Half-year Report

RNS Number : 0002T

GreenX Metals Limited

15 March 2023

 

GreenX Metals Limited

Interim Financial Report for the Half-Year Ended 31 December 2022

ABN 23 008 677 852

CORPORATE DIRECTORY

DIRECTORS: Mr Ian Middlemas   Chairman Mr Benjamin Stoikovich   Director and CEO Mr Garry Hemming   Non-Executive Director Mr Mark Pearce  Non-Executive Director Mr Dylan Browne  Company Secretary PRINCIPAL OFFICES: London: Unit 3C, 38 Jermyn Street London SW1Y 6DN United Kingdom Tel: [phone] Australia (Registered Office): Level 9, 28 The Esplanade Perth  WA  6000 Tel: [phone] Fax: [phone] Greenland: ARC Joint Venture Company ApS c/o Nuna Advokater Box 59 Qulilerfik 2, 6. 3900 Nuuk SOLICITORS: Thomson Geer AUDITOR: Ernst & Young - Perth

BANKERS: National Australia Bank Ltd Australia and New Zealand Banking Group Ltd SHARE REGISTRIES: Australia: Computershare Investor Services Pty Ltd Level 11, 172 St Georges Terrace Perth WA 6000 Tel: [phone] United Kingdom: Computershare Investor Services PLC The Pavilions, Bridgewater Road Bristol BS99 6ZZ Tel: [phone] Poland: Komisja Nadzoru Finansowego (KNF) Plac Powstańców Warszawy 1, skr. poczt. 419 00-950 Warszawa Tel: [phone] STOCK EXCHANGE LISTINGS: Australia: Australian Securities Exchange - ASX Code: GRX United Kingdom: London Stock Exchange (Main Board) - LSE Code: GRX Poland: Warsaw Stock Exchange - GPW Code: GRX

CONTENTS

Selected Financial Data

Directors' Report

Directors' Declaration

Consolidated Statement of Profit or Loss and other Comprehensive Income

Consolidated Statement of Financial Position

Consolidated Statement of Changes in Equity

Consolidated Statement of Cash Flows

Condensed Notes to the Consolidated Financial Statements

To view the following sections plus all figures and illustrations, please refer to the full version of the Interim Financial Report on our website at www.greenxmetals.com

Auditor's Independence Declaration

Independent Auditor's Review Report

SELECTED FINANCIAL DATA (CONVERTED INTO PLN AND EUR)

	Half-Year Ended 31 December 2022 PLN	Half-Year Ended 31 December 2021 PLN	Half-Year Ended 31 December 2022 EUR	Half-Year Ended 31 December 2021 EUR
Arbitration finance facility income	15,028,789	3,894,441	3,174,012	845,178
Sale of land rights at Debiensko	-	1,898,507	-	412,017
Gas and property lease revenue	418,291	295,966	88,341	64,231
Exploration and evaluation expenses	(2,093,485)	(2,215,795)	(442,135)	(480,876)
Arbitration related expenses	(15,137,985)	(3,600,413)	(3,197,074)	(781,368)
Net loss for the period	(4,488,239)	(5,697,421)	(947,896)	(1,236,464)
Net cash flows from operating activities	(4,264,524)	(3,783,510)	(900,648)	(821,104)
Net cash flows from investing activities	(10,072,066)	(3,455,331)	(2,127,175)	(749,882)
Net cash flows from financing activities	3,267,631	13,053,025	690,109	2,891,414
Net increase in cash and cash equivalents	(11,068,959)	5,814,185	(2,337,714)	1,320,428
Basic and diluted loss per share (Grosz/EUR cents per share)	(1.73)	(2.41)	(0.37)	(0.52)

	31 December 2022 PLN	30 June 2022 PLN	31 December 2022 EUR	30 June 2022 EUR
Cash and cash equivalents	7,695,353	18,853,668	1,640,835	4,028,045
Total Assets	41,968,796	48,428,966	8,948,761	10,346,743
Total Liabilities	(11,093,430)	11,961,183	(2,365,387)	2,555,481
Net Assets	30,875,366	36,467,783	6,583,374	7,791,262
Contributed equity	245,709,661	216,970,230	51,892,768	51,912,177

Figures of the consolidated statement of profit or loss and other comprehensive income and consolidated statement of cash flows have been converted into PLN and EUR by applying the arithmetic average for the final day of each month for the reporting period, as published by the National Bank of Poland (NBP). These exchange rates were 3.1337 AUD:PLN and 4.7350 PLN:EUR for the six months ended 31 December 2022, and 2.9010 AUD:PLN and 4.6078 PLN:EUR for the six months ended 31 December 2021.

Assets and liabilities in the consolidated statement of financial position have been converted into PLN and EUR by applying the exchange rate on the final day of each respective reporting period as published by the NBP. These exchange rates were: 2.9890 AUD:PLN and 4.6899 PLN:EUR on 31 December 2022, and 3.0873 AUD:PLN and 4.6806 PLN:EUR on 30 June 2022.

DIRECTORS REPORT

The Directors of GreenX Metals Limited present their report on the Consolidated Entity consisting of GreenX Metals Limited (Company or GreenX) and the entities it controlled during the half-year ended 31 December 2022 (Consolidated Entity or Group).

DIRECTORS

The names and details of the Company's Directors in office at any time during the half-year and until the date of this report are:

Directors:

Mr Ian Middlemas  Chairman
Mr Benjamin Stoikovich    Director and CEO

Mr Garry Hemming    Non-Executive Director
Mr Mark Pearce  Non-Executive Director

Unless otherwise shown, all Directors were in office from the beginning of the half-year until the date of this report.

OPERATING AND FINANCIAL REVIEW

Operations

Highlights during, and subsequent to, the half-year include:

· During the period, the hearing for the international arbitration claims against the Republic of Poland under both the Energy Charter Treaty and the Australia-Poland Bilateral Investment Treaty was concluded.

➢ Combined arbitration hearing took place in front of the Arbitral Tribunal in London under the UNCITRAL Arbitration Rules for GreenX's claims against Poland.

➢ Damages of up to £737 million (A$1.3 billion / PLN4.0 billion) have been claimed including the assessed value of GreenX's lost profits and damages related to both the Jan Karski and Debiensko projects, and accrued interest related to any damages.

➢ The Company has funded the Claim proceedings under its US$12.3 million Litigation Funding Agreement (LFA).

· In November 2022, the Company announced highly encouraging results from an initial site visit to Arctic Rift Copper Project (ARC or Project).

➢ Analysis of the site visit results is underway and will be key to future work programs.

➢ GreenX can earn up to 80% of the ARC copper project in Greenland. ARC is a significant, large-scale project (5,774km² license area) with historical exploration results and recent analysis indicative of an extensive mineral system with potential to host world-class copper deposits.

· Subsequent to the half year, the Company announced a placing to issue 12.4 million new ordinary shares to raise gross proceeds of approximately £3.9 million (~A$6.8 million) from new and existing UK and European investors and some Australian investors (Placing). Due to high demand, directors resolved to increase the Placing to issue 14.1 million new ordinary shares to raise total gross proceeds of approximately £4.4 million (~A$7.7 million). The Placing shares were issued on 14 March 2023.

· On completion of the Placing, the Company will have cash reserves of A$10 million.

Dispute with the Polish Government

During the period, the Company reported the conclusion of the hearing for the international arbitration claims (Claim) against the Republic of Poland under both the Energy Charter Treaty (ECT) and the Australia-Poland Bilateral Investment Treaty (BIT) (together the Treaties). The hearing took place in London in November 2022 and lasted two weeks.

Following completion of the hearing, the Arbitral Tribunal will render an Award (i.e., the legal term used for a 'decision' by the Tribunal) in due course with no specified date available for the Tribunal decision.

As previously advised, the arbitration and hearing proceedings in relation to the Claim are required to be kept confidential.

Details of the Claim

The Company's Claim against the Republic of Poland is being prosecuted through an established and enforceable legal framework, with GreenX and Poland agreeing to apply the United Nations Commission on International Trade Law Rules (UNCITRAL) to the proceedings. The arbitration claims are being administered through the Permanent Court of Arbitration in the Hague.

The evidentiary hearing phase of the arbitration proceedings has now been completed in front of the Arbitral Tribunal. With completion of the hearing, the Arbitral Tribunal will render an Award (i.e., a decision) in due course. There is no specified date for an Award to be rendered. Subsequent to the end of the half-year, the Company filed its post hearing brief with the Tribunal. The Company's claims for damages against Poland are in the amount of up to £737 million (A$1.3 billion/PLN4.0 billion), which includes a revised assessment of the value of GreenX's lost profits and damages related to both the Jan Karski and Debiensko projects, and accrued interest related to any damages. The Claim for damages has been assessed by independent external quantum experts appointed by GreenX specifically for the purposes of the Claim.

In July 2020, the Company announced it had executed the LFA for US$12.3 million with Litigation Capital Management (LCM). The facility is currently being drawn down to cover legal, tribunal and external expert costs as well as defined operating expenses associated with the Claim. The LFA is a limited recourse loan with LCM that is on a "no win - no fee" basis.

In September 2020, GreenX announced that it had formally commenced with the Claim by serving the Notices of Arbitration against the Republic of Poland. In June 2021, GreenX announced that it had formally lodged its Statement of Claim in the BIT arbitration, including the first assessed claim for compensation. The Company's Statement of Reply  was submitted in July 2022 which addressed various points raised by the Republic of Poland in their Statement of Defence. The Statement of Reply also contained a re-evaluation of the claim for damages based on consideration of Poland's Statement of Defence.

GreenX's dispute alleges that the Republic of Poland has breached its obligations under the applicable Treaties through its actions to block the development of the Company's Jan Karski and Debiensko projects in Poland which effectively deprived GreenX of the entire value of its investments in Poland.

In February 2019, GreenX formally notified the Polish Government that there exists an investment dispute between GreenX and the Polish Government. GreenX's notification called for prompt negotiations with the Government to amicably resolve the dispute and indicated GreenX's right to submit the dispute to international arbitration in the event of the dispute not being resolved amicably.

GreenX's investment dispute with the Republic of Poland is not unique, with international media widely reporting that the political environment and investment climate in Poland has deteriorated since the change in Government in 2015. As a result, there are a significant number of International Arbitration claims being bought against Poland.

Highly encouraging results from initial ARC site visit

During the period, GreenX and its joint-venture ( JV ) partner Greenfields Exploration Ltd ( Greenfields ) announced the results of from the first visit to ARC.

The results of this work program have demonstrated the high-grade nature of the known copper sulphide mineralisation and wider copper mineralization in fault hosted Black Earth zones and adjacent sandstone units. The exact position of a native copper fissure at the Neergaard Dal prospect was also identified.

Analysis of this new information is underway and will be key to future work programs.

A logistical base in Greenland was also secured as part of the site visit. The Company successfully established depots, and field trialled its SHERP vehicles and advanced satellite communications systems.

Share Placing to UK and European Investors

In March 2023, the Company announced the Placing to issue 12.4 million new ordinary shares to raise gross proceeds of approximately £3.9 million (~A$6.8 million) from new and existing UK and European investors and some Australian investors. Due to high demand, directors resolved to increase the Placing to issue 14.1 million new ordinary shares to raise total gross proceeds of approximately £4.4 million (~A$7.7 million). The Placing shares were issued on 14 March 2023.

Results of Operations

The net loss of the Consolidated Entity for the half-year ended 31 December 2022 was $1,432,272 (31 December 2021: $1,963,939). Significant items contributing to the current half-year loss and the substantial differences from the previous half-year include to the following:

(i)  Arbitration related expenses of $4,830,784 (31 December 2021: $1,241,087) relating to the Claim against the Republic of Poland. This has been offset by the arbitration funding income of $4,795,937 (31 December 2021: $1,342,440);

(ii)  Sale of land rights at Debiensko of nil (31 December 2021: $654,428);

(iii)  Exploration and evaluation expenses of $668,066 (31 December 2021: $763,800), which is attributable to the Group's accounting policy of expensing exploration and evaluation expenditure incurred by the Group subsequent to the acquisition of rights to explore and up to the commencement of a bankable feasibility study for each separate area of interest;

(iv)  Business development expenses of $132,578 (31 December 2021: $182,433) which includes expenses relating to the Group's review of new business and project opportunities plus also investor relations activities during the six months to 31 December 2022 including public relations, digital marketing, travel costs, attendances at conferences and business development consultant costs;

(v)  Non-cash share-based payment expense of nil (31 December 2021: $1,203,339) due to incentive securities issued to key management personnel and other key employees and consultants of the Group as part of the long-term incentive plan to reward key management personnel and other key employees and consultants for the long-term performance of the Group. The expense results from the Group's accounting policy of expensing the fair value (determined using an appropriate pricing model) of incentive securities granted on a straight-line basis over the vesting period of the options and rights. During the prior period, the Company issued 10,750,000 unlisted options which vested on issue; and

(vi)  Revenue of $161,385 (31 December 2021: $111,664) consisting of interest income of $27,901 (31 December 2021: $9,643) and the receipt of $133,484 (31 December 2021: $102,021) of gas and property lease income derived at Debiensko.

Financial Position

At 31 December 2022, the Group had cash reserves of $2,574,558 (30 June 2022: $ 6,106,847 ) and the US$12.3 million arbitration facility (US$4.2 million available at 31 December 2022) placing it in a good financial position to continue with exploration activities at ARC and with the Claim. On completion of the Placing, the Group will have cash reserves of A$10 million.

At 31 December 2022, the Company had net assets of $10,329,665 (30 June 2022: $ 11,812,416 ) an decrease of approximately 13% compared with 30 June 2022.  This is largely driven by the loss of the half-year of $1,432,272 (31 December 2021: $1,963,939).

Business Strategies and Prospects for Future Financial Years

GreenX's strategy is to create long-term shareholder value through the discovery, exploration, development and acquisition of technically and economically viable mineral deposits. This also includes pursuing the Claim against the Republic of Poland through international arbitration in the short to medium term.

To date, the Group has not commenced production of any minerals, nor has it identified an any Ore reserves in accordance with the JORC Code.  To achieve its objective, the Group currently has the following business strategies and prospects over the medium to long term:

· Continue to enforce its rights through an established and enforceable legal framework in relation to international arbitration for the investment dispute between GreenX and the Polish Government that has arisen out of certain measures taken by Poland in breach of the Treaties;

· Continue to assess corporate options for GreenX's investments in Poland;

· Identify and assess other suitable business opportunities in the resources sector; and

· Continue with exploration activities in Greenland.

All of these activities are inherently risky and the Board is unable to provide certainty of the expected results of these activities, or that any or all of these likely activities will be achieved. Furthermore, GreenX will continue to take all necessary actions to preserve the Company's rights and protect its investments in Poland, if and as required.  The material business risks faced by the Group that could have an effect on the Group's future prospects, and how the Group manages these risks, include the following:

· Litigation risk - All industries, including the mining industry, are subject to legal and arbitration claims. Specifically, and as noted above, the Company is continuing with it its Claim against the Republic of Poland, and will strongly defend its position and will continue to take all relevant actions to pursue its legal rights in the Claim process. During the period, the hearing for the Claim was completed with Tribunal to render an Award (i.e., a decision) in due course with no specified date available for the Tribunal decision. There is however no certainty that the Claim will be successful. If the Claim is unsuccessful, then this may have a material impact on the value of the Company's securities.

· Earn-in and joint venture contractual risk - The Company's earn-in right to the Project is subject to the Earn-In Agreement (EIA) with Greenfields as announced in October 2021. The Company's ability to achieve its objectives is dependent on it and other parties complying with their obligations under the Agreement. Any failure to comply with these obligations may result in the Company not obtaining its interests in the Project and being unable to achieve its commercial objectives, which may have a material adverse effect on the Company's operations and the performance and value of the Shares. There is also the risk of disputes arising with the Company's joint venture partner, Greenfields, the resolution of which could lead to delays in the Company's proposed development activities or financial loss.

If and when the Company earns in its interest in the Project, an incorporated joint venture will be established between the Company and Greenfields. The nature of the joint venture may change in future, including the ownership structure and voting rights in relation to the Project, which may have an effect on the ability of the Company to influence decisions on the Project.

· Operations in overseas jurisdictions risk - The Project is located in Greenland, and as such, the operations of the Company will be exposed to related risks and uncertainties associated with the country, regional and local jurisdictions. Opposition to the Project, or changes in local community support for the Project, along with any changes in mining or investment policies or in political attitude in Greenland and, in particular to the mining, processing or use of copper, may adversely affect the operations, delay or impact the approval process or conditions imposed, increase exploration and development costs, or reduce profitability of the Company. Moreover, logistical difficulties may arise due to the assets being located overseas such as the incurring of additional costs with respect to overseeing and managing the Project, including expenses associated with taking advice in relation to the application of local laws as well as the cost of establishing a local presence in Greenland. Fluctuations in the currency of Greenland may also affect the dealings and operations of the Company.

Failure to comply strictly with applicable laws, regulations and local practices relating to mineral rights applications and tenure, could result in loss, reduction or expropriation of entitlements, or the imposition of additional local or foreign parties as joint venture partners with carried or other interests. Further, the outcomes in courts in Greenland may be less predictable than in Australia, which could affect the enforceability of contracts entered into by the Company.

The Project is remotely located in an area that has an arctic climate and that is categorised as an arctic desert, and as such, the operations of the Company will be exposed to related risks and uncertainties of arctic exploration, including adverse weather or ice conditions which may and has prevented access to the Project, which can impact exploration and field activities or generate unexpected costs. It is not possible for the Company to predict or protect the Company against all such risks.

The Company also had previous operations in Poland which may be subject to regulations concerning protection of the environment, including at the Debiensko and Kaczyce projects which have both been relinquishment by the Company. As with all exploration projects and mining operations, activities will have an impact on the environment including the possible requirement to make good any disturbed or damaged land.

Existing and possible future environmental protection legislation, regulations and actions could cause additional expense, capital expenditures and restrictions, the extent of which cannot be predicted which could have a material adverse effect on the Company's business, financial condition and results of operations.

· The Group's exploration and development activities will require further capital - The exploration and any development of the Company's exploration properties will require substantial additional financing. Failure to obtain sufficient financing may result in delaying or indefinite postponement of exploration and any development of the Company's properties or even a loss of property interest. There can be no assurance that additional capital or other types of financing will be available if needed or that, if available, the terms of such financing will be favourable to the Company.

· The Group's exploration properties may never be brought into production - The exploration for, and development of, mineral deposits involves a high degree of risk. Few properties which are explored are ultimately developed into producing mines. To mitigate this risk, the Company will undertake systematic and staged exploration and testing programs on its mineral properties and, subject to the results of these exploration programs, the Company will then progressively undertake a number of technical and economic studies with respect to its projects prior to making a decision to mine. However, there can be no guarantee that the studies will confirm the technical and economic viability of the Company's mineral properties or that the properties will be successfully brought into production.

· The Group may be adversely affected by fluctuations in copper prices - The price of copper fluctuates widely and is affected by numerous factors beyond the control of the Group. Future production, if any, from the Group's mineral properties will be dependent upon copper prices being adequate to make these properties economic. The Group currently does not engage in any hedging or derivative transactions to manage commodity price risk. As the Group's operations change, this policy will be reviewed periodically going forward.

· The Group may be adversely affected by competition within the copper industry - The Group competes with other domestic and international copper companies, some of whom have larger financial and operating resources. Increased competition could lead to higher supply or lower overall pricing. There can be no assurance that the Company will not be materially impacted by increased competition. In addition, the Group is continuing to secure additional surface and mineral rights, however there can be no guarantee that the Group will secure additional surface and mineral rights, which could impact on the results of the Group's operations.

· The Company may be adversely affected by fluctuations in foreign exchange - Current and planned activities are predominantly denominated in Stirling, Danish krone and/or Euros and the Company's ability to fund these activates may be adversely affected if the Australian dollar continues to fall against these currencies. The Company currently does not engage in any hedging or derivative transactions to manage foreign exchange risk. As the Company's operations change, this policy will be reviewed periodically going forward.

RELATED PARTY DISCLOSURE

Balances and transactions between the Company and its subsidiaries, which are related parties to the Company, have been eliminated on consolidation. There have been no other transactions with related parties during the half-year ended 31 December 2022, other than remuneration for Key Management Personnel and payments of $144,000 (31 December 2021: $120,000) to Apollo Group Pty Ltd, a Company of which Mr Mark Pearce is a Director and beneficial shareholder, for the provision of serviced office facilities and administration services. The amount is based on a monthly retainer due and payable in advance, with no fixed term, and is able to be terminated by either party with one month's notice. This item has been recognised as an expense in the Statement of Profit or Loss and other Comprehensive Income.

SUBSTANTIAL SHAREHOLDERS (shareholder with voting power of at least 5%)

Substantial Shareholder notices have been received by the following:

Substantial Shareholder	Number of Shares/Votes	Voting Power
CD Capital Natural Resources Fund III LP	44,776,120	17.7%

ORDINARY SHARES HELD BY DIRECTORS'

	At the Date of this Report	31 December 2022	30 June 2022
Mr Ian Middlemas	11,660,000	11,660,000	11,660,000
Mr Benjamin Stoikovich	1,492,262	1,492,262	1,492,262
Mr Garry Hemming	-	-	-
Mr Mark Pearce	3,300,000	3,300,000	3,300,000

SIGNIFICANT EVENTS AFTER THE REPORTING PERIOD

Subsequent to the half year, the Company announced the Placing to issue 12.4 million new ordinary shares to raise gross proceeds of approximately £3.9 million (~A$6.8 million) from new and existing UK and European investors and some Australian investors. Due to high demand, directors resolved to increase the Placing to issue 14.1 million new ordinary shares to raise total gross proceeds of approximately £4.4 million (~A$7.7 million). The Placing shares were issued on 14 March 2023.

Other than as outlined above, there were no significant events occurring after balance date requiring disclosure.

AUDITOR'S INDEPENDENCE DECLARATION

Section 307C of the Corporations Act 2001 requires our auditors, Ernst and Young, to provide the Directors of GreenX Metals Limited with an Independence Declaration in relation to the review of the half-year financial report. This Independence Declaration is on page 17 and forms part of this Directors' Report.

Signed in accordance with a resolution of the Directors.

BEN STOIKOVICH

Director

14 March 2023

Competent Persons Statement

The information in this announcement that relates to Exploration Results for ARC is extracted from the ASX announcements dated 6 October 2021 , 22 January 2022, 20 July 2022, 4 August 2022, 11 August 2022 and 9 November 2022 which are available to view at www.greenxmetals.com .

GreenX confirms that (a) it is not aware of any new information or data that materially affects the information included in the original announcements; (b) all material assumptions and technical parameters underpinning the content in the relevant announcements continue to apply and have not materially changed; and (c) the form and context in which the Competent Person's findings are presented have not been materially modified from the original announcements.

Forward Looking Statements

This report may include forward-looking statements. These forward-looking statements are based on GreenX's expectations and beliefs concerning future events. Forward looking statements are necessarily subject to risks, uncertainties and other factors, many of which are outside the control of GreenX, which could cause actual results to differ materially from such statements. GreenX makes no undertaking to subsequently update or revise the forward-looking statements made in this release, to reflect the circumstances or events after the date of that release .

DIRECTORS' DECLARATION

In accordance with a resolution of the Directors of GreenX Metals Limited, I state that:

In the reasonable opinion of the Directors and to the best of their knowledge:

(a)  the attached financial statements and notes thereto for the period ended 31 December 2022 are in accordance with the Corporations Act 2001, including:

(i)  complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001; and

(ii)  giving a true and fair view of the financial position of the Group as at 31 December 2022 and of its performance for the half-year ended on that date; and

(b)  The Directors Report, which includes the Operating and Financial Review, includes a fair review of:

(i)  important events during the first six months of the current financial year and their impact on the half-year financial statements, and a description of the principal risks and uncertainties for the remaining six months of the year; and

(ii)  related party transactions that have taken place in the first six months of the current financial year and that have materially affected the financial position or performance of the Group during that period, and any changes in the related party transactions described in the last annual report that could have such a material effect; and

(c)  there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable.

On behalf of the Board

BEN STOIKOVICH

Director

14 March 2023

CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

FOR THE HALF-YEAR ENDED 31 DECEMBER 2022

	Note	Half-Year Ended 31 December 2022 $	Half-Year Ended 31 December 2021 $
Revenue	4 (a)	161,385	111,664
Other income	4 (b)	4,795,937	1,996,868
Exploration and evaluation expenses		(668,066)	(763,800)
Employment expenses		(181,183)	(180,552)
Administration and corporate expenses		(177,131)	(248,223)
Occupancy expenses		(412,360)	(457,515)
Share-based payment expense		-	(1,203,339)
Business development expenses		(132,578)	(182,433)
Arbitration related expenses		(4,830,784)	(1,241,087)
Reversal of impairment		-	131,207
Other		12,508	73,271
Loss before income tax		(1,432,272)	(1,963,939)
Income tax expense		-	-
Net loss for the period		(1,432,272)	(1,963,939)
Net loss attributable to members of GreenX Metals Limited		(1,432,272)	(1,963,939)
Other comprehensive income
Items that may be reclassified subsequently to profit or loss:
Exchange differences on translation of foreign operations		(50,479)	(50,798)
Total other comprehensive loss for the period		(50,479)	(50,798)
Total comprehensive loss for the period		(1,482,751)	(2,014,737)
Total comprehensive loss attributable to members of GreenX Metals Limited		(1,482,751)	(2,014,737)
Basic and diluted loss per share (cents per share)		(0.55)	(0.83)

The above Consolidated Statement of Profit or Loss and other Comprehensive Income should be read in conjunction with the accompanying notes.

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

AS AT 31 DECEMBER 2022

	Note	31 December 2022 $	30 June 2022 $
ASSETS
Current Assets
Cash and cash equivalents		2,574,558	6,106,847
Trade and other receivables	5	2,682,639	2,149,578
Total Current Assets		5,257,197	8,256,425
Non-Current Assets
Exploration and evaluation assets	6	7,391,258	5,745,590
Property, plant and equipment	7	1,392,628	1,684,496
Total Non-Current Assets		8,783,886	7,430,086
TOTAL ASSETS		14,041,083	15,686,511
LIABILITIES
Current Liabilities
Trade and other payables		2,214,019	2,303,588
Other financial liabilities	8 (a)	326,030	315,808
Provisions	9 (a)	488,963	433,482
Total Current Liabilities		3,029,012	3,052,878
Non-Current Liabilities
Other financial liabilities	8 (b)	412,842	538,266
Provisions	9 (b)	269,564	282,951
Total Non-Current Liabilities		682,406	821,217
TOTAL LIABILITIES		3,711,418	3,874,095
NET ASSETS		10,329,665	11,812,416
EQUITY
Contributed equity	10	78,410,052	78,410,052
Reserves	11	11,003,244	11,053,723
Accumulated losses		(79,083,631)	(77,651,359)
TOTAL EQUITY		10,329,665	11,812,416

The above Consolidated Statement of Financial Position should be read in conjunction with the accompanying notes.

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE HALF-YEAR ENDED 31 DECEMBER 2022

	Contributed Equity	Share-based Payments Reserve	Foreign Currency Translation Reserve	Other Equity	Accumulated Losses	Total Equity
	$	$	$	$	$	$
Balance at 1 July 2022	78,410,052	4,558,339	287,891	6,207,493	(77,651,359)	11,812,416
Net loss for the period	-	-	-	-	(1,432,272)	(1,432,272)
Other comprehensive income for the half-year
Exchange differences on translation of foreign operations	-	-	(50,479)	-	-	(50,479)
Total comprehensive loss for the period	-	-	(50,479)	-	(1,432,272)	(1,482,751)
Balance at 31 December 2022	78,410,052	4,558,339	237,412	6,207,493	(79,083,631)	10,329,665
Balance at 1 July 2021	79,332,108	-	345,909	-	(73,993,904)	5,684,113
Net loss for the period	-	-	-	-	(1,963,939)	(1,963,939)
Other comprehensive income for the half-year
Exchange differences on translation of foreign operations	-	-	(50,798)	-	-	(50,798)
Total comprehensive loss for the period	-	-	(50,798)	-	(1,963,939)	(2,014,737)
Issue of shares	1,814,273	-	-	-	-	1,814,273
Share issue costs	(86,890)	-	-	-	-	(86,890)
Issue of ARC Consideration Performance Rights	-	3,355,000	-	-	-	3,355,000
Recognition of share-based payments	-	1,203,339	-	-	-	1,203,339
Balance at 31 December 2021	81,059,491	4,558,339	295,111	-	(75,957,843)	9,955,098

The above Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes.

CONSOLIDATED STATEMENT OF CASH FLOWS

FOR THE HALF-YEAR ENDED 31 DECEMBER 2022

		Half-Year Ended 31 December 2022 $	Half-Year Ended 31 December 2021 $
Cash flows from operating activities
Payments to suppliers and employees		(1,481,931)	(1,416,194)
Proceeds from property lease and gas sales		92,114	102,021
Interest revenue from third parties		28,936	9,971
Net cash outflow from operating activities		(1,360,881)	(1,304,202)
Cash flows from investing activities
Payments for property, plant and equipment		-	(248,614)
Proceeds from sale of land and property		-	185,851
Payments for arbitration related expenses		(1,316,530)	(731,716)
Payments for exploration and expenditure		(1,897,634)	(396,597)
Net cash outflow from investing activities		(3,214,164)	(1,191,076)
Cash flows from financing activities
Proceeds from issue of shares		-	899,273
Payments for share issue costs		-	(22,900)
Receipts from arbitration funding		1,187,056	937,828
Payments for lease liabilities		(144,300)	(134,388)
Net cash inflow from financing activities		1,042,756	1,679,813
Net decrease in cash and cash equivalents		(3,532,289)	(815,465)
Cash and cash equivalents at the beginning of the period		6,106,847	4,774,968
Cash and cash equivalents at the end of the period		2,574,558	3,959,503

The above Consolidated Statement of Cash Flows should be read in conjunction with the accompanying notes.

CONDENSED NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE HALF-YEAR ENDED 31 DECEMBER 2022

 

1.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a)  Statement of Compliance

The interim consolidated financial statements of the Group for the half-year ended 31 December 2022 were authorised for issue in accordance with the resolution of the Directors.

This general purpose financial report for the interim half-year reporting period ended 31 December 2022 has been prepared in accordance with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Act 2001.

This interim financial report does not include all the notes of the type normally included in an annual financial report.  Accordingly, this report is to be read in conjunction with the annual report of GreenX Metals Limited for the year ended 30 June 2022 and any public announcements made by the Company and its controlled entities during the interim reporting period in accordance with the continuous disclosure requirements of the Corporations Act 2001.

2.  BASIS OF PREPARATION AND CHANGES TO THE GROUP'S ACCOUNTING POLICIES

(a)  Basis of Preparation of Half-Year Financial Report

The consolidated financial statements have been prepared on the basis of historical cost. Cost is based on the fair values of the consideration given in exchange for assets. All amounts are presented in Australian dollars.

(b)  New Standards, interpretations and amendments thereof, adopted by the Group

The accounting policies and methods of computation adopted in the preparation of the consolidated half-year financial report are consistent with those adopted and disclosed in the company's annual financial report for the year ended 30 June 2022 and the comparative interim period, other than as detailed below.

In the current period, the Group has adopted all of the new and revised Standards and Interpretations issued by the Australian Accounting Standards Board (the AASB) that are relevant to its operations and effective for annual reporting periods beginning on or after 1 July 2022.

New and revised Standards and amendments thereof and Interpretations effective for the current half-year that are relevant to the Group include:

· AASB 2020-3 Amendment to AASB 9 - Test for Derecognition of Financial Liabilities

· Conceptual Framework and Financial Reporting

The Group has not early adopted any other standard, interpretation or amendment that has been issued but is not yet effective.

(c)  Issued standards and interpretations not early adopted

Australian Accounting Standards and Interpretations that have recently been issued or amended but are not yet effective have not been adopted by the Company for the reporting period ended 31 December 2022. Those which may be relevant to the Company are set out in the table below, but these are not expected to have any significant impact on the Company's financial statements:

Standard/Interpretation	Application Date of Standard	Application Date for Company
AASB 2020-6 Amendments to Australian Accounting Standards - Classification of Liabilities as Current or Non-Current - Deferral of Effective Date	1 January 2023	1 July 2023
AASB 2021-2 Amendments to Australian Accounting Standards - Disclosure of Accounting Policies and Definition of Accounting Estimates	1 January 2023	1 July 2023
AASB 2020-1 Amendments to Australian Accounting Standards - Classification of Liabilities as Current or Non-Current	1 January 2024	1 July 2024
AASB 2021-7(a-c) Amendments to Australian Accounting Standards - Effective Date of Amendments to AASB 10 and AASB 128 and Editorial Corrections	1 January 2025	1 July 2025

3.  SEGMENT INFORMATION

AASB 8 requires operating segments to be identified on the basis of internal reports about components of the Consolidated Entity that are regularly reviewed by the chief operating decision maker in order to allocate resources to the segment and to assess its performance.

The Consolidated Entity operates in one segment, being mineral exploration. This is the basis on which internal reports are provided to the Chief Executive Officer for assessing performance and determining the allocation of resources within the Consolidated Entity.

		Half-Year ended 31 December 2022 $	Half-Year ended 31 December 2021 $
4.  REVENUE AND OTHER INCOME
(a)  Revenue
Interest Income		27,901	9,643
Gas and property lease revenue		133,484	102,021
		161,385	111,664
(b)  Other income
Arbitration finance facility income		4,795,937	1,342,440
Gain on sale of land rights at Debiensko		-	654,428
		4,795,937	1,996,868
		31 December 2022 $	30 June 2022 $
5.  TRADE AND OTHER RECEIVABLES
Trade receivables		78,808	30,744
Arbitration finance facility receivable		2,265,278	1,815,313
Interest receivable		2,882	4,019
Deposits/prepayments		184,975	193,705
GST and other receivables		150,696	105,797
		2,682,639	2,149,578

	Note	Arctic Rift Copper Project $
6.  EXPLORATION AND EVALUATION ASSETS
Carrying amount at 1 July 2022		5,745,590
Earn-in expenditure2		1,645,668
Carrying amount at 31 December 20221		7,391,258

Note:

¹   The ultimate recoupment of costs carried forward for exploration and evaluation is dependent on the successful development and commercial exploitation or sale of the respective areas of interest.

²   GreenX will earn an interest of up 80% in ARC through an EIA between Mineral Investment Pty Ltd ("MIPL"), a wholly owned subsidiary of the Company. Other key terms of the EIA are included in the 2022 Annual Report.

	Land and Buildings	Plant and equipment	Right-of-use assets	Total
	$	$	$	$
7.  PROPERTY, PLANT AND EQUIPMENT
Carrying amount at 1 July 2022	9,792	875,832	798,872	1,684,496
Write-off	(8,998)	-	-	(8,998)
Depreciation and amortisation	(667)	(150,883)	(131,190)	(282,740)
Foreign exchange differences	(127)	(3)	-	(130)
Carrying amount at 31 December 2022	-	724,946	667,682	1,392,628
- at cost	2,060	1,206,103	1,487,519	2,695,682
- accumulated depreciation and amortisation	(2,060)	(481,157)	(819,837)	(1,303,054)

		31 December 2022 $	30 June 2022 $
8.  OTHER FINANCIAL LIABILITIES
(a)  Current:
Lease liability		326,030	315,808
(b)  Non-Current:
Lease liability		412,842	538,266

		31 December 2022 $	30 June 2022 $
9.  PROVISIONS
(a)  Current Provisions:
Provisions for the protection against mining damage at Debiensko1		248,533	206,380
Provision for closure of gas project2		209,984	203,481
Annual leave provision		30,446	23,621
		488,963	433,482
(b)  Non-Current Provisions:
Provisions for the protection against mining damage at Debiensko1		269,564	282,951
		269,564	282,951

Note:

¹  As Debiensko was previously an operating mine, the Group has provided for the pay out of mining land damages to surrounding land owners who have made a legitimate legal claim under Polish law.

²   The Kaczyce 1 tenement which provides the Group with the ability to extract gas expired on 28 January 2023 . The Group has provided for the costs of its closure.

	Note	31 December 2022 $	30 June 2022 $
10.  CONTRIBUTED EQUITY
(a)  Issued and Unissued Capital
228,355,089 (30 June 2022: 228,355,089) fully paid ordinary shares	10 (b)	75,810,040	75,810,040
Loan Note 2 exchangeable into fully paid ordinary shares at $0.46 per share, net of transaction costs1		2,600,012	2,600,012
Total Contributed Equity		78,410,052	78,410,052

Note:

¹  On 2 July 2017, GreenX and CD Capital completed an investment of US$2.0 million (A$2.6 million) in the form of the non-redeemable, non-interest-bearing convertible Loan Note 2. The Loan Note 2 is convertible into ordinary shares of GreenX at an issue price of A$0.46 per share and is accounted for as equity (in full).

Other key terms of the Loan Note 2 are included in the 2022 Annual Report.

(b)  Movements in fully paid ordinary shares during the past six months

There were no movements in fully paid ordinary shares during the past six months.

	Note	31 December 2022 $	30 June 2022 $
11.  RESERVES
Share-based payments reserve	11 (a)	4,558,339	4,558,339
Foreign currency translation reserve		237,412	287,891
Other equity reserve		6,207,493	6,207,493
		11,003,244	11,053,723

(a)  Movements in share-based payments reserve during the past six months

There were no movements in share based payments during the past six months.

12.  CONTINGENT ASSETS AND LIABILITIES

There have been no changes to contingent assets or liabilities since the date of the last annual report.

13.  FINANCIAL INSTRUMENTS

The Group's financial assets and liabilities, which comprise of cash and cash equivalents, trade and other receivables, trade and other payables and other financial liabilities, may be impacted by foreign exchange movements. At 31 December 2022 and 30 June 2022, the carrying value of the Group's financial assets and liabilities approximate their fair value.

14.  DIVIDENDS PAID OR PROVIDED FOR

No dividend has been paid or provided for during the half-year (31 December 2021: nil).

15.  SIGNIFICANT EVENTS AFTER THE REPORTING PERIOD

Subsequent to the half year, the Company announced the Placing to issue 12.4 million new ordinary shares to raise gross proceeds of approximately £3.9 million (~A$6.8 million) from new and existing UK and European investors and some Australian investors. Due to high demand, directors resolved to increase the Placing to issue 14.1 million new ordinary shares to raise total gross proceeds of approximately £4.4 million (~A$7.7 million). The Placing shares were issued on 14 March 2023.

Other than as outlined above, there were no significant events occurring after balance date requiring disclosure.

 

END

 

 

IR SFFSLIEDSESD