by clicking the arrows at the side of the page, or by using the toolbar.
by clicking anywhere on the page.
by dragging the page around when zoomed in.
by clicking anywhere on the page when zoomed in.
web sites or send emails by clicking on hyperlinks.
Email this page to a friend
Search this issue
Index - jump to page or section
Archive - view past issues
Whitehaven Coal Limited : Annual Report 2012
104 NOTES TO THE FINANCIAL STATEMENTS 30 JUNE 2012 7. SIGNIFICANT ITEMS (CONTINUED) 1 During the year, the Company sold a 10% joint venture interest in the Maules Creek Project to J-Power Australia Limited (J-Power), a wholly owned subsidiary of Electric Power Development Co. Ltd., for A$370 million, realising a gain on sale of $116.2 million. The sale takes the Company's interest in the project down to 75%. 2 During the prior year a significant amount of coal was purchased to fulfil legacy contracts which could not be filled from Whitehaven's own production, resulting in a significant loss before tax amounting to $22.3 million. Where contracts could not be filled with either Whitehaven coal or purchased coal financial settlements were undertaken resulting in a loss before tax of $39.8 million. In addition, provision for future losses on sales of coal into legacy contracts of $3.3 million before tax was made. During the year ended 30 June 2012, further coal purchases and contract settlements were required to fulfil legacy contracts, over and above what had been taken up in the prior year provision. These additional purchases and financial settlements resulted in a significant loss before tax of $29.4 million, made up of $7.5m of losses on sales of purchased coal and $21.9m of losses on contract settlements. 3 This expense relates to the issue of executive shares and executive options. The Board committed to issue these shares and options on 19 February 2009. These shares and options were subsequently approved by shareholders at the AGM on 17 November 2009. Accounting standard AASB 2 deems the issue date of these shares and options to be the date shareholder approval was formally received. Accordingly the company is required to account for the issue based on the prevailing share price at the date of the AGM. In addition, as a result of the acquisition of Boardwalk Resources the Company issued shares to key employees of Boardwalk in lieu of proposed long-term incentive arrangements and issued share options to key management persons. 4 During the year the Group undertook due diligence on a number of projects in relation to corporate and asset transactions. The majority of these costs relate to the acquisition of Boardwalk Resources ($7.7m) and the merger with Aston Resources ($31.0m) as well as the acquisition of Coalworks ($2.7m). 5 The consolidated entity received a claim in June 2008 in relation to the performance of its obligations under a coal sales contract. The claim was settled on 1 July 2011 for an amount of US$1,625,000. 6 Following the acquisition of Boardwalk Resources the company was required to undertake a fair value exercise of the assets and liabilities acquired. It was identified that the consideration paid by the Company was greater than the fair value of identifiable net assets acquired. The balance was initially booked as goodwill and subsequently impaired. Goodwill arose predominately from the requirements that consideration be based on the share price of Whitehaven at the date control changed which was significantly higher than at the time of the offer. In addition, accounting standards also require contingent consideration to be recorded at acquisition assuming that such amounts will be paid, adjusted for probability. 7 A receivable arising on a previous sell down of the Narrabri North Project was denominated in US$ and discounted on initial recognition. At the reporting date the receivable had been fully unwound and a net foreign exchange gain realised on receipt of the outstanding amounts in the current year. 8 During the year the federal government implemented the Mineral Resources Rent Tax regime. Under the requirements of AASB 112, the initial recognition of temporary differences between book and tax starting base values is required to be brought to account. In undertaking its starting base valuation the Company has identified temporary differences which result in the recognition of an MRRT deferred tax asset of $145.0m and a corporate tax deferred tax liability of $43.5m. The net amount of $101.5m has been recognised as an income tax benefit in the year ended 30 June 2012.
Annual Report 2011
Annual Report 2013