Announcement PDF LITHIUM CONSOLIDATED MINERAL EXPLORATION LTD ACN 612 008 358 CONSOLIDATED FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2017 LITHIUM CONSOLIDATED MINERAL EXPLORATION LTD ACN 612 008 358 Phone: +61 7 3212 6299 Fax: +61 7 3212 6250 Address: Level 10, 110 Mary Street, Brisbane Q 4000 LITHIUM CONSOLIDATED MINERAL EXPLORATION LTD - ACN 612 008 358 ANNUAL REPORT 2017 Contents Cautionary Statements 2 Corporate Information 3 Letter from the Chairman 4 Review of Operations 5 Director’s Report 12 Auditor’s Independence Declaration 25 Shareholder Information 26 Interests in Tenements 29 Corporate Governance Statement 30 Consolidated Statement of Profit or Loss and Other Comprehensive Income for the Year Ended 30 June 2017 38 Consolidated Statement of Financial Position as at 30 June 2017 39 Consolidated Statement of Changes In Equity for the Year Ended 30 June 2017 40 Consolidated Statement of Cash Flows for the Year Ended 30 June 2017 41 Notes To The Consolidated Financial Statements for the Year Ended 30 June 2017 42 Director’s Declaration 68 Independent Auditor’s Report 69 Page 1 LITHIUM CONSOLIDATED MINERAL EXPLORATION LTD - ACN 612 008 358 ANNUAL REPORT 2017 Cautionary Statements Forward-looking statements This document may contain certain forward-looking statements. Such statements are only predictions, based on certain assumptions and involve known and unknown risks, uncertainties and other factors, many of which are beyond the company’s control. Actual events or results may differ materially from the events or results expected or implied in any forward-looking statement. The inclusion of such statements should not be regarded as a representation, warranty or prediction with respect to the accuracy of the underlying assumptions or that any forward-looking statements will be or are likely to be fulfilled. LCME undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date of this document (subject to securities exchange disclosure requirements). The information in this document does not take into account the objectives, financial situation or particular needs of any person or organisation. Nothing contained in this document constitutes investment, legal, tax or other advice. Competent Person Statement The information in this release that relates to Exploration Results has been reviewed and approved by Jerry Aiken, who is a Registered Member of the Society for Mining, Metallurgy and Exploration (SME). Jerry Aiken is a geologic consultant to the Company, and has sufficient experience relevant to the styles of mineralisation and type of deposit under consideration, to qualify as a Competent Person (CP) as defined in the 2012 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves” (JORC). Jerry Aiken consents to the inclusion in the release of the concepts and geologic principles expressed in this press release, based on his review in the form and context in which it appears. Page 2 LITHIUM CONSOLIDATED MINERAL EXPLORATION LTD - ACN 612 008 358 Corporate Information Directors and Company Secretary Mr James McKerlie (Chairman) Mr Shanthar Pathmanathan (Executive Director) Mr Vincent Mascolo (Non-executive Director) Mr Brian Moller (Non-executive Director) Mr Duncan Cornish (Company Secretary) Head Office and Registered Office Lithium Consolidated Mineral Exploration Ltd Level 10, 110 Market Street Brisbane QLD 4000 Tel: +61 7 3212 6299 Fax: +61 7 3212 6250 Auditors BDO Audit Pty Ltd Level 10, 12 Creek Street Brisbane QLD 4000 Tel: +61 7 3237 5999 Fax: +61 7 3221 9227 www.bdo.com.au Share Registry Link Market Services Limited Level 15, ANZ Building 324 Queen Street Brisbane QLD 4000 Tel: 1300 554 474 www.linkmarketservices.com.au Stock Exchange Listing Australian Securities Exchange Ltd ASX Code: LI3 Australian Company Number 612 008 358 Page 3 ANNUAL REPORT 2017 LITHIUM CONSOLIDATED MINERAL EXPLORATION LTD - ACN 612 008 358 ANNUAL REPORT 2017 Letter from the Chairman Dear Shareholder On behalf of the Directors, it is my pleasure to present LCME’s maiden result and Annual Report as a publicly listed company. LCME is a Lithium exploration company with a diverse portfolio of prospects in Nevada, Western Australia, South Australia and Botswana. The Western Australian project is hard rock lithium and the other three projects are lithium brine. On 27 March 2017, we listed on the ASX raising $5.3m and stepped into public company life. This event required concurrent execution of our fund raising and the purchase of the Nevada assets. Key management were in place and the serious work began. Outlook Lithium demand continues to grow as the world looks at transformational energy policies and the growing need for effective energy storage and non-carbon energy solutions. This goes far beyond electric vehicles (motor cars and bikes) that are frequently featured in the media, although the replacement of the internal combustion engine with automotive electrification will generate a very high level of demand in of itself. The long-term growth in demand is substantial and the constraints on supply are well known. The world needs to find and produce more of this valuable metal. In the time since listing we have undertaken solid technical analysis of the Nevada assets and prioritised these. Some assets were let go and those with the highest prospectivity will get the full attention of our future endeavours. This was an important step in our Nevada play as we have extensive holdings and needed a plan to manage these. In Australia, we have added complimentary opportunities in Western Australia with lithium hard rock potential. New licenses have been added to our portfolio and work in this area has been accelerated. In Botswana, our advisors have completed a technical review and recommended we undertake an initial sampling program, the results of which will determine the focus of potential initial drilling and deeper sampling work. The asset base we have provides a portfolio approach to lithium exploration. There is a geographical diversity as well as a mix of lithium brine and hard rock lithium opportunities. Assets in the portfolio are being subjected to robust technical assessment and exploration where justified. Additions will be made where opportunities arise and assets will be dropped if they do not warrant further investment after being worked over. There is confidence in the current portfolio, but to create shareholder value in a dynamic environment, both active asset management and field activity is required. Thanks We have only been listed since end of March this year and in this 6 months a great deal of progress has been made. The board thanks our MD Shanthar Pathmanathan, our Business Development adviser Damien Reynolds and the members of the various consulting teams we have worked extensively with for the hard work they have done. The board also wishes to thank the shareholders for your support and assure you that we have just taken a few small steps in what we trust will be a long and successful journey together. Yours sincerely Jim McKerlie Chairman Page 4 LITHIUM CONSOLIDATED MINERAL EXPLORATION LTD - ACN 612 008 358 ANNUAL REPORT 2017 Review of Operations Exploration and development activities at the Group’s projects during the year are detailed below. The 2017 Financial Year has been a year of continued progress for LCME. We incorporated LCME to create a leading lithium exploration company with a portfolio of assets in multiple jurisdictions. Our successful IPO on 27 March 2017 has facilitated rapid progress across our portfolio of lithium exploration projects. Three of our projects have lithium brine potential and the Western Australia project has hard rock lithium potential. The Company owns:  100% of LCME Holdings Inc., a USA company which holds an 80% ownership interest in the Tonopah Lithium Project (“TLP”) in Nevada, USA;  100% of West Resources Pty Ltd, which holds the Yilgarn Lithium Project (“YLP”) in Western Australia and the Eucla Basin project in South Australia; and  80% of South Resources Ventures Pty Ltd, which holds the Botswana Lithium Project (“BLP”). Following the IPO, the Company engaged SRK Consulting (U.S.), Inc. (“SRK”) to perform a systematic review of the Tonopah and Botswana lithium projects. The purpose of the review was to prioritize targets for exploration and develop an exploration program to systematically test the lithium brine targets. SRK’s review resulted in a validation of the lithium brine potential at these projects. The Company has commenced pre-drilling exploration at the Tonopah and Botswana lithium projects. In Western Australia, we continue to explore for hard-rock pegmatite targets across our Yilgarn Exploration Licenses. A field reconnaissance program has been completed to assess conditions for drilling and for surface geochemical sampling. The next steps will be to identify priority targets for core drilling. We are in a strong position to progress exploration at our key lithium exploration projects over the next 12 months. We are committed to taking advantage of the continued growth in the global lithium industry and realizing value accretive growth for our shareholders, both from exploration and any external opportunities. Tonopah Lithium Project, Nevada, USA TLP is in the Clayton Valley, in West Central Nevada, in the United States of America. TLP consist of 439 placer claims over an area of 8,674 acres. Land Management 439 placer claims in Southern part of TLP will be renewed. LCME’s own evaluation of geologic potential and an independent opinion from SRK lead to a decision by LCME to relinquish the northern part of TLP and the whole of the Teels project. A total of 1,587 claims are subject to a relinquishment process which commenced in August 2017. Page 5 LITHIUM CONSOLIDATED MINERAL EXPLORATION LTD - ACN 612 008 358 ANNUAL REPORT 2017 Review of Operations Figure 1: TLP placer claims Source: Mineral Exploration Services, Ltd Exploration SRK completed a technical review of the Nevada projects and provided positive validation of the lithium brine resource potential in the southern part of TLP (“South TLP”). SRK has recommended progressing with the early-stage exploration of South TLP. Gravity infill data survey was acquired over South TLP in August 2017. The newly acquired infill gravity data was merged with the existing gravity data and remodelled in August 2017. The remodelled gravity data has been used to precisely locate 4 lines of magnetotelluric resistivity survey covering a total of 25 line-km (see Figure 2). Page 6 LITHIUM CONSOLIDATED MINERAL EXPLORATION LTD - ACN 612 008 358 ANNUAL REPORT 2017 Review of Operations Figure 2: Image of Basin Depth based on Gravity Data 3D Inversion Modelling Source: Ellis Geophysical Consulting Inc. Yilgarn Lithium Project, Western Australia, Australia YLP is a hard-rock lithium project located in the Yilgarn Province of Western Australia. YLP consists of 12 Exploration Licenses covering 557 km2 (see Figure 3). The YLP Exploration Licenses are located over extensions of known lithium-fertile belts, within covered areas of Archean Yilgarn Craton and hold the potential for hard-rock spodumene (lithium mineral) bearing pegmatite mineralisation, similar to that found at Greenbushes and Mt Marion. Spodumene-bearing pegmatite deposits, which have been discovered in the Yilgarn Craton, lie within exposed lithium-fertile “belts”. Geophysics and geological mapping indicate that these belts also trend “undercover” into areas where older host basement rocks are covered by younger rocks and recent sediments. Most of the Exploration Licenses are 150km west of Kalgoorlie and 30km to 120km NE of Norseman. Page 7 LITHIUM CONSOLIDATED MINERAL EXPLORATION LTD - ACN 612 008 358 ANNUAL REPORT 2017 Review of Operations Figure 3: YLP Exploration Licenses Source: West Resources Pty Ltd Land Management YLP consists of 8 granted Exploration Licenses and 4 pending Exploration License Applications (see Figure 4). Figure 4: YLP Exploration License details License No. Name Granted Area (km2) E 28/2632 Snomys 12-Jun-17 38 E 15/1542 Nawoc 12-Jun-17 29 E 69/3455 Esmond 12-Jun-17 52 E 28/2631 Junction 12-Jun-17 47 E 63/1813 Ten Mile 12-Jun-17 44 E 77/2384 Windarling Pending 42 E 63/1814 Bedonia 12-Jun-17 23 E 63/1815 Carranning Pending 35 Page 8 LITHIUM CONSOLIDATED MINERAL EXPLORATION LTD - ACN 612 008 358 ANNUAL REPORT 2017 Review of Operations License No. Name Granted Area (km2) E 28/2651 Cool 12-Jun-17 41 E 63/1826 Dundas 12-Jun-17 93 E 63/1862 TenMileSth Pending 49 E 15/1616 Wanoc Pending 64 E15/1616 (Wanoc) and E63/1862 (Ten Mile South) need to be processed through the Native Title Act future act process. It is expected that a heritage agreement will be negotiated with the Ngadju Native Title claimants to clear the native title process. E 77/2384 (Windarling) and E 63/1815 (Caranning), overlap conservation reserves and have been referred to the Department of Biodiversity, Conservation and Attractions for the Minister’s comment and recommendations. We have executed an Agreement for Heritage Protection Over Mining Tenure with the Ngadju Native Title Aboriginal Corporation RNTBC for 9 of our Exploration Licenses. The process for heritage protection agreement(s) over E15/1616 and E63/1862 is pending. E77/2384 (Windarling) needs to be processed through the Native Title Act future act process. There is currently no overlapping native title claim and if no claim is lodged prior to grant it is expected that there will be no heritage agreement in relation to this tenement. Exploration LCME has contracted Newexco, an award-winning WA based geological and geophysical group, to execute the exploration program. Newexco has reviewed historical open file exploration data in the granted license areas. This work has identified reconnaissance gold and nickel exploration drill holes and soil sampling in the license areas (see Figure 5). Detailed open-file airborne geophysical data was also acquired and processed for exploration planning and drill targeting (see Figure 5). A field reconnaissance trip has been completed to assess conditions for drilling, surface geochemical sampling and for where possible, the sampling of subcropping geology and historical drill spoil. The next steps in the exploration program will include:  aircore drilling across the defined lithium-fertile zones; and  surface heavy mineral sampling (where possible). There will also be a detailed airborne magnetic survey over the remote E69/3455 (Esmond) license where there is no open-file data and where the current magnetic data is too coarse for exploration planning. Page 9 LITHIUM CONSOLIDATED MINERAL EXPLORATION LTD - ACN 612 008 358 ANNUAL REPORT 2017 Review of Operations Figure 5: Open-file data over the Norseman area Exploration Licenses Source: West Resources Pty Ltd Eucla Basin Project, South Australia, Australia LCME’s South Australian Lithium brine tenement portfolio consists of 5 Exploration License Applications which cover a total of 5,680 km2 of the Eucla Basin. The license applications have been placed over a series of partially exposed salt-bearing playa lakes (salt lakes) and their concealed extensions in the Lake Maurice area of the Eucla Basin. The formal grant of these licenses is subject to completion of the native title process in South Australia. There was no material activity at the Eucla Basin Project in 2017. Page 10 LITHIUM CONSOLIDATED MINERAL EXPLORATION LTD - ACN 612 008 358 ANNUAL REPORT 2017 Review of Operations Botswana Lithium Project, Botswana The BLP exploration assets could underpin a very large lithium brine operation in one of the largest salt pans globally. BLP consists of 6 Prospecting Licenses and 2 Prospecting License Applications in the Makgadikgadi Pans in north eastern Botswana. Land Management The Department of Mines in Botswana (the “Department”) have cancelled portions of Prospecting Licenses 267/2016 and 268/2016 due to what the Department have advised is the Department’s mistake in issuing the same ground for the same mineral commodity to another company. This cancellation only affects 2 of the 6 Prospecting Licenses. Exploration SRK completed a technical review and recommended an initial ‘top of brine’ sampling program, which is pending. The results from the sampling program will be used to define areas of interest for initial drilling and deeper sampling. Figure 6: BLP Prospecting Licenses Source: SRK Page 11 LITHIUM CONSOLIDATED MINERAL EXPLORATION LTD - ACN 612 008 358 ANNUAL REPORT 2017 Director’s Report The directors submit their report on the consolidated entity (“Group”) consisting of Lithium Consolidated Mineral Exploration Ltd and the entities it controlled at the end of, and during, the financial period ended 30 June 2017. Directors The following persons were directors of Lithium Consolidated Mineral Exploration Ltd during the financial period and up to the date of this report, unless otherwise stated: Mr James McKerlie (appointed 2 November 2016) Mr Shanthar Pathmanathan (appointed 13 October 2016) Mr Vincent Mascolo (appointed 19 May 2016) Mr Brian Moller (appointed 13 October 2016) Mr Damien Reynolds (appointed 22 April 2016, resigned 7 November 2016) Information on Directors The board has a strong combination of technical, managerial and capital markets experience. Expertise and experience includes operating and mineral exploration. The names and qualifications of the current directors are summarised as follows: James McKerlie - Non-Executive Chairman Mr McKerlie is a senior director with many years’ experience on public company boards in Australia and overseas. He is a Chartered Accountant and business consultant and has been extensively involved in shareholder management, capital and equity markets, M&A activities, takeover panel reviews, high growth companies and corporate governance matters. Mr McKerlie is experienced in the role of the chair of boards and committees having been chairman of Drillsearch Energy for eight years whilst the company enjoyed significant growth before merging with Beach Energy where he continues as a director. He is also currently chairman of Manalto Limited and Elmo Software Ltd and has previously chaired the boards of inthehouse.com Ltd, Two Way TV Ltd, Circumpacific Ltd (TSXV) and several other public oil and gas ASX listed entities. In addition to working extensively in the energy sector, Mr McKerlie has extensive experience in technology companies and has worked extensively in innovative and disruptive environments. For three years he was a judge on the Ernst & Young Entrepreneur of the Year. He has worked throughout Asia Pacific, North America, UK, Europe and South Africa. He has also had 25 years of media presentation experience in radio, television and the print media, is a regular speaker and writer. During the past three years, Mr McKerlie has served as a director of the following ASX listed companies:  Beach Energy Limited*  Manalto Limited*  Elmo Software Limited*  Drillsearch Energy Ltd (from August 2008 to February 2016) *denotes current directorship Mr McKerlie is a member of the Audit & Risk Management Committee. Shanthar Pathmanathan - Chief Executive Officer and Executive Director Mr Pathmanathan has 14 years corporate finance experience. He was most recently with Deutsche Bank's investment banking division and prior to that has held corporate finance and principal investment roles with Macquarie Group's investment banking division in Australia and New York. He has a Bachelor of Laws from the University of Western Australia. Page 12 LITHIUM CONSOLIDATED MINERAL EXPLORATION LTD - ACN 612 008 358 ANNUAL REPORT 2017 Director’s Report During the past three years, Mr Pathmanathan has not served as a director of any other listed company. Vince Mascolo - Non-Executive Director Mr Mascolo is a qualified mining engineer with extensive experience in gold and coal mining, quarrying and civilworks. He has been a director of various public and private companies over the past 25 years and is currently Chief Executive Officer and Managing Director of AIMlisted IronRidge Resources Ltd. During the past three years, Mr Mascolo has also served as a director of the following listed companies:  DGR Global Ltd*  Ironridge Resources Limited*^ *denotes current directorship ^denotes listed on the Alternative Investment Market of the London Stock Exchange Mr Mascolo is a member of the Audit & Risk Management Committee. Brian Moller – Non-Executive Director Mr Moller specialises in capital markets, mergers and acquisitions and corporate restructuring, and has acted in numerous transactions and capital raisings in the industrial, resources and energy sectors. He has been a partner at the legal firm, HopgoodGanim for 30 years and leads the Corporate Advisory and Governance practice. Mr Moller acts for many publicly listed companies in Australia and regularly advises boards of directors on corporate governance and related issues. Mr Moller is a solicitor of the Supreme Court of Queensland and Solicitor and Barrister of the Supreme Court of Western Australia. Mr Moller is a Non-Executive Director of ASX listed Aguia Resources Ltd, DGR Global Ltd, Platina Resources Ltd, Dark Horse Resources Ltd (formerly Navaho Gold Limited) and chairman of ASX listed AusTin Limited and the dual TSX and AIM-listed SolGold plc. During the past three years, Mr Moller has also served as a director of the following listed companies:  DGR Global Ltd*  Aus Tin Mining Limited*  Dark Horse Resources Limited*  Aguia Resources Limited*  Buccaneer Energy Ltd (from July 2013 to November 2013)  Platina Resources Ltd*  Solgold PLC*^ *denotes current directorship ^denotes listed on the Toronto Stock Exchange and the Alternative Investment Market of the London Stock Exchange Mr Moller is a member of the Audit & Risk Management Committee. Damien Reynolds – Director (resigned 7 November 2016) Mr Reynolds has in excess of 25 years junior resource industry experience. He has led companies that have raised in excess of $350 million for exploration and development activities globally. Mr Reynolds’s capital markets experience spans North America, Europe and Australia. Page 13 LITHIUM CONSOLIDATED MINERAL EXPLORATION LTD - ACN 612 008 358 ANNUAL REPORT 2017 Director’s Report Company Secretary Damien Reynolds held the position of Company Secretary up to 19 September 2016. Duncan Cornish was appointed Company Secretary (and CFO) on 19 September 2016. Mr Cornish is a Chartered Accountant with significant experience as public company CFO and Secretary, focused on junior resource companies, as well as financial, administration and governance. Mr Cornish is an accomplished and highly efficient corporate administrator and manager. He has more than 20 years’ experience in the accountancy profession both in England and Australia, mainly with the accountancy firms Ernst & Young and PricewaterhouseCoopers. He has extensive experience in all aspects of company financial reporting, corporate regulatory and governance areas, business acquisition and disposal due diligence, capital raising, company listings and company secretarial responsibilities, and serves as company secretary and chief financial officer of several Australian and Canadian public companies. Mr. Cornish holds a Bachelor of Business (Accounting) and is a member of the Australian Institute of Chartered Accountants. Interests in Securities As at the date of this report, the interests of each director in shares and options issued by the Company are shown in the table below: Unlisted Options ($0.10 @ 1-Jan-19) Unlisted Performance Rights 750,000 - 1,000,000 S. Pathmanathan 636,750 - 5,000,000 V. Mascolo 550,000 1,000,000 500,000 B. Moller 1,530,000 - 500,000 Directors Shares J. McKerlie Principal Activities The principal activity of the Group during the period was lithium exploration. Corporate Lithium Consolidated Mineral Exploration Pty Ltd was incorporated as an Australian proprietary company limited by shares on 22 April 2016. It converted to a public company on 18 November 2016. On 8 November 2016 the Company lodged a prospectus with the Australian Securities and Investments Commission seeking a listing on the ASX and an Initial Public Offering (“IPO”) to raise between $8.0 million to $9.0 million. The Company issued first, second and third supplementary prospectuses dated 12 December, 2016, 12 January 2017 and 27 January 2017 respectively, before lodging a further ‘refresh’ prospectus on 3 February 2017 (“Supplementary Prospectuses”). The main outcome of these Supplementary Prospectuses was to change the proposed IPO raising to $5.0million to $8.0million and extend the IPO closing date to 6 March 2017. Page 14 LITHIUM CONSOLIDATED MINERAL EXPLORATION LTD - ACN 612 008 358 ANNUAL REPORT 2017 Director’s Report The Company successfully met all the conditions required to list on the ASX, listing on 27 March 2017, raising $5,321,299. Dividends Paid or Recommended There were no dividends paid or recommended during the financial year. Review of Operations Information on the operations of the Group during the financial year and up to the date of this report is set out separately in the Annual Report under Review of Operations. Operating Results The Group’s operating loss for the financial year was $1,189,734 (2016: $463,953). Exploration and evaluation expenditure during the year totalled $3,097,852 (2016: $353,788). The increased loss was caused principally by:  General corporate and administrative expenses ($410,327);  Employee benefits expense ($231,686);  Legal expenses ($127,447) mainly incurred perfecting the project acquisitions; and  Share-based payments ($303,424). Review of Financial Condition Capital Structure As noted above the Company was incorporated on 22 April 2016 with one ordinary share on issue. At 30 June 2016, the Company had 37,400,000 ordinary shares and 3,000,000 options on issue. During the year ended 30 June 2017, the following shares were issued:  10,175,628 shares at $0.10 per share following private (seed capital) placements;  265,000 shares in satisfaction of capital raising fees;  525,000 shares issued to consultants for services performed;  3,000,000 shares in consideration for (the final) 30% interest in West Resource Ventures Pty Ltd;  12,000,000 shares issued as (partial) consideration for the Company’s Big Smokey Nevada projects; and  26,606,494 shares at $0.20 per share in the Company’s IPO. During the year ended 30 June 2017, the following performance rights and options were issued:  7,500,000 performance rights which have various vesting conditions, performance hurdles and expiry dates were granted to directors and consultants;  1,000,000 options were granted to a consultant. The options vested on grant date, with an exercise price of $0.20 and expire on 31 December 2019. As at 30 June 2017 the Company had 89,972,122 ordinary shares, 7,500,000 performance rights and 4,000,000 options on issue. Subsequent to 30 June 2017, 1,500,000 options were granted to consultants. The options vested on grant date, with an exercise price of $0.20 and expire on 30 June 2019. As at the date of this report, the Company had 89,972,122 ordinary shares, 7,500,000 performance rights and 5,500,000 options on issue. Page 15 LITHIUM CONSOLIDATED MINERAL EXPLORATION LTD - ACN 612 008 358 ANNUAL REPORT 2017 Director’s Report Financial Position At 30 June 2017, the Group’s net assets totalled $7,384,423 (2016: $607,588) which included cash assets of $3,480,927 (2016: $262,518). The movement in net assets largely resulted from the following factors:  Operating losses of $1,189,734;  Cash outflows from operating activities of $909,390; and  Cash outflows on exploration and evaluation assets of $671,670 and loan of 383,199; and  Cash inflows from issue of shares ($6,338,861) were partially offset by the share issue costs ($1,156,193). Throughout the year the Group focussed on:  The identification and acquisition of its lithium exploration projects in Nevada, USA, Australia and Botswana;  Preparing for and completing the initial public offering and listing on the ASX; and  Commencing exploration on the Group’s projects. The Group’s working capital, being current assets less current liabilities has increased from $251,771 in 2016 to $3,545,999 in 2017. Treasury policy The Group does not have a formally established treasury function. The Board is responsible for managing the Group’s finance facilities. The Group does not currently undertake hedging of any kind and is not currently directly exposed to material currency risks. Liquidity and funding The Group has sufficient funds to finance its operations and exploration activities, and to allow the Group to take advantage of favourable business opportunities, not specifically budgeted for, or to fund unforeseen expenditure. Significant Changes in State of Affairs Other than the securities issued and the effects of the listing on the ASX as noted above, there were no other significant changes in the state of affairs of the Group in the financial year. Subsequent Events  On 4 September 2017 the Company announced after review , that is was relinquishing some 1,587 claims at its Teels Project and Tonapah Lithium Project (TLP) in Nevada and retaining some 439 claims in the southern part of TLP. There are no other material matters or circumstances that have arisen since the end of the year which 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