve is used to record exchange differences arising from the translation balances of foreign subsidiaries.
Total reserves at 30 June 2022 23,460,290 23,400,370
Note 20: Contingent liabilities and contingent assets
The Directors are not aware of any contingent liabilities or contingent assets as at 30 June 2022.
Note 21: Segment reporting
30 June 2022 Trinidad Trinidad Indonesia Unallocated Total
- Oil & - Oilfield US$ US$ US$
Gas Production Services
US$ US$
--------------------------------- ----------------- ------------ ---------- ------------ ------------
Segment revenue
Total segment revenue - 2,792 2,792
----------------- ------------ ---------- ------------ ------------
Intersegment revenue -
----------------- ------------ ---------- ------------ ------------
Revenue from external -
customers
----------------- ------------ ---------- ------------ ------------
Other income - 2,792 2,792
----------------- ------------ ---------- ------------ ------------
Segment result
Depreciation - - -
----------------- ------------ ---------- ------------ ------------
Interest Income/(expense) - - (30,756) (30,756)
----------------- ------------ ---------- ------------ ------------
Other segment income/(expenses) - - (1,112,049) (1,112,049
----------------- ------------ ---------- ------------ ------------
Impairment of Receivables - - (55,326) (55,326)
----------------- ------------ ---------- ------------ ------------
Impairment of Rigs - -
and related equipment
----------------- ------------ ---------- ------------ ------------
Gain on disposal - - (212,628) (212,628)
----------------- ------------ ---------- ------------ ------------
Profit/(Loss) before
income tax - - (212,628) (212,628)
----------------- ------------ ---------- ------------ ------------
Income tax - - - -
----------------- ------------ ---------- ------------ ------------
Profit/(Loss) after
income tax - (212,628) - (1,195,339) (1,407,967)
----------------- ------------ ---------- ------------ ------------
Segment assets
Segment assets - 4,386,451 - 634,401 5,020,851
----------------- ------------ ---------- ------------ ------------
Total assets - 4,386,451 - 634,401 5,020,851
----------------- ------------ ---------- ------------ ------------
Segment liabilities
Segment liabilities - 9,606,408 - 1,488,166 11,054,574
----------------- ------------ ---------- ------------ ------------
Total liabilities - 9,606,408 - 1,488,166 11,054,574
----------------- ------------ ---------- ------------ ------------
30 June 2021 Trinidad Trinidad Indonesia Unallocated Total
- Oil & - Oilfield US$ US$ US$
Gas Production Services
US$ US$
--------------------------------- ----------------- ------------ ---------- ------------ ------------
Total segment revenue
----------------- ------------ ---------- ------------ ------------
Intersegment revenue - 580,017 - 98,728 678,745
----------------- ------------ ---------- ------------ ------------
Revenue from external
customers - 129,928 - - 129,928
----------------- ------------ ---------- ------------ ------------
Other income - 450,089 - 98,728 548,817
----------------- ------------ ---------- ------------ ------------
Segment result
Depreciation - - - (16,725) (16,725)
----------------- ------------ ---------- ------------ ------------
Interest income/(expense) - 226,839 - (222,236) 4,603
----------------- ------------ ---------- ------------ ------------
Other segment expenses - (805,348) - (1,586,849) (2,392,197)
----------------- ------------ ---------- ------------ ------------
Impairment of receivables - (1,479,072) - (136,500) (1,615,572)
----------------- ------------ ---------- ------------ ------------
Impairment of Rigs
and related equipment - (3,437,053) - - (3,437,053)
----------------- ------------ ---------- ------------ ------------
Gain on disposal - 83,543 - - 83,543
----------------- ------------ ---------- ------------ ------------
Profit/(Loss) before
income tax - (4,831,074) - (1,863,582) (6,694,656)
----------------- ------------ ---------- ------------ ------------
Income tax - 608,557 - - 608,557
----------------- ------------ ---------- ------------ ------------
Profit/(Loss) after
income tax - (4,222,517) - (1,863,582) 47,941,852
----------------- ------------ ---------- ------------ ------------
Segment assets
Segment assets - 4,586,856 - 1,824,078 6,410,934
----------------- ------------ ---------- ------------ ------------
Total assets - 4,586,856 - 1,824,078 6,410,934
----------------- ------------ ---------- ------------ ------------
Segment liabilities
Segment liabilities - 9,676,636 - 133,724 9,810,360
----------------- ------------ ---------- ------------ ------------
Total liabilities - 9,676,636 - 133,724 9,810,360
----------------- ------------ ---------- ------------ ------------
(i) Unallocated assets
30 June 30 June
2022 2021
US$ US$
---------------------- -------- ----------
Segment assets
Cash 519,900 1,668,255
-------- ----------
Other 125,607 155,822
-------- ----------
Total segment assets 642,507 1,824,077
-------- ----------
Note Consolidated
------------------------------------ ------ ------------------------
2022 (US$) 2021 (US$)
------------------------------------ ------ ----------- -----------
Segment result - all other segments
Directors' and officers' fees
and benefits 277,832 702,785
----------- -----------
Finance costs 30,756 6,840
----------- -----------
Other general and administration
expenses 889,543 1,378,474
----------- -----------
Total unallocated segment expenses 1,198,131 2,088,099
----------- -----------
Accounting policies
AASB 8 requires operating segments to be identified on the basis of internal reports about components of the Group that are regularly reviewed by the chief operating decision maker in order to allocate resources to the segment and to assess its performance. The chief operating decision maker is the Executive Chairman and through this role the Board of Directors.
Information regarding these segments is presented above. The accounting policies of the reportable segments are the same as those of the Group. Segment information is prepared in conformity with the accounting policies of the entity as disclosed in Note 1.
Segment revenues and expenses are those directly attributable to the segments and include any joint revenue and expenses where a reasonable basis of allocation exists. Segment assets include all assets used by a segment and consist principally of cash, receivables, plant and equipment, exploration expenditure capitalised and development assets net of accumulated depreciation and amortisation. While most such assets can be directly attributed to individual segments, the carrying amount of certain assets used jointly by two or more segments is allocated to the segments on a reasonable basis. Segment disclosures do not include deferred income taxes.
Note 22 Cash flow information
Note Consolidated
------
2022 (US$) 2021 (US$)
------ ------------ ------------
Reconciliation of cash flow from operations with loss after
income tax
Gain/(loss) after income tax (1,336,247) (6,086,099)
------------ ------------
Non-cash flows in profit (15,136)
------------ ------------
Depreciation, depletion and
amortisation 55,326 120,000
------------ ------------
Share based payment- consultants
and
employees 201,654
------------ ------------
Impairment of non-current assets (206,028) 16,725
------------ ------------
Impairment reversal
------ ------------ ------------
Gain on disposal of subsidiary
------ ------------ ------------
Foreign exchange (gain)/loss 30,756 (44,846)
------------ ------------
Impairments recognised on held
for sale
assets 3,437 , 053
------------ ------------
Decrease in other current assets 221 7,543
------------ ------------
(Increase)/decrease in trade
and other
receivables 115,629 1,867,165
------------ ------------
Decrease in deferred tax asset
------ ------------ ------------
Increase/(decrease) in trade
and other
payables (354,197) (420,933)
------------ ------------
Increase/(Decrease) in deferred
tax liabilities 240,444 (703,647)
------------ ------------
increase/(Decrease) in provisions (195,896)
------------ ------------
Items reclassified as investing
activities on
gain on disposal of subsidiary
------ ------------ ------------
Net cash outflow (from)/to
operations (1,454,096) (1,816,417)
------------ ------------
Note 23: Share based payments
Employee option plan
No options were issued to key management personnel. All options expired during the prior year as vesting conditions were not met.
Expenses recognised in the profit or loss
During the year, no share-based payments were recognised in profit/loss statement. (2021: Nil).
Note 24: Related party transactions
(a) Parent entity
The ultimate Parent Entity and ultimate Australian Parent Entity within the Group is Star Phoenix Group Ltd.
(b) Subsidiaries
Interests in subsidiaries are set out in Note 13.
(c) Transactions with Key Management Personnel
The following transactions occurred during the year with Key Management Personnel or their related parties:
2022 2021
US$ US$
-------------------------------------------------- -------- --------
Consulting fees paid or payable to Kaiyuan
Guosen Management Consulting Limited, a company
owned by Mr Gu 159,399 379,251
-------- --------
Consulting fees paid or payable to Ten Faye
Limited, a company owned by Mr L Liu 64,878 35,833
-------- --------
Note Consolidated
--------------------------- ------ ------------------------
2022 (US$) 2021 (US$)
--------------------------- ------ ----------- -----------
d: Key Management Personnel compensation
Short-term benefits 277,832 508,936
----------- -----------
Post-employment benefits - 29,397
----------- -----------
Issue Shares to directors - 164,452
----------- -----------
Total 277,832 702,785
----------- -----------
Note 25: Parent entity information
The following details information related to the Parent Entity Star Phoenix Group Limited, at 30 June 2022. The information presented here has been prepared in accordance using consistent accounting policies as presented in Note 1.
Note Consolidated
------------------------------------ ------ ------------------------------
2022 (US$) 2021 (US$)
------------------------------------ ------ -------------- --------------
Current assets 504,942 1,648,398
-------------- --------------
Non-current assets 117,502 146,957
-------------- --------------
Total assets 622,444 1,795,355
-------------- --------------
Current liabilities 1,448,166 133,724
-------------- --------------
Non-current liabilities - -
------ -------------- --------------
Total liabilities 1,448,166 133,724
-------------- --------------
Contributed equity 388,570,480 388,570,480
-------------- --------------
Accumulated losses (416,141,109) (411,246,995)
-------------- --------------
Reserves 26,744,907 24,338,146
-------------- --------------
Total equity (825,722) 1,661,631
-------------- --------------
Loss for the year from continuing
operations (1,195,339) (1,863,582)
-------------- --------------
Loss for the year for discontinued
operations (140,908) (4,405,320)
-------------- --------------
Total comprehensive loss for
the year (1,336,247) (6,268,902)
-------------- --------------
No contingent liabilities were recognised as disclosed in Note 20.
Note 26: Financial risk management
The Group has exposure to the following risks from their use of financial instruments:
-- Credit risk -- Liquidity risk -- Market risk
This note presents information about the Group's exposure to each of the above risks, their objectives, policies and processes for measuring and managing risk, and the management of capital. Further quantitative disclosures are included throughout these financial statements. The Board of Directors has overall responsibility for the establishment and oversight of the risk management framework.
Risk management policies are established to identify and analyse the risks faced by the Group, to set appropriate risk limits and controls, and to monitor risks and adherence to limits. Risk management policies and systems are reviewed to reflect changes in market conditions and the Group's activities. The Group, through training and management standards and procedures, aims to develop a disciplined and constructive control environment in which all consultants and agents understand their roles and obligations.
Credit risk
Credit risk is the risk of financial loss to the Group if counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Group's receivables and cash held at financial institutions.
Credit risk is managed on a group basis. Individual risk limits are set based on internal or external ratings in accordance with limits set by the board.
The credit quality of financial assets that are neither past due or impaired can be assessed by reference to external credit ratings (if available) or to historical information about counterparty default rates.
Note Consolidated
------------------- --------- --------------------------------------
2022 (US$) 2021 (US$)
------------------- --------- ------------------ ------------------
Cash at bank, restricted deposits and short-term bank deposits
(S&P ratings)
AAA - 504,942 1,648,398
--------- ------------------ ------------------
AA- 11,957 19,857
--------- ------------------ ------------------
A+ - -
--------- ------------------ ------------------
BBB+ 241,446 242,817
--------- ------------------ ------------------
BBB- - -
--------- ------------------ ------------------
Not rated - -
--------- ------------------ ------------------
Total 10 758,346 1,911,072
--------- ------------------ ------------------
Exposure to credit risk
The carrying amount of the Group's financial assets represents the maximum credit exposure. The Group's maximum exposure to credit risk at the reporting date was:
Note Consolidated
------------------------------- ----- ------------------------
2022 (US$) 2021 (US$)
------------------------------- ----- ----------- -----------
Trade and other receivables - -
non-current (i)
----- ----------- -----------
Trade and other receivables -
current (i) 11 229,292 103,866
----- ----------- -----------
Cash and cash equivalents 10 758,346 1,911,072
----- ----------- -----------
Total 987,638 2,014,938
----- ----------- -----------
(i) Counterparties without an external credit rating.
Loans and receivables
The Group's exposure to credit risk is influenced mainly by the individual characteristics of each debtor. No collateral was held in relation to these receivables.
Impairment losses
Following the sale of Range Resources Trinidad Limited (which held interests in the upstream assets in Trinidad) to LandOcean Energy Services Co Limited Energy Services Co Ltd (LandOcean Energy Services Co Limited), certain sums remain due and payable to the Group.
During the 2021 financial year, the Board made the decision to fully impair the
receivable from LandOcean Energy Services Co Limited and the performance bond receivable to adhere to accounting standards given the situation and age of the balances, resulting to an impairment of US$1,722,462. No further payments have been received to date.
Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Group's approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Group's reputation.
The Group uses activity-based costing to cost its activities, which assists in monitoring cash flow requirements and optimising its cash return on investments. Typically, the Group ensures that it has sufficient cash on demand to meet expected operational expenses for a period of 12 months; this excludes the potential impact of extreme circumstances that cannot reasonably be predicted, such as natural disasters.
Group 2022
Carrying Contractual Within 1-2 years 2-5 years
amount cash flows one year
----------------- ---------- ------------ ---------- ---------- ----------
Financial liabilities at amortised cost
Trade and other
payables 4,505,946 4,505,946 4,505,946 - -
---------- ------------ ---------- ---------- ----------
Total 4,505,946 4,505,946 4,505,946 - -
---------- ------------ ---------- ---------- ----------
Group 2021
Carrying Contractual Within 1-2 years 2-5 years
amount cash flows one year
----------------- ---------- ------------ ---------- ---------- ----------
Financial liabilities at amortised cost
Trade and other
payables (Note
15) 4,849,906 4,849,906 4,849,906 - -
---------- ------------ ---------- ---------- ----------
Total 4,849,906 4,849,906 4,849,906 - -
---------- ------------ ---------- ---------- ----------
Market risk
Market risk is the risk that changes in market prices, such as interest rates and equity prices will affect the Group's income or the value of its holdings of available for sale assets. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising the return.
Foreign exchange risk
The Group operates internationally and is exposed to foreign exchange risk arising from various currency exposures, primarily with respect to the US dollar, AU dollar, TT Dollar, British pound and Chinese Renminbi. Foreign exchange risk arises from future commercial transactions and recognised assets and liabilities denominated in a currency that is not the entity's functional currency. The risk is measured using sensitivity analysis and cash flow forecasting.
The Group's treasury risk management policy is to closely monitor exchange rate fluctuations. To date, the Group has not sought to hedge its exposure to fluctuations in exchange rates, however this policy will be reviewed on an ongoing basis.
The Group's exposure to foreign currency risk at the reporting date was as follows:
Consolidated
------------------- ------------------------------------------
2022 AUD 2021 AUD 2022 GBP 2021 GBP
------------------- --------- --------- --------- ---------
Cash 30,735 45,090 4,837 91,056
--------- --------- --------- ---------
Amount payable to
other entities (18,025) (20,800) (11,250) (11,250)
--------- --------- --------- ---------
Total 12,710 24,290 (6,413) 79,806
--------- --------- --------- ---------
Consolidated
------------------- ------------------------------------------------
2022 TTD 2021 TTD 2022 RMB 2021 RMB
------------------- ------------ ---------- ---------- ----------
Cash 1,629,759 1,636,585 3,183,084 8,449,697
------------ ---------- ---------- ----------
Amount payable to
other entities (475,902) (184,564) - -
------------ ---------- ---------- ----------
Total (1,153,857) 1,452,021 3,183,084 8,449,697
------------ ---------- ---------- ----------
Sensitivity
Based upon the amounts above, had the US dollar strengthened by 10% with all other variables held constant, there would not have been a material impact on the profit and equity of the Group. A 10% weakening of the US dollar against the above currencies at 30 June would have had an equal but opposite effect, on the basis that all other variables remain constant.
Interest rate risk
There is no material interest rate risk exposure in the Group.
Fair values versus carrying amounts
The fair value of financial assets and liabilities, together with the carrying amounts shown in the statement of financial position, are as follows:
Group 30 June 2022 30 June 2021
US$ US$
----------------- -------------------------- --------------------------
Carrying Fair value Carrying Fair
amount amount value
----------------- ------------ ------------ ------------ ------------
Trade and other
receivables 229,292 229,292 103,866 103,866
------------ ------------ ------------ ------------
Cash and cash
equivalents 758,346 758,346 1,911,072 1,911,072
------------ ------------ ------------ ------------
Trade and other
payables (4,505,946) (4,505,946) (4,172,216) (4,172,216)
------------ ------------ ------------ ------------
Total (3,518,308) (3,518,308) (2,157,278) (2,157,278)
------------ ------------ ------------ ------------
The basis for determining fair value is disclosed in Note 1(n).
Other price risks
The Group is not exposed to any other price risks.
Capital management
The entity's objectives when managing capital is to safeguard its ability to continue as a going concern, so that it can continue to provide returns for shareholders and to maintain an optimal capital structure to reduce the cost of capital.
The Group is working on identifying new projects in the energy and resources spectrum.
The capital structure of the group consists of cash and cash equivalents and equity attributable to equity holders of the Company, comprising issued capital, reserves and accumulated losses as disclosed in Notes 18 and 19 respectively. None of the entities within the group are subject to externally imposed capital requirements.
Gearing ratio
The Board reviews the capital structure on an annual basis. As a part of this review the Board considers the cost of capital and the risks associated with each class of capital.
Note Consolidated
--------------------------- ----- --------------------------
2022 (US$) 2021 (US$)
--------------------------- ----- ------------ ------------
Financial assets
Cash and cash equivalents 10 758,346 1,911,072
----- ------------ ------------
Financial liabilities
Trade and other payables 15 (4,505,946) (3,563,659)
----- ------------ ------------
Net debt (4,505,946) (3,563,659)
----- ------------ ------------
Equity (5,962,442) 3,399,429
----- ------------ ------------
Net debt to equity ratio N/A N/A
----- ------------ ------------
Categories of financial instruments
Note Consolidated
---------------------------------------- ----- ------------------------
2022 (US$) 2021 (US$)
---------------------------------------- ----- ----------- -----------
Financial assets
Cash and cash equivalents 10 758,346 1,911,072
----- ----------- -----------
Trade and other receivables
- current 11 229,292 103,864
----- ----------- -----------
Total 987,638 2,014,936
----- ----------- -----------
Financial liabilities
Trade and other payables - non-current - -
----- ----------- -----------
Trade and other payables - current 15 4,505,946 3,563,659
----- ----------- -----------
Total 4,505,946 3,563,659
----- ----------- -----------
The carrying amount reflected above represents the Group's maximum exposure to credit risk for such loans and receivables.
(a) Fair value hierarchy
AASB 13 requires disclosure of fair value measurements by level of the following fair value measurement hierarchy:
(a) Quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1),
(b) Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly or indirectly (level 2), and
(c) Inputs for the asset or liability that are not based on observable market data (unobservable inputs (level 3).
The Group's policy is to recognise transfers into and transfers out of fair value hierarchy levels as at the end of the end of the reporting period. There were no transfers between the levels of the fair value hierarchy during the year ended 30 June 2021.
(b) Fair values of other financial instruments
The Group has financial instruments which are measured at amortised cost in the consolidated statement of financial position.
Due to their short-term nature, the carrying amounts of the current receivables, current payables, current borrowings, and current other financial liabilities is assumed to approximate their fair value.
Note 27: Events after the reporting date
Update on RRDSL Claim
On 28 July 2022, the Company announced that RRDSL has won a claim at an amount of approximately TT$1.1 million ( $163,000) against 360 Oil and Gas Limited in the Supreme Court of Trinidad and Tobago in respect of unpaid service fees.
Lodgement of Claim Against Range Resources Trinidad Limited
On 4 August 2022, the company announced that RRDSL, through its attorney ( Robin B. Ramoutar & Co), has submitted three claims at a total amount of approximately TT$14.9 million ($2.21million) against Range Resources Trinidad Limited ("RRTL" or the "Defendant") in the Supreme Court of Trinidad and Tobago in respect of breach of loan, service and equipment rental contracts from the Defendant (the "Claims"). A Court date will be scheduled in due course.
Update on arbitration proceedings against LandOcean Energy Services Co Limited
On 22 August 2022, the company updated that the London court of international Arbitration issued a consent award on 12 August 2022 (of which the Company was notified on 19 August 2022) in relation to two of the four Stage 1 Claims. Under the consent award, LandOcean Energy Services Co Limited is required to make payment of US$301,265 to Star Phoenix by 16 September 2022, being 35 days from the date of the consent award.
The issuing of the consent award makes a successful conclusion of two of the four Stage 1 Claims. The Company will provide further updates on the remaining Stage 1 Claims in due course.
On 21 September 2022, the Company confirms that no payment has yet been received. LandOcean Energy Services Co Limited has indicated that the Chinese State Administration of Foreign Exchange has, as yet, not permitted the payment to be made. The Company is monitoring the situation closely and will provide further updates as appropriate, in addition to the remaining Stage 1 Claims, in due course.
Note 28: New accounting Standards and interpretations
Australian accounting Standards/amendments released but not yet effective: 30 June 2022 year end
There are no other standards that are not yet effective and that would be expected to have a material impact on Star Phoenix Group in the current or future period and on foreseeable future transactions.
New and Amended Accounting Policies Not Yet Adopted by the Entity
AASB 2020-1: Amendments to Australian Accounting Standards - Classification of Liabilities as Current or Non-current
The amendment amends AASB 101 to clarify whether a liability should be presented as current or non-current.
The Entity plans on adopting the amendment for the reporting period ending 30 June 2024. The amendment is not expected to have a material impact on the financial statements once adopted.
Note 29: Company details
The registered office of the company is:
c/o Edwards Mac Scovell, Level 1, 8 St Georges Terrace, Perth WA 6000
Telephone: +61 8 6205 3012
The principal place of business is:
c/o Edwards Mac Scovell, Level 1, 8 St Georges Terrace, Perth WA 6000
Telephone: +61 8 6205 3012
Directors'Declaration
The directors of the company declare that:
-- The financial statements, comprising the 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, accompanying notes, are in accordance with the Corporations Act 2001 and:
-- comply with Accounting Standards and the Corporations Regulations 2001 and other mandatory professional reporting requirements; and
-- give a true and fair view of the Group's financial position as at 30 June 2022 and of its performance for the year ended on that date.
-- The company has included in the notes to the financial statements an explicit and unreserved statement of compliance with International Financial Reporting Standards.
-- In the directors' opinion, there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable.
-- The directors have been given the declarations by the chief executive officer and chief financial officer required by section 295A.
This declaration is made in accordance with a resolution of the Board of Directors and is signed for and on behalf of the directors by:
Zhiwei Gu
Chairman
October 2022
Independent Audit Report to the Members of Star Phoenix Group Limited
Opinion
We have audited the financial report of Star Phoenix Group
Ltd and Controlled Entities (the company and its controlled
entities (the Group)), which comprises the consolidated
statement of financial position as at 30 June 2022, the
consolidated statement of profit or loss and other comprehensive
income, the consolidated statement of changes in equity
and the consolidated statement of cash flows for the year
then ended, and notes to the financial statements, including
a summary of significant accounting policies and the directors'
declaration.
We do not express an opinion on the accompanying financial
report of the Group. Because of the significance of the
matters described in the Basis for disclaimer of opinion
section of our report, we have not been able to obtain
sufficient appropriate audit evidence to provide a basis
for an audit opinion on this financial report.
Basis for disclaimer of opinion
We have been unable to obtain sufficient appropriate audit
evidence on the books and records of the consolidated entity.
Specifically, we have been unable to satisfy ourselves
on the following areas:
i. As disclosed in Note 5 of the financial statements,
the Group's current assets as at 30 June 2022 include an
amount classified as assets held for sale. During the year
ended 30 June 2022, there has been a continued deterioration
in the operating and economic performance of the Group,
which created an impairment indicator of the assets included
in this amount on 30 June 2021. The Directors have undertaken
an impairment assessment as at 30 June 2021and 30 June
2022 and have estimated the recoverable amount of these
assets based on sales price achieved for four specific
rigs. This resulted in an impairment expense being recognised
in the prior year.
The valuation methodology used to arrive at the recoverable
amount was not in accordance with the requirements of Australian
Accounting Standards, and we were unable to perform alternative
procedures to determine whether any adjustments to the
carrying value of the property plant and equipment, rigs
and related inventory included in assets held for sale
as at 30 June 2022 were necessary.
The previous audit report opinion for the year ended 30
June 2020 and 30 June 2021 was also modified with respect
to this matter.
ii. As disclosed in note 15 of the financial statements,
the Group's current liabilities as at 30 June 2022 includes
an amount in respect of withholding tax liabilities due
on overseas interest payments from loans which were settled
in the financial year ended 30 June 2020. During the current
year, management undertook a review of the withholding
tax amounts and as at the date of this report this reassessment
is completed but lodgement has not been made to the Australia
Taxation Office.
Other Information
The directors are responsible for the other information.
The other information comprises the information included
in the Group's annual report for the year ended 30 June
2022, but does not include the financial report and our
auditor's report thereon. Our opinion on the financial
report does not cover the other information and accordingly
we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial report, our
responsibility is to read the other information and, in
doing so, consider whether the other information is materially
inconsistent with the financial report or our knowledge
obtained in the audit or otherwise appears to be materially
misstated. If, based on the work we have performed, we
conclude that there is a material misstatement of this
other information, we are required to report that fact.
We have nothing to report in this regard.
Responsibilities of the Directors for the Financial Report
The directors of the company are responsible for the preparation
of the financial report that gives a true and fair view
in accordance with Australian Accounting Standards and
the Corporations Act 2001 and for such internal control
as the directors determine is necessary to enable the preparation
of the financial report that gives a true and fair view
and is free from material misstatement, whether due to
fraud or error. In preparing the financial report, the
directors are responsible for assessing the ability of
the Group to continue as a going concern, disclosing, as
applicable, matters related to going concern and using
the going concern basis of accounting unless the directors
either intend to liquidate the Group or to cease operations,
or have no realistic alternative but to do so.
Auditor's Responsibilities for the Audit of the Financial
Report
Our responsibility is to conduct an audit of the financial
report in accordance with Australian Auditing Standards
and to issue an auditor's report. However, because of the
matter described in the Basis for disclaimer of opinion
section of our report, we were not able to obtain sufficient
appropriate audit evidence to provide a basis for an audit
opinion on the financial report.
We are independent of the Group in accordance with the
Corporations Act 2001 and the ethical requirements of the
Accounting Professional and Ethical Standards Board's APES
110 Code of Ethics for Professional Accountants (including
Independence Standards) (the Code) that are relevant to
our audit of the financial report in Australia. We have
also fulfilled our other ethical responsibilities in accordance
with the Code.
Report on the Remuneration Report
We have audited the Remuneration Report included in pages
10 to 16 of the directors' report for the year ended 30
June 2022.
In our opinion, the Remuneration Report of Star Phoenix
Group Ltd, for the year ended 30 June 2022, complies with
section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation
and presentation of the Remuneration Report in accordance
with section 300A of the Corporations Act 2001. Our responsibility
is to express an opinion on the Remuneration Report, based
on our audit conducted in accordance with Australian Auditing
Standards.
Auditor's name and
signature: Douglas Mitchell
Name of firm: Mitchell Wilson & Partners
Address: 883 Toorak Road
Camberwell VIC 3124 Australia
Dated this day of 2022
Additional Information
Top 20 shareholders
The 20 largest shareholders of the Company as at 31 August 2022 are listed below:
Rank Shareholder Number of Percentage
shares held (%)
1. Beijing Sibo Investment Management 24,476,210 16.22%
------------------------------------------- ----------- ----------
2. Preceding Max Ltd 23,561,326 15.62%
------------------------------------------- ----------- ----------
LandOcean Energy Services Co Limited
3. Energy Services Co Limited 17,390,770 11.53%
------------------------------------------- ----------- ----------
4 Sramek Biodynamics Holdings 15,365,998 10.18%
------------------------------------------- ----------- ----------
Interactive investor services Nominees
5. Limited 8,932,046 5.92%
------------------------------------------- ----------- ----------
6. Abraham Limited 7,123,776 4.72%
------------------------------------------- ----------- ----------
7. Mr Zhiwei Gu 5,489,793 3.64%
------------------------------------------- ----------- ----------
Barclays Direct Investing Nominees
8. Limited 5,153,533 3.42%
------------------------------------------- ----------- ----------
Interactive Investor Services Nominees
9. Limited 4,912,586 3.26%
------------------------------------------- ----------- ----------
Hargreaves Landsdown (Nominees)
10. Limited <15942> 2,689,563 1.78%
------------------------------------------- ----------- ----------
11. HSDL Nominees Limited 2,479,858 1.64%
------------------------------------------- ----------- ----------
12. Hargreaves Lansdown (Nominees)Limited<VRA> 1,729,584 1.15%
------------------------------------------- ----------- ----------
13. Mr Lubing Liu 1,726,077 1.14%
------------------------------------------- ----------- ----------
14. Hargreaves Lansdown (Nominees) Limited<VRA> 1,697,395 1.13%
------------------------------------------- ----------- ----------
Interactive Investor Services Nominees
15. Limited 1,684,274 1.12%
------------------------------------------- ----------- ----------
16. Pershing Nominees Limited <Perny> 1,570,698 1.04%
------------------------------------------- ----------- ----------
HSBC Client Holdings Nominee (UK)
17. Limited 1,533,626 1.02%
------------------------------------------- ----------- ----------
18. HSDL Nominees Limited <MAXI> 1,461,891 0.97%
------------------------------------------- ----------- ----------
19. Lawshare Nominees Limited <SIPP> 1,078,273 0.72%
------------------------------------------- ----------- ----------
20. Interactive Brokers LLC<IBLLCR> 1,000,016 0.66%
------------------------------------------- ----------- ----------
Total 131,057,293 86.86%
----------- ----------
Substantial shareholders
An extract of the Company's register of substantial shareholders (being those shareholders who held 5% or more of the issued capital on 31 August 2022) is below:
Rank Shareholder Number of shares Percentage
held (%)
Beijing Sibo Investment
1. Management 24,476,210 16.22%
============================== ================= ===========
2. Preceding Max Ltd 23,561,326 15.62%
============================== ================= ===========
LandOcean Energy Services
3. Co Limited Energy Services 17,390,770 11.53%
============================== ================= ===========
4. Sramek Biodynamics Holdings 15,365,998 10.18%
============================== ================= ===========
Interactive investor services
5. Nominees Limited 8,932,046 5.92%
============================== ================= ===========
Distribution of equity securities
The number of shareholders by size of holding is set out below (31 August 2022):
Size of holding Number of holders Number of shares
1 - 1,000 1,985 573,035
================== =================
1,001 - 5,000 515 1,255,928
================== =================
5,001 - 10,000 130 1,024,036
================== =================
10,001 - 100,000 166 5,030,240
================== =================
100,001 and over 22 143,993,731
================== =================
Total 2,818 150,876,970
================== =================
Tenement schedule
The tenement schedule for the Group as at 30 June 2022 is tabulated below:
Tenement Reference Location Percentage held Operator
(%)
Perlak(1) Indonesia 23 PT Aceh Timur
Kawai Energi
========== ================ ==============
Notes:
1. The Company's indirect interest in the Perlak field is held through its 60% shareholding in Hengtai, which holds a 78% interest in Lukar which in turn holds a 49% interest in PT Aceh Timur Kawai Energi.
Corporate Directory
Mr Lubing Liu Executive Chairman
Dr Mu Luo Executive Director, Company Secretary
-------------- --------------------------------------
Directors Mr Zhiwei Gu Non-Executive Director
-------------- --------------------------------------
Company Secretary Mr Lubing Liu
Registered office c/o Edwards Mac Scovell, Level 1, 8 St Georges
& principal place Terrace
of business Perth WA 6000, Australia
Telephone: +61 8 6245 0222
------------------------------------------------
Share Registry Computershare Investor Services Pty Ltd
(Australia) Level 11, 172 St Georges Terrace, Perth WA
6000
Telephone: +61 3 9415 4000
------------------------------------------------
Share Registry Computershare Investor Services plc
(United Kingdom) PO Box 82, The Pavilions, Bridgwater Road,
Bristol, UK BS99 6ZZ
Telephone: +44 370 702 0000
------------------------------------------------
Auditor Mitchell Wilson & Partners
883 Toorak Road
Camberwell VIC 3124, Australia
------------------------------------------------
Stock Exchange Star Phoenix shares are listed on Alternative
Listing Investment Market of the London Stock Exchange
(AIM code: STA)
------------------------------------------------
Country of Incorporation Australia
------------------------------------------------
Website www.starphoenixgroup.com
------------------------------------------------
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END
FR MZGZZNMGGFZM
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February 21, 2023 12:16 ET (17:16 GMT)
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