ADAVALE RESOURCES LIMITED — Interim / Quarterly Report 2020

Jan 12, 2021

Rule 5.5

Appendix 5B

Mining exploration entity or oil and gas exploration entity quarterly cash flow report

Name of entity

ADAVALE RESOURCES LIMITED ABN Quarter ended (“current quarter”) 96 008 719 015 31 DECEMBER 2020

Consolidated statement of cash flows	Consolidated statement of cash flows	Current quarter	Year to date
		$A’000	(..6 months)
			$A’000
1.	Cash flows from operating activities
1.1	Receipts from customers
1.2	Payments for
	(a) exploration & evaluation (if expensed)	(162)	(177)
	(b) development
	(c) production
	(d) staff costs
	(e) administration and corporate costs	(247)	(287)
1.3	Dividends received (see note 3)
1.4	Interest received
1.5	Interest and other costs of finance paid
1.6	Income taxes paid
1.7	Government grants and tax incentives
1.8	Other (provide details if material)
1.9	Net cash from / (used in) operating	(409)	(464)
	activities
2.	Cash flows from investing activities
2.1	Payments to acquire:
	(a) entities
	(b) tenements
	(c) property, plant and equipment
	(d) exploration & evaluation (if capitalised)
	(e) investments
	(f) other non-current assets

ASX Listing Rules Appendix 5B (01/12/19) + See chapter 19 of the ASX Listing Rules for defined terms.

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Appendix 5B

Mining exploration entity or oil and gas exploration entity quarterly cash flow report

Consolidated statement of cash flows	Consolidated statement of cash flows	Current quarter	Year to date
		$A’000	(..6 months)
			$A’000
2.2	Proceeds from the disposal of:
	(a) entities
	(b) tenements
	(c) property, plant and equipment
	(d) investments
	(e) other non-current assets
2.3	Cash flows from loans to other entities
2.4	Dividends received (see note 3)
2.5	Other (provide details if material)
2.6	Net cash from / (used in) investing
	activities
3.	Cash flows from financing activities
3.1	Proceeds from issues of equity securities
	(excluding convertible debt securities)	2,765	2,765
3.2	Proceeds from issue of convertible debt
	securities
3.3	Proceeds from exercise of options
3.4	Transaction costs related to issues of equity	(93)	(93)
	securities or convertible debt securities
3.5	Proceeds from borrowings
3.6	Repayment of borrowings
3.7	Transaction costs related to loans and
	borrowings
3.8	Dividends paid
3.9	Other (provide details if material)
3.10	Net cash from / (used in) financing	2,672	2,672
	activities
4.	Net increase / (decrease) in cash and
	cash equivalents for the period
4.1	Cash and cash equivalents at beginning of	30	85
	period
4.2	Net cash from / (used in) operating	(409)	(464)
	activities (item 1.9 above)
4.3	Net cash from / (used in) investing activities
	(item 2.6 above)
4.4	Net cash from / (used in) financing activities	2,672	2,672
	(item 3.10 above)

ASX Listing Rules Appendix 5B (01/12/19) + See chapter 19 of the ASX Listing Rules for defined terms.

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Appendix 5B Mining exploration entity or oil and gas exploration entity quarterly cash flow report

Consolidated statement of cash flows	Consolidated statement of cash flows	Current quarter	Year to date
		$A’000	(..6 months)
			$A’000
4.5	Effect of movement in exchange rates on
	cash held
4.6	Cash and cash equivalents at end of	2,293	2,293
	period

5. Reconciliation of cash and cash equivalents at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts Current quarter $A’000 5.1 Bank balances 2,293 5.2 Call deposits 5.3 Bank overdrafts 5.4 Other (provide details) 5.5 Cash and cash equivalents at end of quarter (should equal item 4.6 above) 2,293	Previous quarter $A’000 30 30
6. Payments to related parties of the entity and their associates 6.1 Aggregate amount of payments to related parties and their associates included in item 1 6.2 Aggregate amount of payments to related parties and their associates included in item 2
	Current quarter $A'000 0*

Note: if any amounts are shown in items 6.1 or 6.2, your quarterly activity report must include a description of, and an explanation for, such payments

*During the quarter, in accordance with resolutions passed at the Company’s 2020 Annual General Meeting the following shares were issued by way of compensation for services rendered.

• 789,690 shares to related parties (directors) for services to 30 November 2020, calculated (prorata basis) at an issue price using a 5-day-VWAP for the last five trading days of each relevant month, based on $3,000 per month excluding GST.

• 1,575,000 to former directors for past services rendered, as described in the relevant Explanatory Statement of the Notice of Annual General Meeting.

…………………………………………………………………………………………………………………….

ASX Listing Rules Appendix 5B (01/12/19) + See chapter 19 of the ASX Listing Rules for defined terms.

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Appendix 5B

Mining exploration entity or oil and gas exploration entity quarterly cash flow report

7. Financing facilities Total facility Amount drawn	at
Note: the term “facility’ includes all forms of financing arrangements available to the entity. Add notes as necessary for an understanding of the sources of finance available to the entity. amount at quarter end $A’000 quarter end $A’000
7.1 Loan facilities
7.2 Credit standby arrangements 250	75
7.3 Other (please specify)
7.4 Total financing facilities 250	75
7.5 Unused financing facilities available at quarter end 175
7.6 Include in the box below a description of each facility above, including the lender, interest
rate, maturity date and whether it is secured or unsecured. If any additional financing
facilities have been entered into or are proposed to be entered into after quarter end,
include a note providing details of those facilities as well.
Convertible Loan Facility (Converted)
Following the agreement during the previous quarter to convert the Convertible Note (CN) plus
accrued interest into shares per the CN Agreement, during the quarter the CN and accrued interest
has been converted to 25,746,504 shares and the CN facility fully extinguished.
Standby Subscription Agreement
The facility arrangement with LKC Technology Pty Ltd is a five year agreement for $250,000	as
announced on 29 April 2020.
The facility investor agrees to subscribe to shares if requested by the company subject to the terms
and conditions of the facility agreement. A drawdown will have fully paid ordinary shares issued at the
value of the drawdown notice at a price of 80% of the 5 day VWAP prior to issue. The facility has
$175k undrawn.

8. 8.1 8.2 8.3 8.4 8.5 8.6 8.7	Estimated cash available for future operating activities $A’000 Net cash from / (used in) operating activities (Item 1.9) 409 Capitalised exploration & evaluation (Item 2.1(d)) - Total relevant outgoings (Item 8.1 + Item 8.2) 409 Cash and cash equivalents at quarter end (Item 4.6) 2,293 Unused finance facilities available at quarter end (Item 7.5) 175 Total available funding (Item 8.4 + Item 8.5) 2,468 Estimated quarters of funding available (Item 8.6 divided by Item 8.3) 6.0
8.8	If Item 8.7 is less than 2 quarters, please provide answers to the following questions: 1. Does the entity expect that it will continue to have the current level of net operating cash flows for the time being and, if not, why not?
	Answer

1. Has the entity taken any steps, or does it propose to take any steps, to raise further cash to fund its operations and, if so, what are those steps and how likely does it believe that they will be successful?

ASX Listing Rules Appendix 5B (01/12/19) + See chapter 19 of the ASX Listing Rules for defined terms.

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Appendix 5B

Mining exploration entity or oil and gas exploration entity quarterly cash flow report

1. Does the entity expect to be able to continue its operations and to meet its business objectives and, if so, on what basis?

Answer:

Compliance statement

• 1 This statement has been prepared in accordance with accounting standards and policies which comply with Listing Rule 19.11A.

• 2 This statement gives a true and fair view of the matters disclosed.

Date 13 January 2021

Authorised by the Board of Directors

Notes

1. This quarterly cash flow report and the accompanying activity report provide a basis for informing the market about the entity’s activities for the past quarter, how they have been financed and the effect this has had on its cash position. An entity that wishes to disclose additional information over and above the minimum required under the Listing Rules is encouraged to do so.

2. If this quarterly cash flow report has been prepared in accordance with Australian Accounting Standards, the definitions in, and provisions of, AASB 6: Exploration for and Evaluation of Mineral Resources and AASB 107: Statement of Cash Flows apply to this report. If this quarterly cash flow report has been prepared in accordance with other accounting standards agreed by ASX pursuant to Listing Rule 19.11A, the corresponding equivalent standards apply to this report.

3. Dividends received may be classified either as cash flows from operating activities or cash flows from investing activities, depending on the accounting policy of the entity.

4. If this report has been authorised for release to the market by your board of directors, you can insert here: “By the board”. If it has been authorised for release to the market by a committee of your board of directors, you can insert here: “By the [ name of board committee – eg Audit and Risk Committee ]”. If it has been authorised for release to the market by a disclosure committee, you can insert here: “By the Disclosure Committee”.

5. If this report has been authorised for release to the market by your board of directors and you wish to hold yourself out as complying with recommendation 4.2 of the ASX Corporate Governance Council’s Corporate Governance Principles and Recommendations , the board should have received a declaration from its CEO and CFO that, in their opinion, the financial records of the entity have been properly maintained, that this report complies with the appropriate accounting standards and gives a true and fair view of the cash flows of the entity, and that their opinion has been formed on the basis of a sound system of risk management and internal control which is operating effectively.

ASX Listing Rules Appendix 5B (01/12/19) + See chapter 19 of the ASX Listing Rules for defined terms.

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