Future Metals NL : FME Annual Report 2021

Future Metals NL

(formerly Red Emperor Resources NL)

Annual Report

30 June 2021

ABN 99 124 734 961 future-metals.com.au

CONTENTS	PAGE
Corporate Directory	1
Directors' Report	2
Consolidated Statement of Profit or Loss and Other Comprehensive Income	15
Consolidated Statement of Financial Position	16
Consolidated Statement of Changes in Equity	17
Consolidated Statement of Cash Flows	18
Notes to the Consolidated Financial Statements	19
Directors' Declaration	34
Auditor's Independence Declaration	35
Independent Auditor's Report	36
ASX Additional Information	41
About Panton PGM Project and Schedule of Tenements	43
Important Information and Disclaimers	45

CORPORATE DIRECTORY

Directors	Australian Solicitors
Greg Bandy - Executive Chairman	Edwards Mac Scovell
Aaron Bertolatti - Finance Director	Level 7, 140 St Georges Terrace
Allan Mulligan - Non-Executive Technical Director	Perth WA 6000
Justin Tremain - Non-Executive Director
Robert Mosig - Independent Non-Executive Director	Financial Adviser
	Strand Hanson Limited
Company Secretary	26 Mount Row London W1K 3SQ, UK
Aaron Bertolatti
	Stock Exchange
Registered Office	Australian Securities Exchange (ASX)
First Floor, 35 Richardson Street	(Home Exchange: Perth, Western Australia)
West Perth WA 6005	ASX Code: FME
Share Registry	Website
Computershare Investor Services Pty Ltd	www.future-metals.com.au
Level 11, 172 St Georges Terrace
Perth WA 6000
Auditors
BDO Audit (WA) Pty Ltd
38 Station Street
Subiaco WA 6008

DIRECTORS' REPORT

The Directors present their report for Future Metals NL ("Future Metals" or "the Company") and its subsidiaries (together "the Group") for the period ended 30 June 2021.

DIRECTORS

The names, qualifications and experience of the Company's Directors in office during the period and at the date of this report are set out below. The Directors were in office for the entire period unless otherwise stated.

Gregory (Greg) John Bandy - appointed 1 August 2010

Executive Chairman

Greg Bandy has over 20 years' experience in retail, corporate and capital markets, both in Australia and overseas. Greg worked as a Senior Client Advisor at Montagu Stockbrokers and Patersons Securities for over 10 years before moving to the corporate sector. As a former Director of Empire Beer Group Limited, he oversaw the acquisition of Car Parking Technologies (now Smart Parking Limited (ASX: SPZ)) before stepping down as Executive Director. Greg is also the former Managing Director of Fin Resources Limited (ASX: FIN).

Aaron Dean Bertolatti - appointed 4 June 2018

Finance Director & Company Secretary

Aaron Bertolatti is a qualified Chartered Accountant and Company Secretary with over 15 years' experience in the mining industry and accounting profession. He has significant experience in the administration of ASX listed companies, corporate governance and corporate finance. He was previously Australian Chief Financial Officer of Highfield Resources Limited (ASX: HFR) and acts as Company Secretary for listed ASX companies: Fin Resources Limited, Odin Metals Limited, American Pacific Borate Limited. Aaron is also a Director and Company Secretary of Megado Gold Ltd.

Allan Ewald Mulligan - appointed 11 June 2021

Non-Executive Technical Director

Allan Mulligan is a mining engineer with over 35 years' management and production experience in mining operations, mine start-up and construction that culminated in management roles in large scale platinum and gold mines. Allan has specialised in technical assessment and production economics, feasibility studies, project design and costing of underground mines and prospects. He has worked extensively in exploration, mine development and operations across Africa and Australia. Allan's experience includes 14 years with Lonmin Plc in a variety of senior and technical mine management roles. He previously served as a representative of Lonmin Plc on the Board of Platinum Australia Limited.

Justin Albert Tremain - appointed 11 June 2021

Non-Executive Director

Justin Tremain is an experienced company director with extensive expertise across the mineral resources sector. His experience covers equity capital markets and promotion, resource project acquisition, exploration and resource delineation, feasibility studies and project development financing. Justin is currently Managing Director of West African gold explorer Turaco Gold Ltd where he was appointed in December 2020. He is also Non- Executive Director of Caspin Resources Ltd, which listed on the ASX in November 2020. Prior to becoming involved in the management of ASX listed resource companies from early 2010, Justin had over 10 years investment banking experience in the metals and mining sector with NM Rothschild & Sons, Investec and Macquarie Bank. Justin was previously the Managing Director of Exore Resources Ltd, having joined in January 2018 as a 'shell company' and identified and led the acquisition of a gold exploration portfolio in Cote d'Ivoire for A$3.5 million. Exore was acquired by Perseus Mining Ltd in September 2020 for a value of A$80 million.

Robert (Rob) Walter Mosig - appointed 11 June 2021

Independent Non-Executive Director

Rob Mosig is a geologist with over 30 years' experience in platinum group metals, gold and diamond exploration. His experience includes exploration using geology, geochemistry, geophysics and drilling; ore resource drilling and calculation; metallurgical and engineering evaluation and environmental and economic evaluations; mining and processing. He was the founding Director of both ASX listed Helix Resources Limited and Platina Resources Limited and is currently the CEO of Caeneus Minerals Limited.

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2021 Annual Report to Shareholders

DIRECTORS' REPORT

Jason Bontempo - appointed 24 January 2011, resigned 11 June 2021

Non-Executive Director

Jason Bontempo has 23 years' experience in public company management, corporate advisory, investment banking and public company accounting, qualifying as a chartered accountant with Ernst & Young. He has worked primarily serving on the board and the executive management of minerals and resources public companies focusing on advancing and developing mineral resource assets and business development.

DIRECTORSHIPS OF OTHER LISTED COMPANIES

Directorships of other listed companies held by the current Directors in the 3 years immediately before the end of the financial period are as follows:

Director	Company	Period of Directorship
Aaron Bertolatti	Odin Metals Ltd	Director from October 2017 to April 2020
	Megado Gold Ltd	Director since March 2019
Allan Mulligan	Walkabout Resources Ltd	Director since August 2012
Justin Tremain	Turaco Gold Ltd	Director since December 2020
	Caspin Resources Ltd	Director since October 2020
	Exore Resources Ltd	Director from February 2018 to September 2020
	Carnaby Resources Ltd	Director from February 2016 to March 2020
	Odin Metals Ltd	Director from October 2017 to June 2020
	Fin Resources Ltd	Director from May 2018 to June 2020
	Emerald Resources NL	Director from September 2016 to October 2018

INTERESTS IN THE SECURITIES OF THE COMPANY

As at the date of this report, the interests of the Directors in the securities of Future Metals NL are:

	Director			Ordinary Shares				Performance Rights1
					Class A			Class B			Class C
	Greg Bandy		140,000		2,666,666		2,666,667			2,666,667
	Aaron Bertolatti		302,500		333,333		333,333			333,334
	Allan Mulligan		-		1,000,000		1,000,000			1,000,000
	Justin Tremain		-		2,666,666		2,666,667			2,666,667
	Rob Mosig		-		666,666		666,667			666,667

1 Each Performance Right is exercisable into one (1) fully paid ordinary share upon and from the date of satisfaction of the relevant vesting condition until their expiry date of 11 June 2024.

Vesting Conditions:

1. Class A: the volume-weighted average price over a period of at least 20 consecutive trading days on which trades in the Company's shares are recorded on ASX (20 Day VWAP) being at least $0.15. This vesting condition was achieved on 20 July 2021.
2. Class B: 20 Day VWAP being at least $0.20. This vesting condition was achieved on 20 July 2021.
3. Class C: 20 Day VWAP being at least $0.25

RESULTS OF OPERATIONS

The Company's net loss after taxation attributable to the members of Future Metals for the period to 30 June 2021 was $6,307,456.

DIVIDENDS

No dividend was paid or declared by the Company during the period and up to the date of this report.

CORPORATE STRUCTURE

Future Metals NL is a company limited by shares, which is incorporated and domiciled in Australia.

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2021 Annual Report to Shareholders

DIRECTORS' REPORT

NATURE OF OPERATIONS AND PRINCIPAL ACTIVITIES

On 22 June 2021, the Company was relisted on the ASX following re-compliance with Chapters 1 and 2 of the ASX Listing Rules. As part of the readmission process, the Company successfully completed a $10.0 million gross equity raising via the issue of 100m shares at $0.10 per share and the acquisition of 100% of the Panton PGM Project in Western Australia via the issue of 17.5m new ordinary shares and 87.5m options exercisable at $0.10 on or before 11 June 2024, and payment of an option fee in cash of $3 million.

More precisely, on 17 June 2021 the Company announced that it had completed the acquisition of the entire issued share capital of Great Northern Palladium Pty Ltd ('GNP'), the holder of 80% of the issued capital of Panton Sill Pty Ltd ('Panton Sill'). GNP had also exercised its option to acquire the remaining 20% of the issued capital of Panton Sill in return for the payment of $3.0 million to Panoramic Resources Ltd ('Panoramic Resources'). Accordingly, on 16 June 2021 Panton Sill became a wholly owned subsidiary of Future Metals. Panton Sill is the registered holder of a 100% interest in the three granted mining leases that cover the Panton PGM Project.

REVIEW OF OPERATIONS

Panton PGM Project

The Panton PGM Project is located 60 kilometres north of Halls Creek and just 1 kilometre off the Great Northern Highway, in the East Kimberley Region of Western Australia (refer to Figure One). The Great Northern Highway provides direct access to the Port of Wyndham. The Panton PGM Project is held under three granted Mining Leases (M80/103, M80/104 and M80/105) covering a total area of approximately 23km2.

Figure One | Panton PGM Project's Location

Past exploration and drilling, predominantly undertaken by Platinum Australia Ltd ('Platinum Australia') in the early 2000s, resulted in the delineation of a Mineral Resource Estimate ('MRE') for the Panton deposit undertaken by Cube Consulting Pty Ltd ('Cube') in April 2003. In August 2015, Cube reviewed and re-reported its 2003 MRE model to report the MRE in accordance with the Australasian Code for Reporting of Mineral Resources and Ore Reserves 2012 ('JORC 2012').

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2021 Annual Report to Shareholders