Speciality Metals International Limited Annual Report 2020

Speciality Metals International Limited Annual Report 2020 51 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Page | 52 18. INVESTMENT IN SUBSIDIARIES Equity Interest Cost of Parent Entity’s Investment Parent Entity Speciality Metals International Limited 2020 % 2019 % 2020 $ 2019 $ Controlled Entities South Eastern Resources Pty Ltd 100 100 2 3 Mt Carbine Retreatment Pty Ltd 1 100 100 200 2 Troutstone Resources Pty Ltd 100 100 1 2 Mt Carbine Quarrying Operations Pty Ltd 2 100 100 100 - Mt Carbine Quarries Pty Limited 3 100 100 8,130,000 8,130,000 Icon Resources Africa Pty Ltd 100 100 10 10 Special Metals Chile SpA 4 - 100 - 6,060 Mt Carbine Retreatment Management Pty Ltd 5 50% - 50 - 1 Cast Resources Pty Ltd changed it name to Mt Carbine Retreatment Pty Ltd on 19 March 2019. 2 Kaowest Pty Ltd changed its name to Mt Carbine Quarrying Operations Pty Ltd on 19 March 2019. 3 Mt Carbine Quarries Pty Ltd acquired 28 June 2019. 4 Special Metals Chile SpA is in the final stages of being wound-up following the Company’s decision not to pursue further exploration activities in Chile. 5 Mt Carbine Retreatment Management Pty Ltd acts as the agent for the unincorporated joint venture between Mt Carbine Retreatment Pty Ltd and CRONIMET Australia Pty Ltd. Speciality Metals International Limited and all of its subsidiaries, with the exception of Special Metals Chile SpA, are located and incorporated in Australia. 19. IMPAIRMENT OF DEFERRED EXPLORATION EXPENDITURE AND PLANT AND EQUIPMENT The Directors reassess the carrying value of the Group’s assets including deferred exploration expenditure, tenements and plant and equipment at each half year, or at a period other than that, should there be any indication of impairment to fair value. When making their assessment for the 2020 financial year the Directors took the following into consideration: § During the financial year the Company through its Joint Venture with CRONIMET Australia Pty Ltd concluded the refurbishing and commenced production from the Mt Carbine Retreatment Plant with its first tungsten concentrate shipment being despatched during June 2020. § The Company’s wholly owned subsidiary, Mt Carbine Quarrying Operations Pty Ltd, received in June 2020 its largest order to date for approximately $4 million (including GST) for the supply of various quarry materials. Efforts to support the continued growth and development of the quarry are continuing. The revenues associated with this order are expected to the recognised during the last half of the 2020 calendar year. § The Company has maintained its two (2) gold prospects in NSW with a further tungsten focused Exploration Permit being granted in June 2020 (EPM 27394) to complement its existing two (2) tungsten focused Exploration Permits (EPM 14871 & EPM 14872) located at Mt Carbine, North Queensland. EPM 14872 contains both the Iron Duke and Petersen’s Lode prospects whilst EPM 14871 features the Mt Holmes tin-tungsten prospect. The Company believes that EPM 14872 holds significant exploration upside given that the tungsten grades indicated in the sampling of the Iron Duke and Petersen’s Lode are extensively higher than the estimated global average grade in the present open-pit resource within the Mt Carbine Mining Leases. These unencumbered, greenfield sites also offer the added advantage of having minimal environmental legacy issues. § Due to changes within the geo-political climate in Chile the Company concluded not to pursue any further exploration activities with all expenses being impaired in full during the reporting period as detailed below: Based on the above, Directors’ have assessed there to be no indication of impairment, other than that which relates to the Company’s Chilean Exploration Concessions, which have been impaired in full during the 2020 financial year. Impairment of Deferred Exploration Expenditure 2020 $ 2019 $ Chile Exploration Concessions (140,855) -