Half Yearly Results and Accounts

Resolute Mining Limited
22 August 2023
 

 
22 August 2023

Appendix 4D

Half Year Report for the six months ended 30 June 2023

 

Reporting Period

The reporting period is for the half year ended 30 June 2023 with the corresponding reporting period being for the six months ended 30 June 2022.

Results for Announcement to the Market

 

30 June 2023

$'000

30 June 2022

$'000

Increase

$'000

 Increase

%

Revenues from ordinary activities

329,499

317,658

11,841

4%

Earnings before interest, tax, depreciation, amortisation and fair value adjustments (EBITDA)

101,378

78,416

22,962

29%

Profit/(loss) after income tax

87,679

(24,146)

111,825

463%

Profit/(loss) from ordinary activities after income tax attributable to members/net profit for the year

73,842

(24,286)

98,128

404%

 

Dividend Information

 

Amount per share

$

Franked amount per share

$

Interim dividend for the half-year ended 30 June 2023

Nil

Nil

 

Net Tangible Assets

 

30 June 2023

$

31 December 2022

$

Net tangible assets per share

0.25

0.22

 

This half year report should be read in conjunction with the most recent annual financial report for the year ended
31 December 2022. All dollar figures are United States dollar ($) currency unless otherwise stated.


Corporate Directory

Directors

Non-Executive Chairman        Martin Botha

Managing Director & CEO      Terence Holohan

Non-Executive Director          Simon Jackson

Non-Executive Director          Mark Potts

Non-Executive Director          Sabina Shugg

Non-Executive Director          Adrian Reynolds

Non-Executive Director          Keith Marshall

Company Secretary

Richard Steenhof

Registered Office

Level 2, Australia Place

15-17 William Street

Perth, Western Australia 6000

 

PO Box 7232 Cloisters Square

Perth, Western Australia 6850

Telephone: + 61 8 9261 6100

Facsimile: + 61 8 9322 7597

Email: contact@rml.com.au

Australian Business Number

ABN 39 097 088 689

Website

Resolute Mining Limited maintains a website where all announcements are available: www.rml.com.au

 

Share Registry

Computershare Investor Services Pty Limited

Level 11, 172 St Georges Terrace

Perth, Western Australia 6000

Home Exchange

Australian Securities Exchange

Level 40, Central Park

152 St Georges Terrace

Perth, Western Australia 6000

 

Quoted on the official lists of the

Australian Securities Exchange (ASX) and London Stock Exchange (LSE)

 

ASX/LSE Ordinary Share Code: "RSG"

Securities on Issue (30/06/2023)

Ordinary Shares               2,129,006,569

Performance Rights         23,795,006

Auditor

Ernst & Young

Ernst & Young Building

11 Mounts Bay Rd

Perth, Western Australia 6000

 

Shareholders wishing to receive copies of Resolute's ASX announcements by e-mail should register their interest by contacting the Company at contact@rml.com.au

 



Directors' Report

Your directors present their half year report on the consolidated entity (referred to hereafter as the "Group" or "Resolute") consisting of Resolute Mining Limited and the entities it controlled at the end of or during the half year ended 30 June 2023 (H1 2023).

Corporate Information

Resolute Mining Limited ("Resolute" or "the Company") is a company limited by shares that is incorporated and domiciled in Australia.

Directors

The names of the Company's directors in office during the entire half year period and until the date of this report are set out below. Directors were in office for this entire period unless otherwise stated.

Martin Botha (Non-Executive Chairman)

Terence Holohan (Managing Director and CEO)

Simon Jackson (Non-Executive Director)

Mark Potts (Non-Executive Director)

Sabina Shugg (Non-Executive Director)

Adrian Reynolds (Non-Executive Director)

Keith Marshall (Non-Executive Director) (appointed 19 June 2023)

Company Secretary

Richard Steenhof

Key Highlights

Key highlights for half year ended 30 June 2023 include:

·    Production (gold poured) for H1 of 176,629 ounces (oz) compared to 170,903oz in H1 2022.

·    All-In Sustaining Cost (AISC) of $1,469/oz for the first half of the year, which is stable compared H1 2022.

·    H1 gold sales of 173,058oz at an average realised gold price of $1,906/oz compared to 173,717oz at an average realised gold price of $1,824/oz in H1 2022.

·    Cash generation of $17.3 million excluding interest payments and working capital movements.H1 capital expenditure of $36.7 million with non-sustaining capital of $18.6 million, sustaining capital expenditure of $15.6 million, and exploration spend of $2.5 million.

·    Net Debt of $17.2 million (down 14% from $19.9 million in Q1-2023), including Cash and Bullion of $85.7 million. Available liquidity (Cash, Bullion and undrawn Revolving Credit Facility (RCF)) of $165.7 million.

Operations Review

In H1 2023, a total of 176,630oz of gold was produced (poured) at an All-In Sustaining Cost (AISC) of $1,469/oz with total gold sales of 173,058oz at an average realised price of $1,906/oz.

During H1 2023, 2.9 million tonnes (Mt) of ore was milled at an average grade of 2.25 grams per tonne (g/t Au) for 178,795oz of gold recovered.



 

Directors' Report

Production and Cost Summary for H1 2023

 

 

Units

Syama sulphide

Syama oxide

Syama Total

Mako

Group
Total

UG Lateral Development

m

 2,191

 -  

 2,191

 -  

 2,191

UG Vertical Development

m

 20

 -  

 20

 -  

 20

Total UG Development

m

 2,211

 -  

 2,211

 -  

 2,211

UG Ore Mined

t

 1,153,689

 -  

 1,153,689

 -  

 1,153,689

UG Grade Mined

g/t

 2.87

 -  

 2.87

 -  

 2.87

OP Operating Waste

BCM

 -  

 3,932,837

 3,932,837

 3,765,640

 7,698,477

OP Ore Mined

BCM

 -  

 470,994

 470,994

 472,184

 943,178

OP Grade Mined

g/t

 -  

 1.69

 1.69

 1.91

 1.80

Total Ore Mined

t

 1,153,689

 972,309

 2,125,998

 1,334,922

 3,460,920

Total Tonnes Processed

t

 1,074,980

 809,849

 1,884,829

 1,047,790

 2,932,619

Grade Processed

g/t

 2.94

 1.55

 2.34

 2.09

 2.25

Recovery

%

 79.2

 82.9

 80.7

 92.0

 84.8

Gold Recovered

oz

 80,505

 33,327

 113,832

 64,963

 178,795

Gold in Circuit Drawdown/(Addition)

oz

 (775)

 (271)

 (1,046)

 (1,120)

 (2,166)

Gold Poured

oz

 79,730

 33,056

 112,786

 63,843

 176,629

Gold Bullion in Metal Account Movement (Increase)/Decrease

oz

 (1,909)

 (986)

 (2,895)

 (677)

 (3,572)

Gold Sold

oz

 77,822

 32,070

 109,892

 63,166

 173,058

Achieved Gold Price

$/oz

 -  

 -  

 -  

 -  

 1,906

Mining

$/oz

 489

 561

 510

 719

 586

Processing

$/oz

 517

 602

 542

 396

 489

Site Administration

$/oz

 155

 297

 197

 119

 169

Site Operating Costs

$/oz

 1,161

 1,460

 1,249

 1,234

 1,244

Royalties

$/oz

 111

 109

 110

 95

 107

By-Product Credits + Corp Admin

$/oz

 (3)

 (3)

 (3)

 -  

 38

Total Cash Operating Costs

$/oz

 1,269

 1,566

 1,356

 1,329

 1,389

Sustaining Capital

$/oz

103

218

137

3

88

Non-cash adjustments

$/oz

9

(17)

1

(24)

(8)

All-In Sustaining Cost (AISC)
AISC is calculated on gold poured

$/oz

1,381

1,767

1,494

1,308

1,469

 



 

Directors' Report

Syama Gold Mine

At the Syama Gold Mine in Mali (Syama), gold production for 6 months to 30 June 2023 was 112,787oz at an AISC of $1,494/oz.

Sulphide Operations

During the six months ending 30 June 2023, gold production from the Syama sulphide circuit was 79,731oz at an AISC of $1,381/oz. Gold production increased by 9% in H1 2023 compared to H1 2022 despite maintenance carried out on the tertiary crusher which has been scheduled for replacement in H2 2023. The improved performance was due to higher grades milled and higher plant throughput achieved prior to the crusher breakdown. Syama sulphide AISC per ounce poured decreased by 2% due to steps being taken to sustainably reduce cost at the operations.      

Oxide Operations

During the first half of 2023, production was 33,056oz at an AISC of $1,767/oz. Ore tonnes continued to be sourced from the Tabakoroni Splay pit and Syama North at Paysans and Folona. Preparatory activities involving stripping and grade control were stepped up during the first half of the year in readiness to mine the A21 pit.

During H1 2023, total tonnes processed from the Syama oxide circuit was 9% higher compared to H1 2022 despite the lower recovery rate on account of the higher organic carbon content in the mill feed during the second quarter of the year - the mining of this ore was immediately curtailed.

Exploration

Total exploration expenditure for the first half of 2023 was $9.0 million (made up of $2.5 million of capital and $6.5 million of exploration expenditure) with the majority of the focus on Syama North.

An updated Mineral Resource estimate for Syama North was announced on 19 January 2023 with an increase to 34 million tonnes at 2.9g/t Au for 3.18 million ounces.

The infill drilling program at Syama North, which commenced in early 2023, has continued throughout the year with the strategy of converting inferred resources to indicated category. This program was completed in late June and after the return of analytical results, the Mineral Resource Estimate will be updated.  Resolute is expected to provide an updated Mineral Resource model for Syama North during Q3 2023 which will further feed and optimise the Syama Phase I Expansion study.

Diamond drilling continues at Syama North with the focus now on expanding the Mineral Resource, given the recent completion of the in-fill drilling for Ore Reserves, as the deposit remains open along strike and down dip. 

Oxide Mineral Resources exploration has been ongoing throughout 2023 in Syama with Reverse Circulation drilling on several newly identified targets.  This program will continue for the remainder of 2023.

Exploration activities continued in Senegal with drilling programs carried out on the Petowal Mining Lease and the Laminia Joint Venture which is located 10km east of Petowal.

In Guinea, surface exploration programs undertaken in the past two years have identified a strong gold anomaly in the western portion of the Niagassola Research Permit which is now named the Mansala prospect. Reverse Circulation (RC) drilling at the Mansala Prospect has intersected encouraging gold mineralisation.  Drilling continues, and a more detailed report will be announced in Q3 2023.

Mako Gold Mine

During H1 2023, production from the Mako Gold Mine was 63,843oz at an AISC of $1,308/oz. During H1 2023, production decreased by 5% due to the planned focus on mining the medium grade sections of the ore body while the scheduled waste stripping continued to expose higher grade ore to be mined later in the year.

 

 

Directors' Report

Financial Overview

Profit and Loss Analysis
($'000s)

H1 2023
Group

H1 2022
Group

Revenue

329,499

317,658

Cost of sales excluding depreciation and amortisation

(182,551)

(193,116)

Royalties and other operating expenses

(29,777)

(30,030)

Administration and other corporate expenses

(9,081)

(7,562)

Share-Based payments expense

(344)

(291)

Exploration and business development expenditure

(6,368)

(8,187)

EBITDA

101,378

78,472

Depreciation and amortisation

(47,459)

(43,566)

Net interest and finance costs

(7,121)

(5,725)

NRV inventory movements and unrealised treasury transactions

37,924

(35,440)

Other

352

3,702

Indirect tax expense

(5,273)

(5,451)

Net profit/ (loss) before tax

79,801

(8,008)

Income tax benefit/ (expense)

7,878

(16,138)

Net income/ (loss) after tax

87,679

(24,146)

Financial Performance

Revenue for H1 2023 was $329.5 million, from gold sales of 173,058oz at an average realised price of $1,906/oz. Earnings before interest, tax, depreciation, and amortisation (EBITDA) was $101.4 million. In H1 2023 the Group reversed historic provisions related to the tax exoneration in Senegal totalling $26.1 million. This resulted in an increase of $16.4 million to EBITDA relating to the reversal of operating costs. Resolute reported a Net Profit After Tax of $87.7 million. Resolute continued to invest in the business in H1 2023 with capital expenditures on development, property, plant and equipment totalling $36.7 million, and exploration and evaluation expenditure of $4.6 million.



 

Directors' Report

Financial Position

As at 30 June 2023, Resolute had cash of $65.8 million and bullion with a market value of $20.0 million. In addition at 30 June 2023 the Company had listed investments with a market value of $8.5 million and Promissory notes and contingent consideration receivable carried at $53.4 million. The Group's net debt inclusive of the syndicated facilities and in-country overdraft facilities was $17.2 million at 30 June 2023. Resolute also held receivables of $17.6 million associated with Malian VAT paid and refundable.

Significant Events After Balance Date

Since the end of the period and to the date of this report, no matter or circumstance has arisen that has significantly affected, or may significantly affect, the operations of the Group, the results of operation or the state of affairs of the consolidated group in subsequent periods.

Auditor's Independence

Refer to page 9 for a copy of the Auditor's Independence Declaration to the Directors of Resolute Mining Limited.

Rounding

Resolute is a company of the kind specified in Australian Securities and Investments Commission Corporations (Rounding in Financial Directors' Reports) Instrument 2016/191. In accordance with that Instrument, amounts in the financial report and the Directors' Report have been rounded to the nearest thousand dollars unless specifically stated to be otherwise.

Signed in accordance with a resolution of the directors.

Terence Holohan

Managing Director & CEO

 

Perth, Western Australia

22 August 2023


AUDITOR'S INDEPENDENCE DECLARATION

 

Declaration available on full report at www.rml.com.au 

 

 




Consolidated Statement of Comprehensive Income


Note

For the half year ended 30 June 2023

$'000

For the half year ended 30 June 2022

$'000

 

 

 

 

Revenue from contracts with customers for gold and silver sales

3

329,499

317,658

Costs of production relating to gold sales

3

(182,551)

(193,116)

Gross profit before depreciation, amortisation and other operating costs

 

146,948

124,542





Depreciation and amortisation relating to gold sales

3

(46,538)

(42,411)

Other operating costs relating to gold sales

3

(29,777)

(30,030)

Gross profit from operations

 

70,633

52,101





Interest income

3

1,411

3,743

Other income/ (expense)

3

(104)

4,549

Exploration and business development expenditure

3

(6,368)

(8,187)

Administration and other corporate expenses

3

(9,081)

(7,562)

Share-based payments expense

3

(344)

(291)

Treasury - realised gains

3

456

51

NRV inventory movements and unrealised treasury transactions

3

37,924

(35,440)

Share of associates' losses

3

-

(898)

Depreciation of non-mine site assets

3

(921)

(1,155)

Finance costs

3

(8,532)

(9,468)

Indirect tax expense

3

(5,273)

(5,451)

Profit/(loss) before tax

 

79,801

(8,008)





Tax benefit/(expense)

3&5

7,878

(16,138)

Profit/(loss) for the period


87,679

(24,146)





Profit/(Loss) attributable to:




Members of the parent


73,842

(24,286)

Non-controlling interest


13,837

140

Profit/(loss) for the period


87,679

(24,146)

 

 

 

 

Consolidated Statement of Comprehensive Income (continued)


Note

For the half year ended 30 June 2023

$'000

For the half year ended 30 June 2022

$'000

Profit/(loss) for the period (brought forward)

 

87,679

(24,146)





Other comprehensive income/(loss)

 



 

 



Items that may be reclassified subsequently to profit or loss

 



 

 



Exchange differences on translation of foreign operations:

 



- Members of the parent

 

(23,623)

(6,363)





Items that may not be reclassified subsequently to profit or loss




 




Exchange differences on translation of foreign operations:




- Non-controlling interest


(1,226)

6,362

- Changes in the fair value/realisation of financial assets at fair value through other comprehensive income, net of tax


-

(1,045)





Other comprehensive loss for the period, net of tax

 

(24,849)

(1,046)





Total comprehensive income/(loss) for the period

 

62,830

(25,192)

 

 



Total comprehensive income/(loss) attributable to:

 



Members of the parent


50,219

(31,694)

Non-controlling interest


12,611

6,502

Total comprehensive income/(loss) for the period


62,830

(25,192)





Profit/(loss) per share for net loss attributable for operations to the ordinary equity holders of the parent:

 



Basic earnings/(loss) per share


4.31 cents

(2.20) cents

Diluted earnings/(loss) per share


4.31 cents

(2.20) cents





Profit/(loss) per share for net loss attributable for continuing operations to the ordinary equity holders of the parent:




Basic earnings/(loss) per share


4.31 cents

(2.20) cents

Diluted earnings/(loss) per share


4.31 cents

(2.20) cents







 

Consolidated Statement of Financial Position


Note

30 June 2023
$'000

31 December 2022
$'000

Current assets




Cash and cash equivalents


65,777

80,873

Other financial assets - restricted cash


1,406

1,406

Receivables

6

4,044

48,793

Inventories

7

157,456

146,430

Prepayments and other assets


13,430

11,141

Asset sale receivable


2,500

-

Total current assets


244,613

288,643

Non current assets




Income tax asset


6,092

10,545

Receivable

6

13,795

-

Inventories

7

51,268

42,434

Promissory note receivable


40,123

40,015

Contingent consideration receivable


13,280

13,636

Exploration and evaluation


3,901

3,211

Mine properties

8

205,103

222,395

Property, plant and equipment


240,308

234,461

Right-of-use assets


11,720

13,453

Total non current assets


585,590

580,150

Total assets


830,203

868,793

Current liabilities




Payables


55,750

63,700

Financial derivative liabilities


1,730

1,546

Interest bearing liabilities

9

105,259

95,634

Provisions

10

50,463

100,377

Current tax liability


 2,028

19,107

Lease liabilities


3,298

3,373

Total current liabilities


218,528

283,737

Non current liabilities




Interest bearing liabilities

9

-

29,482

Provisions

10

65,960

71,544

Lease liabilities


10,988

12,536

Total non current liabilities


76,948

113,562

Total liabilities


295,476

397,299

Net assets


534,727

471,494

 



 

Consolidated Statement of Financial Position (continued)


Note

30 June 2023
$'000

31 December 2022
$'000

Equity attributable to equity holders of the parent


 

 

Contributed equity

11

882,731

882,731

Reserves


(45,176)

(21,956)

Retained earnings/(accumulated losses)


(243,499)

(317,341)

Total equity attributable to equity holders of the parent


594,056

543,434

Non-controlling interest


(59,329)

(71,940)

Total equity

 

534,727

471,494



 

Consolidated Statement of Changes in Equity

 

 

 

 

 

 

 

 

 

Contributed equity

Net unrealised gain/(loss) reserve

Employee equity benefits reserve

Other reserves

Foreign currency translation reserve

Retained earnings/ accumulated losses

Non-controlling interest

Total

At 1 January 2023

882,731

(9,348)

20,447

4,152

(37,207)

(317,341)

(71,940)

471,494


 

 

 

 

 

 

 


Profit for the period

-

-

-

-

-

73,842

13,837

87,679

Other comprehensive (loss)/income, net of tax

-

-

-

-

(23,623)

-

(1,226)

(24,849)

Total comprehensive (loss)/income for the period, net of tax

-

-

-

-

(23,623)

73,842

12,611

62,830


 

 

 

 

 

 

 


Dividend paid

-

-

-

-

-

-

-

-

Share-based payments to employees

-

-

403

-

-

-

-

403

At 30 June 2023

882,731

(9,348)

20,850

4,152

(60,830)

(243,499)

(59,329)

534,727

 

 

 

 

 

 

 

 

 

Contributed equity

Net unrealised gain/(loss) reserve

Employee equity benefits reserve

Other reserves

Foreign currency translation reserve

Retained earnings/ accumulated losses

Non-controlling interest

Total

 

At 1 January 2022

777,021

(8,631)

19,813

4,152

(19,040)

(277,682)

(70,073)

425,560

 


 

 

 

 

 

 

 

 

 

Profit/(loss) for the period

-

-

-

-

-

(24,286)

140

(24,146)

 

Other comprehensive (loss)/income, net of tax

-

(1,045)

-

-

(6,363)

-

6,362

(1,046)

 

Total comprehensive (loss)/income for the period, net of tax

-

(1,045)

-

-

(6,363)

(24,286)

6,502

(25,192)

 


 

 

 

 

 

 

 

 

 

Dividend paid

-

-

-

-

-

-

(4,398)

(4,398)

 

Share-based payments to employees

-

-

(452)

-

-

-

-

(452)

 

At 30 June 2022

777,021

(9,676)

19,361

4,152

(25,403)

(301,968)

(67,969)

395,518

 

 



 

Consolidated Cash Flow Statement


For the half year ended 30 June 2023

$'000

For the half year ended 30 June 2022

$'000

Cash flows from operating activities



Receipts from customers

330,209

317,200

Payments to suppliers, employees, and others

(266,974)

(249,904)

Exploration expenditure

(4,446)

(7,268)

Net interest paid

(5,756)

(7,834)

Indirect tax payment

(4,787)

(4,896)

Income tax payment

(3,261)

(2,549)

Net cash inflows from operating activities

44,985

44,749


 

 

Cash flows used in investing activities

 

 

Payments for property, plant & equipment

(13,526)

(20,866)

Payments for development activities

(22,557)

(14,895)

Payments for evaluation activities

(1,047)

(1,305)

Proceeds from sale of property, plant & equipment

297

18,121




Proceeds from sale of assets

-

(356)

Other investing activities

(382)

-

Proceeds from investment in associate

1,000

30,000

Net cash flows From/(used in) investing activities

(36,215)

10,699




Cash flows from/(used in) financing activities



Repayment of borrowings

(30,000)

(55,000)

fcr



Subsidiary dividend paid to non-controlling interest

-

(3,069)

Dividend paid

(1,430)

-

Repayment of lease liability

(1,988)

(1,960)

Net cash flows used in financing activities

(33,418)

(60,029)




Net decrease in cash and cash equivalents

(24,648)

(4,581)




Cash and cash equivalents at the beginning of the period

35,460

25,237

Exchange rate adjustment

1,967

381

Cash and cash equivalents at the end of the period

12,779

21,038

 



Cash and cash equivalents comprise the following:



Cash at bank and on hand

65,776

65,613

Bank overdraft

(52,997)

(44,575)

Cash and cash equivalents at the end of the period

12,779

21,038

 

Notes to the Financial Statements

Note 1: Corporate Information

The financial report of Resolute Mining Limited and its controlled entities ("Resolute", the "Group" or "consolidated entity") for the half year ended 30 June 2023 was authorised for issue in accordance with a resolution of directors on 22 August 2023.

Resolute Mining Limited (the parent) is a for profit company limited by shares incorporated and domiciled in Australia whose shares are publicly traded on the Australian Securities Exchange and the London Stock Exchange.

The principal activities of entities within the consolidated entity during the half year were:

•    gold mining; and,

•    prospecting and exploration for minerals.

There has been no significant change in the nature of those activities during the half year.

Note 2: Basis of Preparation and Summary of Significant Accounting Practices

a)   Basis of Preparation

This interim financial report for the half year ended 30 June 2023 has been prepared in accordance with AASB 134 Interim Financial Reporting and the Corporations Act 2001.

The half year financial report does not include all notes of the type normally included within the annual financial report and therefore cannot be expected to provide as full an understanding of the financial performance, financial position and financing and investing activities of the Group as the full financial report.

It is recommended that the half year financial report be read in conjunction with the Annual Report for the year ended 31 December 2022 and considered together with any public announcements made by Resolute Mining Limited during the half year ended 30 June 2023 in accordance with the continuous disclosure obligations of the Australian Securities Exchange listing rules and London Stock Exchange rules. The consolidated financial report is presented in United States dollars ("$") rounded to the nearest thousand dollars, unless otherwise stated.

The accounting policies and methods of computation are the same as those adopted in the most recent annual financial report.

 

 


Notes to the Financial Statements

Note 3 (a): Segment revenue and expenses

For the half year ended 30 June 2023

 Mako (Senegal)

$'000

Syama (Mali)

$'000

Corp/Other

$'000

Total

$'000

Amortisation of evaluation, development and rehabilitation costs

(16,998)

(13,479)

-

(30,477)

Depreciation of mine site properties, plant and equipment

(7,273)

(8,788)

-

(16,061)

Segment operating result before treasury, other income/(expenses) and tax

33,182

31,083

(9,425)

54,840

Inventories net realisable value movements and obsolete consumables

928

7,615

-

8,543

Unrealised foreign exchange gain on intercompany balances

-

-

31,571

31,571

NRV inventory movements and unrealised treasury transactions

237

7,615

30,072

37,924

1 - The Group has settled the Mako tax exoneration and fully extended the exoneration period from 5 to 7 years. The prior year recognised provision has been reversed in the current period. For the half year ended 30 June 2023, cost of production and income tax expense has reversed by $16.4 million and $14.5 million, respectively.



 

Notes to the Financial Statements

Note 3 (a): Segment revenue and expenses (continued)

For the half year ended 30 June 2022

 Mako (Senegal)

$'000

Syama (Mali)

$'000

Corp/Other

$'000

Total

$'000

Amortisation of evaluation, development and rehabilitation costs

(15,228)

(12,459)

-

(27,687)

Depreciation of mine site properties, plant and equipment

(6,017)

(8,707)

-

(14,724)

Segment operating result before treasury, other income/(expenses) and tax

22,273

18,534

(4,746)

36,061

Inventories net realisable value movements and obsolete consumables

(1,638)

(155)

-

(1,793)

Unrealised foreign exchange loss on intercompany balances

-

-

(23,261)

(23,261)

NRV inventory movements and unrealised treasury transactions

(3,890)

(155)

(31,395)

(35,440)

Notes to the Financial Statements

Note 3 (a): Segment revenue and expenses (continued)

(a)        Revenue from external sales for each reportable segment is derived from several customers.

(b)        This information does not represent an operating segment as defined by AASB 8 'Operating Segments' and forms part of the reconciliation of the results and positions of the operating segments to the financial statements.

Note 3 (b): Segment assets and liabilities

For the half year ended 30 June 2023

 Mako (Senegal)

$'000

Syama (Mali)

$'000

Corp/Other

$'000

Total

$'000

 

(a)        This information does not represent an operating segment as defined by AASB 8 'Operating Segments' and forms part of the reconciliation of the results and positions of the operating segments to the financial statements.

Note 4: Dividend

There were no interim dividends paid or provided for Resolute Mining Limited during the half year end up to the date of this report (half year ended 30 June 2022: $nil).

Note 5: Taxes

At 30 June 2023, the Group recognised an income tax benefit of $7.9 million (30 June 2022: tax expense of $16.1 million). A $14.5 million reduction in the income tax expense in Senegal relating to the finalisation of the tax exoneration extension was offset by a $4.6 million income tax expense for local statutory purposes.

Note 6: Receivables

Receivables of $17.8 million at 30 June 2023 (31 December 2022: $48.8 million) primarily relate to indirect taxes owing to the Group by the Republic of Mali and Senegal. Significant movement for the year relates to the reversal of $34.9 million of VAT provision raised in relation with the Senegalese tax authority as the exoneration was settled.

 

 

 

 

 

 

 

Notes to the Financial Statements

Note 7: Inventories


 

30 June 2023

 

31 December 2022


$'000

$'000

Current



Ore stockpiles - at cost

30,041

27,223

Ore stockpiles - at net realisable value

31,767

28,286

Gold in circuit - at cost

5,739

4,186

Gold in circuit - at net realisable value

1,687

373

Gold bullion on hand - at cost

15,308

10,276

Consumables at net realisable value

72,914

76,086

Total Inventory (current)

157,456

146,430

Non current

 

 

Ore stockpiles - at cost

3,142

1,959

Ore stockpiles - at net realisable value

4,189

3,279

Gold in circuit - at net realisable value

43,937

37,196

Total Inventory (non current)

51,268

42,434

Note 8: Mine properties

At 30 June 2023, the Group's mine properties amount to $205.1 million (31 December 2022: $222.4 million). During the six-month period to 30 June 2023, further additions for development activities were made of $22.6 million, fully offset by amortisation recognition on production assets.

Note 9: Interest bearing liabilities

 

 

30 June 2023

 

31 December 2022

$'000

$'000

Interest bearing liabilities (current)



Bank overdraft

52,996

45,414

Insurance premium funding

2,395

-

Borrowings

49,868

50,220

Total Interest bearing liabilities (current)

105,259

95,634

Interest bearing liabilities (non current)



Borrowings

-

29,482

Total Interest bearing liabilities (non current)

-

29,482




Total

105,259

125,116

 

 

 

 

 

Notes to the Financial Statements

Note 10: Provisions


 

30 June 2023

 

31 December 2022


$'000

$'000

Current



Site restoration

3,139

1,220

Employee entitlements

3,373

4,336

Provision for direct and indirect taxes1

42,011

92,936

Other provision

1,940

1,885

Total provisions (current)

50,463

100,377


 

 

Non Current

 

 

Site restoration

65,028

70,874

Employee entitlements

932

670

Total provisions (non current)

65,960

71,544

1.  Based on the facts and circumstances at 30 June 2023 and in line with requirements of the accounting standards, the Group has reversed $66.7 million (comprised of $34.9 million VAT, $17.3 million indirect taxes, and $14.5 million income tax) of the tax claim by the Senegalese tax authority as the exoneration dispute was settled for an amount of $5 million. The factual basis and validity of the remaining demands (primarily in Mali) are being strongly disputed by Resolute due to fundamental misinterpretations of the application of certain tax law. Resolute continues to work with its legal and tax advisors to contest the demand and will resist any efforts to enforce payment. The demand for Income Tax has been disclosed as a contingent liability.



 

Notes to the Financial Statements

Note 11: Contributed Equity

 


Total Number

Number Quoted

$'000

At 1 January 2023

2,129,006,569

2,129,006,569

882,731

Changes during current period, net of issue costs:

-

-

-

At 30 June 2023

2,129,006,569

2,129,006,569

882,731

 


Issue Date

Total Number

Fair Value per Right at Grant Date (A$)

Vesting Date

Performance rights on issue





Band A1 and A2

26/10/2018

13,550

$0.92

30/06/2021

Band A1 and A2

21/05/2019

73,377

$0.93

31/12/2021

Band A1 and A2

22/05/2020

121,130

$0.85

31/12/2022

Band A0

14/07/2021

443,716

$0.43

31/12/2023

Band A1, A2 and B1

14/07/2021

1,398,849

$0.57

31/12/2023

Band A1 and A2

06/12/2021

211,276

$0.37

31/12/2023

Band B1

06/12/2021

219,942

$0.31

31/12/2023

Band A1 and A2

06/12/2021

264,171

$0.32

31/12/2023

Band A0

22/06/2022

1,958,147

$0.19

31/12/2024

Band A1, A2 and B1

22/06/2022

5,275,334

$0.19

31/12/2024

Band A0

30/06/2023

1,000,000

                $0.23

30/06/2025

Band A0

30/06/2023

3,548,554

$0.34

31/12/2025

Band A1, A2 and B1

30/06/2023

9,266,960

$0.35

31/12/2025

As at 30 June 2023

 

23,795,006

 

 


Date of Change

Total Number

Fair Value per Right at Grant Date (A$)

Vesting Date

 

Opening number of performance rights


10,916,506



 

Decrease through lapsing of performance rights (Band A0)

30/06/2023

(194,352)

$0.56

31/12/2022

 

Decrease through lapsing of performance rights (Band A1 to A2)

30/06/2023

(742,662)

$0.85

31/12/2022

 

Increase through issue of performance rights to eligible employees (Band A0)

30/06/2023

1,000,000

$0.23

30/06/2025

 

Increase through issue of performance rights to eligible employees (Band A0)

30/06/2023

3,548,554

$0.34

31/12/2025

 

Increase through issue of performance rights to eligible employees (Band A1, A2 and B1)

30/06/2023

9,266,960

$0.35

31/12/2025

 

Closing number of performance rights


23,795,006



 

*The terms and conditions of the Remuneration Framework are consistent with those disclosed in the Annual Report for the year ended 31 December 2022 and the Notice of Annual General Meeting sent to shareholders on 18 April 2023.

 

 

 

Notes to the Financial Statements

Note 12: Gold forward contracts

As part of its risk management policy, the Group enters into gold forward contracts to manage the gold price of a proportion of anticipated sales of gold.

Gold forward contracts commitment at 30 June 2023 (not recorded as derivatives):


Average Contracted Gold Sale Price per oz ($)

Gold for Physical Delivery oz

Value of Committed sales

$'000

30 June 2023




Within one year

1,929

162,500

313,462

Total

 

162,500

313,462

Note 13: Events Occurring after Balance Date

Since the end of the period and to the date of this report, no matter or circumstance has arisen that has significantly affected, or may significantly affect, the operations of the Group, the results of operation or the state of affairs of the consolidated group in subsequent periods.



 

Directors' Declaration

In the opinion of the directors:

a)   the financial statements and notes are in accordance with the Corporations Act 2001, including:

 

(i)    complying with Accounting Standard AASB 134 Interim Financial Reporting, the Corporations Regulations 2001; and

(ii)   giving a true and fair view of the Group's financial position as at 30 June 2023 and of its performance, as required by Accounting Standards, for the half year ended on that date.

 

b)   there are reasonable grounds to believe that the Group will be able to pay its debts as and when they become due and payable.

 

This declaration has been made in accordance with a resolution of the directors.

A signature on a white background Description automatically generated

Terence Holohan

Managing Director & CEO

 

Perth, Western Australia

22 August 2023

 

 

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