Australian Pacific Coal : Half Yearly Report and Accounts

onlyAustralian Pacific Coal Limited

ABN 49 089 206 986

useInterim Report - 31 December 2021 personalFor

Australian Pacific Coal Limited Directors' report

31 December 2021

The directors present their report, together with the financial statements, on the consolidated entity (referred to hereafter onlyas the 'consolidated entity') consisting of Australian Pacific Coal Limited (referred to hereafter as the 'company' or 'parent

entity') and the entities it controlled at the end of, or during, the half-year ended 31 December 2021.

Directors

The following persons were directors of Australian Pacific Coal Limited during the whole of the financial half-year and up to the date of this report, unless otherwise stated:

Mr David Conry AM Mr Tony Lalor

useMr Craig McPherson (Appointed 6 December 2021) Mr Mark Jagla (Resigned 6 December 2021)

Review of operations

The loss for the consolidated entity after providing for income tax amounted to $6,382,970 (31 December 2020: $11,497,432)

personalM tters subsequent to the end of the half year

On 21 February 2022, the company announced that it had received from its major shareholder and creditor Trepang Services Pty Ltd ('Trepang'), a binding offer for Trepang or its nominee to purchase the Dartbrook Coal Project through acquisition of 100% of the Company's wholly owned subsidiaries (AQC Investments 2 Pty Ltd; ACQ Dartbrook Pty Ltd; AQC Dartbrook Management Pty Ltd and Dartbrook Coal (Sales) Pty Ltd 'Subsidiaries') (the Offer).

The Offer has been made by Trepang on the basis that all debt and accrued interest (approx. $62m at 31 January 2022) owed by the Company to Trepang and its associates will be novated to the Subsidiaries such that at completion of the tran action the Company will be released from all liabilities with respect to debt owed to Trepang and its associates.

In addition, the Company will receive a royalty of A$2.50 per tonne of certain coal extracted from the Dartbrook Coal Project and an additional A$2.50 per tonne (total of A$5.00 per tonne) where coal is extracted and sold at above US$200 per tonne.

The Buyer will assume responsibility for management and holding costs of the Dartbrook Project until completion or earlier termination of the offer.

On 14 March 2022, the Company announced an update to the application to modify the development consent for the ForDa tbrook Coal mine (Modification 7) and the associated Land and Environment Court proceedings. The Company advised that it had entered into an agreement with the Minister for Planning and Public Spaces under s34 of the Land and Environment Court Act 1979 which, amongst other things, provides for a 5 year extension of mining operations under the development consent. Further that the Land and Environment Court has now modified the development consent in

accordance with the s34 agreement.

During the reporting period the outbreak of what is known as the COVID-19 pandemic continued to spread, resulting in significant volatility with worldwide economies as well as there being Government imposed social distancing guidelines. Subsequent to the reporting period the COVID-19 pandemic has remained prevalent, and this may impact the results of operations of the consolidated entity in future reporting periods. Given the stage of the pandemic, the company is not in a position to reliably estimate this impact. No other matter or circumstance has arisen since 30 June 2021 that has significantly affected, or may significantly affect the consolidated entity's operations, the results of those operations, or the consolidated entity's state of affairs in future financial years.

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Australian Pacific Coal Limited Directors' report

31 December 2021

Rounding of amounts

The company is of a kind referred to in Corporations Instrument 2016/191, issued by the Australian Securities and onlyInvestments Commission, relating to 'rounding-off'. Amounts in this report have been rounded off in accordance with that

Corporations Instrument to the nearest dollar.

Auditor's independence declaration

A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set out immediately after this directors' report.

This report is made in accordance with a resolution of directors, pursuant to section 306(3)(a) of the Corporations Act 2001. useOn behalf of the directors

personal__________________________

D vid Conry AM Director

15 March 2022

Brisbane

For

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For personal use only

AUSTRALIAN PACIFIC COAL LIMITED

ABN 49 089 206 986

AND CONTROLLED ENTITIES

AUDITOR'S INDEPENDENCE DECLARATION

UNDER SECTION 307C OF THE CORPORATIONS ACT 2001

TO THE DIRECTORS OF

AUSTRALIAN PACIFIC COAL LIMITED

I In accordance with section 307C of the Corporations Act 2001, I am pleased to provide the following declaration of independence to the directors of Australian Pacific Coal Limited. As the lead audit partner for the review of the financial report of Australian Pacific Coal Limited for the half-year ended 31 December 2021, I declare that, to the best of my knowledge and belief, there have been no contraventions of:

1. the auditor independence requirements as set out in the Corporations Act 2001 in relation to the review; and
2. any applicable code of professional conduct in relation to the review.

Hall Chadwick (NSW)

Level 40, 2 Park Street

Sydney NSW 2000

SANDEEP KUMAR

Partner

Date: 15 March 2022

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SYDNEY · PENRITH · MELBOURNE · BRISBANE · PERTH · DARWIN

Liability limited by a scheme approved under Professional Standards Legislation

www.hallchadwick.com.au

Australian Pacific Coal Limited

Contents

31 December 2021

Statement of profit or loss and other comprehensive income onlyStatement of financial position

Statement of changes in equity Statement of cash flows Notes to the financial statements Directors' declaration

I dependent auditor's report to the members of Australian Pacific Coal Limited

General information

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useThe financial statements cover Australian Pacific Coal Limited as a consolidated entity consisting of Australian Pacific Coal

Limited and the entities it controlled at the end of, or during, the year. The financial statements are presented in Australian dollars, which is Australian Pacific Coal Limited's functional and presentation currency.

A stralian Pacific Coal Limited is a listed public company limited by shares, incorporated and domiciled in Australia. Its registered office and principal place of business are:

Registered office	Principal place of business
personalFor	Stair Street
Level 15, 344 Queen Street
Brisbane QLD 4000	Kayuga NSW 2333

A description of the nature of the consolidated entity's operations and its principal activities are included in the directors' rep rt, which is not part of the financial statements.

The financial statements were authorised for issue, in accordance with a resolution of directors, on 15 March 2022. The directors have the power to amend and reissue the financial statements.

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