The two remaining directors of a mining company that racked up losses of $26.4m last financial year have called in voluntary administrators.
The two remaining directors of a mining company that racked up losses of $26.4m last financial year have called in voluntary administrators.

Miner enters administration after $26.4m loss

A BRISBANE-based miner with a long and troubled history has hit the wall.

The two remaining directors of Moreton Resources, Brett Garland and John Haley, tipped the company into administration this week.

One of the administrators, Deloitte operative David Orr, told City Beat on Thursday that the company had simply run out of cash.

That's not terribly surprising. Moreton suffered a staggering $26.4 million net loss in the last financial year as auditors warned of a "material uncertainty'' about its ability to survive.

Orr now expects to put Moreton's remaining assets, including a mothballed silver mine in Texas (Queensland), on the market shortly. Creditors will hold their first meeting June 22.

There were plenty of signs recently that the company was fast unravelling, including an astonishing churn of directors through the revolving door over the past year or so.

Just last month, Jason Elks, a former chairman and managing director of Moreton, lodged an application to wind up the company in Brisbane Supreme Court. No defence was lodged before administrators took control.

John Dalton at Kingaroy.
John Dalton at Kingaroy.

Earlier this year, the firm withdrew a widely-panned lease application for an open cut thermal coal mine on prime farming land just outside Kingaroy.

Moreton had first flagged plans for the ill-fated $200 million project back in 2015, sparking outrage from plenty of the locals.

One of the critics, John Dalton, called on the State Government to snuff out the potential for another licensee to step in and to toughen planning laws aimed at preventing mining on top-grade agricultural properties.

"Something needs to be done to prevent other companies doing to us what Moreton has done,'' he said.

Moreton, which previously traded under the name of Cougar Energy, also came to grief in Kingaroy in 2011 when it was ordered to shut down its trial $550 million underground coal gasification project over environmental concerns.

Cougar sued the State Government for $34 million over the closure but eventually dropped the case. It was later fined $75,000 for releasing cancer-causing benzene into groundwater.

 

CAP IN HAND

Batteries will power our cars, homes and industries in the future but getting there won't be cheap or easy.

A perfect illustration of this can be found in Redflow, the loss-making Brisbane battery maker which has gone back to the market with cap in hand.

Redflow announced another in a long series of capital raisings on Thursday, seeking an immediate $6.25 million but aiming for up to $22.9 million to bankroll its global activities through June next year.

The company, headed by boss Tim Harris, specialises in what's known as zinc-bromine batteries, as distinct from the lithium-ion variety which powers cars, garden tools and the like.

With a manufacturing plant in Thailand, Redflow has chalked up some wins in the past few years targeting telcos, remote areas and industrial facilities. They've got a toehold in South Africa, New Zealand and China.

 

 

But it's been a tough slog for Redflow, which joined the ASX 10 years ago after raising $17.5 million and has yet to turn a profit.

Indeed, it's been nothing but red ink so far, with a $3.7 million net loss in the December half and an $11.6 million net loss in the last financial year.

 

A large scale battery designed by Red Flow. Picture: Claudia Baxter
A large scale battery designed by Red Flow. Picture: Claudia Baxter

 

The firm, which most recently raised $8.4 million in May last year, still has about $5 million cash in the bank and no debt. A $2 million tax rebate for R&D and cost cutting efforts, including a salary trim for senior executives, have also helped.

Ultimately, Redflow is counting on the accuracy of forecasters, who have predicted the world's market for so-called "redox flow'' batteries will be worth $US4.5 billion by 2028.

The wider global energy storage sector is tipped to hit a whopping $620 billion by 2040.

Even so, investors appeared underwhelmed with Redflow's latest fundraising campaign, sending its shares down slightly to close at a mere 2.5 cents. They originally floated at $1.

 

Originally published as Brisbane miner in administration after $26.4m loss


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