Interim Results

RNS Number : 1339B

Harvest Minerals Limited

29 September 2022

 

29 September 2022

.

Harvest Minerals Limited

 ("Harvest" or the "Company")

Interim Results

Harvest Minerals Limited, the AIM listed fertiliser producer, is pleased to announce its unaudited interim results for the six-month period ended 30 June 2022.

Results

The loss after tax recorded in the Condensed Consolidated Statement of Comprehensive Income for the half-year ended 30 June 2022 was $883,556 (30 June 2021: $1,067,707).  The loss is attributable to non-cash items including depreciation, amortisation and impairments.   

Net cash inflows from operating activities in the Condensed Consolidated Statement of Cashflows for the half year ended 30 June 2022 was $693,207 (30 June 2021: net cash outflows $1,116,168). Refer to note 5 in the financial statements for further detail reconciling the net loss to net cash inflows from operating activities.

Review of Operations

Arapua Fertiliser Project

During the half-year ended 30 June 2022, Harvest sold 35,014 tonnes of its KP Fértil®, representing a 108.3% increase over the 16,812 tonnes sold in the same period of 2021, and despite the continuing challenges imposed by the COVID-19 pandemic. The Company is maintaining its 2022 year-end sales target of 150,000 tonnes of KP Fértil®.

The Company's team includes 12 associates/agronomists split into two regional teams, which is supported by its third-party network comprising 20 resales' centres.  The Company continues to build on its marketing campaign to offer its product for coffee, sugarcane, and other crops, and boosted the Company's efforts towards the new marketing channels opened since it added the higher margin 25kg bag option that targets small to medium sized farmers and resellers. The Company has also started to actively market its KP Fértil® in other regions beyond its immediate market in Minas Gerais and Sao Paulo.

In terms of market fundamentals, the performance of the Brazilian agriculture sector continued to be robust over the half-year and several sector associations forecast double digit growth in most of the crops targeted by Harvest.

Sergi Potash Project & Mandacaru Phosphate Project

Given the scale of activity currently being undertaken at Arapua, the Company did not materially advance either of its Sergi Potash Project or its Mandacaru Phosphate Project during the half-year to 30 June 2022.

Brian McMaster

Executive Chairman

29 September 2022

Competent Person Statement

The technical information in this report is based on complied and reviewed data by Mr Paulo Brito BSc(geol), MAusIMM, MAIG. Mr Brito is a consulting geologist for Harvest Minerals Limited and is a Member of AusIMM - The Minerals Institute, as well as, a Member of Australian Institute of Geoscientists. Mr Brito has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which is being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Mr Brito also meets the requirements of a qualified person under the AIM Note for Mining, Oil and Gas Companies and consents to the inclusion in this report of the matters based on his information in the form and context in which it appears. Mr Brito accepts responsibility for the accuracy of the statements disclosed in this report

Condensed Consolidated Statement of Comprehensive Income

for the half-year ended 30 June 2022

		Consolidated
	Notes	6 months ended 30 June 2022 $		6 months ended 30 June 2021 $
Revenue from fertiliser sales	3	2,735,590		790,224
Cost of goods sold	4	(1,153,441)		(603,957)
Gross profit		1,582,149		186,267
Interest income		9,857		7,852
Other income		513		506
Gain on sale of motor vehicle		8,185		-
Foreign exchange gain/(loss)		(54,401)		91,594
Accounting and audit fees		(81,131)		(95,372)
Advertising fees		(146,877)		(127,680)
Consultants' fees		(52,383)		(184,228)
Directors' fees		(390,705)		(296,649)
Depreciation		(4,685)		(15,158)
Legal fees		(6,423)		(4,377)
Wages & Salaries		(427,713)		(114,349)
Interest expense		(44,808)		-
Public company costs		(117,474)		(108,534)
Rent and outgoings expenses		-		(750)
Travel expenses		(306,748)		(164,573)
Impairment exploration expense	9	(491,500)		-
Other expenses		(359,412)		(242,256)
Loss from continuing operations before income tax		(883,556)		(1,067,707)
Income tax benefit		-		-
Loss from continuing operations after income tax	5	(883,556)		(1,067,707)
Other comprehensive income
Item that may be reclassified subsequently to profit or loss
Foreign currency translation		964,215		777,637
Other comprehensive income for the half-year		964,215		777,637
Total comprehensive income/(loss) for the half-year		80,659		(290,070)
Loss per share
Basic and diluted loss per share (cents per share)		(0.48)		(0.57)

The accompanying notes form part of this half-year financial report.

Condensed Consolidated Statement of Financial Position

as at 30 June 2022

		Consolidated
	Notes	30 June 2022 $		31 December 2021 $
Assets
Current Assets
Cash and cash equivalents	5	2,414,039		1,708,001
Trade and other receivables	6	1,691,287		1,909,730
Inventories		350,292		63,129
Total Current Assets		4,455,618		3,680,860
Non-Current Assets
Trade and other receivables		318,201		281,698
Plant and equipment	7	2,024,277		1,111,314
Mine properties	8	4,341,533		3,691,160
Deferred exploration and evaluation expenditure	9	-		454,462
Total Non-Current Assets		6,684,011		5,538,634
Total Assets		11,139,629		9,219,494
Current Liabilities
Trade and other payables	10	649,697		278,696
Borrowings	11	149,086		51,567
Total Current Liabilities		798,783		330,263
Non-Current Liabilities
Provision for rehabilitation		298,279		74,983
Borrowings	11	1,349,628		201,968
Total Non-Current Liabilities		1,647,907		276,951
Total Liabilities		2,446,690		607,214
Net Assets		8,692,939		8,612,280
Equity
Contributed equity	12	43,328,219		43,328,219
Reserves		1,022,961		58,746
Accumulated losses		(35,658,241)		(34,774,685)
Total Equity		8,692,939		8,612,280
The accompanying notes form part of this half-year financial report.

Condensed Consolidated Statement of Changes in Equity

for the half-year ended 30 June 2022

Consolidated		Notes	Contributed equity $	Accumulated losses $	Foreign currency translation reserve $	Option reserve $	Total $
Balance as at 1 January 2022		12	43,328,219	(34,774,685)	(3,482,302)	3,541,048	8,612,280
Total comprehensive gain for the half-year
Loss for the half-year 30 June 2022			-	(883,556)	-	-	(883,556)
Other comprehensive income			-	-	964,215	-	964,215
Total comprehensive income for the half-year			-	(883,556)	964,215	-	80,659
Balance at 30 June 2022			43,328,219	(35,658,241)	(2,518,087)	3,541,048	8,692,939
Balance as at 1 January 2021			43,048,343	(30,606,613)	(2,938,622)	3,541,048	13,044,156
Total comprehensive loss for the half-year
Loss for the half-year 30 June 2021			-	(1,067,707)	-	-	(1,067,707)
Other comprehensive income			-	-	777,637	-	777,637
Total comprehensive loss for the half-year			-	(1,067,707)	777,637	-	(290,070)
Balance at 30 June 2021		12	43,048,343	(31,674,320)	(2,160,985)	3,541,048	12,754,086
	The accompanying notes form part of this half-year financial report.

Condensed Consolidated Statement of Cash Flows

for the half-year ended 30 June 2022

		Consolidated
		6 months ended 30 June 2022 $		6 months ended 30 June 2021 $
Cash flows from operating activities
Receipts from customers		2,999,821		1,402,588
Payments to suppliers and employees		(2,271,663)		(2,526,608)
Interest received		9,857		7,852
Interest paid		(44,808)		-
Net cash inflow / (outflow) from operating activities	5	693,207		(1,116,168)
Cash flows from investing activities
Purchase of plant and equipment		(941,621)		(57,787)
Payments for mine properties		(351,413)		(32,066)
Payments for exploration and evaluation expenditure		(37,063)		-
Proceeds from sale of motor vehicle		8,185		-
Net cash outflow from investing activities		(1,321,912)		(89,853)
Cash flows from financing activities
Proceeds from borrowings		1,274,816		-
Repayment of borrowings		(29,637)		-
Net cash inflow from financing activities		1,245,179		-
Net increase / (decrease) in cash and cash equivalents		616,474		(1,206,021)
Cash and cash equivalents at beginning of period		1,708,001		2,992,727
Effect of exchange rate fluctuations on cash held		89,564		450,877
Cash and cash equivalents at the end of the period	5	2,414,039		2,237,583

The accompanying notes form part of this half-year financial report.

Notes to the Condensed Consolidated Financial Statements
for the half-year ended 30 June 2022

NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES

Corporate Information

This general purpose half-year financial report of Harvest Minerals Limited (the "Company") and its subsidiaries (the "Group") for the half-year ended 30 June 2022 was authorised for issue in accordance with a resolution of the Directors on 29 September 2022.

Harvest Minerals Limited is a company limited by shares incorporated in Australia whose shares are publicly traded on the AIM market of the London Stock Exchange.

The nature of the operations and principal activities of the Group are described in the Directors' Report.

Basis of Preparation

This financial report for the half-year ended 30 June 2022 has been prepared in accordance with the requirements of the Corporations Act 2001, applicable accounting standards including AASB 134 Interim Financial Reporting, Accounting Interpretations and other authoritative pronouncements of the Australian Accounting Standards Board ("AASB").  Compliance with AASB 134 ensures compliance with IAS 134 "Interim Financial Reporting". The Group is a for profit entity for financial reporting purposes under Australian Accounting Standards.

These half-year financial statements do not include all notes of the type normally included within the annual financial statements and therefore cannot be expected to provide as full an understanding of the financial performance, financial position and financing and investing activities of the group as the full financial statements.

It is recommended that the half-year financial statements be read in conjunction with the annual report for the year ended 31 December 2021 and considered together with any public announcements made by Harvest Minerals Limited during the half-year ended 30 June 2022 in accordance with the continuous disclosure obligations of the AIM market.

For the purpose of preparing the interim report, the half-year has been treated as a discrete reporting period. The accounting policies and methods of computation adopted are consistent with those of the previous financial year and corresponding interim reporting period.  These accounting policies are consistent with Australian Accounting Standards and with International Financial Reporting Standards.

New and amending Accounting Standards and Interpretations

In the half-year ended 30 June 2022, the Directors have reviewed all of the new and revised Standards and Interpretations issued by the AASB that are relevant to the Group's operations and effective for current reporting periods beginning on or after 1 January 2022. The Directors have also reviewed all new Standards and Interpretations that have been issued but are not yet effective for the half-year ended 30 June 2022. As a result of this review the Directors have determined that there is no impact, material or otherwise, of the new and revised Standards and Interpretations on the Group's business and, therefore, no change is necessary to the Group accounting policies.

New and amended accounting standards and interpretations have been published but are not mandatory. The Group has decided against early adoptions of these standards, and has determined the potential impact on the financial statements from the adoption of these standards and interpretations is not material to the Group.

Significant Accounting Policies

Deferred 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.

Notes to the Condensed Consolidated Financial Statements
for the half-year ended 30 June 2022

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 written off. 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.

Mine Properties

Mine properties represent the accumulation of all exploration, evaluation and development expenditure incurred in respect of areas of interest in which mining has commenced or is in the process of commencing. When further development expenditure is incurred in respect of mine property after the commencement of production, such expenditure is carried forward as part of the mine property only when substantial future economic benefits are thereby established, otherwise such expenditure is classified as part of the cost of production.

Amortisation is provided on a unit of production basis which results in a write off of the cost proportional to the depletion of the proven and probable mineral reserves.

The net carrying value of each area of interest is reviewed regularly and to the extent to which this value exceeds its recoverable amount, the excess is either fully provided against or written off in the financial year in which this is determined.

The Group provides for environmental restoration and rehabilitation at site which includes any costs to dismantle and remove certain items of plant and equipment. The cost of an item includes the initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located, the obligation for which an entity incurs when an item is acquired or as a consequence of having used the item during that period. This asset is depreciated on the basis of the current estimate of the useful life of the asset. In accordance with AASB 137 Provisions, Contingent Liabilities and Contingent Assets the Group is also required to recognise as a provision the best estimate of the present value of expenditure required to settle this obligation. The present value of estimated future cash flows is measured using a current market discount rate.

Notes to the Condensed Consolidated Financial Statements
for the half-year ended 30 June 2022

Stripping costs

Costs associated with material stripping activity, which is the process of removing mine waste materials to gain access to the mineral deposits underneath, during the production phase of surface mining are accounted for as either inventory or a non-current asset (non-current asset is also referred to as a 'stripping activity asset').

To the extent that the benefit from the stripping activity is realised in the form of inventory produced, the Group accounts for the costs of that stripping activity in accordance with the principles of AASB 102 Inventories. To the extent the benefit is improved access to ore, the Group recognises these costs as a non-current asset provided that:

· it is probable that the future economic benefit (improved access to the ore body) associated with the stripping activity will flow to the Group;

· the Group can identify the component of the ore body for which access has been improved; and

· the costs relating to the stripping activity associated with that component can be measured reliably.

Stripping activity assets are initially measured at cost, being the accumulation of costs directly incurred to perform the stripping activity that improves access to the identified component of ore plus an allocation of directly attributable overhead costs. In addition, stripping activity assets are accounted for as an addition to, or as an enhancement to, an existing asset.

Accordingly, the nature of the existing asset determines:

· whether the Group classifies the stripping activity asset as tangible or intangible; and

· the basis on which the stripping activity asset is measured subsequent to initial recognition

In circumstances where the costs of the stripping activity asset and the inventory produced are not separately identifiable, the Group allocates the production stripping costs between the inventory produced and the stripping activity asset by using an allocation basis that is based on volume of waste extracted compared with expected volume, for a given volume of ore production.

Borrowings

Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortised cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognised in profit or loss over the period of the borrowing using the effective interest method. Fees paid on the establishment of loan facilities are recognised as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down. In this case, the fee is deferred until the draw down occurs. To the extent there is no evidence that it is probable that some or all of the facility will be drawn down, the fee is capitalised as a prepayment for liquidity services and amortised over the period of the facility to which it relates.

Revenue

Revenue arises mainly from the sale of fertiliser. The Group generates revenue in Brazil. To determine whether to recognise revenue, the Group follows a 5-step process:

1.  Identifying the contract with a customer

2.  Identifying the performance obligations

3.  Determining the transaction price

4.  Allocating the transaction price to the performance obligations

5.  Recognising revenue when/as performance obligation(s) are satisfied.

The revenue and profits recognised in any period are based on the delivery of performance obligations and an assessment of when control is transferred to the customer.

Notes to the Condensed Consolidated Financial Statements
for the half-year ended 30 June 2022 

In determining the amount of revenue and profits to record, and related statement of financial position items (such as contract fulfilment assets, capitalisation of costs to obtain a contract, trade receivables, accrued income and deferred income) to recognise in the period, management is required to form a number of key judgements and assumptions. This includes an assessment of the costs the Group incurs to deliver the contractual commitments and whether such costs should be expensed as incurred or capitalised.

Revenue is recognised either when the performance obligation in the contract has been performed, so 'point in time' recognition or 'over time' as control of the performance obligation is transferred to the customer. For contracts with multiple components to be delivered such as fertiliser, management applies judgement to consider whether those promised goods and services are (i) distinct - to be accounted for as separate performance obligations; (ii) not distinct - to be combined with other promised goods or services until a bundle is identified that is distinct or (iii) part of a series of distinct goods and services that are substantially the same and have the same pattern of transfer to the customer.

Transaction price

At contract inception the total transaction price is estimated, being the amount to which the Group expects to be entitled and has rights to under the present contract. The transaction price does not include estimates of consideration resulting from change orders for additional goods and services unless these are agreed. Once the total transaction price is determined, the Group allocates this to the identified performance obligations in proportion to their relative stand-alone selling prices and recognises revenue when (or as) those performance obligations are satisfied.

For each performance obligation, the Group determines if revenue will be recognised over time or at a point in time. Where the Group recognises revenue over time for long term contracts, this is in general due to the Group performing and the customer simultaneously receiving and consuming the benefits provided over the life of the contract.

For each performance obligation to be recognised over time, the Group applies a revenue recognition method that faithfully depicts the Group's performance in transferring control of the goods or services to the customer. This decision requires assessment of the real nature of the goods or services that the Group has promised to transfer to the customer. The Group applies the relevant output or input method consistently to similar performance obligations in other contracts.

When using the output method the Group recognises revenue on the basis of direct measurements of the value to the customer of the goods and services transferred to date relative to the remaining goods and services under the contract. Where the output method is used, in particular for long term service contracts where the series guidance is applied, the Group often uses a method of time elapsed which requires minimal estimation. Certain long term contracts use output methods based upon estimation of number of users, level of service activity or fees collected.

If performance obligations in a contract do not meet the over time criteria, the Group recognises revenue at a point in time. This may be at the point of physical delivery of goods and acceptance by a customer or when the customer obtains control of an asset or service in a contract with customer-specified acceptance criteria.

Disaggregation of revenue

The Group disaggregates revenue from contracts with customers by contract type, which includes only fertiliser as management believes this best depicts how the nature, amount, timing and uncertainty of the Group's revenue and cash flows.

Performance obligations

Performance obligations categorised within this revenue type include the debtor taking ownership of the fertiliser product.

Notes to the Condensed Consolidated Financial Statements
for the half-year ended 30 June 2022

Inventories

Inventories are valued at the lower of cost and net realisable value.

Costs incurred in bringing each product to its present location and condition is accounted for as follows:

· Raw materials - purchase cost; and

· Finished goods - cost of direct materials and labour and an appropriate proportion of variable and fixed overheads based on normal operating capacity.

Net realisable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and the estimated costs necessary to make the sale.

Provisions

Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation.

Where the Group expects some, or all, of a provision to be reimbursed, for example under an insurance contract, the reimbursement is recognised as a separate asset but only when the reimbursement is virtually certain. The expense relating to any provision is presented in the statement of comprehensive income net of any reimbursement.

If the effect of the time value of money is material, provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money, and where appropriate, the risks specific to the liability. Where discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.

NOTE 2:  SEGMENT REPORTING

For management purposes, the Group is organised into one main operating segment, which involves mining exploration processing and sale of fertiliser. All of the Group's activities are interrelated, and discrete financial information is reported to the Board (Chief Operating Decision Maker) as a single segment. No revenue is derived from a single external customer.

Accordingly, all significant operating decisions are based upon analysis of the Group as one segment. The financial results from this segment are equivalent to the financial statements of the Group as a whole.  Revenue earned by the Group is generated in Brazil and all of the Group's non-current assets reside in Brazil.

The following table present revenue and loss information and certain asset and liability information regarding business segments for the half year ended 30 June 2022.

	Continuing operations
	Australia	Brazil	Consolidated
30 June 2022	$	$	$
Segment revenue	-	2,735,590	2,735,590
Segment profit/(loss) before income tax expense	(656,104)	(227,452)	(883,556)
30 June 2022
Segment assets	822,413	10,317,216	11,139,629
Segment liabilities	342,633	2,104,057	2,446,690
Additions to non-current assets	-	1,330,097	1,330,097

Notes to the Condensed Consolidated Financial Statements
for the half-year ended 30 June 2022

NOTE 2:  SEGMENT REPORTING (continued)

	Continuing operations
	Australia	Brazil	Consolidated
30 June 2021	$	$	$
Segment revenue	-	790,224	790,224
Segment loss before income tax expense	(503,487)	(564,220)	(1,067,707)
30 June 2021
Segment assets	2,141,141	10,949,765	13,090,906
Segment liabilities	109,577	227,243	336,820
Additions to non-current assets	-	89,853	89,853

NOTE 3:  REVENUE FROM CONTRACTS WITH CUSTOMERS

The Group derives its revenue from the sale of goods at a point in time in the major category of Fertiliser.

			Consolidated
			6 months to 30 June 2022 $		6 months to 30 June 2021 $
Fertiliser sales				2,735,590	790,224
Total revenue				2,735,590	790,224

NOTE 4:  COST OF GOODS SOLD

			Consolidated
			6 months to 30 June 2022 $		6 months to 30 June 2021 $
Mine operating costs			492,617	414,731
Royalty expense			108,430	36,120
Rehabilitation expense			216,272	31,209
Depreciation			146,931	103,754
Amortisation			189,191	18,143
Total cost of goods sold			1,153,441	603,957

NOTE 5: CASH AND CASH EQUIVALENTS

	Consolidated
Reconciliation of Cash and Cash Equivalents Cash comprises:	6 months to 30 June 2022 $	6 months to 30 June 2021 $
Cash at bank	2,414,039	2,237,583
	2,414,039	2,237,583

Notes to the Condensed Consolidated Financial Statements for the half-year ended 30 June 2022 NOTE 5: CASH AND CASH EQUIVALENTS (continued)
	Consolidated
Reconciliation of operating loss after tax to the cash flows from operations	6 months to 30 June 2022 $	6 months to 30 June 2021 $
Loss from ordinary activities after tax	(883,556)	(1,067,707)
Non cash items
Depreciation charge	151,616	118,912
Amortisation charge	189,191	18,143
Rehabilitation charge	216,272	31,209
Impairment of exploration and evaluation expenditure	491,500	-
Gain on disposal of motor vehicle	(8,185)	-
Foreign exchange gain	54,401	(91,594)
Change in assets and liabilities
(Increase) / Decrease in trade and other receivables	174,834	(23,970)
(Increase) / Decrease in inventories	(287,163)	(173,442)
Increase / (Decrease) in trade and other payables and provisions	594,297	72,281
Net cash outflow from operating activities	693,207	(1,116,168)

NOTE 6: TRADE AND OTHER RECEIVABLES

			Consolidated
			30 June 2022 $	31 December 2021 $
Trade Debtors			1,560,846	1,824,564
Prepayments			-	40,897
Cash advances			121,555	27,098
GST receivable			6,503	6,430
Other receivables			2,383	10,741
Total trade and other receivables			1,691,287	1,909,730

Trade debtors, other debtors and goods and services tax are receivable on varying collection terms. Due to the short-term nature of these receivables, their carrying value is assumed to approximate their fair value. Some debtors are given industry standard longer payment terms which may cross over more than one accounting period. These trade terms are widely used in the agricultural market in Brazil and are considered industry norms.

Notes to the Condensed Consolidated Financial Statements
for the half-year ended 30 June 2022

NOTE 7: PLANT AND EQUIPMENT

			Consolidated
			6 months to 30 June  2022 $			12 months to 31 December  2021 $
At beginning of the period				1,111,314	1,037,475
Additions for the period				941,621	332,217
Disposals for the period				(8,330)	-
Depreciation charge for the period				(151,616)	(159,038)
Net exchange difference on translation				131,288	(99,340)
Balance at the end of the period				2,024,277	1,111,314

NOTE 8: MINE PROPERTIES

			Consolidated
			6 months to 30 June  2022 $			12 months to 31 December  2021 $
At beginning of the period				3,691,160	4,188,916
Additions for the period				351,413	187,023
Amortisation charge for the period				(189,191)	(116,818)
Net exchange difference on translation				488,151	(567,961)
Balance at the end of the period				4,341,533	3,691,160

NOTE 9: DEFERRED EXPLORATION AND EVALUATION EXPENDITURE

	Consolidated
	6 months to 30 June 2022 $	12 months to 31 December 2021 $

Exploration and evaluation phase:

At beginning of the period		454,462	3,317,445
Acquisition of Miriri Phosphate Project		-	453,986
Exploration expenditure during the period		37,063	2,433
Impairment loss1		(491,500)	(3,317,445)
Net exchange differences on translation		(25)	(1,957)
Balance at the end of the period		-	454,462

The ultimate recoupment of costs carried forward for exploration expenditure is dependent on the successful development and commercial exploitation or sale of the respective mining areas.

¹ Post the reporting period, on 4 August 2022, the Company announced to the AIM Stock Exchange that it had conducted a review of the Miriri Phosphate Project and determined that its merits were uneconomic. The Company has elected to write-off the costs of the project at 30 June 2022 and has subsequently relinquished its interest in the Project.

Notes to the Condensed Consolidated Financial Statements
for the half-year ended 30 June 2022

NOTE 10: TRADE AND OTHER PAYABLES

	Consolidated
	30 June 2022 $	31 December 2021 $

Trade payables		346,242	115,298
Accruals		192,046	148,052
Other payables		111,409	15,346
		649,697	278,696

Trade creditors, other creditors and goods and services tax are non-interest bearing and generally payable on 60 day terms. Due to the short term nature of these payables, their carrying value is assumed to approximate their fair value.

NOTE 11: BORROWINGS

	Consolidated
	30 June 2022	31 December 2021
	$	$
Current
Secured Loans payable	149,086	51,567
	149,086	51,567

Non-current
Secured Loans payable	1,349,628	201,968
	1,349,628	201,968

On 28 September 2021, the Group obtained a secured debt facility with Banco Santander with a five-year term totalling $R3,000,000. The debt is secured against the solar power facility at the Arapua Fertiliser Project. Furthermore, on 30 March 2022, the Group executed a loan agreement with Banco Bradesco with a five-year term totalling $R1,000,000 for expansion works to the storage warehouse at the Arapua Fertiliser Project.

In April 2022, the Group secured a further $R3,500,000 in loans with Banco Santander for purchase of equipment and machinery. The loans are repayable over a two and half year and four-year period. As at 30 June 2022, the Group recorded $1,498,714 (31 December 2021: $253,535) of secured loans as a payable.

Notes to the Condensed Consolidated Financial Statements
for the half-year ended 30 June 2022

NOTE 12: CONTRIBUTED EQUITY

30 June 2022 $

31 December 2021 $

Contributed equity

Ordinary shares fully paid

43,328,219

43,328,219

	6 months to 30 June 2022			12 months year ended 31 December 2021
	No.	$		No.	$

Movements in ordinary shares on issue

Opening balance	185,835,884	43,328,219		185,835,884	43,048,343
Shares to be issued as part an acquisition1	-	-		-	279,876
Closing balance	185,835,884	43,328,219		185,835,884	43,328,219

¹ On 29 November 2021, the Company entered into an agreement to acquire 100% of the ordinary shares of BF Mineraço Ltda for cash and shares. On 6 July 2022, the Company announced to the AIM Stock Exchange the issuance of 3,333,333 related to the agreement to acquire 100% of the ordinary shares of BF Mineraço Ltda for the Miriri Phosphate Project.

NOTE 13: DIVIDENDS

No dividends have been paid or provided for during the half-year (half-year to 30 June 2021: $nil).

NOTE 14: CONTINGENT LIABILITIES AND COMMITMENTS

There has been no material change in contingent liabilities or commitments since the last annual reporting date.

NOTE 15: FINANCIAL INSTRUMENTS

The Group has a number of financial instruments which are not measured at fair value in the statement of financial position.

The Directors consider that the carrying amounts of current receivables, current payables and current borrowings are considered to be a reasonable approximation of their fair values.

NOTE 16: SUBSEQUENT EVENTS

On 6 July 2022, the Company announced to the AIM Stock Exchange the issuance of 3,333,333 related to the agreement to acquire 100% of the ordinary shares of BF Mineraço Ltda for the Miriri Phosphate Project. The fair value of these shares has been recorded in share capital in the financial year ended 31 December 2021. Refer to note 12.

On 4 August 2022, the Company announced to the AIM Stock Exchange that it had conducted a review of the Miriri Phosphate Project and determined that its merits were uneconomic. The Company has elected to write-off the costs of the project at 30 June 2022 and has subsequently relinquished its interest in the Project. The carrying value of this project has been reduced to $nil as at 30 June 2022.

There have been no other known significant events subsequent to the end of the period that require disclosure in this report.

**ENDS**

For further information, please visit  www.harvestminerals.net  or contact:

Harvest Minerals Limited	Brian McMaster (Chairman)	Tel: [phone]
Strand Hanson Limited Nominated & Financial Adviser	Ritchie Balmer James Spinney	Tel: [phone]
T avira Securities Broker	Jonathan Evans	Tel: [phone]
St Brides Partners Ltd Financial PR	Ana Ribeiro I sabel de Salis	Tel: [phone]

 

END

 

 

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