CONTENTS FINANCIAL STATEMENTS YEAR IN REVIEW DIRECTORS’ REPORT CORPORATE DIRECTORY SHAREHOLDER INFORMATION 8. Investment in joint venture (continued) (b) Borrowings Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortised cost. Any difference between the proceeds (net of transaction costs) and redemption amount is recognised in the profit or loss over the period of the borrowings using the effective interest method. Fees paid on the establishment of the loan facilities are recognised as transaction costs of the loan to the extent that it is probably that some or all of the facility will be drawn down. In this case, the fee is deferred until the draw down occurs. To the extent there is no evidence that it is probably that some or all of the facility will be drawn down, the fee is capitalised as a prepayment for liquidity services and amortised over the period of the facility to which it relates. Carrying amount of borrowings is as follows: Joint venture (100%) 2023 $’000 (Audited) Joint venture (100%) 2022 $’000 (Audited) Non-current liabilities Facility 1 – secured liabilities Northern Australia Infrastructure Facility Principal loan 96,725 – Borrowing costs (3,492) – Amortisation of borrowing costs 117 – 93,350 – Facility 2 – secured liabilities Orion Mineral Royalty Fund Principal loan 132,364 – Borrowing costs (6,874) – Amortisation of borrowing costs 12,747 – Foreign exchange movement (1,769) – 136,468 – 229,818 – Facility 1 - Northern Australia Infrastructure Facility On 4 October 2022, Kimberley Mineral Sands Pty Ltd’s (KMS) wholly owned subsidiary, Thunderbird Operations Pty Ltd (TOPL) entered into a Facility Agreement with the Northern Australia Infrastructure Facility (NAIF) for $160m inclusive of a term loan and cost overrun facility. Loan – The facility comprises of AU$120m debt facility (Facility A) and a A$40m cost overrun facility (Facility B). – Interest charged at a base rate based upon the Commonwealth Government Security cost plus a margin of 3.5% which increases to 8% from year 6 onwards. Interest is payable quarterly in arrears. – Principal repayments are made in line with the repayment schedule commencing 31 December 2027 with the final payment made 31 December 2033. – The facility is secured against TOPL’s assets. As at 30 June 2023, $96.7m was drawn from the facility with $23.3m available under the facility subject to compliance with debt covenants. Total interest paid for the year was $2.3m. 47 Sheffield Resources Limited Annual Report 2023
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