CuFe Ltd
ABN: 31 112 731 638
HALF-YEAR REPORT
FOR THE HALF-YEAR ENDED
31 DECEMBER 2022
The information in this report, given to ASX under Listing Rule 4.2A, should be read in
conjunction with CuFe Ltd's most recent annual financial report.
CONTENTS
Corporate Directory | 3 |
Directors' Report | 4 |
Auditor's Independence Declaration | 9 |
Consolidated Statement of Comprehensive Income | 10 |
Consolidated Statement of Financial Position | 11 |
Consolidated Statement of Cash Flows | 12 |
Consolidated Statement of Changes in Equity | 13 |
Condensed notes to the Consolidated Financial Statements | 14 |
Directors' Declaration | 28 |
Independent Review Report | 29 |
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CORPORATE DIRECTORY
Australian Business Number | 31 112 731 638 | |
Country of Incorporation | Australia | |
Board of Directors | Antony Sage | Executive Chairman |
Mark Hancock | Executive Director | |
Nicholas Sage | Non-Executive Director | |
Scott Meacock | Non-Executive Director | |
Company Secretary | Catherine Grant-Edwards | |
Melissa Chapman | ||
Principal Administrative Office | Unit 3, 32 Harrogate Street | |
and Registered Office | West Leederville, WA 6007 | |
Telephone: | +61 (08) 6181 9793 | |
Share Registry | Link Market Services | |
Level 12, QV1 Building | ||
250 St Georges Terrace | ||
Perth WA 6000 | ||
Telephone: | 1300 554 474 (within Australia) | |
+61 (8) 9211 6670 (overseas) | ||
Email: | info@linkmarketservices.com.au | |
Website: | www.linkmarketservices.com.au | |
Auditors | Stantons | |
Level 2, 40 Kings Park Road | ||
West Perth, WA 6005 | ||
ASX | CuFe Ltd's fully paid ordinary shares are quoted on the Official List of ASX | |
(ASX Codes: CUF and CUFO). |
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Directors' Report
Half-Year Report 2022
DIRECTOR'S REPORT
The directors of CuFe Ltd (CUF, the Company or the Group) submit their report for the half-year ended 31 December 2022.
DIRECTORS
The names of CUF's directors in office during the half-year and as at the date of this report are as follows:
Antony Sage (Executive Chairman)
Mark Hancock (Executive Director)
Nicholas Sage (Non-Executive Director)
Scott Meacock (Non-Executive Director) (Appointed 5 December 2022)
All directors were in office for the entire period unless otherwise stated.
REVIEW AND RESULTS OF OPERATIONS
CUF is an Australian mining and mineral exploration company which holds, or has rights or interests in, various tenements prospective for copper, iron ore, gold and base metals located in Western Australia and the Northern Territory. The Company's main focus is its iron ore assets in Western Australia (JWD Iron Ore Project) and the Northern Territory (Yarram Iron Ore Project), and the Tennant Creek Copper Project in the Northern Territory. The remaining projects are all subject to various joint venture agreements under which CUF does not have operational control.
CORPORATE
Financial Results
The Group recorded a net loss after tax for the period of $6,978,255 (31 December 2021: net loss after tax $39,069). This loss included significant non-cash items, being amortisation and depreciation of $2,330,795 and iron ore inventory net realisable value write off of $600,537. Exploration and evaluation expenditure of $735,172 was incurred during the period and recorded through profit of loss.
Annual General Meeting
The Company's Annual General Meeting was held on 30 November 2022 (AGM). All resolutions put to the meeting were passed via a poll.
Board Change
Mr Scott Meacock was appointed as a Non-Executive Director effective 5 December 2022. Mr Meacock holds a Bachelor of Laws (LLB) degree and a Bachelor of Commerce (BComm) degree from the University of Western Australia and has a wealth of experience as external counsel acting in, and advising on, complex corporate and commercial law transactions and disputes for clients in a wide range of industry sectors including natural resources and financial services. Mr Meacock currently serves as the Chief Executive Officer and General Counsel of the Gold Valley Group, the Company's major shareholder and therefore is not considered by the Board to be an independent director.
Shares issued
During the period the Company issued the following shares:
- 7,500,000 shares issued upon exercise of unlisted options exercisable at $0.03 expiring 31 August 2022, raising $225,000
Options issued
During the period the Company issued the following options:
- 14,250,000 unlisted options exercisable at $0.027 expiring 7 September 2024 with vesting conditions issued pursuant to the Company's Employee Securities Incentive Plan (ESIP) (ESIP approved by shareholders at the July 2021 EGM)
- 20,000,000 unlisted options exercisable at $0.027 expiring 7 September 2024 with vesting conditions issued to directors (or their nominees) following receipt of shareholder approval at the AGM
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Directors' Report
Half-Year Report 2022
Options exercised
The following options were exercised during the period:
- 7,500,000 unlisted options exercisable at $0.03 expiring 31 August 2022
Options lapsed or expired
During the period, the following options lapsed or expired:
- 5,000,000 unlisted options exercisable at $0.04 expiring 31 August 2023 lapsed
- 2,000,000 unlisted options exercisable at $0.06 expiring 30 June 2023 lapsed
- 5,500,000 unlisted options exercisable at $0.027 expiring 7 September 2024 lapsed
- 16,500,000 unlisted options exercisable at $0.03 expired on 31 August 2022
- 1,000,000 unlisted options exercisable at $0.074 expired on 31 December 2022
PROJECTS
The Company holds, or has rights or interests in, various tenements prospective for copper, iron ore, gold and base metals located in Western Australia and the Northern Territory. The Company's main focus is its iron ore assets in Western Australia (JWD Iron Ore Project) and the Northern Territory (Yarram Iron Ore Project), and development of the recently acquired Tennant Creek Copper Project in the Northern Territory. The remaining projects are all subject to various joint venture agreements for which the Company does not have operational control.
JWD Iron Ore Project - Wiluna Iron JV (60%) (Western Australia)1
During the period iron ore prices continued their rapid fall which had commenced in the prior period, decreasing from USD120 at 30 June 2022 to reach a floor of USD79.50 on 31 October 2022. While the Company had some hedging in place to provide price protection this expired in October it didn't cover all tonnes produced and some of the gain on the hedges had been booked in prior periods via mark to market calculation, resulting in an operating loss for this period. In response to this the Company commenced slowing down mining activities from September and formally suspended in October.
The Company has continued to look at ways to reduce costs which have been adversely impacted by escalation in diesel costs, which have a significant impact on the operating costs given the long road haul for JWD material to port which totals some 800km. Labour, consumables and freight have also remained elevated over the period.
In addition to waiting for iron ore prices to improve the Company has redesigned the JWD short term mine plan to minimise strip ratio by focusing on a smaller pit, with less waste moved. The cost reductions arising from this, along with freight and road haulage costs reducing as fuel prices retrace somewhat have reduced the breakeven level for JWD operations. Improved iron ore pricing, which had recovered to USD117.35 by 31 December 2022 allowed the Company to announce a restart of operations post period end.
1 Amounts referred to in this section of the Directors' Report are stated at 100% of the amounts recorded in by the JWD JV. In accordance with its accounting policy in respect of the joint operation, CUF takes up its 60% share of assets, liabilities and results of the JWD JV in the Group's consolidated financial statements presented in this half-year report.
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Cufe Ltd. published this content on 14 March 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 17 March 2023 08:35:09 UTC.