CADOUX LIMITED — Interim / Quarterly Report 2021

Mar 11, 2021

FYI RESOURCES LIMITED ABN 85 061 289 218

Interim Report 31 December 2020

FYI RESOURCES LIMITED 31 DECEMBER 2020

Table of Contents

	Page
	Number
Corporate Directory..............................................................	2
Directors’ Report……………….……….……………....…..….	3
Condensed Statement of Comprehensive Income..….....	4
Condensed Statement of Financial Position…………....…	5
Condensed Statement of Changes in Equity….…………..	6
Condensed Statement of Cash Flows……..………..………	7
Notes to the Condensed Financial Statements…………...	8
Directors’ Declaration……...…………………………….........	18
Auditor’s Independence Declaration..………………………	19
Independent Auditor’s Review Report ……………………..	20

1

FYI RESOURCES LIMITED 31 DECEMBER 2020

CORPORATE DIRECTORY

DIRECTORS

Edmund Babington – Non-Executive Chairman David Sargeant – Non-Executive Director Adrian Jessup – Non-Executive Director Roland Hill – Managing Director

COMPANY SECRETARY

Phillip MacLeod

REGISTERED and PRINCIPAL OFFICE

Units 8-9, 88 Forrest Street Cottesloe 6011 Western Australia

Phone +61 9313 3920 Website www.fyiresources.com.au

ABN

85 061 289 218

SHARE REGISTRY

Automic Pty Ltd Level 5 126 Phillip Street Sydney NSW 2000

AUDITOR

HLB Mann Judd (WA) Partnership Level 4 130 Stirling Street Perth WA 6000 Western Australia

SECURITIES EXCHANGE LISTINGS

ASX Limited Home Exchange Perth ASX Code: FYI

Frankfurt Stock Exchange Code: SDL

Hamburg Stock Exchange Code: A0RDPF

Berlin Stock Exchange Code: SDL

2

FYI RESOURCES LIMITED DIRECTORS’ REPORT FOR THE HALF-YEAR ENDED 31 December 2020

Directors’ Report

Your directors submit their report on FYI Resources Limited (“the Company”) and its controlled entities (“the Group”) for the half-year ended 31 December 2020. In order to comply with the provisions of the Corporations Act 2001, the directors report as follows:

Directors

The directors of the Company at any time during or since the end of the half-year are:

Edmund Babington Roland Hill David Sargeant Adrian Jessup

Review of Operations and Exploration Activities

The Group’s loss for the half-year ended 31 December 2020 was $1,844,956 (2019: $1,624,466).

During the period the principal activities of the Group consisted of advancing its fully integrated and innovative high purity alumina (HPA) project in Western Australia and mineral exploration and evaluation in southeast Asia.

Dividends

No dividends have been paid during the period and no dividends have been recommended by the directors.

Events subsequent to reporting date

On the 15[th] of February 2021, the Company announced the placement of $3.13 million, via the issue of 9.3 million shares, under the Company’s $80 million capital commitment facility with GEM. This is the first draw down on the GEM financing facility (announced 11 March 2020) which was put in place to provide the Company with capital support for the development of the Company’s HPA project.

Auditor’s Independence Declaration

Section 307C of the Corporations Act 2001 requires our auditors, HLB Mann Judd, to provide the directors of the Company with an Independence Declaration in relation to the review of the interim report. This written Auditor’s Independence Declaration is set out on page 19 and forms part of this Directors’ Report for the half-year ended 31 December 2020.

This report is signed in accordance with a resolution of the Board of Directors made pursuant to s306(3) of the Corporations Act 2001.

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Roland Hill Managing Director Perth, 12[th] March 2021

3

FYI RESOURCES LIMITED

CONDENSED STATEMENT OF COMPREHENSIVE INCOME FOR THE HALF-YEAR ENDED 31 DECEMBER 2020

	Note	Consolidated	Consolidated
		6 months ended 31/12/2020 $	6 months ended 31/12/2019 $
Continuing Operations
Australian Government assistance		5,000 - 169 1,119
Interest income
Exploration and evaluation expenditure	6	(566,575) (1,174,419)
Amortisation expense	9	(464,137) -
ASX fees		(27,912) (31,687) (234,495) - (148,269) (121,566) (112,548) (49,414) (167,280) (155,280) (34,895) (11,901) (7,000) (3,000) (50,715) (35,979) (36,299) (42,339)
Share based payment expense	7
Accounting and consulting fees
Other administration expenses
Directors fees
Share registry expenses Legal expenses Consulting fees
Interest expense
Loss before income tax expense
		(1,844,956) (1,624,466)
Income tax benefit		- -
Net loss for the period Other comprehensive income, net of tax		(1,844,956) (1,624,466)
Items that may be reclassified to profit or loss Exchange differences from translation of foreign operations		4,372 (2,079)
Other comprehensive loss Total comprehensive loss Loss for the period is attributable to:		4,372 (2,079)
		(1,840,584) (1,626,545)
Owners of FYI Resources Ltd		(1,833,292) (1,614,737) (11,664) (9,729)
Non-controlling interests
Total comprehensive loss for the period is attributable to: Owners of FYI Resources Ltd		(1,844,956) (1,624,466)
		(1,828,920) (1,616,816)
Non-controlling interests		(11,664) (9,729)
		(1,840,584) (1,626,545)
Basic and diluted loss per share (cents per share)	16	(0.72) (0.76)

The accompanying notes form part of these financial statements.

4

FYI RESOURCES LIMITED

CONDENSED STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2020

	Note	Consolidated	Consolidated
		31/12/2020 $	30/06/2020 $
CURRENT ASSETS Cash and cash equivalents		6,867,497 107,893
Trade and other receivables	8	173,543 1,126,382 920,705 920,705
Other assets	9
Total Current Assets NON-CURRENT ASSETS Deferred exploration and evaluation expenditure	10	7,961,745 2,154,980
		3,533,332 3,533,332
Other assets	9	1,092,235 1,556,372
Total Non-Current Assets TOTAL ASSETS CURRENT LIABILITIES Trade and other payables Borrowings	11 12	4,625,567 5,089,704
		12,587,312 7,244,684
		504,380 1,348,117 - 826,661
Other financial liabilities	13	1,600,000 1,600,000
Total Current Liabilities TOTAL LIABILITIES NET ASSETS EQUITY Issued capital Reserves Accumulated losses	14	2,104,380 3,774,778
		2,104,380 3,774,778
		10,482,932 3,469,906
		46,027,298 37,899,646 3,520,195 2,789,865 (38,849,158) (37,015,866)
Equity attributable to owners of the parent Non-controlling interests		10,698,335 3,673,645
		(215,403) (203,739)
TOTAL EQUITY
		10,482,932 3,469,906

The accompanying notes form part of these financial statements.

5

FYI RESOURCES LIMITED

CONDENSED STATEMENT OF CHANGES IN EQUITY FOR THE HALF-YEAR ENDED 31 DECEMBER 2020

	Consolidated	Consolidated	Consolidated	Consolidated	Consolidated	Consolidated	Consolidated
	Issued Capital	Accumulated Losses	Share- based payments reserve	Option premium reserve	Foreign currency translation reserve	Non- controlling interests	Total
	$	$	$	$	$	$	$
Balance at 1 July 2019 Loss for the period Other comprehensive loss Total comprehensive loss for the period Balance at 31 December 2019 Balance at 1 July 2020 Loss for the period Other comprehensive loss Total comprehensive loss for the period Shares issued net of transactions costs Balance at 31 December 2020	37,495,460 (34,937,824) 793,843 834,677 630 (179,561) 4,007,225 - (1,614,737) - - - (9,729) (1,624,466) - - - - (2,079) - (2,079)
	- (1,614,737) - - (2,079) (9,729) (1,626,545)
	37,495,460 (36,552,561) 793,843 834,677 (1,449) (189,290) 2,380,680
	37,899,646 (37,015,866) 1,955,960 834,677 (772) (203,739) 3,469,906 - (1,833,292) - - - (11,664) (1,844,956) - - - - 4,372 - 4,372
	- (1,833,292) - - 4,372 (11,664) (1,840,584) 8,127,652 - 725,958 - - - 8,853,610
	46,027,298 (38,849,158) 2,681,918 834,677 3,600 (215,403) 10,482,932

The accompanying notes form part of these financial statements.

6

FYI RESOURCES LIMITED

CONDENSED STATEMENT OF CASH FLOWS FOR THE HALF-YEAR ENDED 31 DECEMBER 2020

		Consolidated	Consolidated
		6 months ended 31/12/2020 $	6 months ended 31/12/2019 $
Cash flows from operating activities		10,000 - (657,267) (274,572) (1,286,311) (1,433,385) (112,960) (36,074) 169 1,119 924,564 777,631
Australian Government assistance
Payments to suppliers and employees Payments for exploration and evaluation Finance costs Interest received Other - R&D tax offset
Net cash outflow from operating activities		(1,121,805) (965,281)
Cash flows from financing activities Proceeds from issue of shares		9,183,500 - (552,091) (5,011) - 998,750 (750,000) (550,000)
Share issue costs
Proceeds from borrowings Repayment of borrowings Net cash inflow from financing activities Net increase / (decrease) in cash held Cash at the beginning of the period Cash at the end of the period
		7,881,409 443,739
		6,759,604 (521,542) 107,893 940,088
		6,867,497 418,546

The accompanying notes form part of these financial statements.

7

FYI RESOURCES LIMITED

NOTES TO THE CONDENSED FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2020

1. Basis of Preparation

These interim consolidated financial statements are general purpose financial statements prepared in accordance with the requirements of the Corporations Act 2001, Australian Accounting Standards including AASB 134: Interim Financial Reporting, Accounting Interpretations and other authoritative pronouncements of the Australian Accounting Standards Board.

For the purpose of preparing the interim report, the half-year has been treated as a discrete reporting period, and the Company as a for-profit entity.

This condensed half-year report does not include full disclosures of the type normally included in the full financial report. Therefore, it cannot be expected to provide as full an understanding of the financial performance, financial position and cash flows of the Group as in the full financial report. It is recommended these interim financial statements be read in conjunction with the full financial report for the year ended 30 June 2020 and any public announcements made by the Company during the half-year in accordance with continuous disclosure requirements arising under the Corporations Act 2001 and the ASX Listing Rules.

The accounting policies and methods of computation adopted are consistent with those of the previous financial year and corresponding half-year, except for the impact of the new Standards and Interpretations described in the section ‘Adoption of new and revised Accounting Standards’. These accounting policies are consistent with Australian Accounting Standards and with International Financial Reporting Standards.

The interim report has been prepared on a historical cost basis. Historical cost is based on the fair value of the consideration given in exchange for assets, goods and services.

The Company is domiciled in Australia and all amounts are presented in Australian dollars.

The preparation of interim financial reports requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expense. Actual results may differ from these estimates.

In preparing this interim report, the significant judgements made by management in applying the Group’s accounting policies and the key sources of estimation uncertainty were the same as those that applied to the financial report for the year ended 30 June 2020.

(a) Statement of compliance

The interim financial statements were authorised for issue on 12 March 2021.

The interim financial statements comply with Australian Accounting Standards, which include Australian equivalents to International Financial Reporting Standards (AIFRS). Compliance with AIFRS ensures that the financial report, comprising the interim financial statements and notes thereto, complies with International Financial Reporting Standards (IFRS).

8

FYI RESOURCES LIMITED

NOTES TO THE CONDENSED FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2020

1. Basis of Preparation (continued)

(b) Adoption of New and Revised Standards

New Standards and Interpretations applicable for the half year ended 31 December 2020

In the period ended 31 December 2020, the Directors have reviewed all of the new and revised Standards and Interpretations issued by the AASB that are relevant to the Group and effective from the current reporting period. As a result of this review, the Directors have determined that there is no material impact of the new and revised Standards and Interpretations on the Group and, therefore, no material change is necessary to Group accounting policies.

New Standards and Interpretations in issue not yet adopted

The Directors have also reviewed all of the new and revised Standards and Interpretations in issue not yet adopted for the period ended 31 December 2020. As a result of this review the Directors have determined that there is no material impact of the Standards and Interpretations in issue not yet adopted on the Group and, therefore, no change is necessary to Group accounting policies.

(c) Going concern

The interim financial statements have been prepared on the going concern basis, which contemplates continuity of normal business activities and the realisation of assets and settlements of liabilities in the ordinary course of business.

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FYI RESOURCES LIMITED

NOTES TO THE CONDENSED FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2020

2. Segment Reporting

Operating segments are reported in a manner that is consistent with the internal reporting provided to the chief operating decision maker. The chief operating decision maker has been identified as the Board of the Company.

The Group operates in two business and two geographical segments being high purity alumina exploration and evaluation in Australia and potash exploration and evaluation in Asia. The Group considers its business operations in mineral exploration to be its primary reporting function.

The following table presents revenue and profit information and certain asset and liability information regarding business segments for the half years ended 31 December 2020 and 31 December 2019.

	HPA Exploration and Evaluation Potash Exploration and Evaluation Australia Asia $ $ Continuing Operations	Unallocated Items $	Total $
Year ended 31 December 2020 Other income Australian Government assistance - - 5,000 5,000 Segment net operating loss after tax (579,998) (22,876) (1,242,082) (1,844,956) Interest and other revenue - - 169 169 Income tax benefit/(expense) - - - - Segment assets 5,546,372 48,716 6,992,224 12,587,312 Segment liabilities 1,733,576 61,299 309,505 2,104,380 Half-year ended 31 December 2019 Revenue Segment net operating loss after tax (1,197,666) (19,092) (407,708) (1,624,466) Interest and other revenue - - 1,119 1,119 Segment assets 3,593,432 3,562 556,834 4,153,828 Segment liabilities 626,765 65,961 1,080,422 1,773,148

3. Dividends

No dividends were paid or declared payable during or since the half-year.

4. Contingent Liabilities

There has been no change in contingent liabilities of the Group since the last annual reporting date.

5. Events Subsequent to Reporting Date

On the 15[th] of February 2021, the Company announced the placement of $3.13 million, via the issue of 9.3 million shares, under the Company’s $80 million capital commitment facility with GEM. This is the first draw down on the GEM financing facility (announced 11 March 2020) which was put in place to provide the Company with capital support for the development of the Company’s HPA project.

10

FYI RESOURCES LIMITED

NOTES TO THE CONDENSED FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2020

6. Expenses

	Consolidated	Consolidated
	6 months ended 31/12/2020 $	6 months ended 31/12/2019 $
Exploration and evaluation expenditure Laos exploration HPA tenement expenses	22,876 19,092 7,569 8,883
HPA metallurgy and assay HPA product development HPA engineering HPA Pilot plant HPA Rockingham Lease amortisation	387,631 299,133
	87,515 166,541
	- 119,786
	33,867 523,379
	15,123 -
Other exploration expense	11,994 37,605
	566,575 1,174,419

7. Share based payment expense

During the half-year ended 31 December 2020, 2,250,000 Options were granted to the Directors of the Company.

The options were granted on 27 November 2020 with an exercise price of $0.3360 and an expiry date of 27 November 2022. The fair value of the options is $234,495 ($0.10422 per Option).

8. Trade and Other Receivables

8. Trade and Other Receivables
	Consolidated
	31/12/2020 $	30/06/2020 $
Current Trade receivables Other receivables Allowance for impairment Prepaid expenses R&D tax receivable	- 8,116 161,620 162,821 - (8,116)
	161,620 162,821 11,924 33,997 - 929,564
	173,543 1,126,382

Trade and sundry receivables are non-interest bearing and are generally received on 30 - 60 days terms.

There is no expected credit loss in relation to the trade and other receivables at balance date other than that disclosed in the allowance for impairment.

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FYI RESOURCES LIMITED

NOTES TO THE CONDENSED FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2020

9. Other Assets

9. Other Assets
	Consolidated
	31/12/2020 $	30/06/2020 $
Current Facility costs Non-current Facility costs Accumulated Amortisation	920,705 920,705
	920,705 920,705
	1,841,412 1,841,412 (749,177) (285,040)
	1,092,235 1,556,372

In March 2020, the Group entered into a strategic project development equity financing facility of up to A$80 million with a Luxembourg based private equity group, GEM Global Yield LLC SCS (GEM). The Company will pay $1,600,000 and issue to GEM or its nominee 23 million options, Tranche 1, with an exercise price of 15 cents each expiring 5 March 2024. In addition, the Company will issue to GEM or its nominee, following shareholder approval, 23.7 million options, Tranche 2, with an exercise price of 15 cents each expiring 5 March 2024. Other assets comprise the $1,600,000 and the value of these share-based payments less amortisation over three years.

10. Deferred Exploration and Evaluation Expenditure

10. Deferred Exploration and Evaluation Expenditure
	Consolidated
	31/12/2020 $	30/06/2020 $
Balance at beginning of year Balance at end of year	3,533,332 3,533,332
	3,533,332 3,533,332

The recoupment of costs carried forward in relation to areas of interest in the exploration and evaluations phases is dependent on the successful development and commercial exploitation or sale of the respective areas.

12

FYI RESOURCES LIMITED

NOTES TO THE CONDENSED FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2020

11. Trade and other payables

	31/12/2020 30/06/2020 $ $ Consolidated	31/12/2020 30/06/2020 $ $ Consolidated
		30/06/2020 $
Trade and other payables Director related payables Accruals	286,877 1,109,682 147,486 167,120 70,017 71,315
	504,380 1,348,117
12. Borrowings
	Consolidated
	31/12/2020 $	30/06/2020 $
Borrowings Changes in liabilities arising from financing activities At start of year Net cash from financing activities Finance costs incurred Repayment of borrowings Finance costs paid	- 826,661
	- 826,661
	826,661 309,677 - 998,750 36,299 104,308 (750,000) (550,000) (112,960) (36,074)
Balance at end of year	- 826,661

The Company entered into an agreement with Asymmetric Innovation Finance Pty Ltd to borrow an advance of up to $750,000 at the applicable interest rate of 15% per annum. The interest is capitalised on a monthly basis, in arrears. As at the reporting period, the Company had repaid the principal and outstanding interest on the principal after the receipt of the refundable tax offset.

13. Other financial Liabilities

	Consolidated	Consolidated
	31/12/2020 $	30/06/2020 $
Promissory Note	1,600,000 1,600,000
	1,600,000 1,600,000

In March 2020, the Group entered into a strategic project development equity financing facility of up to A$80 million with a Luxembourg based private equity group, GEM Global Yield LLC SCS. The Company will pay a fee of 2% of the equity commitment within a year of entering the financing facility.

13

FYI RESOURCES LIMITED

NOTES TO THE CONDENSED FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2020

14. Issued capital

(a) Ordinary shares

Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the Company in proportion to the number of and amounts paid on the shares. On a show of hands every holder of ordinary shares present at a meeting, in person or by proxy, is entitled to one vote, and upon a poll each share is entitled to one vote.

	Consolidated	Consolidated
	31/12/2020 $	30/06/2020 $
300,795,989 (30 June 2020: 221,095,989) fully paid ordinary shares	46,027,298 37,899,646

(i) Ordinary shares - number	Consolidated	Consolidated
	31/12/2020 No.	30/06/2020 No.
Balance at beginning of year	221,095,989 212,772,654
8,323,335 shares issued at 5 cents per share on 15 June 20201 21,6666,666 shares issued at 6 cents per share on 20 August 20202 600,000 shares issued at 10 cents per share on 16 September 20203 1,200,000 shares issued at 10 cents per share on 23 September 20203 23,333,334 shares issued at 10 cents per share on 8 October 20202 500,000 shares issued at 10 cents per share on 12 October 20203 2,250,000 shares issued at 10.6 cents per share on 24 November 20204 150,000 shares issued at 10 cents per share on 24 November 20203 30,000,000 shares issued at 20 cents per share on 7 December 20205	- 8,323,335
	21,666,666 -
	600,000 -
	1,200,000 -
	23,333,334 -
	500,000 -
	2,250,000 -
	150,000 -
	30,000,000 -
Balance at end of year	300,795,989 221,095,989

1 Issued in consideration for services provided to the Company.

2 Issued to sophisticated and professional investors, announcement 13 August 2020

3 Conversion of unlisted options exercisable at 10 cents each expiring 31 July 2021 (FYIAC)

4 Conversion of unlisted options exercisable at 10.6 cents each expiring 26 November 2020 (FYIAC)

5 Issued to sophisticated and professional investors

14

FYI RESOURCES LIMITED

NOTES TO THE CONDENSED FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2020

14. Issued capital (continued)

14. Issued capital (continued)
(ii) Ordinary shares – value	Consolidated
	31/12/2020 $	30/06/2020 $
Balance at beginning of year	37,899,646 37,495,460
8,323,335 shares issued at 5 cents per share on 15 June 20201 21,666,666 shares issued at 6 cents per share on 20 August 20202 600,000 shares issued at 10 cents per share on 16 September 20203 1,200,000 shares issued at 10 cents per share on 23 September 20203 23,333,334 shares issued at 6 cents per share on 8 October 20202 500,000 shares issued at 10 cents per share on 12 October 20203 2,250,000 shares issued at 10.6 cents per share on 24 November 20204 150,000 shares issued at 10 cents per share on 24 November 20203 30,000,000 shares issued at 20 cents per share on 7 December 20205	- 407,844 1,300,000 - 60,000 - 120,000 - 1,400,000 - 50,000 - 238,500 - 15,000 - 6,000,000 - (1,055,848) (3,658)
Costs of shares issued
Balance at end of year	46,027,298 37,899,646

b) Options

As at 31 December 2020 the Company had the following options on issue over ordinary shares:

	Consolidated	Consolidated
Options - number	31/12/2020 No.	30/06/2020 No.
Balance at beginning of year	57,096,600 12,396,600
Expiry of options 4 April 2020 Exercise of options 16 September 2020	- (2,000,000) (600,000) -
Exercise of options 23 October 2020	(1,200,000) -
Exercise of options 12 October 2020 Exercise of options 24 November 2020 Exercise of options 24 November 2020 Issue of options 22 September 2020 Issue of options 12 November 2020 Issue of options 24 December 2020 Issue of options 24 December 2020 Balance of options issued at end of year Options granted 9 March 2020 - unissued Options granted 9 March 2020 - unissued and subject to shareholder approval	(500,000) - (2,250,000) - (150,000) - 23,000,000 - 23,700,000 - 2,250,000 - 4,000,000 -
	105,346,600 10,396,600 (23,000,000) 23,000,000 (23,700,000) 23,700,000
Balance of options issued and unissued at end of year	58,646,600 57,096,600

The following share-based payment arrangements were in place during the current and prior periods.

15

FYI RESOURCES LIMITED

NOTES TO THE CONDENSED FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2020

	Number	Grant date	Expiry date	Exercise Price	Fair value at grant date	Vesting date
Director Options	2,250,000	27-Nov-18	26-Nov-20	$0.106	$0.0371	Exercised
GEM Options Tranche 1	23,000,000	09-Mar-20	05-Mar-24	$0.150	$0.0249	22-Sep-20
GEMOptions Tranche 2	23,700,000	09-Mar-20	05-Mar-24	$0.150	$0.0249	12-Nov-20
Director Options	2,250,000	27-Nov-20	26-Nov-22	$0.336	$0.1042	24-Dec-20
Lead Manager Options	4,000,000	07-Dec-20	31-Dec-22	$0.300	$0.1229	24-Dec-20

The fair value of the equity-settled share options granted is estimated as at the date of grant using the Black and Scholes model taking into account the terms and conditions upon which the options were granted.

15. Related Party Disclosure

The consolidated financial statements include the financial statements of FYI Resources Ltd and the subsidiaries listed in the following table.

Controlled entities	Country of incorporation	Percentage Owned	Percentage Owned
		31/12/2020 %	30/06/2020 %
Parent Entity: FYI Resources Ltd Australia
Subsidiaries of FYI Resources Ltd:
Kokardine Kaolin Pty Ltd Australia		100 100
FYI Thailand Pty Ltd Australia which controls		100 100
West Mekong Minerals Ltd Thailand		49 49

The Company finances the operations of FYI Thailand Pty Ltd and thus this company has unsecured borrowings from the Company that are interest free and at call. The ability of this controlled entity to repay debts due to the company (and other parties) will be dependent on the commercialisation of the prospecting licences owned by the subsidiary.

FYI Thailand Pty Ltd possesses 82.8% of the voting rights for West Mekong Minerals Ltd.

Balances and transactions between the Company and its subsidiaries, which are related parties of the Company, have been eliminated on consolidation and not disclosed in this note.

Arrangements with Directors continue to be in place. For details on these arrangements, refer to the 30 June 2020 annual financial report.

16

FYI RESOURCES LIMITED

NOTES TO THE CONDENSED FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2020

16. Loss per share

	Consolidated	Consolidated
	31/12/2020 Cents	31/12/2019 Cents
Basic loss per share	(0.72) (0.76)
Loss used in the calculation of basic EPS	(1,833,292) (1,614,737)
Weighted average number of shares outstanding during the period used in calculations of basic loss per share	253,188,156 212,772,654

17. Fair Value

The Director’s consider that the carrying amounts of financial assets and financial liabilities approximates their fair value at balance date.

17

FYI RESOURCES LIMITED

DIRECTORS’ DECLARATION

In the opinion of the Directors of FYI Resources Limited ("Company"):

1. The attached financial statements and notes are in accordance with the Corporations Act 2001, including:

(a) complying with Accounting Standards, Corporations Regulations 2001 and other mandatory professional reporting requirements; and

(b) giving a true and fair view of the Group's financial position as at 31 December 2020 and of its performance for the half-year then ended; and

1. There are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable.

This declaration is signed made in accordance with a resolution of the Board of Directors made pursuant to s303(5) of the Corporations Act 2001.

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Roland Hill Director

Perth, 12[th] March 2021

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AUDITOR’S INDEPENDENCE DECLARATION

As lead auditor for the review of the consolidated financial report of FYI Resources Limited for the half-year ended 31 December 2020, I declare that to the best of my knowledge and belief, there have been no contraventions of:

• a) the auditor independence requirements of the Corporations Act 2001 in relation to the review; and

• b) any applicable code of professional conduct in relation to the review.

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Perth, Western Australia 12 March 2021

M R Ohm Partner

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INDEPENDENT AUDITOR’S REVIEW REPORT

To the members of FYI Resources limited

Report on the Condensed Half-Year Financial Report

Conclusion

We have reviewed the accompanying half-year financial report of FYI Resources Limited (“the company”) which comprises the condensed consolidated statement of financial position as at 31 December 2020, the condensed consolidated statement of comprehensive income, the condensed consolidated statement of changes in equity and the condensed consolidated statement of cash flows for the half-year ended on that date, notes comprising a summary of significant accounting policies and other explanatory information, and the directors’ declaration, for the consolidated entity comprising the company and the entities it controlled at the half-year end or from time to time during the half-year.

Based on our review, which is not an audit, we have not become aware of any matter that makes us believe that the half-year financial report of FYI Resources Limited does not comply with the Corporations Act 2001 including:

• (a) giving a true and fair view of the consolidated entity’s financial position as at 31 December 2020 and of its performance for the half-year ended on that date; and

• (b) complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001 .

Basis for conclusion

We conducted our review in accordance with ASRE 2410 Review of a Financial Report Performed by the Independent Auditor of the Entity . Our responsibilities are further described in the Auditor’s responsibilities for the review of the financial report section of our report. We are independent of the company in accordance with the auditor independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code) that are relevant to our audit of the annual financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.

Responsibility of the directors for the financial report

The directors of the company are responsible for the preparation of the half-year financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the half-year financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error.

Auditor’s responsibility for the review of the financial report

Our responsibility is to express a conclusion on the half-year financial report based on our review. ASRE 2410 requires us to conclude whether we have become aware of any matter that makes us believe that the half-year financial report is not in accordance with the Corporations Act 2001 including giving a true and fair view of the consolidated entity’s financial position as at 31 December 2020 and its performance for the half-year ended on that date, and complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001 .

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Auditor’s responsibility for the review of the financial report

Our responsibility is to express a conclusion on the half-year financial report based on our review. ASRE 2410 requires us to conclude whether we have become aware of any matter that makes us believe that the half-year financial report is not in accordance with the Corporations Act 2001 including giving a true and fair view of the consolidated entity’s financial position as at 31 December 2020 and its performance for the half-year ended on that date, and complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001 .

A review of a half-year financial report consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Australian Auditing Standards and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Independence

In conducting our review, we have complied with the independence requirements of the Corporations Act 2001 .

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HLB Mann Judd Chartered Accountants

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M R Ohm Partner

Perth, Western Australia 12 March 2021

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