Moreton Resources director Jason Elks

October 10, 2019

Moreton Resources – the company which hopes to develop an open-cut coal mine on the outskirts of Kingaroy – has recorded a $26.47 million loss.

The figure, after tax to the year ended June 30, was revealed in the company’s annual report which was lodged with the ASX on Thursday.

When entries linked to its Research and Development Tax Incentive (which date to the Cougar Energy UCG project) are excluded, the group’s loss was $10.5 million.

The annual report also lists the comings and goings of various Directors throughout the year:

  • Gary Harradine (appointed February 11, 2019; resigned August 20)
  • Robin Lonergan (appointed July 22, 2019; resigned August 20)
  • Kalman Salgo (appointed December 10, 2018; resigned April 10)
  • Brent Staden (appointed February 11, 2019; resigned March 7)
  • John Haley (appointed November 5, 2018; resigned February 6)
  • Valeri Melik-Babakhanov (resigned December 14, 2018)
  • Philip Anthony Feitelson (resigned November 5, 2018)

The current Board consists of:

  • Former CEO Jason Elks (resigned July 29, 2019 and reappointed August 27, 2019)
  • Phillip Bryant (appointed April 10, 2019); and
  • Brett Garland (appointed July 22, 2019).

The annual report notes that non-binding expressions of interest had been received in relation to its Bowen Basin and Surat Basin coal projects.

Capital expenditure of $247,255 had been incurred on its Tarong Basin project (ie. the Kingaroy mine).

Net cash outflows increased to $7.54 million (up from $1.4 million during the previous 12 months) attributed mainly to “significant increases in employee benefits expense, mining operation expenditure, and legal and professional fees”.

The annual report notes that the ability of the group to continue as a going concern is dependent on:

  • Raising extra capital or securing other forms of financing
  • Positive cash flows from the Granite Belt (ie. Texas silver) project, and
  • A favourable outcome in the Research and Development Tax Incentive case before the Administrative Appeals Tribunal.

“These conditions give rise to a material uncertainty which may cast significant doubt over the consolidated entity’s ability to continue as a going concern” the report notes.

However, the Directors believed there were reasonable grounds to believe the company could continue, because:

  • Active operations have re-commenced at the Granite Belt project
  • The company’s existing loan facilities have been re-financed
  • The Directors are confident of a favourable decision in the Administrative Appeals Tribunal, and
  • The company has a successful history of obtaining additional equity funding when required.

The ASX suspended Moreton from trading on October 1 after it failed to lodge its report before the due date.

UPDATE October 11: The suspension of trading was lifted immediately following the lodgment of the annual report.

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