Final Results and Publication of Annual Report
26/09/2024 15:55
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RNS Number : 8703F Castillo Copper Limited 26 September 2024
26 September 2024
CASTILLO COPPER LIMITED
("Castillo Copper" or the "Company")
Final Results
Publication of Annual Report
Castillo Copper Limited (LSE and ASX: CCZ), a base metal explorer primarily
focused on copper across Australia and Zambia, announces its financial results
for the year ended 30 June 2024.
Chairman's Letter
Dear Shareholders,
As we reflect on the past year, it's evident that Castillo Copper has
navigated through a period of transition and refocus. While the market
environment has presented its share of challenges, I'm pleased to report that
the Company has emerged more resilient and strategically positioned for
growth. Our commitment to advancing our core assets, coupled with the targeted
exploration activities, places us in a strong position to drive value in the
year ahead.
Among our key highlights for the year include:
STRATEGIC PORTFOLIO REVIEW
The Company conducted a comprehensive review of our portfolio, which was
instrumental in identifying the assets that align most closely with our
long-term strategic goals. Consequently. the Company is channelling its
resources into developing the Big One Deposit at our NWQ Copper Project,
located in the world-class Mt Isa copper belt. The Big One Deposit has a JORC
2012 compliant Mineral Resource Estimate (MRE) of 2.1Mt @ 1.1% Cu for 21,886t
contained metal.
To this end, Global Ore Discovery was recently appointed as the lead
geological consultant to spearhead our exploration efforts, commencing with a
comprehensive surface sampling campaign.
The Board is optimistic that once assays from the surface sampling campaign
are reconciled with known geophysical anomalies, then targets for
test-drilling can be identified. As such, a key goal for FY2025 is to fully
develop the potential of the Big One Deposit and then identify other prospects
within the NWQ Copper Project that have comparable upside.
Following the sale of the BHA West Project in Broken Hill to ASX listed
Rimfire Pacific Mining (ASX: RIM), which has successfully unlocked value, the
Board has resolved to find the right strategic partners to develop or sell the
remaining non-core assets comprising:
· Cangai Copper Mine (NSW): based on previous historical data and
several drilling campaigns undertaken by Castillo, a JORC compliant inferred
MRE was calculated at 4.6Mt @ 2.45% Cu for 114kt contained copper metal. In
addition, there are several untested bedrock conductors open at depth which
are yet to be drill-tested.
· BHA East Project (NSW): leveraging historical data and recent
drilling campaign, a JORC compliant inferred MRE was calculated at 64Mt @ 318
ppm Co for 21,556t contained cobalt metal and 44,260t of contained copper
metal (63Mt @ 0.07% Cu) at relatively shallow depths, that enhances the
result.
· Mkushi Project (Zambia): a 2022 IP survey highlighted multiple zones
of high chargeability coincident with known copper soil anomalies which are
potential bodies of disseminated copper sulphide mineralisation and prime
targets to test drill.
COPPER MARKET UPDATE
The copper market has demonstrated buoyancy throughout 2024, with the price
reaching an all-time high of US$11,464 per metric tonne in May 2024.This
growth has been driven by a recovery in global factory activity and glimpses
of supply tightness. Investment banks,
including Citi, Goldman Sachs and Morgan Stanley, are bullish on copper, with
Goldman Sachs raising its year-end price target to $12,000 per tonne. This
positive outlook further reinforces our strategic focus on copper assets,
particularly within the NWQ project.
LEADERSHIP CHANGES
In line with the Company's renewed focus on growth, we welcomed Eduardo
Robaina and Joel Logan to the Castillo Copper Board. Their combined expertise
in the industry will be invaluable as we work towards maximising shareholder
value and advancing our key projects. Eduardo's extensive experience in
project development, coupled with Joel's strategic insights, will undoubtedly
strengthen our leadership team and support our ambitions for the future.
As we move forward, Castillo Copper is firmly committed to delivering on the
strategy devised by the Board at the end of 2023. Our focus remains on the NWQ
Copper Project and we are confident that this approach will yield significant
value for our shareholders.
We are well-positioned to capitalise on the opportunities that lie ahead. I
would like to express my gratitude to our shareholders for their continued
support and confidence in our vision.
Ged Hall
Chairman
For further information, please contact:
Castillo Copper Limited +61 8 6558 0886
Gerrard Hall (UK), Chairman
SI Capital Limited (Financial Adviser and Corporate Broker) +44 (0)1483 413500
Nick Emerson
Gracechurch Group (Financial PR) +44 (0)20 4582 3500
Harry Chathli, Alexis Gore, Henry Gamble
About Castillo Copper
Castillo Copper Limited is an Australian-based, Australian-focussed copper
exploration Company with a strategy to develop multi-commodity assets that
demonstrate future potential as an economic mining operation.
Through the application of disciplined and structured exploration and
analysis, Castillo Copper has identified assets deemed core to the Company's
sustained growth and is actively progressing these interests up the value
curve.
Current focus will be on advancing exploration activity at the Company's
wholly owned NWQ Project, situated in the copper-belt district approximately
150km north of Mt Isa in north-west Queensland.
Other interests include the Broken Hill Project in western New South Wales and
the Cangai Copper Mine in north-east New South Wales, as well as exploration
targets in Zambia.
Castillo Copper is listed on the LSE and ASX under the ticker "CCZ".
Competent Person's Statement
The information in this report that relates to Exploration Results for the
Mkushi Project, Zambia, is based on information compiled or reviewed by Mr
Matt Bull, a consultant of Castillo Copper Limited. Mr Bull is a member of the
Australian Institute of Geoscientists and has sufficient experience of
relevance to the styles of mineralisation and types of deposits under
consideration, and to the activities undertaken, to qualify as a Competent
Person as defined in the 2012 Edition of the Joint Ore Reserves Committee
(JORC) Australasian Code for Reporting of Exploration Results, Mineral
Resources and Ore Reserves. Mr Bull consents to the inclusion in this report
of the matters based on information in the form and context in which it
appears.
The information in this report that relates to Exploration Results,
Exploration Targets and Mineral Resources for the NWQ Project contained in
this announcement is based on a fair and accurate representation of the
publicly available information at the time of compiling this report and is
based on information and supporting documentation compiled by Mark Biggs. The
information in this report that relates to Exploration Results and Mineral
Resource Estimates for the BHA Project and Cangai Copper Mine is based on
information compiled or reviewed by Mr Mark Biggs. Mr Biggs is a director of
ROM Resources, a company which is a shareholder of Castillo Copper Limited.
ROM Resources provides ad hoc geological consultancy services to Castillo
Copper Limited. Mr Biggs is a member of the Australian Institute of Mining and
Metallurgy (member #107188) and has sufficient experience of relevance to the
styles of mineralisation and types of deposits under consideration, and to the
activities undertaken, to qualify as a Competent Person as defined in the 2012
Edition of the Joint Ore Reserves Committee (JORC) Australasian Code for
Reporting of Exploration Results, and Mineral Resources. Mr Biggs holds an
AusIMM Online Course Certificate in 2012 JORC Code Reporting. Mr Biggs also
consents to the inclusion in this report of the matters based on information
in the form and context in which it appears.
ANNUAL REPORT AND ACCOUNTS
The Company's Annual Report and Accounts is available on the Company's website
at: https://castillocopper.com/investors/
(https://castillocopper.com/investors/)
RESULTS OF OPERATIONS
The net loss of the Group for the year after income tax was $1,461,849 (2023:
$6,942,228) and the net assets of the Group at 30 June 2024 were $10,610,574
(2023: $12,071,269).
DIVIDENDS
No dividend was paid or declared by the Group during the year and up to the
date of this report.
CORPORATE STRUCTURE
Castillo Copper Limited is a company limited by shares that is incorporated
and domiciled in Australia.
NATURE OF OPERATIONS AND PRINCIPAL ACTIVITIES
During the financial year, the principal activity of the Group was mineral
exploration and examination of new resource opportunities.
The Group currently holds copper projects in Queensland and New South Wales in
Australia as well as a copper project in Zambia.
EMPLOYEES
Other than the Directors, the Group had no employees at 30 June 2024 (2023:
Nil).
REVIEW OF OPERATIONS
Castillo Copper Limited is an Australian-based copper exploration company with
a strategy to develop multi-commodity assets that demonstrate future potential
as an economic mining operation.
A positive global outlook for both base and precious metals, our strategy is
underpinned by the exploration, development and delivery of our four
high-quality projects that we own and operate across Australia and Zambia.
The Company's current focus will be on advancing exploration activity at its
wholly owned NWQ Project, situated in the copper-belt district approximately
150km north of Mt Isa in north-west Queensland. Other interests include the
Cangai Copper Mine in north-east New South Wales, as well as exploration
targets in Zambia.
NWQ COPPER PROJECT
The NWQ Copper Project comprises five mineral leases covering a total area of
977sqm. It offers outstanding potential to deliver material exploration upside
in Queensland's North West minerals province, home to one of the world's
greatest high-grade concentrations of copper, zinc, lead and silver.
The Project is near several historic / currently operating copper mines
including Lady Annie, Mt Oxide and Capricorn Copper.
The highest likelihood of discovering copper deposits lies at the
intersections of fault lines, especially within or close to the Mount Gordon
Fault Zone.
Extensive historical exploration database has provided Castillo Copper with 22
walk up targets, including the major 'Big One' copper discovery.
The Big One Deposit has a JORC 2012 compliant Mineral Resource Estimate (MRE)
of 2.1Mt @ 1.1% Cu for 21,886t contained metal, which includes the following
high-grade drilling results:
· 40m @ 1.64% from surface incl: 11m @ 4.40% from 24m, 5m @ 7.34% from
28m & 1m @ 16.65% from 29m (BO_303RC)
· 44m @ 1.19% Cu from surface incl: 14m @ 3.55% from 27m, 3m @ 10.88%
from 37m & 1m @ 12.6% from 37m (BO_301RC)
In May 2024, the company revealed a comprehensive surface sampling
campaign that will concentrate on eight areas across the Big One Deposit, with
historical anomalous surface copper and/or high conductivity zones. Of
particular interest for follow up work, are the findings from an inaugural
Induced Polarisation (IP) survey undertaken by the Company in 2020, which
evidenced the following:
· Significant incremental copper mineralisation located along
north-trending fault structures rather than constrained in the trachyte dyke,
and
· Significant untested bedrock conductor north of the line of lode,
materially larger than the high-grade anomaly drilled in 2020.
Based on historic surface observations, circa 200m north from the line of lode
there also exists a sizeable, potentially mineralised gossan that is earmarked
for thorough sampling. Once geochemical data from the upcoming campaign is
reconciled with historical geophysics and surface observations,
high-conviction targets for test-drilling can be formulated to potentially
extend known mineralisation north of the line of lode.
Once approvals are secured, soil and rock chip sampling at an area north of
the known orebody where there is a sizeable, untested, bedrock conductor.
Previous work confirmed the known orebody commences from surface though is not
fully defined as it is open to the north, east and down dip.
Upon receipt of surface sampling campaign assay results, the geology team
believes there will be sufficient data to formulate a drilling campaign to
test key targets and extend known mineralisation.
Source: CCZ Geology Team
Members of the geology team also visited the Boomerang and Josephine Prospects
to assess their exploration potential. Both have been interpreted as
prospective for structurally controlled copper mineralisation.
The field trip included a small program of rock chip sampling taken across
various geological formations. This preliminary work was undertaken to
determine the prospectivity for copper mineralisation and facilitate the next
phase of a more systematic exploration campaign if suitable targets are
determined.
From the Boomerang Prospect, 21 rock-chip samples were taken from the exposed
sections of the Surprise Creek Formation. In addition, 13 rock-chip samples
were obtained from the outcrops of the Gunpowder Formation, Paradise Creek
Formation, and Surprise Creek Formation at the Josephine Prospect.
The rock-chip samples were sent to ALS Brisbane for multi-element analysis,
with assay results identifying elevated levels of copper up to 0.46% Cu at the
Boomerang Prospect.
MKUSHI PROJECT
Mkushi is comprised of a high-quality prospective asset across central
Zambia's copper-belt - the second largest copper producer in Africa.
An undrilled shear zone in Shi Yang Group's mining lease was discovered via
desktop studies in 2020, parallel to the existing Mtugu Zone and stretching
4km into Mkushi Project. Following this, over 2020 & 2021, Castillo Copper
conducted 2 geochemical surveys with a study area focused on 4km shear zone
and boundary of SYG mining lease. 1,787 samples were collected at 100m
intervals along 250m or 500m spaced NW-SE lines and were PxRF analysed.
Results identified 5 geochemical anomalies, with the strike lengths ranging
from 2-7km in total.
An Induced Polarisation (IP) survey campaign undertaken at the Mkushi Project
in 2022 highlighted multiple zones of high chargeability coincident with known
copper soil anomalies. According to geophysicist interpretations, these are
potential bodies of disseminated copper sulphide mineralisation and prime
targets to test drill.
With geochemical and geophysical data considered, Castillo Copper has
developed drill plans to target geochemical, geophysical & magnetic
anomalies, comprising 15 RC drill holes across the 3,000m combined area of A,
B and C. The multiple primary targets for test drilling identified at the
Mkushi Project boosts its exploration potential materially.
Castillo Copper has resolved to seek a strategic partner to further develop
this Zambian asset.
This would enable the completion of work on the inaugural drilling campaigns
for the Mkushi Project.
Castillo Copper is actively seeking strategic JV or divestment partners for
this asset.
CANGAI COPPER PROJECT
Cangai Copper Mine, one of Australia's highest grading historic copper mines,
is located approximately 40kms west of Grafton, in north-east New South Wales.
On 25 July 2023, the Company's geology team, working in conjunction with a
specialist geological consultancy, produced an updated JORC (2012) compliant
Mineral Resource Estimate (MRE) for the Cangai Copper Mine at:
· 4.4Mt @ 2.5% Cu inferred insitu and 0.2Mt @ 1.35% Cu indicated from
historic stockpiles for ~114kt contained copper metal; augmented further by
zinc, gold, and silver credits (Table 1).
TABLE 1: CANGI COPPER MINE RESOURCE TONNAGES
INFERRED MASS (T)
CATEGORY Cu (%) Co (%) Nn (%) Au (g/t) Ag (g/t) Cu (T) Co(T) Zn (T) Au (Kg) Ag (Kg)
OXIDE INSITU 634,000 2.65 0.01 0.65 0.15 16.1 16,801 63 4,121 95 10,207
FRESH 3,773,000 2.48 0.01 0.55 0.31 15.2 93,570 226 20,752 1,170 57,350
EX-MINE OXIDE DUMPS
29,000 2.10 0.02 0.3 0.58 14.5 609 5 17 17 421
TOTAL 4,436,000 2.5 0.01 0.6 0.29 15.3 110,980 294 1,282 1,282 67,978
HISTORIC STOCKPILES
INFERRED MASS (T)
CATEGORY Cu (%) Co (%) Nn (%) Au (g/t) Ag (g/t) Cu (T) Co(T) Zn (T) Au (Kg) Ag (Kg)
SMELTER SLAG AND EX-MINE OXIDE DUMPS
199,000 1.35 0.02 1.9 0.1 4.6 2,687 48 3,781 20 915
TOTAL 199,000 1.35 0.02 1.9 0.1 4.6 2,687 48 3,781 20 915
TOTAL 4,635,000 2.45 0.01 0.6 0.28 14.9 113,667 342 28,741 1,301 68,893
Notes:
1. All resource tonnages rounded to the nearest 1,000 tonnes
2. Refer to JORC Table 1 for details on data and estimation
3. Insitu tonnages calculated as a guide only, no recovery factor,
loss or dilution considered.
Source: CCZ Geology Team
In calculating the updated MRE from the 2017 work (MRE: 3.3Mt @ 3.35% Cu for
108,000t), the geology team factored in reverse circulation and diamond core
drilling campaigns undertaken across 2017-18 and used more conservative
assumptions to boost the confidence in the revised 2023 MRE. The geology team
noted several encouraging observations that underpins significant exploration
potential for the Cangai Copper Mine, including:
· The underlying orebody - which commences from surface - is not fully
defined, as it remains open to the east, south-east and down dip.
· There are several sizeable downhole electromagnetic (DHEM)
conductors, proximal to the line of lode, that can potentially extend known
mineralisation along strike.
· With the revised 2023 MRE enhancing the Cangai Copper Mine's resource
size, the Board is highly optimistic the Company can realise value for
shareholders from this historical producing asset.
Castillo Copper is actively seeking strategic JV or divestment partners for
this asset.
BROKEN HILL PROJECT
BROKEN HILL PROJECT: WEST
On 21 March 2024, the Broken Hill Cobalt project was acquired by Rimfire
Pacific Mining Ltd. Under the terms of the agreement, Rimfire has acquired an
unencumbered 100% ownership of Exploration Licences 8572 and 8599 which lie
adjacent to Rimfire's Bald Hill Cobalt prospect, 30 kilometres west of Broken
Hill, NSW.
As per agreement terms, Rimfire issued the following Rimfire Ordinary Shares;
· To Castillo Copper, 8,064,516 Rimfire Ordinary Shares (Consideration
Shares) being $150,000 worth of shares at an issue price of $0.0186
(Consideration Shares Issue Price).
· To Castillo Copper, a further $150,000 worth of Rimfire Ordinary
Shares (Subsequent Shares) at an issue price of $0.0279, which is 50% above
the Consideration Shares Issue Price (Subsequent Shares Issue Price). The
Subsequent Shares were issued at the Subsequent Shares Issue Price, resulting
in the issue of 5,376,345 Shares; and
· To individual Royalty holders, 5,376,337 Rimfire Ordinary Shares
being $100,000 worth of shares at the Consideration Shares Issue Price $0.0186
(Royalty Holder Shares).
All Consideration Shares, Subsequent Shares and Royalty Holder Shares were
subject to a 6-month escrow period that ended on 20 September 2024.
BROKEN HILL PROJECT: EAST
The Company maintained its Broken Hill East Exploration Licences: EL8434 and
EL8435, which cover a combined area of 684.3km2. Regionally, the project area
is situated in the Broken Hill spatial domain, which extends from far western
New South Wales into eastern South Australia. Applying the Geological Survey
of NSW (GSNSW) predictive geological model to the project area illustrates it
is "Highly Prospective" for IOCG style mineralisation (gold-copper primarily).
Since the Company acquired EL8434 and EL8435 in late 2020, the Board's initial
intent was to deliver a Maiden Mineral Resource Estimate (MRE). This was
achieved in June 2022, with the Company reporting a JORC (2012) compliant MRE
of 44,260t of contained copper (63Mt @ 700ppm) and 64Mt @ 318 ppm Co for
21,556t contained cobalt metal.
Castillo Copper is actively seeking strategic JV or divestment partners for
this asset.
OPERATING AND FINANCIAL RISK
The Group's activities have inherent risk and the Board is unable to provide
certainty of the expected results of activities, or that any or all of the
likely activities will be achieved. The material business risks faced by the
Group that could influence the Group's future prospects, and how the Group
manages these risks, are detailed below:
OPERATIONAL RISKS
The Group may be affected by various operational factors. In the event that
any of these potential risks eventuate, the Group's operational and financial
performance may be adversely affected. No assurances can be given that the
Group will achieve commercial viability through the successful exploration,
sale, and/or development of its tenement interests. Until the Group is able to
realise value from its projects, it is likely to incur ongoing operating
losses.
The operations of the Group may be affected by various factors, including
failure to locate or identify mineral deposits, failure to achieve predicted
grades in exploration, operational and technical difficulties encountered in
exploration, insufficient or unreliable infrastructure such as transport,
unanticipated metallurgical problems which may affect extraction costs,
adverse weather conditions, industrial and environmental accidents, and
unexpected shortages or increases in the costs of contractor services.
The Group's MREs are made in accordance with the 2012 edition of the JORC
Code. MREs are estimates only. An estimate is an expression of judgement based
on knowledge, experience and industry practice. Estimates which were valid
when originally calculated may alter significantly when new information or
techniques become available. In addition, by their very nature, resource
estimates are imprecise and depend to some extent on interpretations, which
may prove to be inaccurate.
The tenements are at various stages of exploration, and potential investors
should understand that mineral exploration and development are speculative and
high-risk undertakings that may be impeded by circumstances and factors beyond
the control of the Group.
There can be no assurance that exploration of the Tenements, or any other
exploration properties that may be acquired in the future, will result in the
discovery of an economic mineral resource. Even if an apparently viable
deposit is identified, there is no guarantee that it can be economically
exploited.
There is no assurance that exploration or project studies by the Group will
result in the definition of an economically viable mineral deposit or that the
exploration tonnage estimates, and conceptual project developments are able to
be achieved. In the event the Group successfully delineates economic deposits
on any Tenement, it may apply for a mining lease to undertake development and
mining on the relevant Tenement. There is no guarantee that the Group will be
granted a mining lease if one is applied for and if a mining lease is granted,
it will also be subject to conditions which must be met.
FURTHER CAPITAL REQUIREMENTS
The Group's projects may require additional funding to progress activities.
There can be no assurance that additional capital or other types of financing
will be available if needed to further exploration or possible development
activities and operations or that, if available, the terms of such financing
will be favourable to the Group.
NATIVE TITLE AND ABORIGINAL HERITAGE
There are areas of the Group's projects over which legitimate common law
and/or statutory Native Title rights of Aboriginal Australians exist. Where
Native Title rights do exist, the Group must obtain consent of the relevant
landowner to progress the exploration, development and mining phases of
operations. Where there is an Aboriginal Site for the purposes of the
Aboriginal Heritage legislation, the Group must obtain consents in accordance
with the legislation.
THE GROUP'S ACTIVITIES ARE SUBJECT TO GOVERNMENT REGULATIONS AND APPROVALS
The Group is subject to certain Government regulations and approvals. Any
material adverse change in government policies or legislation in Australia or
Zambia that affect mineral exploration, mining, processing, and development
activities, export activities, income tax laws, royalty regulations,
government subsidiaries and environmental issues may affect the viability and
profitability of any planned exploration or possible development of the
Group's portfolio of projects.
GLOBAL CONDITIONS
Global economic conditions (including movements inflation rates and currency
exchange rates), national and international political circumstances, natural
disasters, and other global events, may have an adverse effect on the
Company's exploration activities, as well as on its ability to fund those
activities.
General economic conditions may also affect the value of the Company and its
market valuation regardless of its actual performance.
CORPORATE
BOARD CHANGES
On 10 October 2023, the Board accepted the resignation of Managing Director Dr
Dennis Jensen, who left the company on his own accord to take up a new
business opportunity.
On 15 December 2023, Mr Jack Sedgwick transitioned from interim Executive
Director to Non-Executive Director. With these changes, all Castillo Copper
Board Directors moved to Non-Executive roles.
On 14 March 2024, the company announced the appointment of Mr Eduardo Robaina
and Mr Joel Logan to the Castillo Copper Board of Directors. Mr Robaina
assumed the role of Non-Executive Director. Mr Logan assumed the role of
Non-Executive Director. Mr Jack Sedgwick and Mr David Drakeley stepped down
from their roles as Non-Executive Directors.
SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS
There were no significant changes in the state of affairs of the Group during
the year, other than as outlined elsewhere in this report.
SIGNIFICANT EVENTS AFTER THE BALANCE DATE
On the 14 May 2024, Castillo announced that it was actively looking to align
with partners to develop its remaining assets in NSW and Zambia which had
previously been designated as non-core assets. At the date of this report the
Company is in advanced discussions with third parties regarding
a possible transaction in relation to its non-core assets but no agreements or
binding terms have been signed as of the date of this report.
Other than as set out above, there were no known material significant events
from the end of the financial year to the date of this report that have
significantly affected, or may significantly affect the operations of the
Group, the results of those operations, or the state of affairs of the Group
in future financial periods.
LIKELY DEVELOPMENTS AND EXPECTED RESULTS OF OPERATIONS
The Group remains focused on progressing its four (4) pillared strategy which
includes continued exploration efforts at NWQ Copper Project in Queensland,
Cangai Copper Mine and Broken Hill Project in New South Wales, and its Zambian
property.
ENVIRONMENTAL REGULATION AND PERFORMANCE
The operations of the Group are presently subject to environmental regulation
under the laws of the Commonwealth of Australia and the States of Queensland
and New South Wales and the Republic of Zambia. The Group is, to the best of
its knowledge, at all times in full environmental compliance with the
conditions of its licenses.
SHARE OPTIONS
As at the date of this report, there were 8,000,000 unissued ordinary shares
under unlisted options. The details of the unlisted options at the date of
this report are as follows:
EXCERCISE PRICE $
NUMBER EXPIRY DATE
8,000,000 0.08 31 January 2025
During the year ended 30 June 2024, 121,699,971 unlisted options expired.
Since the end of the financial year, a further 3,000 unlisted options and
163,439,781 listed options have expired. At the date of this report all listed
options have expired.
PERFORMANCE SHARES
As part of the Zed Copper acquisition in the 2020 financial year, the Group
issued 2 classes of performance shares to the vendors on 20 February 2020:
46,875,000 Class A performance shares
Conditions precedent - converting to an equal number of Castillo shares on
delineation of a JORC resource of 200,000 tonnes of contained copper at a
minimum grade of 0.5% within 5 years of execution of the Share Sale Agreement.
46,875,000 Class B performance shares
Conditions precedent - converting to an equal number Castillo shares on
completion of a preliminary feasibility study demonstrating an internal rate
of return greater than 25% within 5 years of execution of the Share Sale
Agreement.
None of the above conditions were met during the 2024 financial year.
INDEMNIFICATION AND INSURANCE OF DIRECTORS AND OFFICERS
The Group has made an agreement indemnifying all the Directors and Officers of
the Group against all losses or liabilities incurred by each Director or
Officer in their capacity as Directors or Officers of the Group to the extent
permitted by the Corporation Act 2001. The indemnification specifically
excludes wilful acts of negligence. The Group paid insurance premiums in
respect of Directors' and Officers' Liability Insurance contracts for current
officers of the Group. The liabilities insured are damages and legal costs
that may be incurred in defending civil or criminal proceedings that may be
brought against the Officers in their capacity as Officers of entities in the
Group. The total amount of insurance premiums paid has not been disclosed due
to confidentiality reasons.
PROCEEDINGS ON BEHALF OF THE GROUP
No person has applied for leave of the court to bring proceedings on behalf of
the Group or intervene in any proceedings to which the Group is a party for
the purpose of taking responsibility on behalf of the Group for all or any
part of those proceedings. The Group was not a party to any such proceedings
during the year.
INDEMNITY AND INSURANCE OF AUDITOR
The Company has not, during or since the end of the financial year,
indemnified or agreed to indemnify the auditor of the company or any related
entity against a liability incurred by the auditor.
CORPORATE GOVERNANCE
In recognising the need for the highest standards of corporate behaviour and
accountability, the Directors of Castillo Copper Limited support and have
adhered to the principles of sound corporate governance. The Board recognises
the recommendations of the Australian Securities Exchange Corporate Governance
Council and considers that Castillo Copper is in compliance with those
guidelines to the extent possible, which are of importance to the commercial
operation of a junior listed resources company. During the financial year,
shareholders continued to receive the benefit of an efficient and cost
effective corporate governance policy for the Group. The Group's Corporate
Governance Statement and disclosures can be found at https://
castillocopper.com/investors/governance/.
AUDITOR'S INDEPENDENCE AND NON-AUDIT SERVICES
Section 307C of the Corporations Act 2001 requires the Group's auditors to
provide the Directors of Castillo Copper Limited with an Independence
Declaration in relation to the audit of the financial report. A copy of that
declaration is included on page 59 of the Annual Report. There were no
non-audit services provided by the Group's auditor during the year ended 30
June 2024.
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2024
NOTES 2024 $ 2023 $
Interest received 35,661 15,615
Other income 4 415,922 -
TOTAL 451,583 15,615
Listing and public company expenses (169,688) (158,585)
Accounting and audit expenses (163,150) (125,358)
Consulting and Directors' fees (544,718) (515,196)
Impairment of exploration expenditure 9 (419,369) (5,672,872)
Other expenses 4 (616,507) (485,832)
LOSS BEFORE INCOME TAX (1,461,849) (6,942,228)
Income tax benefit 5 - -
LOSS AFTER INCOME TAX (1,461,849) (6,942,228)
OTHER COMPREHENSIVE INCOME
Item that may be reclassified subsequently to profit or loss
Foreign currency translation 1,154 1,359
TOTAL OTHER COMPREHENSIVE INCOME 1,154 1,359
TOTAL COMPREHENSIVE LOSS FOR THE YEAR (1,460,695) (6,940,869)
Basic and diluted loss per share (cents per share) 13 (0.11) (0.53)
The accompanying notes form part of these financial statements.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 30 June 2024
NOTES 2024 $ 2023 $
CURRENT ASSETS
Cash and cash equivalents 6 1,118,294 2,897,611
Financial assets at fair value through profit or loss 7 376,344 -
Other assets 8 420,707 78,845
TOTAL CURRENT ASSETS 1,915,345 2,976,456
NON-CURRENT ASSETS
Other assets 8 314,361 486,961
Deferred exploration and evaluation expenditure 9 8,493,010 8,736,198
TOTAL NON-CURRENT ASSETS 8,807,371 9,223,159
TOTAL ASSETS 10,722,716 12,199,615
CURRENT LIABILITIES
Trade and other payables 112,142 128,346
TOTAL CURRENT LIABILITIES 112,142 128,346
TOTAL LIABILITIES 112,142 128,346
NET ASSETS 10,610,574 12,071,269
EQUITY
Issued capital 11 35,964,396 35,964,396
Reserves 12 4,082,889 4,081,735
Accumulated losses (29,436,711) (27,974,862)
TOTAL EQUITY 10,610,574 12,071,269
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2024
ISSUED CAPITAL SHARE BASED PAYMENT RESERVE FOREIGN CURRENCY TRANSLATION RESERVE ACCUMULATED LOSSES TOTAL
$ $
$ $
$
Balance at 1 July 2023 35,964,396 4,230,962 (149,227) (27,974,862) 12,071,269
Loss for the year - - - (1,461,849) (1,461,849)
Other comprehensive income - - 1,154 - 1,154
Total Comprehensive Loss - - 1,154 (1,461,849) (1,460,695)
Transactions with owners in their capacity as owners
- - - - -
Balance as at 30 June 2024 35,964,396 4,230,962 (148,073) (29,436,711) 10,610,574
ISSUED CAPITAL SHARE BASED PAYMENT RESERVE FOREIGN CURRENCY TRANSLATION RESERVE ACCUMULATED LOSSES TOTAL
$ $
$ $
$
Balance at 1 July 2022 35,964,396 4,230,962 (150,586) (21,032,634) 19,012,138
Loss for the year (6,942,228) (6,942,228)
Other comprehensive income 1,359 1,359
Total Comprehensive Loss 1,359 (6,942,228) (6,940,869)
Transactions with owners in their capacity as owners
- - - - -
Balance as at 30 June 2024 35,964,396 4,230,962 (149,227) (27,974,862) 12,071,269
The accompanying notes form part of these financial statements.
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2024
NOTES 2024 $ 2023 $
CASH FLOWS FROM OPERATING ACTIVITIES
Interest received 32,261 15,615
Payments to suppliers and employees (1,193,574) (1,115,720)
NET CASH USED IN OPERATING ACTIVITIES 6 (1,161,313) (1,100,105)
CASH FLOWS FROM INVESTING ACTIVITIES
Payments for tenements bonds - (82,000)
Exploration and evaluation expenditure 9 (617,285) (1,678,114)
NET CASH USED IN INVESTING ACTIVITIES (617,285) (1,760,114)
CASH FLOWS FROM FINANCING ACTIVITIES - -
NET CASH FROM FINANCING ACTIVITIES - -
NET (DECREASE) IN CASH AND CASH EQUIVALENTS
(1,778,598) (2,860,219)
Cash and cash equivalents at beginning of year 2,897,611 5,754,049
Foreign exchanges variances on cash (719) 3,781
CASH AND CASH EQUIVALENTS AT END OF FINANCIAL YEAR
6 1,118,294 2,897,611
The accompanying notes form part of these financial statements.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
1. CORPORATE INFORMATION
The financial report of Castillo Copper Limited and its subsidiaries
("Castillo Copper" or "the Group") for the year ended 30 June 2024 was
authorised for issue in accordance with a resolution of the Directors on 26
September 2024.
Castillo Copper Limited is a company limited by shares incorporated in
Australia whose shares are publicly traded on the Australian Securities
Exchange and London Stock Exchange. The nature of the operations and the
principal activities of the Group are described in the Directors' Report.
2. SUMMARY OF MATERIAL ACCOUNTING POLICIES
(A) BASIS OF PREPARATION
The financial report is a general-purpose financial report, which has 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. The Group
is a for profit entity for financial reporting purposes under Australian
Accounting Standards. The financial report has been prepared on an accrual
basis and is based on historical costs. Material accounting policies adopted
in preparation of this financial report are presented below and have been
consistently applied unless otherwise stated.
The presentation currency is Australian dollars.
(B) STATEMENT OF COMPLIANCE
The financial report complies with Australian Accounting Standards, which
include Australian equivalents to International Financial Reporting Standards
(AIFRS). Compliance with AIFRS ensures that the financial report, comprising
the financial statements and notes thereto, complies with International
Financial Reporting Standards (IFRS).
(C) ADOPTION OF NEW AND REVISED STANDARDS
Standards and Interpretations applicable 30 June 2024.
In the year ended 30 June 2024, the Directors have reviewed all of the new and
revised Standards and Interpretations issued by the AASB that are relevant to
the Company and effective for the current annual reporting period. As a result
of this review, the Directors have determined that there is no material impact
of the new and revised Standards and Interpretations on the Group and
therefore, no material change is necessary to Group accounting policies.
Standards and interpretations issued, but not yet effective.The Directors have
also reviewed all Standards and Interpretations issued, but not yet effective
for the period 30 June 2024. As a result of this review the Directors have
determined that there is no material impact of the Standards and
Interpretations issued but not yet effective on the Company.
(D) 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.
The Group incurred a net loss for the year ended 30 June 2024 of of $1,461,849
and net cash outflows from operating activities of $1,161,313 net cash
outflows from investing activities of $617,285 and net cash flows from
financing activities of $Nil. At 30 June 2024, the Group had a net asset
position of $10,610,574. The cash and cash equivalents balance at 30 June 2024
was $1,118,294.
Notwithstanding these results, the Directors believe that the Company will be
able to continue as a going concern and as a result the financial statements
have been prepared on a going concern basis. The financial report has been
prepared on the assumption that the Group is a going concern for the following
reasons:
· the ability of the Group to scale back parts of its operations and
reduce costs if required;
· the Board is of the opinion that the Group has, or shall have access
to, sufficient funds to meet the planned corporate activities and working
capital requirements; and
· as the Group is an ASX-listed entity, the Group has the ability to
raise additional funds, if required.
In the event that the Group is unable to achieve the actions noted above,
there is a material uncertainty that may cast significant doubt as to the
Group's ability to continue as a going concern, and it may be required to
realise its assets at amounts different to those currently recognised, settle
liabilities other than in the ordinary course of business and make provisions
for other costs which may arise as a result of cessation or curtailment of
normal business operations.
The directors have reviewed the Group's financial position and are of the
opinion that the use of the going concern basis of accounting is appropriate.
(E) BASIS OF CONSOLIDATION
The consolidated financial statements comprise the financial statements of
Castillo Copper Limited and its subsidiaries as at 30 June
each year ('the Company').
Subsidiaries are all those entities (including special purpose entities) over
which the Company has control. The Company controls an entity when the company
is exposed to, or has rights to, variable returns from its involvement with
the entity and has the ability to affect those returns through its power to
direct the activities of the Group.
The financial statements of the subsidiaries are prepared for the same
reporting period as the parent Company, using consistent accounting policies.
In preparing the consolidated financial statements, all intercompany balances
and transactions, income and expenses and profit and losses resulting from
intra-company transactions have been eliminated in full.
Subsidiaries are fully consolidated from the date on which control is obtained
by the Company and cease to be consolidated from the date on which control is
transferred out of the Company.
A change in the ownership interest of a subsidiary that does not result in a
loss of control, is accounted for as an equity transaction.
(F) FOREIGN CURRENCY TRANSLATION
(I) FUNCTIONAL AND PRESENTATION CURRENCY
Items included in the financial statements of each of the Company's entities
are measured using the currency of the primary economic environment in which
the entity operates ('the functional currency'). The functional and
presentation currency of Castillo Copper Limited is Australian Dollars. The
functional currency of the Chilean subsidiary is Chilean Peso. The functional
currency of the Zambian subsidiaries is United States Dollars.
(II) TRANSACTIONS AND BALANCES
Foreign currency transactions are translated into the functional currency
using the exchange rates prevailing at the dates of the transactions. Foreign
exchange gains and losses resulting from the settlement of such transactions
and from the translation at year-end exchange rates of monetary assets and
liabilities denominated in foreign currencies are recognised in the statement
of comprehensive income.
(III) GROUP ENTITIES
The results and financial position of all the Company entities (none of which
has the currency of a hyperinflationary economy) that have a functional
currency different from the presentation currency are translated into the
presentation currency as follows:
· assets and liabilities for each statement of financial position
presented are translated at the closing rate at the date of that statement of
financial position;
· income and expenses for each statement of comprehensive income are
translated at average exchange rates (unless this is not a reasonable
approximation of the rates prevailing on the transaction dates, in which case
income and expenses are translated at the dates of the transactions); and
· all resulting exchange differences are recognised as a separate
component of equity.
On consolidation, exchange differences arising from the translation of any net
investment in foreign entities are taken to foreign currency translation
reserve. When a foreign operation is sold or any borrowings forming part of
the net investment are repaid, a proportionate share of such exchange
differences are recognised in the statement of comprehensive income, as part
of the gain or loss on sale where applicable.
(G) IMPAIRMENT OF NON-FINANCIAL ASSETS
The Group assesses at each reporting date whether there is an indication that
an asset may be impaired. If any such indication exists, or when annual
impairment testing for an asset is required, the Group makes an estimate of
the asset's recoverable amount. An asset's recoverable amount is the higher of
its fair value less costs to sell and its value in use and is determined for
an individual asset, unless the asset does not generate cash inflows that are
largely independent of those from other assets of the Group. In such cases the
asset is tested for impairment as part of the cash generating unit to which it
belongs. When the carrying amount of an asset or cash-generating unit exceeds
its recoverable amount, the asset or cash-generating unit is considered
impaired and is written down to its recoverable amount.
In assessing value in use, the estimated future cash flows are discounted to
their present value using a pre-tax discount rate that reflects current market
assessments of the time value of money and the risks specific to the asset.
Impairment losses relating to continuing operations are recognised in those
expense categories consistent with the function of the impaired asset unless
the asset is carried at revalued amount (in which case the impairment loss is
treated as a revaluation decrease).
An assessment is also made at each reporting date as to whether there is any
indication that previously recognised impairment losses may no longer exist or
may have decreased. If such indication exists, the recoverable amount is
estimated. A previously recognised impairment loss is reversed only if there
has been a change in the estimates used to determine the asset's recoverable
amount since the last impairment loss was recognised. If that is the case the
carrying amount of the asset is increased to
its recoverable amount. That increased amount cannot exceed the carrying
amount that would
have been determined, net of depreciation, had no impairment loss been
recognised for the asset in prior years. Such reversal is recognised in profit
or loss unless the asset is carried at revalued amount, in which case the
reversal is treated as a revaluation increase. After such a reversal the
depreciation charge is adjusted in future periods to allocate the asset's
revised carrying amount, less any residual value, on a systematic basis over
its remaining useful life.
(H) EXPLORATION AND EVALUATION EXPENDITURE
Exploration and evaluation expenditure incurred by or on behalf of the Group
is accumulated separately for each area of interest. Such expenditure
comprises net direct costs and an appropriate portion of related overhead
expenditure, but does not include general overheads or administrative
expenditure not having a specific nexus with a particular area of interest.
Each area of interest is limited to a size related to a known or probable
mineral resource capable of supporting a mining operation.
Exploration and evaluation expenditure for each area of interest is carried
forward as an asset provided that one of the following conditions is met:
· such costs are expected to be recouped through successful development
and exploitation of the area of interest or, alternatively, by its sale; or
· exploration and evaluation activities in the area of interest have
not yet reached a stage which permits a reasonable assessment of the existence
or otherwise of economically recoverable reserves, and active and significant
operations in relation to the area are continuing.
Expenditure which fails to meet the conditions outlined above is impaired;
furthermore,
the Directors regularly review the carrying value of exploration and
evaluation expenditure and make write downs if the values are not expected to
be recoverable.
Identifiable exploration assets acquired are recognised as assets at their
cost of acquisition, as determined by the requirements of AASB 6 Exploration
for and evaluation of mineral resources. Exploration assets acquired are
reassessed on a regular basis and these costs are carried forward provided
that at least one of the conditions referred to in AASB 6 is met.
Exploration and evaluation expenditure incurred subsequent to acquisition in
respect of an exploration asset acquired, is accounted for in accordance with
the policy outlined above for exploration expenditure incurred by or on behalf
of the entity.
Acquired exploration assets are not written down below acquisition cost until
such time as the acquisition cost is not expected to be recovered. When an
area of interest is abandoned, any expenditure carried forward in respect of
that area is written off.
Expenditure is not carried forward in respect of any area of interest/mineral
resource unless the Group's rights of tenure to that area
of interest are current.
(I) CASH AND CASH EQUIVALENTS
Cash and short term deposits in the statement of financial position include
cash on hand, deposits held at call with banks and other short term highly
liquid investments with original maturities of three months or less. Bank
overdrafts are shown as current liabilities in the statement of financial
position. For the purpose of the statement of cash flows, cash and cash
equivalents consist of cash and cash equivalents as described above.
(J) INVESTMENTS AND OTHER FINANCIAL ASSETS
Investments and other financial assets are initially measured at fair value.
Transaction costs are included as part of the initial measurement, except for
financial assets at fair value through profit or loss. Such assets are
subsequently measured at either amortised cost or fair value depending on
their classification. Classification is determined based on both the business
model within which such assets are held and the contractual cash flow
characteristics of the financial asset unless an accounting mismatch is being
avoided.
Financial assets are derecognised when the rights to receive cash flows have
expired or have been transferred and the consolidated entity has transferred
substantially all the risks and rewards of ownership. When there is no
reasonable expectation of recovering part or all of a financial asset, its
carrying value is written off.
FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS
Financial assets not measured at amortised cost or at fair value through other
comprehensive income are classified as financial assets at fair value through
profit or loss. Typically, such financial assets will be either: (i) held for
trading, where they are acquired for the purpose of selling in the short-term
with an intention of making a profit, or a derivative; or (ii) designated as
such upon initial recognition where permitted. Fair value movements are
recognised in profit or loss.
FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME
Financial assets at fair value through other comprehensive income include
equity investments which the consolidated entity intends to hold for the
foreseeable future and has irrevocably elected to classify them as such upon
initial recognition.
IMPAIRMENT OF FINANCIAL ASSETS
The consolidated entity recognises a loss allowance for expected credit losses
on financial assets which are either measured at amortised cost or fair value
through other comprehensive income. The measurement of the loss allowance
depends upon the consolidated entity's assessment at the end of each reporting
period as to whether the financial instrument's credit risk has increased
significantly since initial recognition, based on reasonable and supportable
information that is available, without undue cost or effort to obtain.
Where there has not been a significant increase in exposure to credit risk
since initial recognition, a 12-month expected credit loss allowance is
estimated. This represents a portion of the asset's lifetime expected credit
losses that is attributable to a default event that is possible within the
next 12 months.
Where a financial asset has become credit impaired or where it is determined
that credit risk has increased significantly, the loss allowance is based on
the asset's lifetime expected credit losses. The amount of expected credit
loss recognised is measured on the basis of the probability weighted present
value of anticipated cash shortfalls over the life of the instrument
discounted at the original effective interest rate.
For financial assets mandatorily measured at fair value through other
comprehensive income, the loss allowance is recognised in other comprehensive
income with a corresponding expense through profit or loss. In all other
cases, the loss allowance reduces the asset's carrying value with a
corresponding expense through profit or loss.
(K) CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS
Estimates and judgements are continually evaluated and are based on historical
experience and other factors, including expectations of future events that may
have a financial impact on the entity and that are believed to be reasonable
under the circumstances. The Group makes estimates and assumptions concerning
the future.
The resulting accounting estimates will, by definition, seldom equal the
related actual results. The estimates and assumptions that have a significant
risk of causing a material adjustment to the carrying amounts of assets and
liabilities within the next financial year are discussed below.
CAPITALISED EXPLORATION AND EVALUATION EXPENDITURE
The future recoverability of capitalised exploration and evaluation
expenditure is dependent on a number of factors, including whether the Group
decides to exploit the related lease itself or, if not, whether it
successfully recovers the related exploration and evaluation asset through
sale.
Factors which could impact the future recoverability include the level of
proved, probable and inferred mineral resources, future technological changes
which could impact the cost of mining, future legal changes (including changes
to environmental restoration obligations) and changes to commodity prices.
To the extent that capitalised exploration and evaluation expenditure is
determined not to be recoverable in the future, this will reduce profits and
net assets in the period in which this determination is made. In addition,
exploration and evaluation expenditure is capitalised if activities in the
area of interest have not yet reached a stage which permits a reasonable
assessment of the existence or otherwise of economically recoverable reserves.
To the extent that it is determined in the future that this capitalised
expenditure should be written off, this will reduce profits and net assets in
the period in which this determination is made.
SHARE-BASED PAYMENT TRANSACTIONS
The Group measures the cost of equity-settled transactions with employees by
reference to the fair value of the equity instruments at the date at which
they are granted. The fair value is determined by using a Black and Scholes
model, using the assumptions detailed in note 11.
REHABILITATION PROVISION
The Group's mining and exploration activities are subject to various laws and
regulations governing the protection of the environment. The Group recognises
management's best estimate for asset retirement obligations in the period in
which they are incurred. Actual costs incurred in the future periods could
differ materially from the estimates. Additionally, future changes to
environmental laws and regulations, life of mine estimates and discount rates
could affect the carrying amount of this provision.
(L) REHABILITATION PROVISION
A provision for rehabilitation and restoration is recognised when there is a
present obligation as a result of activities undertaken, it is probable that
an outflow of economic benefits will be required to settle the obligation, and
the amount of the provision can be measured reliably. The estimated future
obligations include the costs of abandoning sites, removing facilities and
restoring the affected areas.
The provision for future restoration costs is the best estimate of the present
value of the expenditure required to settle the restoration obligation at the
balance date.
Future restoration costs are reviewed annually and any changes in the estimate
are reflected in the present value of the restoration provision at each
balance date.
The initial estimate of the restoration and rehabilitation provision is
capitalised into the cost of the related asset and amortised on the same basis
as the related asset, unless the present obligation arises from the production
of inventory in the period, in which case the amount is included in the cost
of production for the period. Changes in the estimate of the provision for
rehabilitation are treated in the same manner, except that the unwinding of
the effect of discounting on the provision is recognised as a finance cost
rather than being capitalised into the cost of the related asset.
(M) INCOME TAX
Deferred income tax is provided for on all temporary differences at balance
date between the tax base of assets and liabilities and their carrying amounts
for financial reporting purposes. No deferred income tax will be recognised
from the initial recognition of goodwill or of an asset or liability,
excluding a business combination, where there is no effect on accounting or
taxable profit or loss. No deferred income tax will be recognised in respect
of temporary differences associated with investments in subsidiaries if the
timing of the reversal of the temporary difference can be controlled and it is
probable that the temporary differences will not reverse in the near future.
Deferred tax is calculated at the tax rates that are expected to apply to the
period
when the asset is realised or liability is settled. Deferred tax is credited
in the statement of comprehensive income 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 for all
deductible temporary differences, carry forward of unused tax assets and
unused tax losses to the extent that it is probable that future tax profits
will be available against which deductible temporary differences can be
utilised.
The amount of benefits brought to account or which may be realised in the
future is based on tax rates (and tax laws) that have been enacted or
substantially enacted at the balance date 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.
The carrying amount of deferred tax assets is reviewed at each balance date
and only recognised to the extent that sufficient future assessable income is
expected to be obtained. Income taxes relating to items recognised directly in
equity are recognised in equity and not in the statement of comprehensive
income.
(N) ISSUED CAPITAL
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.
(O) REVENUE
Revenue is recognised to the extent that it is probable that the economic
benefits will flow to the Group and the revenue is capable of being reliably
measured. The following specific recognition criteria must also be met before
revenue is recognised:
INTEREST INCOME
Revenue is recognised as the interest accrues (using the effective interest
method, which is the rate that exactly discounts estimated future cash
receipts through the expected life of the financial instrument) to the net
carrying amount of the financial asset.
(P) EARNINGS / LOSS PER SHARE
BASIC EARNINGS / LOSS PER SHARE
Basic earnings / loss per share is calculated by dividing the profit/loss
attributable to equity holders of the Group, excluding any costs of servicing
equity other than dividends, by the weighted average number of ordinary
shares, adjusted for any bonus elements.
DILUTED EARNINGS / LOSS PER SHARE
Diluted earnings / loss per share is calculated as net profit/loss
attributable to members of the Group, adjusted for:
· costs of servicing equity (other than dividends) and preference share
dividends;
· the after tax effect of dividends and interest associated with
dilutive potential ordinary shares that have been recognised as expenses; and
· other non-discretionary changes in revenues or expenses during the
period that would result from the dilution of potential ordinary shares; and
· divided by the weighted average number of ordinary shares and
dilutive potential ordinary shares, adjusted for any bonus elements.
(Q) GOODS AND SERVICES TAX
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. The net amount of GST recoverable from, or payable to, the
Australian Tax Office is included as part of receivables or payables in the
statement of financial position. Cash flows are presented in the 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.
(R) TRADE AND OTHER PAYABLES
Liabilities for trade creditors and other amounts are measured at amortised
cost, which is the fair value of the consideration to be paid in the future
for goods and services received that are unpaid, whether or not billed to the
Group.
(S) SHARE-BASED PAYMENT TRANSACTIONS
The Group provides benefits to individuals acting as, and providing services
similar to employees (including Directors) of the Group in the form of share
based payment transactions, whereby individuals render services in exchange
for shares or rights over shares ('equity settled transactions').
The cost of these equity settled transactions with employees is measured by
reference to the fair value at the date at which they are granted. The fair
value is determined by using the Black Scholes formula taking into account the
terms and conditions upon which the instruments were granted, as discussed in
note 11(e).
In valuing equity settled transactions, no account is taken of any performance
conditions, other than conditions linked to the price of the shares of
Castillo Copper Limited ('market conditions').
The cost of the equity settled transactions is recognised, together with a
corresponding increase in equity, over the period in which the performance
conditions are fulfilled, ending on the date on which the relevant employees
become fully entitled to the award ('vesting date').
The cumulative expense recognised for equity settled transactions at each
reporting date until vesting date reflects (i) the extent to which the vesting
period has expired and (ii) the number of awards that, in the opinion of the
Directors of the Group, will ultimately vest. This opinion is formed based on
the best available information at balance date.
No adjustment is made for the likelihood of the market performance conditions
being met as the effect of these conditions is included in the determination
of fair value at grant date. The statement of comprehensive income charge or
credit for a period represents the movement in cumulative expense recognised
at the beginning and end
of the period.
No expense is recognised for awards that do not ultimately vest, except for
awards where vesting is conditional upon a market condition.
Where the terms of an equity settled award are modified, as a minimum, an
expense is recognised as if the terms had not been modified. In addition, an
expense is recognised for any increase in the value of the transaction as a
result of the modification, as measured at the date of the modification.
Where an equity settled award is cancelled, it is treated as if it had vested
on the date of the cancellation, and any expense not yet recognised for the
award is recognised immediately. However if a new award is substituted for the
cancelled award, and designated as a replacement award on the date that it is
granted, the cancelled and new award are treated as if they were a
modification of the original award, as described in the previous paragraph.
The cost of equity-settled transactions with non-employees is measured by
reference to the fair value of goods and services received unless this cannot
be measured reliably, in which case the cost is measured by reference to the
fair value of the equity instruments granted. The dilutive effect, if any, of
outstanding options is reflected in the computation of loss per share (see
note 13).
(T) COMPARATIVE INFORMATION
When required by Accounting Standards, comparative information has been
reclassified to be consistent with the presentation in
the current year.
(U) OPERATING SEGMENTS
Operating segments are presented using the 'management approach', where the
information presented is on the same basis as the internal reports provided to
the Chief Operating Decision Makers ('CODM').
The CODM is responsible for the allocation of resources to operating segments
and assessing their performance.
(V) FAIR VALUE MEASUREMENT
When an asset or liability, financial or non-financial, is measured at fair
value for recognition or disclosure purposes, fair value is based on the price
that would be received to sell an asset or paid to transfer a liability in an
orderly transaction between market participants at the measurement date; and
assumes that the transaction will take place either: in the principle market;
or in the absence of a principal market, in the most advantageous market.
Fair value is measured using the assumptions that market participants would
use when pricing the asset or liability, assuming they act in their economic
best interest. For non-financial assets, the fair value measurement is based
on its highest and best use. Valuation techniques that are appropriate in the
circumstances and for which sufficient data are available to measure fair
value, are used, maximising the use of relevant observable inputs and
minimising the use of unobservable inputs.
Assets and liabilities measured at fair value are classified, into three
levels, using a fair value hierarchy that reflects the significance of the
inputs used in making the measurements. Classifications are reviewed each
reporting date and transfers between levels are determined based on a
reassessment of the lowest level input that is significant to the fair value
measurement.
For recurring and non-recurring fair value measurements, external valuers may
be used when internal expertise is either not available or when the valuation
is deemed to be significant. External valuers are selected based on market
knowledge and reputation. Where there is a significant change in fair value of
an asset or liability from one period to another, an analysis is undertaken,
which includes a verification of the major inputs applied in the latest
valuation and a comparison, where applicable, with external sources of data.
(W) PARENT ENTITY FINANCIAL INFORMATION
The financial information for the parent entity, Castillo Copper Limited,
disclosed in Note 17 has been prepared on the same basis as the consolidated
financial statements, except as set out below.
INVESTMENTS IN SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE ENTITIES
Investments in subsidiaries, associates and joint venture entities are
accounted for at cost in the parent entity's financial statements. Dividends
received from associates are recognised in the parent entity's profit or loss,
rather than being deducted from the carrying amount of these investments.
3. SEGMENT INFORMATION
Management has determined the operating segments based on the reports reviewed
by the Board of Directors that are used to make strategic decisions. The
entity has four geographical segments being exploration in Northwest
Queensland (NWQ), New South Wales (Cangai), New South Wales (Broken Hill) and
Zambia. Revenue attributable to all segments is immaterial. Allocationof
asset, liabilities, income and expenses to each segment is shown below:
NWQ (QLD) CANGAI (NSW) BROKEN HILL (NSW) ZAMBIA UNALLOCATED TOTAL
2024 $ $ $
$ $ $
SEGMENT ASSETS AND LIABILITIES
Current assets
- 152,600 20,000 - 1,742,745 1,915,345
Non-current assets
6,690,813 168,500 1,316,415 631,522 122 8,807,371
Current liabilities
- - - - (112,142) (112,142)
SEGMENT INCOME AND EXPENSES
Interest income
- - - - 35,661 35,661
Other income
- - 415,922 - - 415,922
Other expenses
- (210,247) - (228,616) (1,474,569) (1,913,432)
Loss before tax
- (210,247) 415,922 (228,616) (1,438,908) (1,461,849)
NWQ (QLD) CANGAI (NSW) BROKEN HILL (NSW) ZAMBIA UNALLOCATED TOTAL
2023 $ $ $
$ $ $
SEGMENT ASSETS AND LIABILITIES
Current assets
- - - - 2,976,456 2,976,456
Non-current assets
6,605,846 321,100 1,527,490 768,601 122 9,223,159
Current liabilities
- - - - (128,346) (128,346)
SEGMENT INCOME AND EXPENSES
Interest income
- - - - 15,615 15,615
Other expenses
- (5,322,762) - (350,110) (1,284,971) (6,957,843)
Loss before tax
- (5,322,762) - (350,110) (1,269,356) (6,942,228)
4. OTHER INCOME AND EXPENSES
2024 2023
$ $
OTHER INCOME
Gain on sale of exploration assets1 415,922 -
Total other income 415,922 -
1Refer to Note 9.
OTHER EXPENSES
Travel and Accomodation 1,327 6,780
Legal 25,433 7,860
Loss on revaluation of assets held at fair value through the profit and loss 134,409 -
Insurance 74,609 98,270
Foreign Exchange Losses / (Gains) 720 (482)
Investor Relations 335,416 336,944
Other 44,593 36,460
Total Other Expenses 616,507 485,832
5. INCOME TAX
(A) INCOME TAX EXPENSE/(BENEFIT)
2024 2023
$ $
Major component of tax expense for the year: - -
Current tax - -
Deferred tax - -
Total - -
(B) NUMERICAL RECONCILIATION BETWEEN AGGREGATE TAX EXPENSE RECOGNISED IN THE
STATEMENT OF COMPREHENSIVE INCOME AND TAX EXPENSE CALCULATED PER THE STATUTORY
INCOME TAX RATE
A reconciliation between tax expense and the product of accounting result
before income tax multiplied by the Group's applicable tax rate is as follows:
2024 2023
$ $
Loss from continuing operations before income tax expense (1,461,849) (6,942,228)
Tax at the Australian rate of 25% (2023: 30%) (365,462) (2,082,668)
Non-allowable expenses 1,872 -
Income tax benefit not bought to account 363,590 2,082,668
Income tax expense - -
(C) THE FOLLOWING DEFERRED TAX BALANCES HAVE NOT BEEN BOUGHT
TO ACCOUNT:
2024 2023
$ $
ASSETS
Total losses available to offset against future taxable income 6,539,166 7,353,655
Total accrued expenses 9,699 12,461
Total share issue costs deductible over five years 111,651 285,972
LIABILITIES
Prepayments (10,102) -
Financial assets held at fair value through profit and loss (33,323) -
Deferred tax liability on capitalised exploration costs (2,136,828) (2,390,279)
Deferred tax assets not brought to account as realisation is not regarded as (4,480,262) (5,261,809)
probable
Deferred tax asset recognised - -
(D) UNUSED TAX LOSSES
2024 2023
$ $
Unused tax losses 26,156,655 24,512,183
Potential tax benefit not recognised at 25% (2023: 30%) 6,539,166 7,353,655
The benefit for tax losses will only be obtained if:
(i) the Group derives future assessable income in
Australia of a nature and of an amount sufficient to enable the benefit from
the deductions for the losses to be realised;
(ii) the Group continues to comply with the conditions for
deductibility imposed by tax legislation in Australia; and
(iii) no changes in tax legislation in Australia, adversely
affect the Group in realising the benefit from the deductions for the losses.
6. CASH AND CASH EQUIVALANTS
2024 2023
$ $
(A) RECONCILIATION OF OPERATING LOSS AFTER TAX TO NET THE CASH FLOWS USED IN
OPERATIONS
Loss from ordinary activities after tax (1,461,849) (6,942,228)
NON-CASH ITEMS
Loss on revaluation of financial assets held at fair value through profit or 134,409 -
loss
Impairment expense 419,369 5,672,872
Foreign exchange loss/(gain) 1,874 (455)
Sale of non current assets for shares (415,922) -
PROFIT & LOSS ITEMS CLASSED AS INVESTING ACTIVITIES
Consulting fees relating to exploration expenditure 163,515 150,000
CHANGES IN ASSETS AND LIABILITIES
(Decrease) / increase in trade and other payables (15,682) 26,942
Decrease / (Increase) in other receivables 12,973 (7,236)
Net cash flow used in operating activities (1,161,313) (1,100,105)
(B) RECONCILIATION OF CASH
2024 2023
$ $
CASH BALANCE COMPRISES:
Cash at bank 718,294 2,805,611
Term deposits 400,000 92,000
Total 1,118,294 2,897,611
Cash at bank earns interest at floating rates based on daily bank deposit
rates. Term deposits earn interest at fixed rates based on the 3-month term
deposit rate.
7. FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS
2024 2023
$ $
CURRENT
Listed ordinary shares - designated at fair value through profit or loss 376,344 -
Total 376,344 -
RECONCILIATION
Reconciliation of the fair values at the beginning and end of the current and
previous financial year are set out below:
2024 2023
$ $
Opening fair value - -
Additions 510,753 -
Revaluation increments (134,409) -
Closing fair value 376,344 -
Ordinary shares at fair value through profit or loss are measured at fair
value based on quoted prices (unadjusted) in active markets for identical
assets that the entity can access at the measurement date.
8. OTHER ASSETS
2024 2023
$ $
CURRENT
GST/VAT receivable 21,544 37,764
Prepayments 40,408 41,081
Accrued interest 3,400 -
Tenement guarantees 172,600 -
R&D Tax Incentive receivable 182,755 -
Total 420,707 78,845
NON-CURRENT
Tenement guarantees 314,361 486,961
Total 314,361 486,961
Current tenement guarantees relate to security deposits that were refunded by
the New South Wales State Government in August 2024.
9. DEFFERED EXPLORATION AND EVALUATION EXPENDITURE
2024 2023
$ $
EXPLORATION AND EVALUATION PHASE:
Opening balance 8,736,198 12,899,486
Exploration and evaluation expenditure during the period 453,768 1,509,584
R&D Tax Incentive receivable relating to capitalised exploration (182,756) -
expenditure
Impairment1 (419,369) (5,672,872)
Sale of exploration assets2 (94,831) -
Closing balance 8,493,010 8,736,198
The recoupment of costs carried forward in relation to areas of interest in
the exploration and evaluation phase is dependent on the successful
development and commercial exploration or sale of respective areas.
1 At each reporting date, the Group undertakes an assessment of the carrying
amount of its exploration and evaluation assets. During the period, the Group
identified indicators or impairment on certain exploration and evaluation
assets under AASB 6 Exploration and Evaluation of Mineral Resources. As a
result of this review, an impairment charge of $419,369 has been recognised in
the statement of profit or loss and other comprehensive income in relation to
areas of interest where no future exploration and evaluation activities are
expected or where the right to explore has expired.
2 On 21 March 2024 the sale of the Company's Exploration Licenses 8572 and
8599 in Broken Hill, NSW, to Rimfire Pacific Mining Limited (ASX: RIM) as
announced on 11 January 2024 was completed. As consideration for the sale, the
Group received 13,440,861 shares in RIM with a value of $510,753. As a result,
a gain on sale of exploration assets of $415,922 has been recognised in the
statement of profit or loss and other comprehensive income.
10. TRADE AND OTHER PAYABLES
2024 2023
$ $
CURRENT
Trade and other payables 81,642 87,586
Accruals 30,500 40,758
Total 112,142 128,344
Trade and other payables are non-interest bearing and payable on demand. Due
to their short-term nature, the carrying value of trade and other payables is
assumed to approximate their fair value.
11. ISSUED CAPITAL
2024 2023
$ $
(A) ISSUED AND PAID UP CAPITAL
Ordinary shares fully paid 35,965,396 35,965,396
NUMBER OF SHARES NUMBER OF SHARES
$ $
(B) MOVEMENTS IN ORDINARY SHARES ON ISSUE
Opening balance 1,299,505,355 35,964,396 1,299,505,355 35,964,396
Closing balance 1,299,505,355 35,964,396 1,299,505,355 35,964,396
(C) ORDINARY SHARES
The Group does not have authorised capital nor par value in respect of its
issued capital. Ordinary shares have the right to receive dividends as
declared and, in the event of a winding up of the Company, to participate in
the proceeds from sale of all surplus assets in proportion to the number of
and amounts paid up on shares held. Ordinary shares entitle their holder to
one vote, either in person or proxy, at a meeting of the Company.
(D) SHARE OPTIONS
At 30 June 2024 there were 11,000,000 (30 June 2023: 132,699,971) unlisted
options and 163,439,781 (30 June 2023: 163,439,781) listed options (ASX:
CCZOA, CCZOB) with various exercise prices and expiry dates.
The following share-based payment arrangements were in place during the
period:
EXCERSISE PRICE $ FAIR VALUE AT GRANT DATE LISTED / UNLISTED
SERIES NUMBER GRANT DATE EXPIRY DATE VESTING DATE
1 14,285,714 15 June 2021 31 July 2024 $0.08 $0.022 15 June 2021 Listed
2 2,955,665 16 June 2021 1 August 2024 £0.044 $0.021 16 June 2021 Listed
3 2,418,044 5 August 2021 31 July 2024 $0.08 $0.007 5 August 2021 Listed
4 462,378 17 August 2021 1 August 2024 £0.044 $0.017 17 August 2021 Listed
5 4,000,000 27 October 2021 31 July 2024 $0.08 $0.007 27 October 2021 Listed
6 3,000,000 30 November 2021 31 July 2024 $0.08 $0.010 30 November 2021 Unlisted
7 8,000,000 1 February 2022 31 January 2025 $0.08 $0.007 1 February 2022 Unlisted
No options were exercised during the period.
79,117,618 listed options and 42,582,353 unlisted options expired during the
period. Since the end of the financial year, 163,439,781 listed and 3,000,000
unlisted options have expired.
No listed or unlisted options have been issued since the end of the year.
Weighted remaining contractual life (years) 0.11
Weighted average exercise price $0.08
Options granted as equity compensation benefits to Key Management Personnel
during the year are set out in the audited remuneration report.
(E) PERFORMANCE SHARES
The fair value of the equity-settled unlisted options granted in prior periods
was estimated as at the date of grant using the Black and Scholes model taking
into account the terms and conditions upon which they were granted, as
follows: 46,875,000 CLASS A
PERFORMANCE SHARES
Conditions precedent - converting to an equal number of Castillo shares on
delineation of a JORC resource of 200,000 tonnes of contained copper at a
minimum grade of 0.5% within 5 years of execution of the Share Sale Agreement.
46,875,000 CLASS B
PERFORMANCE SHARES
Conditions precedent - converting to an equal number Castillo shares on
completion of a preliminary feasibility study demonstrating an internal rate
of return greater than 25% within 5 years of execution of the Share Sale
Agreement.
The performance shares will expire on 20 February 2025.
12. RESERVES
SHARE BASED PAYMENT RESERVE
The share based payment reserve is used to record the value of equity benefits
provided to Directors and executives as part of their remuneration and
non-employees for their services.
FOREIGN CURRENCY TRANSLATION RESERVE
The foreign exchange differences arising on translation of balances originally
denominated in a foreign currency into the functional currency are taken
to the foreign currency translation reserve. The reserve is recognised in
profit or loss when the net investment is disposed of.
13. LOSS PER SHARE
2024 2023
$ $
Loss used in calculating basic and dilutive EPS (1,461,849) (6,942,228)
2024 2023
NU
MB
ER
OF
SH
AR
ES
Weighted average number of ordinary shares used in calculating basic loss per 1,299,505,355 1,299,505,355
share:
Effect of dilution:
Share options - -
Adjusted weighted average number of ordinary shares used in calculating 1,299,505,355 1,299,505,355
diluted loss per share:
Basic and diluted loss per share (cents per share) (0.11) (0.53)
There have been no transactions involving ordinary shares or potential
ordinary shares that would significantly change the number of ordinary shares
or potential ordinary shares outstanding between the reporting date and the
date of completion of these financial statements.
There are no potential ordinary shares on issue that are considered to be
dilutive, therefore basic earnings per share also represents diluted earnings
per share.
14. AUDITOR'S RENUMERATION
The auditor of Castillo Copper Limited is HLB Mann Judd. Amounts received or
due and receivable for:
2024 2023
$ $
Audit or review of the financial report of the entity and any other entity in 50,599 46,358
the Group
Total 50,599 46,358
15. RELATED PARTY DISCLOSURES
(A) KEY MANAGEMENT PERSONNEL
Compensation of key management personnel
2024 2023
$ $
Short term employee benefits 322,948 360,553
Post-employment benefits 14,380 2,139
Total 337,328 362,692
B) OTHER TRANSACTIONS WITH KEY MANAGEMENT PERSONNEL
Field Crew Pty Ltd, a company of which Mr Drakeley is a director, charged the
Group consulting fees of $171,662 inclusive of expense reimbursements (2023:
$115,135). There was $2,618 outstanding at 30 June 2024 (2023: nil).
C) SUBSIDIARIES
The consolidated financial statements incorporate the assets, liabilities and
results of Castillo Copper Limited and the following subsidiaries:
EQUITY HOLDING
NAME OF ENTITY COUNTRY OF INCORPORATION
2024 2023
Castillo Copper Chile SPA Chile 100% 100%
Castillo Exploration Limited Australia 100% 100%
Qld Commodities Pty Ltd Australia 100% 100%
Total Iron Pty Ltd Australia 100% 100%
Total Minerals Pty Ltd Australia 100% 100%
BHA No. 1 Pty Ltd Australia 100% 100%
Atlantica Holdings (Bermuda) Bermuda 75% 75%
Zed Copper Pty Ltd Australia 100% 100%
Chalo Mining Group Ltd Zambia 100% 100%
Luflilian Resources Zambia Ltd Zambia 100% 100%
Belmt Resources Mining Company Ltd Zambia 50% 50%
Castillo Copper Limited is the ultimate Australian parent entity and ultimate
parent of the Group. Balances and transactions between the Company and its
subsidiaries, which are related parties of the Company, have been eliminated
on consolidation and not disclosed in this note.
16. FINANCIAL RISK MANAGEMENT
Exposure to liquidity, interest rate, price, credit, and foreign exchange risk
arises in the normal course of the Group's business. The Group does not hold
or use derivative financial instruments. The Group's principal financial
instruments comprise mainly of deposits with banks. The totals for each
category of financial instruments are as follows:
2024 2023
$ $
FINANCIAL ASSETS
Cash and cash equivalents 1,118,294 2,897,611
Financial assets at fair value through profit or loss 376,344 -
Other receivables (current and non-current) 694,660 524,725
Total 2,189,298 3,422,336
FINANCIAL LIABILITIES
Trade and other payables 112,142 128,346
The Group uses different methods as discussed below to manage risks that arise
from these financial instruments. The objective is to support the delivery of
the financial targets while protecting future financial security.
(A) CAPITAL RISK MANAGEMENT
The Group's capital comprises share capital and reserves less accumulated
losses. As at 30 June 2024, the Group has net assets of $10,610,574 (2023:
$12,071,269). The Group manages its capital to ensure its ability to continue
as a going concern and to optimise returns to its shareholders.
(B) LIQUIDITY RISK
Liquidity risk is the risk that the Group will encounter difficulty in meeting
obligations associated with financial liabilities. The Group manages liquidity
risk by maintaining sufficient cash facilities to meet the operating
requirements of the business and investing excess funds in highly liquid short
term investments. The responsibility for liquidity risk management rests with
the Board of Directors.
Alternatives for sourcing future capital needs include the cash position and
future equity raising alternatives. These alternatives are evaluated to
determine the optimal mix of capital resources for our capital needs.
The Board expects that, assuming no material adverse change in a combination
of our sources of liquidity, present levels of liquidity will be adequate to
meet expected capital needs.
MATURITY ANALYSIS FOR FINANCIAL LIABILITIES
Financial liabilities of the Group comprise trade and other payables. As at 30
June 2024 any financial liabilities that are contractually maturing within 60
days have been disclosed as current. Trade and other payables that have a
deferred payment date of greater than 12 months have been disclosed as
non-current.
(C) INTEREST RATE RISK
Interest rate risk arises from the possibility that changes in interest rates
will affect future cash flows or the fair value of financial instruments.
The Group's exposure to changes to interest rate risk relates primarily to its
earnings on cash and term deposits. The Group manages the risk by investing in
short term deposits.
2024 2023
$ $
Cash and cash equivalents 1,118,294 2,897,611
INTEREST RATE SENSITIVITY
The following table demonstrates the sensitivity of the Group's statement of
comprehensive income to a reasonably possible change in interest rates, with
all other variables constant.
EFFECT ON POST TAX LOSS EFFECT ON EQUITY INCLUDING RETAINED EARNINGS ($)
($)
INCREASE / (DECREASE)
INCREASE / (DECREASE)
2024 2023 2024 2023
Increase 100 basis points 11,183 28,976 11,183 28,976
Decrease 100 basis points (11,183) (28,976) (11,183) (28,976)
A sensitivity of 100 basis points has been used as this is considered
reasonable given the current level of both short term and long term Australian
Dollar interest rates. This would represent two to four movements by the
Reserve Bank of Australia.
(D) PRICE RISK
The Group is exposed to price risk through its short-term holding of
Australian shares (all listed on the ASX). The sensitivity analysis of the
Group's exposure to price risk is as follows:
EFFECT ON POST TAX LOSS EFFECT ON EQUITY INCLUDING RETAINED EARNINGS ($)
($)
INCREASE / (DECREASE)
% CHANGE
INCREASE / (DECREASE)
2024 2023 2024 2023
Increase 100% 376,344 - 376,344 -
Decrease 100% (376,344) - (376,344) -
(E) FAIR VALUE MEASUREMENT
Other than financial assets held at fair value through the profit or loss
(refer Note 7), there were no financial assets or liabilities at 30 June 2024
requiring fair value estimation and disclosure as they are either not carried
at fair value or in the case for short term assets and liabilities, their
carrying values approximate fair value.
(F) CREDIT RISK EXPOSURES
Credit risk represents the risk that the counterparty to the financial
instrument will fail to discharge an obligation and cause the Group to incur a
financial loss. The Group's maximum credit exposure is the carrying amounts on
the statement of financial position. The Group holds financial instruments
with credit worthy third parties. At 30 June 2024, the Group held cash at
bank. These were held with financial institutions with a rating from Standard
& Poor's of AA- or above (long term). The Group has no past due or
impaired debtors as at 30 June 2024.
(G) FOREIGN EXCHANGE
The Group undertakes certain transactions denominated in foreign currencies
hence exposures to exchange rate fluctuations arise. The Group does not manage
these exposures with foreign currency derivative products. The carrying
amounts of the Group's foreign currency denominated monetary assets and
monetary liabilities at the balance date expressed in Australian dollars are
as follows:
CHILEAN PESO (CLP) 2024 2023
$ $
Assets 88,392 103,800
Liabilities (10,584) (12,932)
Total 77,808 90,868
BRITISH POUND STERLING (GBP) 2024 2023
$ $
Assets 322,120 639,899
Liabilities - (15,432)
Total 322,120 624,467
The Group is exposed to Chilean Peso (CLP) and British Pound Sterling (GBP)
currency fluctuations.
The following table details the Group's sensitivity to a 10% increase and
decrease in the Australian dollar against the relevant foreign currencies. 10%
is the sensitivity rate used when reporting foreign currency risk internally
to key management personnel and represent management's assessment of the
possible change in foreign exchange rates. The sensitivity analysis includes
only outstanding foreign currency denominated monetary items and adjusts their
translation at the period end for a 10% change in foreign currency rates. The
sensitivity analysis includes external loans as well as loans to foreign
operations within the Group where the denomination of the loan is in a
currency other than the currency of the lender or the borrower. A positive
number indicates an increase in profit and equity where the Australian Dollar
weakens against the respective currency. For a strengthening of the Australian
Dollar against the respective currency there would be an equal and opposite
impact on the profit and equity and the balances below would be negative.
10% INCREASE 2024 2023
$ $
Profit/(loss) and equity - CLP 7,781 9,343
Profit/(loss) and equity - GBP 32,212 62,447
Total 39,993 71,790
10% DECREASE 2024 2023
$ $
Profit/(loss) and equity - CLP (7,781) (9,343)
Profit/(loss) and equity - GBP (32,212) (62,447)
Total (39,993) (71,790)
17. PARENT ENTITY INFORMATION
2024 2023
$ $
Current assets 1,914,216 2,975,126
Non-current assets 8,175,849 8,454,557
Total Assets 10,090,065 11,429,683
Current liabilities 101,558 115,952
Non-current liabilities - -
Total liabilities 101,558 115,952
Net Assets 9,988,507 11,313,731
Issued capital 35,964,396 35,964,396
Reserves 4,230,962 4,230,962
Accumulated losses (30,206,851) (28,881,627)
Total equity 9,988,507 11,313,731
Loss of the parent entity 1,325,224 4,882,693
Other comprehensive income for the year
Total comprehensive loss of the parent entity 1,325,224 4,882,693
(A) GUARANTEES
Castillo Copper Limited has not entered into any guarantees in relation to the
debts of its subsidiary.
(B) OTHER COMMITMENTS AND CONTINGENCIES
Castillo Copper Limited has not entered into any commitments and does not have
any known contingent liabilities at year end.
18. CONTINGENT LIABILITIES
The Company has entered into the following royalty agreements:
· 1% net smelter return royalty in respect of the area covered by the
tenements acquired from Qld Commodities Pty Ltd vendors (or their nominee);
· 3% net smelter return royalty in respect of the area covered by the
tenements acquired from Total Minerals Pty Ltd vendors (or their nominee);
· 3% net smelter return royalty in respect of the area covered by the
tenements acquired from Total Iron Pty Ltd vendors (or their nominee).
· 2% net smelter return royalty in respect of the area covered by the
tenements acquired from Zed Copper Pty Ltd vendors (or their nominee).
Other than outlined above, there are no contingent liabilities.
19. COMMITMENTS
To maintain current contractual rights concerning its mineral projects, the
Group has certain commitments to meet work program requirements.
Whilst there are no minimum expenditure requirements, the total estimated
expenditure on current work programs, less expenditure incurred on these work
programs at balance date are as follows:
2024 2023
$ $
(RESTATED)
Within one year 1,617,097 1,252,755
After one year but not more than five years 2,317,500 1,877,598
Longer than five years - -
Total 3,934,597 3,130,353
20. DIVIDENDS
No dividend was paid or declared by the Group in the period since the end of
the financial year, and up to the date of this report. The Directors' do not
recommend that any amount be paid by way of a dividend for the financial year
ended 30 June 2024. The balance of the franking account is Nil at 30 June 2024
(2023: Nil).
21. SHARE BASED PAYMENTS
(A) SHARES ISSUED TO SUPPLIERS
There were no shares issued to suppliers in lieu of cash payment during the
year ended 30 June 2024.
(B) FAIR VALUE OF OPTIONS
The fair value of all options issued in previous years have been determined
using the Black & Scholes model taking in to account the inputs outlined
in Note 11(e).
22. SUBSEQUENT EVENTS
On the 14 May 2024, Castillo announced that it was actively looking to align
with partners to develop its remaining assets in NSW and Zambia which had
previously been designated as non-core assets. At the date of this report the
Company is in advanced discussions with third parties regarding a possible
transaction in relation to its non-core assets but no agreements or binding
terms have been signed as of the date of this report.
Other than as stated above, there were no known material significant events
from the end of the financial year to the date of this report that have
significantly affected, or may significantly affect the operations of the
Group, the results of those operations, or the state of affairs of the Group
in future financial periods.
CONSOLIDATED ENTITY DISCLOSURE STATEMENT AS AT 30 JUNE 2024
PLACE FORMED
ENTITY NAME ENTITY TYPE / COUNTRY OF INCORPORATION OWNERSHIP INTEREST % TAX RESIDENCY
Castillo Copper Chile SPA Body corporate Chile 100.00% Australia
Castillo Exploration Limited Body corporate Australia 100.00% Australia
Qld Commodities Pty Ltd Body corporate Australia 100.00% Australia
Total Iron Pty Ltd Body corporate Australia 100.00% Australia
Total Minerals Pty Ltd Body corporate Australia 100.00% Australia
BHA No. 1 Pty Ltd Body corporate Australia 100.00% Australia
Atlantica Holdings (Bermuda) Body corporate Bermuda 100.00% Australia
Zed Copper Pty Ltd Body corporate Australia 100.00% Australia
Chalo Mining Group Ltd Body corporate Zambia 100.00% Australia
Luflilian Resources Zambia Ltd Body corporate Zambia 100.00% Australia
Belmt Resources Mining Company Ltd Body corporate Zambia 100.00% Australia
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