REG - Resolute Mining Ltd - Half Yearly Results and Accounts
22/08/2023 08:00
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RNS Number : 0566K 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 30 June 2022 Increase Increase
$'000 $'000 $'000 %
Revenues from ordinary activities 329,499 317,658 11,841 4%
Earnings before interest, tax, depreciation, amortisation and fair value 101,378 78,416 22,962 29%
adjustments (EBITDA)
Profit/(loss) after income tax 87,679 (24,146) 111,825 463%
Profit/(loss) from ordinary activities after income tax attributable to 73,842 (24,286) 98,128 404%
members/net profit for the year
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 Share Registry
Non-Executive Chairman Martin Botha
Computershare Investor Services Pty Limited
Managing Director & CEO Terence Holohan Level 11, 172 St Georges Terrace
Non-Executive Director Simon Jackson Perth, Western Australia 6000
Home Exchange
Non-Executive Director Mark Potts
Australian Securities Exchange
Non-Executive Director Sabina Shugg Level 40, Central Park
Non-Executive Director Adrian Reynolds 152 St Georges Terrace
Non-Executive Director Keith Marshall Perth, Western Australia 6000
Company Secretary
Richard Steenhof
Registered Office
Level 2, Australia Place Quoted on the official lists of the
15-17 William Street Australian Securities Exchange (ASX) and London Stock Exchange (LSE)
Perth, Western Australia 6000
ASX/LSE Ordinary Share Code: "RSG"
Securities on Issue (30/06/2023)
PO Box 7232 Cloisters Square
Ordinary Shares 2,129,006,569
Perth, Western Australia 6850 Performance Rights 23,795,006
Auditor
Telephone: + 61 8 9261 6100
Ernst & Young
Facsimile: + 61 8 9322 7597 Ernst & Young Building
Email: contact@rml.com.au (mailto:contact@rml.com.au) 11 Mounts Bay Rd
Australian Business Number
ABN 39 097 088 689 Perth, Western Australia 6000
Website
Resolute Mining Limited maintains a website where all announcements are
available: www.rml.com.au (http://www.rml.com.au)
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 (mailto:contact@rml.com.au)
Table of Contents
Directors' Report (#_Toc444002386)
Auditor's Independence Declaration (#_Toc444002403) 9
Consolidated Statement of Comprehensive Income (#_Toc444002404) 10
Consolidated Statement of Financial Position (#_Toc444002407)
Consolidated Statement of Changes in Equity
Consolidated Cash Flow Statement
Notes to the Financial Statements (#_Toc444002412)
Directors' Declaration (#_Toc444002444) 23
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) $/oz 1,381 1,767 1,494 1,308 1,469
AISC is calculated on gold poured
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
$1,308/oz. During H1 2023, production decreased by 5% due to the planned focus
on mining the medium grade sections of the ore body while the scheduled waste
stripping continued to expose higher grade ore to be mined later in the year.
Directors' Report
Financial Overview
Profit and Loss Analysis H1 2023 H1 2022
($'000s)
Group
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 For the half year ended 30 June 2022
$'000 $'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 For the half year ended 30 June 2022
$'000 $'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 - (1,045)
through other comprehensive income, net of tax
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 31 December 2022
$'000
$'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 31 December 2022
$'000
$'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 For the half year ended 30 June 2022
$'000 $'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) Syama (Mali) Corp/Other Total
$'000 $'000 $'000 $'000
Revenue
Gold and silver sales at spot to external customers (a) 121,910 207,589 - 329,499
Total segment gold and silver sales revenue 121,910 207,589 - 329,499
Costs of production (48,989)(1) (139,937) - (188,926)
Gold in circuit inventories movement 1,162 5,213 - 6,375
Costs of production relating to gold sales (47,827) (134,724) - (182,551)
Royalty expense (6,096) (14,164) - (20,260)
Operational support costs (8,518) (999) - (9,517)
Other operating costs relating to gold sales (14,614) (15,163) - (29,777)
Administration and other corporate expenses - - (9,081) (9,081)
Share-based payments expense - - (344) (344)
Exploration and business development expenditure (2,016) (4,352) - (6,368)
Earnings/(loss) before interest, tax, depreciation and amortisation 57,453 53,350 (9,425) 101,378
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)
Depreciation and amortisation relating to gold sales (24,271) (22,267) - (46,538)
Segment operating result before treasury, other income/(expenses) and tax 33,182 31,083 (9,425) 54,840
Interest income 4 - 1,407 1,411
Other income/ (expense) - (135) 31 (104)
Interest and fees (370) (2,719) (3,981) (7,070)
Rehabilitation and restoration provision accretion (526) (936) - (1,462)
Finance costs (896) (3,655) (3,981) (8,532)
Realised foreign exchange gain/(loss) (846) 379 923 456
Treasury - realised gains/(loss) (846) 379 923 456
Inventories net realisable value movements and obsolete consumables 928 7,615 - 8,543
Unrealised foreign exchange (loss) (691) - (1,499) (2,190)
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
Depreciation of non-mine site assets (69) - (852) (921)
Indirect tax (expense)/benefit (5,000) (1) (273) - (5,273)
Income tax (expense)/benefit 14,463 (1) (4,608) (1,977) 7,878
(Loss)/profit for the period 41,075 30,406 16,198 87,679
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) Syama (Mali) Corp/Other Total
$'000 $'000 $'000 $'000
Revenue
Gold and silver sales at spot to external customers (a) 122,746 194,912 - 317,658
Total segment gold and silver sales revenue 122,746 194,912 - 317,658
Costs of production (58,976) (124,190) - (183,166)
Gold in circuit inventories movement 342 (10,292) - (9,950)
Costs of production relating to gold sales (58,634) (134,482) - (193,116)
Royalty expense (6,137) (12,865) - (19,002)
Operational support costs (8,986) (2,042) - (11,028)
Other operating costs relating to gold sales (15,123) (14,907) - (30,030)
Administration and other corporate expenses (2,543) (748) (4,271) (7,562)
Share-based payments expense - - (291) (291)
Exploration and business development expenditure (2,928) (5,075) (184) (8,187)
Earnings/(loss) before interest, tax, depreciation and amortisation 43,518 39,700 (4,746) 78,472
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)
Depreciation and amortisation relating to gold sales (21,245) (21,166) - (42,411)
Segment operating result before treasury, other income/(expenses) and tax 22,273 18,534 (4,746) 36,061
Interest income - - 3,743 3,743
Other Income - 15 4,534 4,549
Interest and fees (47) (1,619) (7,170) (8,836)
Rehabilitation and restoration provision accretion (199) (433) - (632)
Finance costs (246) (2,052) (7,170) (9,468)
Realised foreign exchange gain (loss) 660 1,393 (2,002) 51
Treasury - realised gains (loss) 660 1,393 (2,002) 51
Inventories net realisable value movements and obsolete consumables (1,638) (155) - (1,793)
Unrealised foreign exchange gain/(loss) (2,252) - (8,134) (10,386)
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)
Share of associates' losses - - (898) (898)
Depreciation of non-mine site assets (78) - (1,077) (1,155)
Indirect tax expense - (5,389) (62) (5,451)
Income tax (expense)/benefit (11,388) (2,057) (2,693) (16,138)
(Loss)/profit for the period 7,331 10,289 (41,766) (24,146)
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) Syama (Mali) Corp/Other Total
$'000 $'000 $'000 $'000
Segment balance sheet items
Segment assets 220,904 512,185 97,114 830,203
Segment liabilities 65,088 166,003 64,385 295,476
(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 taxes(1) 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, 30/06/2023 9,266,960 $0.35 31/12/2025
A2 and B1)
Closing number of performance rights 23,795,006
*The terms and conditions of the Remuneration Framework are consistent with
those disclosed in the Annual Report for the year ended 31 December 2022 and
the Notice of Annual General Meeting sent to shareholders on 18 April 2023.
Notes to the Financial Statements
Note 12: Gold forward contracts
As part of its risk management policy, the Group enters into gold forward
contracts to manage the gold price of a proportion of anticipated sales of
gold.
Gold forward contracts commitment at 30 June 2023 (not recorded as
derivatives):
Average Contracted Gold Sale Price per oz ($) 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.
Terence Holohan
Managing Director & CEO
Perth, Western Australia
22 August 2023
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