MEDIA RELEASE
Austral Gold Limited
17 March 2021
Austral Gold Files 2020 Annual Report
Austral Gold Limited (the “Company” or “Austral”) (ASX: AGD; TSX-V: AGLD) is pleased to
announce that it has filed its Annual Report for the Financial Year Ended 31 December 2020.
The Annual Report is available under the Company’s profile at www.asx.com.au and
www.sedar.com and on the Company’s website at www.australgold.com
About Austral Gold
Austral Gold Limited is a growing gold and silver mining, development and exploration company
building a portfolio of quality assets in Chile, the USA and Argentina. Austral owns 100%
interest in the Guanaco/Amancaya mine in Chile and the Casposo Mine (care and maintenance)
in Argentina, and a 26.46% interest in the Rawhide Mine in Nevada. In addition, Austral owns
an attractive portfolio of exploration projects in the Paleocene Belt in Chile (including those
acquired in the recent acquisition of Revelo Resources Corp) and a 100% interest in the
Pingüino project in Santa Cruz, Argentina. Austral Gold Limited is listed on the TSX Venture
Exchange (TSX-V: AGLD), and the Australian Securities Exchange. (ASX: AGD). For more
information, please consult Austral's website at (www.australgold.com).
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in
the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy
of this release.
Release approved by the Chief Executive Officer of Austral Gold, Stabro Kasaneva.
For additional information please contact:
Jose Bordogna
Chief Financial Officer
Austral Gold Limited
jose.bordogna@australgold.com
+54 (11) 4323 7558
David Hwang
Company Secretary
Austral Gold Limited
info@australgold.com
+61 (2) 9698 5414448
Austral Gold Limited ABN 30 075 860 472 ASX: AGD TSXV: AGLD
Level 5 126 Phillip St, Sydney NSW 2000 | T +61 2 9380 7233 | F +61 2 9251 7455 | info@australgold.com | www.australgold.com
ANNUAL
REPORT
FOR THE YEAR ENDED 31 DECEMBER 2020
www.australgold.com
TABLE OF
CONTENTS
CORPORATE DIRECTORY
CHAIRMAN’S LETTER
KEY PRINCIPLES
REVIEW OF ACTIVITIES
DIRECTORS’ REPORT
FINANCIAL STATEMENTS
DIRECTORS’ DECLARATION
INDEPENDENT AUDITOR’S REPORT
ADDITIONAL INFORMATION
4
6
8
10
34
54
88
90
98
Austral Gold Limited
3
Annual Report 2020
CORPORATE
DIRECTORY
KEY MANAGEMENT
Stabro Kasaneva
Chief Executive Officer and Executive Director
Rodrigo Ramirez
Vice President of Operations
Raul Guerra
Vice-President of Exploration
Jose Bordogna
Chief Financial Officer
DIRECTORS
Wayne Hubert
Chairman & Executive Director
Eduardo Elsztain
Vice Chairman & Non-Executive Director
Saul Zang
Non-Executive Director
Pablo Vergara del Carril
Non-Executive Director
Stabro Kasaneva
Chief Executive Officer and Executive Director
Robert Trzebski
Independent Non-Executive Director
Ben Jarvis
Independent Non-Executive Director
COMPANY SECRETARY
David Hwang
Automic Group
REGISTERED OFFICE
Level 5 126 Phillip Street
Sydney NSW 2000
Tel: +61 2 9380 7233
Email: info@australgold.com
Web: www.australgold.com
OTHER OFFICES
Santiago, Chile
Lo Fontecilla 201 of. 334
Santiago, Chile
Tel: +56 (2) 2374 8560
Buenos Aires, Argentina
Bolivar 108
Buenos Aires (1066) Argentina
Tel: +54 (11) 4323 7500
Fax: +54 (11) 4323 7591
Vancouver, Canada
170-422 Richards Street
Vancouver, BC V6B 2Z4
Tel: +1 604 868 9639
Austral Gold Limited
4
Annual Report 2020
LISTED
Australian Securities Exchange
ASX: AGD
TSX Venture Exchange
TSXV: AGLD
PLACE OF INCORPORATION:
Western Australia
SHARE REGISTRIES
Computershare Investor Services Australia
GPO Box 2975
Melbourne VIC 3001
Tel: 1300 850 505 (within Australia)
Tel: +61 3 9415 5000 (outside Australia)
Computershare Investor Services Canada
510 Burrard Street, 2nd Floor
Vancouver, BC V6C 3B9
Tel: +1 604 661 9400
Fax: +1 604 661 9549
AUDITORS
KPMG
www.kpmg.com.au
Austral Gold Limited
5
Annual Report 2020
DEAR
SHAREHOLDERS
Austral Gold Limited
6
Annual Report 2020
state of Utah with the goal of consolidating the Mercur camp for
the first time. The investment was completed in early 2021.
In 2021 we plan to build upon the accomplishments made this
year. We forecast production to be at 50,000-55,000 gold equiva-
lent ounces and expect to continue to deliver solid margins and
strong cash flows from operations. Our strategic acquisitions and
organic growth opportunities, backed by an experienced manage-
ment team with a proven operational and exploration track record,
an exceptional understanding of the Chilean and Argentinean
resources sector and the strategic equity investments in North
America provide us with the foundation for continued growth.
This has been a very good year for our shareholders. The market
finally started to recognise the value we created as indicated by
the 200% increase in our share price in 2020. In addition, we paid
our shareholders a dividend of A$0.009 per share and in early 2021
declared another dividend of A$0.008 per share.
Our Board is proud of key milestones that Austral Gold achieved
this year, including:
• Solid production at Guanaco/Amancaya
• Record adjusted EBITDA with solid C1 and AISC metrics at our
mining operations in Chile
• Exploration success that included significant drilling results at
Amancaya, Guanaco and Casposo
• A stronger balance sheet with an increase in our current ratio
to 1.33 (2019:1.14) and a reduction of our combined net debt
by US$10.3m (net of cash and cash equivalents) to negative
US$4.0m (2019: positive US$6.3m). The amount is net of
approximately 6,200 refined gold ounces in inventory with a
fair value of US$11.7 million at year-end.
• Increase in our share price by 200%
• Payment of a dividend of US$3.5 million in 2020 and declaration
of a dividend of approximately US$3.8 million in 2021
Safety is also a significant priority for Austral Gold. We are commit-
ted to the well-being of our employees and the communities in
which we operate, and continue to promote the highest health,
safety and environmental standards. We are very supportive of
the local communities in which we operate through local hiring of
personnel and community and education initiatives.
During 2019 and 2020, we saw a positive trend for gold and silver
prices and we expect the price of precious metals to remain
strong in 2021 and increase over the long term. Although we have
improved our financial results in 2020, we continually strive to
improve profit margins, while increasing the life and value of our
mineral resources to ultimately increase shareholder value.
I would like to thank our shareholders for their continued support,
all of our employees and contractors, and our Board members for
their hard work and dedication during this year.
WAYNE HUBERT
Chairman
I AM PLEASED TO REPORT THAT 2020 WAS A
VERY GOOD YEAR FOR AUSTRAL GOLD LIMITED
AND I AM HONORED TO BE NAMED EXECUTIVE
CHAIRMAN IN AUGUST 2020.
Our operations generated both record cash flows and gross
margins through the realisation of higher gold and silver prices
despite COVID-19, lower sales revenue, an interruption to opera-
tions due to our miners’ strike and the strategic decision to
outsource operations.
The key to any business is its people and having strong leader-
ship. In order to complement the executive team, we were fortu-
nate to add Raul Guerra as Corporate VP of Exploration. Raul
brings strong leadership to the Group, with more than 30 years
of precious metal exploration experience and has been involved
in the discovery of more than 50 million ounces of gold including
two large greenfield discoveries at Barrick. We are excited by his
contributions to date which included leading a strategic review of
exploration activities and setting priorities including major goals
for the Group including the discovery of new Tier I or II deposit(s)
through exploration and new business.
Another key factor in running a successful business is having suffi-
cient cash to execute its business plan. The Guanaco/Amancaya
mine complex has been our primary cash generating asset and
we expect this to continue.
The Board is very proud of the financial performance at the
Guanaco/Amancaya mine complex in 2020 as it was the main
contributor to the Group’s adjusted EBITDA of US$46.0 million
(2019: US$37.6 million), a profit after income tax of US$7.667
million (2019: US$1.639 million) and the generation of net cash
flows from operating activities of US$30.482 million (2019:
US$29.635 million).
With our objective to extend the mine life at Guanaco/Amancaya
mine in Chile, not only did we obtain many positive drill results at
Amancaya, we also took great strides to increase our footprint
in the Paleocene-Eocene Belt in Chile. This was accomplished
through the acquisition of Revelo Resources (closed in February
2021) and other surrounding mining properties to our flagship
mine complex.
Regarding Casposo, although we have a clear objective to recom-
mence mining operations, our efforts in 2020 were affected by
COVID-19. Notwithstanding, we completed phase 1 of the new
drilling campaign while continuing the design of the next phase
and have budgeted for a significant increase in exploration which
also includes activities in the new area of Manantiales. In addi-
tion, we continually assess opportunities to consolidate projects
that surround Casposo and to source ore from third parties in the
region. This is a work in progress and several compelling oppor-
tunities are being pursued by us.
Further, with the agreement that provides us with the option to
acquire all or part of the Sierra Blanca gold-silver project in Santa
Cruz, near the Group’s Pingüino project, we expanded the area
of our Pingüino project by securing an additional 7,000 hectares,
resulting in a new exploration cluster in the Province of Santa Cruz.
In the US, during 2020, we increased our investment in the
Rawhide mine in Nevada, USA to 26.46% from 22.48% and also
entered into an agreement to acquire a 19.9% equity position in
Ensign Gold which is currently assembling a 5,000-hectare land
package on favourable Carlin-type gold deposit geology in the
Austral Gold Limited
7
Annual Report 2020
I
S
E
L
P
C
N
R
P
I
Y
E
K
Austral Gold Limited
8
Annual Report 2020
Be socially and environmentally responsible and
strive to reduce safety risks and operating costs
Be the preferred partner for companies,
communities and governments to operate precious
metal projects in the Americas: currently focused on Chile,
Argentina and the USA
MAXIMIZE VALUE CREATION
FOR STAKEHOLDERS
Austral Gold Limited
9
Annual Report 2020
REVIEW OF
ACTIVITIES
Austral Gold Limited
10
Annual Report 2020
Rawhide Mine
Fallon Nevada,
USA
PROPERTIES
Operations
Exploration projects
100%
Interest
100%
Interest
GUANACO/AMANCAYA
CASPOSO
100%
Interest
26.46%
Interest
PINGÜINO
RAWHIDE MINE
Guanaco/Amancaya
Antofagasta,
Chile
Casposo
San Juan Province,
Argentina
Pingüino
Santa Cruz Province,
Argentina
Austral Gold Limited is a growing gold and silver mining, development and exploration company building a portfolio of quality
assets in Chile, the USA and Argentina. Austral owns 100% interest in the Guanaco/Amancaya mine in Chile. Casposo Mine (care
and maintenance) in Argentina, and a 26.46% interest in the Rawhide Mine in Nevada and a 19.96% on the Mercur Project in Utah
(Ensign Gold). In addition, Austral owns an attractive portfolio of exploration projects in the Paleocene Belt in Chile (including
the recent investments in Revelo Resources Corp and other surrounding mining concessions near Guanaco/Amancaya) and a
100% interest in the Pingüino project in Santa Cruz, Argentina.
Austral Gold Limited
11
Annual Report 2020
AUSTRAL GOLD HAS PRODUCED OVER 500,000 GOLD
EQUIVALENT OUNCES OVER THE LAST TEN YEARS.
SOUND CASH FLOWS HAVE FUNDED AUSTRAL’S
GROWTH INITIATIVES
5
6
3
,
1
5
8
8
0
,
1
5
8
8
8
,
6
4
Acquired
Amancaya
Project
Acquired
51% of U/G
mining
contractor
Kinross
royalty
agreement
exited
2014
Purchased
15% stake in
Goldrock
Mines
Purchased
20% stake
in Argentex
Mining
2013
Achieved low cash
costs of US$548/
AuEq oz
2015
8
5
0
,
0
0 3
5
9
,
2
1
First gold
doré bar
poured at
Guanaco
2011
Guanaco cash
flow positive
Guanaco
mineral
resources
increased
by 10%
2012
*
Includes production from Casposo (51%)
** Includes production from Casposo (70%)
Austral Gold Limited
12
Annual Report 2020
*
*
6
5
0
,
0
8
6
3
1
,
0
7
*
*
8
8
4
,
4
6
*
4
1
0
,
5
5
Acquired San
Guillermo &
Reprado Projects
Acquired additional
19% of Casposo
Mine
Updated FS for
mining projects
Finalized
construction of
new agitation
leaching plant
in Chile
First full year
operating the
new agitation
leaching in plant
Record combined
production
surpassing
80K Geo
Starts UG opera-
tions at Amancaya
Record individual
production at
Guanaco/
Amancaya
Placed Casposo
on Care &
Maintenance
Effectively
acquired
remaining 30% of
Casposo mine
Entered into North
America through
investment in the
Rawhide mine
2017
2018
2019
Acquired 51%
of Casposo
Mine
Acquired
Argentex
Mining
Dual listed
on TSX-V
2016
0
9
1
,
5
5
Record Adjusted
EBITDA of
US$46 million
Agreement to
acquire 100% of
Revelo Resources
(closed in 2021)
Agreements
to acquire
additional mining
concessions
near Guanaco/
Amancaya
Agreement to
acquire up
to 100% of
Sierra Blanca
in Argentina
2020
Austral Gold Limited
13
Annual Report 2020
REVIEW OF RESULTS OF OPERATIONS
Key
Operating
Results
Fiscal Year ended 31 December
2020
2019
Guanaco/
Amancaya
Mines
Rawhide
Mine (100%
basis)1
Casposo
Mine
(100% basis)2
Net to
Austral
Gold*2,3
Guanaco/
Amancaya
Mines
Casposo
Mine (100%
basis)2
Net to
Austral
Gold1,2
Processed (t)
195,296
1,855,337
Gold
produced (Oz)
Silver
produced (Oz)
Gold
Equivalent
Ounces (Oz)3
52,306
24,213
253,066
160,113
55,190
26,265
-
-
-
-
665,995
253,024
39,545
280,706
58,449
60,666
2,770
62,605
293,687
543,906
143,542
644,385
61,853
67,005
4,473
70,136
1 Attributable production from the Rawhide Mine and as of December 2020 twelve month Austral recorded a weighted average of 25.37% (2019-nil) as 17 December 2019 –
acquired 22.48% ownership in the Rawhide Mine and exercised options to increase its ownership interest on 31, January 2020 Austral to 23.62% ownership interest. On 8,
May 2020 the Group exercised its remaining options and increased its ownership interest to 26.46%.
2 Effective December 2019, Austral Gold owned 100% of Casposo. From March 2017 to 22 December 2019, Austral Gold owned 70% of Casposo;
3 AuEq ratio is calculated at 86:3 Ag:Au for the FY20 and 85:1 Ag:Au for FY19.
Austral Gold Limited
14
Annual Report 2020
BACKGROUND
The Guanaco and Amancaya mines remain the Company’s
flagship asset. Guanaco is located approximately 220km
south-east of Antofagasta in Northern Chile at an elevation
of 2,700m and 45km from the Pan American Highway.
Guanaco is embedded in the Paleocene/Eocene belt, a
geological feature which runs north/south through the centre
of the Antofagasta region, Chile.
Gold mineralisation at Guanaco is controlled by pervasively
silicified, sub-vertical east/northeast-west/southwest trend-
ing zones with related hydro-thermal breccias.
Silicification grades outward into advanced argillic alteration
and further into zones with argillic and propylitic alteration. In
the Cachinalito vein system, most of the gold mineralisation
is concentrated between depths of 75m and 200m and is
contained in horizontally elongated mineralised shoots. The
alteration pattern and the mineralogical composition of the
Guanaco mineralisation have led to the classification as a
high-sulfidation epithermal deposit.
In July 2014, the Company acquired the Amancaya Project
(‘Amancaya’) from Yamana Gold Inc (TSX:YRI | NYSE:AUY)
which is located approximately 60km south-west of the
Guanaco mine. Amancaya is a low sulfidation epithermal
gold-silver deposit consisting of eight mining exploration
concessions covering 1,755 hectares (and a further 1,390
hectares of second layer mining claims).
At Amancaya, open-pit mining operations began during the
first half of 2017 while underground operations started in
2018. The Amancaya ore is delivered to the Guanaco plant
for processing.
On 14 November 2017, Austral Gold purchased a 100% inter-
est in the San Guillermo and Reprado gold-silver projects,
located in the emerging Amancaya precious metals district
of northern Chile, from Revelo Resources Corp. (TSX- V:RVL)
for consideration of ten million Austral Gold ordinary shares.
The San Guillermo property consists of concessions totalling
12,175 hectares that surround the company’s high-grade
gold and silver Amancaya operation. The Reprado Project
consists of concessions totalling 3,960 hectares situated
approximately 20km north of Amancaya. Historical drilling
undertaken by Teck Resources Ltd intersected gold in low
sulfidation quartz veins trending essentially east-west.
A technical report on combined resources and construction
of a new agitation leaching plant at the Guanaco mine site
was completed in June 2017 and the commissioning phase
was completed in November 2017.
During February 2021, the Group acquired Revelo Resources,
that owns three projects located close to the Group’s pre-
existing Guanaco/Amancaya mining complex to provides
the Group with a leading role in the Paleocene-Eocene Belt
in Chile.
Austral Gold Limited
15
Annual Report 2020
PRODUCTION
Guanaco/Amancaya Operations
Mined Ore (t)
Processed (t)
Average Plant Grade (g/t Au)
Average Plant Grade (g/t Ag)
Gold produced (Oz)
Silver produced (Oz)
Gold-Equivalent (Oz) ***
C1 Cash Cost of Production (US$/AuEq Oz)*
All-in Sustaining Cost (US$/Au Oz) *
Realised gold price (US$/Au Oz)
Realised silver price (US$/Ag Oz)
Sales volume
Fiscal Year ended 31 December months ended
2020
196,194
195,296
8.5
43.9
52,306
253,066
55,190
723
1,021
1,765
21
49,995
2019
250,986
253,024
7.6
81.2
60,666
543,906
67,005
661
899
1,404
16
66,657
* The cash cost (C1) includes: Mine, Plant, On-Site G&A, Smelting, Refining, and Royalties (excludes Corporate G&A). It is the cost of production per gold
equivalent ounce.
** The All-in Sustaining Cost (AISC) includes: C1, Sustaining Capex, Brownfield Exploration, and Mine Closure Amortisation.
*** AuEq ratio is calculated at 88:1 Ag:Au for the FY20 and 85:1 Ag:Au for the FY19
Production during FY20 at Guanaco/Amancaya decreased by 18% to 55,190 gold equivalent ounces (52,306 gold ounces
and 253,066 silver ounces) from 67,005 gold equivalent ounces (60,666 gold ounces and 543,906 silver ounces) during
FY19. The decrease was mainly a result of the lower throughput of the mine and lower silver grades which was anticipated
in accordance with the Group’s production guidance.
During FY20, mining continued at the Guanaco underground operations with a total of 2,928 tonnes mined while 193,266
tonnes were mined from the Amancaya underground operations. Management continues to evaluate opportunities to
extend the life of mine of the Guanaco and Amancaya mines.
Austral Gold Limited
16
Annual Report 2020
EXPLORATION
With the appointment of Raul Guerra as Corporate VP of
Exploration during the third quarter, the Company performed
a strategic review of the exploration activities and defined
new objectives.
Based on the strategic review, the exploration priorities were
set as follows:
• Discover new Tier I or II deposit(s) through exploration and
acquisition of new business
• Discover brownfields ounces at Amancaya, Casposo and
Manantiales:
• Guanaco District: complete delineation at Sierra Inesper-
ada to drill the best ranked targets starting in October 2020
• New Opportunities: Identify and consolidate third-party
projects with potential near existing Austral Gold infra-
structure
• Explore other oxide and deeper gold-rich sulfide mineral-
ization opportunities at the Guanaco District
During the year an evaluation of both Guanaco and Aman-
caya was completed with a new approach including the
utilisation of specialist geology consultants to define the
structural architecture, identify the phreatomagmatic activ-
ity centers, recognize new major mineralization controls
and reprocess previous remote sensing and geophysical
studies. With this new information platform, targeting and
ranking was completed that reoriented the exploration and
identified new opportunities.
MINING
During the year ended 31 December 2020, mining contin-
ued at the Guanaco underground operations with a total
of 2,928 tonnes mined while 193,266 tonnes were mined
at the Amancaya underground operations. The geological
team continues to investigate opportunities to extend both
the life of mine of the Guanaco deposit (reserves depleted
during 2018) and the Amancaya deposit.
SAFETY AND ENVIRONMENTAL PROTECTION
During the year ended 31 December 2020, there was one
lost-time accident (LTA) and four nil-lost-time accidents
(NLTA) involving employees of Guanaco and third party
contractors.
Safety and environmental protection are core values of the
Company. The implementation of best practice safety stan-
dards along with a sound risk management program are key
priorities for Austral Gold.
COVID-19 IMPACT
During FY20, the Company´s flagship mine complex in Chile
(Guanaco/Amancaya) was not significantly impacted by
COVID-19 except for several precautionary measures to
address the risk of the COVID-19 virus as recommended by
the Health Authorities and Governments around the world.
In Argentina, exploration activities were reduced at the
Casposo and Pingüino projects following mandatory isola-
tion measures in effect in Argentina during Q2 and Q3 2020.
COMMUNITY ACTIVITIES
Austral Gold has an extensive history of being a committed
neighbor to the communities in which it operates.
Our support to the communities surrounding our projects in
Chile focuses mainly on education programs as we believe
that through education it is possible to improve citizens
socio-economic conditions and contribute to the youth
population and the overall community.
Austral Gold Limited
17
Annual Report 2020
EXPLORATION
IN CHILE
Austral Gold Limited
18
Annual Report 2020
Exploration in 2020 was focused on brownfield areas in the Amancaya / Sierra Inesperada
(Guanaco) District.
EXTENDING THE KNOWN VEINS TO DEPTH
The drilling program started in the fourth quarter of 2020 in order
to extend resources and reserves at the Amancaya mine at depth.
Previous exploration was not successful in intercepting the veins
at depth when drilling was performed from east to west. Austral
mapped out the contact between two breccia zones at the loca-
tion of the veins and observed a steepening of this contact zone.
Consequently, drilling was undertaken from west to east, and
intersected the vein with similar widths and tenor that is currently
being mined 50m to 100m under previous intersections.
Drill hole DAM-008 also included a high-grade intersection on the
hanging wall of 4.1m of 23.5 g/t Au and 29 g/t Ag.
For 2021 we have also budgeted for a near mine exploration
program to target the discovery of the vein systems based on
the new structural - geological district model and ore controls
related to phreatomagmatic breccias complex learned from the
current program.
AMANCAYA MINE EXPLORATION
The exploration activities at the Amancaya Project focused on a
drilling campaign to validate the continuity of mineralization along
strike and to depth with the goal of expanding the resources.
During September 2020, the Company started a drilling campaign
based on a new internal conceptual geological model for the
Amancaya Mine updated with relogging, remapping of current
accessible ramps and drifts, and modelling of conceptual geologi-
cal sections. The main objectives were to perform in-depth testing
on the continuity of mineralization at level 1650 and to identity
shallow extension to the south of Sur Central Vein.
HIGHLIGHTS
Significant results were obtained from the deep drilling campaign
of the Amancaya Vein System including highlights from assays
reported on 27 January 2021:
• DAM-002 1.35 meters @14.65 g/t gold and 50.60 g/t silver
including 42.43 g/t gold and 124 g/t silver over 0.44 meters
• DAM-003 2.07 meters @12.13 g/t gold and 57.50 g/t silver
including 21.01 g/t gold and 142.8 g/t silver over 0.88 meters
• DAM-008 2.53 meters @12.18 g/t gold and 8.50 g/t silver in the
Central Vein and 30m at 4.04 g/t gold and 7.50 g/t silver includ-
ing 4.14 meters @23.50 g/t gold and 29.30 g/t silver in a newly
discovered mineralized breccia zone at depth
• DAM-012 0.40 meters @41.89 g/t gold and 7.50 g/t silver
A total of 4,806 meters were drilled to validate the extension of
the mineralization down to the 1600 level at the Amancaya mine.
A detailed relogging and underground mine mapping program
identified new controls for the veins related to the phreatomagam-
tic breccia complex geometry.
Encouraging results were obtained in the central vein, mainly at
the southern end of the Sur vein opening exploration to the south
of this sector.
Additionally, one drill hole was successfully extended to explore
the eastern edge of the Amancaya diatreme as a major mineral-
ization control, intercepting 30m @ 4.04 gpt Au (DAM-008), which
includes high-grade veins and hydrothermal injection breccias.
This zone also included a high-grade intersection on the hanging
wall of 4.1m of 23.5 g/t Au and 29 g/t Ag.
During Q1 2021, we plan on focusing the drilling activities on defin-
ing the continuity of the mineralization intercepted by hole DAM-008,
recognizing the southern and northern extension of this new Vein/
Breccia System. In addition, an infill drilling program is planned to
categorize resources at the north, central and south veins.
Austral Gold Limited
19
Annual Report 2020
GUANACO DISTRICT EXPLORATION
During the year, the focus continued on the Sierra Inesperada area with
delineation and drilling activities. A total of 2,239 meters were drilled, starting
with Mina Inesperada and continuing with a first phase drill campaign at the
Carla and Purisima veins. Seven maar-diatreme complexes in the area were
recognized suggesting that they are near entirely preserved and affected by
favorable hydrothermal alteration, being relatively restricted to phreatomag-
matic products. Geological mapping focused on the identification of intra-
maar structures and phreatomagmatic facies as indicators of proximity to
the positions of the conduits.
At Mina Inesperada, two drillholes with different azimuth were completed. The
ore control has been identified with drill hole DIN-003, opening the upside to
the north. It also confirms that the favorable alteration and the gold mineraliza-
tion is related and hosted in the phreatomagmatic breccia body.
The most interesting results from our Q4 2020 drilling program relates to drill
holes DIN-006A and DIN-008 at Purisima, where low grade gold mineraliza-
tion was intercepted and which suggests a fertile Diatreme-Dome system.
Highlights from the drilling results of the Q4 2020 drilling campaign include:
• DAM-002 1.4 meters @14.7 g/t gold and 50.6 g/t silver including 42.4 g/t
gold and 124 g/t silver over 0.4 meters
• DAM-003 2.1 meters @12.1 g/t gold and 57.5 g/t silver including 21.0 g/t
gold and 143g/t silver over 0.9 meters
• DAM-008 2.5m of 12.2 g/t gold and 8.5 g/t silver in the Central Vein and
30m at 4 g/t gold including 4.1 meters @23.5 g/t gold and 29.3 g/t silver in
a newly discovered mineralized breccia zone at depth
• DAM-012 0.4 meters @41.9 g/t gold and 7.5 g/t silver
The 2021 exploration program is expected to continue with drilling activities
in (i) the Mina Inesperada area with the goal of validating an extension of the
mineralization to the North, and (ii) the Purisima and Ines areas. This has been
adjusted based on the results of DIN-007 to address a preferred drilling direc-
tion from West to East (Purisima, Ines) and North South (Ines).
ACQUISITION OF REVELO RESOURCES SUBSEQUENT TO
YEAR-END
As described in note 37 (i) to the FY20 Financial statements, on 5 Febru-
ary 2021, the Group completed the acquisition of Revelo Resources Corp.
(“Revelo”) under a plan of arrangement (“the Arrangement”) in Canada. Under
terms of the Arrangement, Austral acquired all Revelo shares and Revelo
shareholders received total consideration of US$6,977,713 comprised of
cash of US$917,059 (C$1,176,471) and 35,475,095 ordinary shares of Austral
valued at approximately US$6,060,654. Consequently, Revelo became a
wholly-owned subsidiary of Austral. Revelo’s main assets are three explo-
ration projects located close to the Group’s Guanaco/Amancaya mining
complex in Chile. As part of the acquisition, the Group acquired a 19.9%
interest in Pampa Metals Corporation (CSX:PM).
Revelo´s Las Pampas project is a large property located in the heart of the
highly productive Paleocene Mineral Belt in northern Chile that contains
several important gold, silver and copper mines and projects. Numerous indi-
cations of low-sulphidation, epithermal gold and silver mineralization occur
on the property, which is situated along geologic trend and a few kilometers
to the southwest of the prolific El Peñon mining district.
Austral Gold Limited
20
Annual Report 2020
CERRO BUENOS AIRES PROJECT
During December 2020, Austral entered into a purchase option agreement of 36 mining concessions from Mr.
Simunovic Petricio. The Property is a potential High Sulfidation (HS) project with a significant hydrothermal alteration
footprint. However, to date no anomalous gold values have been reported in the sector which has been under evaluation
by various companies in the past as a possible copper porphyry system.
There are geophysical studies in the sector that generated favorable indicators for the occurrence of a HS type deposit.
Another strong indicator is the age of the hydrothermal alteration totally synchronous with other similar deposits in the belt.
As disclosed in the FY20 financial statements, the cost of the option is US$5.05 million and is to be paid in Chilean pesos.
US$100,000 was paid on signing the agreement and the balance payable over five years and there is a Net Smelter
Return (“NSR”) royalty over the mining properties of 2% for precious metals and 1.5% for the sale or disposal of any other
mineral, metal and/or other refined or unrefined mining products ripped up and extracted from the mining properties.
The Company has the option of exiting the agreement without paying the option installments. However, none of the
option payments made would be refundable.
Austral Gold Limited
21
Annual Report 2020
CASPOSO MINE
The Casposo mine is located in the department of Calingasta, San Juan Province, Argentina, approximately 150km from the city of
San Juan, and covers an area of 100.21km2. Casposo is a low sulfidation epithermal deposit of gold and silver located in the eastern
border of the Cordillera Frontal geological province.
The Cordillera Frontal represents the eastern portion of the Cordillera Principal that runs along the Chile-Argentine border for approxi-
mately 1,500km. The Casposo gold– silver mineralisation is Permian in age, and occurs in the extensive Permo-Triassic volcanic rocks
of the Choiyoi Group, at both rhyolite, and underlying andesitic rocks, where it is associated with NW-SE, E-W and N-S striking banded
quartz, chalcedony and calcite veins, typical of low sulfidation epithermal environments. Post-mineralisation dykes of rhyolitic, mafic,
and trachytic composition often cut the vein systems. These dykes, sometimes reaching up to 30m thickness, are usually steeply
dipping and north–south oriented. Mineralisation at Casposo occurs along a 10km long north- west to southeast trending regional
structural corridor, with the main Kamila Vein system forming a 500m long sigmoidal set near the centre. The Mercado Vein system is
the northwest continuation of Kamila and is separated by an east–west fault from the Kamila deposit.
In March 2016, Austral Gold acquired a controlling stake and management of the Casposo gold and silver project. Since then, Austral
Gold undertook a complete revision of historical work (geology, geochemistry, geophysics and drillings), and completed a regional
mapping at a 1:10,000 scale to identify potential opportunities for discovering additional mineralisation and ranking a series of mine
and brownfield exploration targets.
In March 2017, Austral Gold acquired an additional 19% of the Casposo silver and gold project and in December 2019, it effectively
acquired the remaining 30%.
CARE AND MAINTENANCE
During the June 2019 quarter, Austral completed a comprehensive review of operations, and as the mine operator, decided to tempo-
rarily place the mine on care and maintenance. During the year, Austral paid approximately US$2 million in severance to 199 Casposo
employees.
The Casposo Mine continues to be on care and maintenance. The Group’s goal is to recommence processing operations.
ARGENTINA
Austral Gold Limited
22
Annual Report 2020
Operations
Casposo Mine Year ended
31
December
2020
31
December
2019
31
December
2018
Processed (t)
-
39,545
166,194
Average Plant Grade
(g/t Au)
Average Plant Grade
(g/t Ag)
Gold produced (Oz)
Share of Gold
produced*
Silver produced (Oz)
Share of Silver
produced*
C1 Cash Cost (US$/
AuEq Oz) *
All-in Sustaining
Cost (US$/Au Oz) *
Realised gold price
(US$/Au Oz)
Realised silver price
(US$/Ag Oz)
-
-
-
-
-
-
-
-
-
-
2.7
2.0
97.8
277.3
2,770
11,564
1,939
8,095
143,542
1,213,316
100,479
861,921
2,133
1,362
2,289
1,710
1,303
1,227
15
15
* As of 23 December 2019, Austral Gold owned 100% of Casposo. From March
2017 to 22 December 2019, Austral Gold owned 70% of Casposo
CASPOSO MINE
The Casposo mine is located in the department of Calingasta,
San Juan Province, Argentina, approximately 150km from the
city of San Juan, and covers an area of 100.21km2. Casposo is
a low sulfidation epithermal deposit of gold and silver located in
the eastern border of the Cordillera Frontal geological province.
The Cordillera Frontal represents the eastern portion of the
Cordillera Principal that runs along the Chile-Argentine border for
approximately 1,500km. The Casposo gold– silver mineralisation is
Permian in age, and occurs in the extensive Permo-Triassic volca-
nic rocks of the Choiyoi Group, at both rhyolite, and underlying
andesitic rocks, where it is associated with NW-SE, E-W and N-S
striking banded quartz, chalcedony and calcite veins, typical of low
sulfidation epithermal environments. Post-mineralisation dykes
of rhyolitic, mafic, and trachytic composition often cut the vein
systems. These dykes, sometimes reaching up to 30m thickness,
are usually steeply dipping and north–south oriented. Mineralisa-
tion at Casposo occurs along a 10km long north- west to southeast
trending regional structural corridor, with the main Kamila Vein
system forming a 500m long sigmoidal set near the centre. The
Mercado Vein system is the northwest continuation of Kamila and
is separated by an east–west fault from the Kamila deposit.
In March 2016, Austral Gold acquired a controlling stake and
management of the Casposo gold and silver project. Since then,
Austral Gold undertook a complete revision of historical work
(geology, geochemistry, geophysics and drillings), and completed
a regional mapping at a 1:10,000 scale to identify potential oppor-
tunities for discovering additional mineralisation and ranking a
series of mine and brownfield exploration targets.
In March 2017, Austral Gold acquired an additional 19% of the
Casposo silver and gold project and in December 2019, it effec-
tively acquired the remaining 30%.
CARE AND MAINTENANCE
During the June 2019 quarter, Austral completed a comprehen-
sive review of operations, and as the mine operator, decided to
temporarily place the mine on care and maintenance. During the
year, Austral paid approximately US$2 million in severance to 199
Casposo employees.
The Casposo Mine continues to be on care and maintenance. The
Group’s goal is to recommence processing operations.
Austral Gold Limited
23
Annual Report 2020
ARGENTINA EXPLORATION
COVID-19 Impact
In Argentina, exploration activities were reduced at the
Casposo and Pingüino projects following mandatory
isolation measures in effect in Argentina during Q2
and Q3 2020.
Casposo Exploration
During Q4 2020, the exploration activities were
focused on the Manantiales — Casposo district in
the San Juan Province, Argentina. Drilling targets
were defined based on new concepts resulting in
our confirmation of the presence of high-grade gold
rock chip samples related to new veins at the Cerro
Amarillo area in the Manantiales — Casposo District.
At Manantiales, a potential south extension and two
new secondary veins were identified through geologi-
cal mapping and surface activities whereas at Valen-
tina, historic results were reviewed and validated with
gold values up to 7.66 g/t Au. A drilling campaign
started during February 2021. The Cerro Amarillo area
was also identified with exploration potential for a
high-grade gold veins system based on multiple rock
chip samples +10 gpt Au.
The drilling program commenced in Q1 2021 at the
Valentina Vein target and is expected to be followed
by the Manantiales veins and Cerro Amarillo area.
Austral Gold Limited
24
Annual Report 2020
SANTA CRUZ PROVINCE
PINGÜINO AND SIERRA BLANCA PROJECTS
Pingüino Project
The Group owns 100% of the mineral rights of 20 properties with
over 51,000 hectares of land. These properties are located within
two prominent geographical features, the Deseado and Somun-
cura Massifs both of which have proven to host significant epith-
ermal precious metal deposits. The large epithermal vein swarm
at Pingüino contains indium-enriched vein-hosted base metal
mineralisation, as well as low sulphidation precious metal vein
mineralisation. The combination of these two types of mineralisa-
tion within the same property is unique for the province of Santa
Cruz and a significant asset for the Company.
The Silver-Gold-Zinc-Lead-Indium Pingüino Project is an advanced
stage development project located in south-central Argentina,
300km southwest of the city of Comodoro Rivadavia and 220km
northwest of Puerto San Julián. In the last 20 years, seven mines
have been constructed in Santa Cruz, making it one of the most
prolific precious metal provinces in the world, including world class
deposits such as Cerro Vanguardia and Cerro Negro.
The Pingüino Project lies in a vein field similar but smaller to Cerro
Vanguardia some 35kms north-west along same controlling struc-
ture as Pingüino deposit (225km strike length of veins vs 115 km
strike length of veins).
The project has year round access, is close to major infrastructure,
has no nearby communities and more than 70% of surface land
is owned by the Group.
During 2020, the geology team completed a trenching program at
the Pingüino project which totaled 113 trenches with 5,360 meters
excavated within 12 veins (e.g. Tranquilo, Marta Norte, Ana, Marta
Northeast, Fantasma, Sol, Ivana, Silvia and Trinda Veins).
Sierra Blanca Project
As disclosed in note 20 to the December 2020 financial state-
ments, during 2020, the Group and New Dimension Resources Ltd.
(TSX-V:NDR) (“New Dimension”) signed an agreement to acquire
New Dimension’s Sierra Blanca gold-silver project (the “Project”)
in Santa Cruz, near the Group’s Pingüino project.
With this transaction, Austral expanded the area of its Pingüino
project by securing an additional 7,000 hectares, resulting in a
new exploration cluster in the Province of Santa Cruz. In addition,
the exploration team carried out the inventory of the veins of both
projects to design the next exploration campaign.
The geological team also began planning the exploration activities
for 2021 including a US$100,000 work commitment program for
Sierra Blanca over the next 12 months.
Austral Gold Limited
25
Annual Report 2020
USA
Austral Gold Limited
26
Annual Report 2020
RAWHIDE MINE / ENSIGN GOLD
BACKGROUND
On 17 December, 2019, Austral acquired an equity interest in
Rawhide Acquisition Holding LLC (“RWH”), a privately-held Dela-
ware limited liability company that owns Rawhide Mining LLC
which in turn owns the Rawhide Mine located ~50 miles outside
of Fallon, Nevada, United States.
The Rawhide mine is located in Nevada’s prolific Walker Lane
gold-silver belt, among multiple historic mines that produced more
than 1 million ounces of gold (e.g., Comstock, Round Mountain,
Borealis, and Tonopah). Rawhide is a historical mining operation
that started in the early 1900s. Rawhide was formerly operated as
a subsidiary of Kennecott Corporation prior to Coral Reef Capital, a
private equity firm, partnering with the Rawhide mine management
team to acquire the property from Rio Tinto Plc in 2010. Currently,
Coral Reef Capital is the controlling shareholder of Rawhide Acqui-
sition Holding LLC.
The Rawhide mine is a fully permitted operation that produces
gold and silver through an open pit heap leaching operation. In
2019, Rawhide received a mine expansion permit associated with
the Regent open pit. It is surrounded by multiple 1.0 million+ gold
oz deposits.
Austral Gold made the strategic investment in the Rawhide opera-
tion as part of its acquisition plan to focus on near-term cash
producing mining assets.
OVERVIEW OF RAWHIDE OPERATION
Gold was discovered at Rawhide in 1906, with intermittent small
scale production until Kennecott undertook open pit mining from
1990-2003, producing 1.4 million ounces of gold and 10.9 million
ounces of silver from 88 million tons. Residual heap leaching until
2010 recovered an additional 200 thousand ounces of gold and 1.9
million ounces of silver. Austral Gold has been advised by Rawhide
that from 2011-2018 its mining at the Rawhide property totaled 4.9
million tons, with 160,000 ounces of gold and 1.8 million ounces
of silver produced.
Gold-silver mineralization at Rawhide has been historically mined
from a series of low sulfidation epithermal veins, vein swarms and
replacement zones hosted by various basaltic to rhyolitic volcanic
units. The lower grade bulk tonnage mineralization that is the focus
of current operations occurs between structures within permeable
volcanic units and at intrusive contacts. Rawhide Mining received
a mine expansion permit covering the Regent satellite deposit, and
open pit mining has recently commenced. Regent highlights the
upside exploration and production optionality of Austral’s strategic
investment in the Rawhide mining operation.
EQUITY OWNERSHIP
As disclosed in note 21 to the December 2020 financial state-
ments, the Group increased its equity interest in Rawhide Acqui-
sition Holding LLC (“RAH”) from 22.48% to 26.46% through the
exercise of options during the year.
Although RAH did not have taxable income in 2020, its objective
is to distribute 50% of its taxable income to the LLC members on
a quarterly basis as a Tax Distribution.
Historically made significant additional Ordinary Distributions to its
members provided its ongoing mining at the Rawhide and Regent
open pits generate taxable income.
OPERATING ACTIVITIES
The following table summarizes the production figures of the
Rawhide mine (US) in which Austral has a 26.46% interest. Actual
production was slightly below Rawhide’s FY20 guidance of 27,000-
30,000 gold equivalent ounces mainly as a result of interruptions at
the crushing plant due to repairs and the ramp up of the crushing
conveying system.
Rawhide Operations
(100% basis)
Processed (t)
Gold produced (Oz)
Silver produced (Oz)
Gold-Equivalent (Oz)
Fiscal Year ended
December 2020
1,855,337
24,213
160,113
26,265
*
The Company acquired an initial 22.48% interest in interest in Rawhide on 17
December 2019.
* * FY20 weighted average of 25.23% (ownership in the Rawhide Mine as effective
31, January 2020 Austral held a 23.62% ownership interest in Rawhide. On 8,
May 2020 the ownership interest was increased to 26.46%).
*** AuEq ratio is calculated at 78:1 Ag:Au for FY20
ENSIGN GOLD
As disclosed in note 37(ii) to the financial statements, the Group
acquired a 19.96% equity interest in Ensign Gold. It also acquired
warrants that if exercised would increase the Group’s interest to
approximately 27.22% on a partially diluted basis (approximately
22.90% on a fully diluted basis).
Ensign is a privately held federally incorporated Canadian company.
Austral Chairman Wayne Hubert and CEO Stabro Kasaneva are
directors of Ensign Gold. Ensign is not a reporting issuer in any
Province of Canada, nor is it listed on any stock exchange. Ensign is
currently assembling a 5,000-hectare land package on favourable
Carlin-type gold deposit geology in the state of Utah with the goal
of consolidating the Mercur camp for the first time. Ensign owns
54 patented claims, 370 unpatented claims, and 5 SITLA claims
on South Mercur, West Mercur and North Mercur. Historically, this
region produced over 3 million ounces of gold and was shut down
over two decades ago when gold was selling for less than $300
per ounce.
Austral Gold Limited
27
Annual Report 2020
Austral Gold Limited
28
Annual Report 2020
TABLE 1: ORE RESERVES ESTIMATE
31 December 2020
Ore Reserves (JORC 2012 and NI 43-101 Compliant)
Proven Reserves
Probable Reserves
Total Ore Reserves
Gold (Au)
Tonnes
(Kt)
Grade
(g/t)
Contained
Metal (koz)
Tonnes
(Kt)
Grade
(g/t)
Contained
Metal (koz)
Tonnes
(Kt)
Grade
(g/t)
Contained
Metal (koz)
Guanaco
Underground
Total Guanaco
3
3
2.1
0.2
2.1
0.2
3
3
1.0
0.1
1.0
0.1
6
6
1.6
0.3
1.6
0.3
Underground
162
7.2
Total Amancaya
162
7.2
Total Combined
165
7.1
37
37
38
Amancaya
133
5.1
133
5.1
136
5.0
22
22
22
295
6.2
295
6.2
301
6.1
59
59
59
Silver (Ag)
Tonnes
(Kt)
Grade
(g/t)
Contained
Metal (koz)
Tonnes
(Kt)
Grade
(g/t)
Contained
Metal (koz)
Tonnes
(Kt)
Grade
(g/t)
Contained
Metal (koz)
Underground
65
Total Guanaco
65
6
6
12
12
Guanaco
168
168
3
3
Amancaya
19
19
233
233
4
4
31
31
Underground
170
33
180
171
21
115
341
27
295
Total Amancaya
170
33
180
171
21
115
341
27
295
Total Combined
235
25
192
339
12
134
574
18
326
Austral Gold Limited
29
Annual Report 2020
TABLE 2: MINERAL RESOURCES ESTIMATE
31 December 2020
Mineral Resources (JORC 2012 and NI 43-101 Compliant)
Measured (Me)
Indicated (Ind)
Total (Me + Ind)
Inferred (Inf)
Gold (Au)
Tonnes
(Kt)
Grade
(g/t)
Contained
Metal (koz)
Tonnes
(Kt)
Grade
(g/t)
Contained
Metal (koz)
Tonnes (Kt)
Grade
(g/t)
Contained
Metal (koz)
Tonnes (Kt)
Grade
(g/t)
Contained
Metal (koz)
Guanaco
Underground
283
2.4
Total Guanaco
283
2.4
Open Pit
–
–
Underground
169
10.1
Total Amancaya
169
10.1
Total Combined
452
5.3
22
22
–
55
55
77
502
2.6
502
2.6
42
42
785
2.6
785
2.6
65
65
717
2.4
717
2.4
54
54
Amancaya
2
8.9
0.4
2
8.9
0.4
23
4.49
3
223
5.7
225
5.7
41
41
392
7.6
394
7.6
96
96
693
6.23
139
716
6.2
142
727
3.6
83
1,179
4.2
161
1,433
4.3
196
Silver (Ag)
Tonnes
(Kt)
Grade
(g/t)
Contained
Metal (koz)
Tonnes
(Kt)
Grade
(g/t)
Contained
Metal (koz)
Tonnes (Kt)
Grade
(g/t)
Contained
Metal (koz)
Tonnes (Kt)
Grade
(g/t)
Contained
Metal (koz)
Underground
283
23
210
502
Total Guanaco
283
23
210
502
Guanaco
17
17
278
785
278
785
Amancaya
Open Pit
–
–
–
2
Underground
169
52
283
223
Total Amancaya
169
52
283
225
Total Combined
452
34
493
727
81
14
14
16
4
98
2
392
102
394
19
16
81
30
30
489
717
489
717
4
23
380
693
384
716
15
15
37
17
18
16
342
342
28
387
415
757
380
1,179
23
873
1,433
Austral Gold Limited
30
Annual Report 2020
TABLE 3: ORE RESERVES ESTIMATE
31 December 2019
Ore Reserves (JORC 2012 and NI 43-101 Compliant)Ore (JORC 2012 and NI 43-101 Compliant)
Proven Reserves
Probable Reserves
Total Ore Reserves
Gold (Au)
Tonnes
(Kt)
Grade
(g/t)
Contained
Metal (koz)
Tonnes
(Kt)
Grade
(g/t)
Contained
Metal (koz)
Tonnes
(Kt)
Grade
(g/t)
Contained
Metal (koz)
Underground
Total Guanaco
65
65
Underground
264
Total Amancaya
264
Total Combined
329
Underground
Total Casposo
–
–
4.7
4.7
6.9
6.9
6.5
–
–
Guanaco
168
168
Amancaya
243
243
410
Casposo
608
608
3.1
3.1
5.5
5.5
4.5
2.4
2.4
10
10
59
59
69
–
–
17
17
43
43
60
46
46
233
233
506
506
739
608
608
3.6
3.6
6.3
6.3
5.4
2.4
2.4
27
27
102
102
129
46
46
Total
329
6.5
69
1,018
3.2
106
1,347
4.0
175
Silver (Ag)
Tonnes
(Kt)
Grade
(g/t)
Contained
Metal (koz)
Tonnes
(Kt)
Grade
(g/t)
Contained
Metal (koz)
Tonnes
(Kt)
Grade
(g/t)
Contained
Metal (koz)
Underground
Total Guanaco
65
65
Underground
264
Total Amancaya
264
Total Combined
329
Underground
Total Casposo
–
–
6
6
32
32
27
–
–
12
12
274
274
285
–
–
Guanaco
168
168
Amancaya
243
243
410
Casposo
3.5
3.5
25
25
16
19
19
196
196
215
233
233
506
506
739
4.1
4.1
29
29
21
31
31
470
470
500
608
179
3,495
608
179
3,495
608
179
3,495
608
179
3,495
Total
329
27
285
1,019
113
3,709
1,347
92
3,995
Austral Gold Limited
31
Annual Report 2020
TABLE 4: MINERAL RESOURCES ESTIMATE
31 December 2019
Mineral Resources (JORC 2012 and NI 43-101 Compliant)
Measured (Me)
Indicated (Ind)
Total (Me + Ind)
Inferred (Inf)
Gold (Au)
Tonnes
(Kt)
Grade
(g/t)
Contained
Metal (koz)
Tonnes
(Kt)
Grade
(g/t)
Contained
Metal (koz)
Tonnes
(Kt)
Grade
(g/t)
Contained
Metal (koz)
Tonnes
(Kt)
Grade
(g/t)
Contained
Metal (koz)
Guanaco
Underground
422
3.2
Total Guanaco
422
3.2
43
43
1,213
2.8
108
1,636
2.9
151
1,134
2.6
1,213
2.8
108
1,636
2.9
151
1,134
2.6
96
96
Amancaya
Open Pit
–
–
–
2
8.9
0.4
2
8.9
0.4
23
4.49
3
Underground
307
10.2
101
298
7.3
Total Amancaya
307
10.2
101
300
7.3
70
70
605
8.8
171
716
5.96
137
607
8.8
171
739
5.9
140
Total Combined
730
6.1
144
1,513
3.7
178
2,243
4.5
322
1,874
3.9
236
Casposo
Underground
Total Casposo
37
37
2.4
2.4
3
3
1,009
2.8
1,009
2.8
92
92
1,046
2.8
1,046
2.8
95
95
913
5.4
158
913
5.4
158
Total
767
5.9
147
2,522
3.3
270
3,289
3.9
417
2,787
4.4
394
Silver (Ag)
Tonnes
(Kt)
Grade
(g/t)
Contained
Metal (koz)
Tonnes
(Kt)
Grade
(g/t)
Contained
Metal (koz)
Tonnes
(Kt)
Grade
(g/t)
Contained
Metal (koz)
Tonnes
(Kt)
Grade
(g/t)
Contained
Metal (koz)
Guanaco
Underground
422
17
235
1,213
15
592
1,636
16
827
1,134
13
477
Total Guanaco
422
17
235
1,213
15
592
1,636
16
827
1,134
13
477
Amancaya
Open Pit
–
–
–
2
Underground
307
49
480
298
Total Amancaya
307
49
480
300
81
28
28
4
2
265
605
269
607
81
38
38
4
744
748
23
716
739
37
17
18
28
399
426
Total Combined
730
30
715
1,513
18
861
2,243
22
1,576
1,874
15
903
Casposo
Underground
37
221
264
1,090
167
5,409
1,046
169
5,673
913
143
4,204
Total Casposo
37
221
264
1,009
167
5,409
1,046
169
5,673
913
143
4,204
Total
767
40
978
2,522
77
6,270
3,289
69
7,248
2,787
57
5,108
Note: Numbers may not add in the above tables due to rounding
Austral Gold Limited
32
Annual Report 2020
Competent Persons Statements
The information in the report to which this statement is attached
that relates to Mineral Resources is based upon information
compiled by Sebastian Ramirez, a Competent Person (CP
165) who is a registered member of the Comision Calificadora
de Competencias en Recursos y Reservas Mineras. Sebastian
Ramirez is a full time employee of the company and has suffi-
cient experience that is relevant to the style of mineralisation and
the type of deposit under consideration and to the activity being
undertaken to qualify as a Competent Person as defined in the
2012 Edition of the ‘Australasian Code for Reporting of Exploration
Results, Mineral Resources and Ore Reserves’. Sebastian Ramirez
consents to the inclusion in the report of matters based on his
information in the form and context in which it appears.
The information in the report to which this statement is attached
that relates to Ore Reserves is based upon information compiled
by Dr Robert Trzebski, a Competent Person who is a fellow of the
Australian Institute of Mining and Metallurgy (AUSIMM). Dr Robert
Trzebski is a Non-Executive Director of the Company and has
sufficient experience that is relevant to the style of mineralisation
and the type of deposit under consideration and to the activity
being undertaken to qualify as a Competent Person as defined in
the 2012 Edition of the ‘Australasian Code for Reporting of Explo-
ration Results, Mineral Resources and Ore Reserves’. Dr Robert
Trzebski consents to the inclusion in the report of matters based
on his information in the form and context in which it appears.
NOTES TO THE MINERAL RESOURCES
& ORE RESERVES STATEMENT
Guanaco and Amancaya Mines
The RPA Qualified Persons (QPs) for the Amancaya and Guanaco
Reserve and Resource Estimate include: Kathleen Ann Altman,
P.E., Ph.D. (Metallurgy); Jason J. Cox, P.Eng. (Mineral Reserves);
Ian Weir, P.Eng. (Mineral Reserves); Chester M. Moore, P.Eng.,
(Mineral Resources). The Mineral Resources and Reserves are
classified and reported in accordance with CIM definitions as
incorporated in NI 43-101, as well as JORC 2012, within the
Guanaco and Amancaya Gold Project, Region II, Chile, dated 16
June, 2017, with an effective date of 31 December 2016. Mineral
resources have been updated to account for depletion from mining
activities by Sebastian Ramirez, P.Eng, an Austral Gold employee
and a QP as per NI 43-101 and a CP as per JORC 2012.
The Company confirms that it is not aware of any new informa-
tion or data that materially affects the information included in
the original market announcement on 13 June 2017 and, in the
case of estimates of Mineral Resources or Ore Reserves, that all
material assumptions and technical parameters underpinning the
estimates in the relevant market announcement continue to apply
and have not materially changed. The Company confirms that the
form and context in which the CP’s findings are presented have
not been materially modified from the original market announce-
ment. The Company ensures that the Ore Reserves and Mineral
Resource Estimates are subject to appropriate levels of gover-
nance and internal controls. Governance of the Company’s Ore
Reserves Mineral Resources development and the estimation
process is a key responsibility of the Executive Management of the
Company. The Chief Executive Officer of the Company oversees
the review and technical evaluations of the Ore Reserves and
Mineral Resource estimates.
Casposo Mine
The RPA Qualified Persons (‘QP’) for the Casposo Reserve
and Resource Estimate include: Jason J. Cox, P.Eng. (Mineral
Reserves) and Chester M. Moore, P.Eng., (Mineral Resources).
The Mineral Resources and Reserves are classified and reported
in accordance with Canadian Institute of Mining, Metallurgy and
Petroleum Definition Standards for Mineral Resources and Ore
Reserves dated May 10, 2014 (‘CIM’) definitions as incorporated
in NI 43-101, as well as JORC 2012, within the Technical Report
on the Casposo Gold-Silver Mine, Department of Calingasta, San
Juan Province, Argentina dated 7 September 2016.
Mineral Resources and Ore Reserves have been updated to
account for depletion from mining activities by Nicolas Pizarro,
P.Eng, an Austral Gold employee and a QP as per NI-43-101 and
a Competent Person (‘CP’) as per JORC 2012. Ore reserves have
been updated to account for depletion from mining activities by Dr
Robert Trzebski, who is an Independent Director of Austral Gold,
and a QP as per NI 43-101 and a CP as per JORC 2012.
Austral Gold Limited
33
Annual Report 2020
DIRECTORS’
REPORT
Austral Gold Limited
34
Annual Report 2020
REVIEW OF RESULTS
For the Year Ended 31 December 2020
The following report on the review of results for the year ended 31 December 2020 (“FY20”)
and 2019 (“FY19”) together with the consolidated financial report of Austral Gold Limited
(the Company) and its subsidiaries, (referred to hereafter as the Group).
PRINCIPAL ACTIVITIES
The principal activities of the Group during FY20 were:
• Several precautionary measures taken to protect the health of our people to address the risk of the COVID-19 virus.
• Gold and silver production at the Group’s Guanaco/ Amancaya mines achieved its full-year production guidance despite the interrup-
tion to operations from a miners´ strike during Q2 2020 and the transition to outsource the Amancaya underground mining operations.
• Continued to seek quality assets through M&A activities in stable jurisdictions by:
– executing a definitive arrangement agreement to acquire 100% of the shares of Revelo Resources Corp. The acquisition was
finalised on 5 February 2021;
– entering into a Subscription and Investment Agreement with Ensign Gold to acquire a 19.9% interest;
– increasing the Group’s interest in Rawhide. The Group owns a 26.46% interest after exercising its options during 2020;
– executing an agreement with New Dimension Resources Ltd. (TSX-V:NDR) (“New Dimension”) to acquire up to 100% of New
Dimension’s Sierra Blanca gold-silver project (the “Project”) in Santa Cruz Province near the Group’s Pinguino project;
– executing acquisition agreements to acquire additional mining concessions near the Group’s Guanaco/Amancaya complex.
• Exploration activities seeking organic growth in the Company´s existing mining projects in Argentina and Chile.
• Strengthening the corporate team through the appointment of Wayne Hubert as Executive Chairman and Raúl Guerra as VP of
Exploration while Director Eduardo Elsztain, the Company´s largest shareholder, remains on the Board as Non-Executive Director
and Vice-Chairman.
• There were no other significant changes in our principal activities during the period. A summary of key operating results for FY20
and FY19 is set out in the following table for comparative purposes.
REVIEW OF RESULTS OF OPERATIONS
Fiscal Year ended 31 December
2020
2019
Key Operating Results
Guanaco/
Amancaya
Rawhide
Mine
(100%
basis)1
Casposo
(100%
basis)2
Net to
Austral
Gold1,2
Guanaco/
Amancaya
Casposo
(100%
basis)2
Net to
Austral
Gold1,2
Processed (t)
195,296
1,855,337
Gold produced (Oz)
52,306
24,213
Silver produced (Oz)
253,066
160,113
Gold Equivalent Ounces (Oz)3
55,190
26,265
-
-
-
-
665,995
253,024
39,545
280,706
58,449
60,666
2,770
62,605
293,687
543,906
143,542
644,385
61,853
67,005
4,473
70,136
1 Attributable production from the Rawhide Mine and as of December 2020 twelve month Austral recorded a weighted average of 25.37% (2019-nil) as 17 December 2019 –
acquired 22.48% ownership in the Rawhide Mine and exercised options to increase its ownership interest on 31, January 2020 Austral to 23.62% ownership interest. On 8,
May 2020 the Group exercised its remaining options and increased its ownership interest to 26.46%.
2 Effective December 2019, Austral Gold owned 100% of Casposo. From March 2017 to 22 December 2019, Austral Gold owned 70% of Casposo;
3 AuEq ratio is calculated at 86:3 Ag:Au for the FY20 and 85:1 Ag:Au for FY19.
Austral Gold Limited
35
Annual Report 2020
Guanaco Operations
Mined Ore (t)
Processed (t)
Average Plant Grade (g/t Au)
Average Plant Grade (g/t Ag)
Gold produced (Oz)
Silver produced (Oz)
Gold-Equivalent (Oz) ***
C1 Cash Cost of Production (US$/AuEq Oz)*
All-in Sustaining Cost (US$/Au Oz) *
Realised gold price (US$/Au Oz)
Realised silver price (US$/Ag Oz)
Sales volume
Fiscal Year ended 31 December months ended
2020
196,194
195,296
8.5
43.9
52,306
253,066
55,190
723
1,021
1,765
21
49,995
2019
250,986
253,024
7.6
81.2
60,666
543,906
67,005
661
899
1,404
16
66,657
* The cash cost (C1) includes: Mine, Plant, On-Site G&A, Smelting, Refining, and Royalties (excludes Corporate G&A). It is the cost of production per gold equivalent ounce.
** The All-in Sustaining Cost (AISC) includes: C1, Sustaining Capex, Brownfield Exploration, and Mine Closure Amortisation.
*** AuEq ratio is calculated at 88:1 Ag:Au for the FY20 and 85:1 Ag:Au for the FY19
Production during FY20 at Guanaco/Amancaya decreased by 18% to 55,190 gold equivalent ounces (52,306 gold ounces and 253,066
silver ounces) from 67,005 gold equivalent ounces (60,666 gold ounces and 543,906 silver ounces) during FY19. The decrease was
mainly a result of the lower throughput of the mine and lower silver grades which was anticipated in accordance with the Group’s
production guidance.
During FY20, mining continued at the Guanaco underground operations with a total of 2,928 tonnes mined while 193,266 tonnes were
mined from the Amancaya underground operations. Management continues to evaluate opportunities to extend the life of mine of the
Guanaco and Amancaya mines.
In addition, the following table summarizes the production figures of the Rawhide mine (US) in which Austral has a 26.46% interest.
Actual production was slightly below Rawhide’s FY20 guidance of 27,000-30,000 gold equivalent ounces mainly as a result of inter-
ruptions at the crushing plant due to repairs and the ramp up of the crushing conveying system.
Rawhide Operations (100% basis)
Fiscal Year ended December 2020
Processed (t)
Gold produced (Oz)
Silver produced (Oz)
Gold-Equivalent (Oz) *
1,855,337
24,213
160,113
26,265
* The Company acquired an initial 22.48% interest in interest in Rawhide on 17 December 2019.
** FY20 weighted average of 25.23% (ownership in the Rawhide Mine as effective 31, January 2020 Austral held a 23.62% ownership interest in Rawhide. On 8, May 2020
the ownership interest was increased to 26.46%).
*** AuEq ratio is calculated at 78:1 Ag:Au for FY20
COVID-19 IMPACT
During FY20, the Company´s flagship mine complex in
Chile (Guanaco/Amancaya) was not significantly impacted
by COVID-19 except for several precautionary measures to
address the risk of the COVID-19 virus as recommended
by the Health Authorities and Governments around the
world. In Argentina, exploration activities were reduced at
the Casposo and Pingüino projects following mandatory
isolation measures in effect in Argentina during Q2 and
Q3 2020.
Austral Gold Limited
36
Annual Report 2020
KEY FINANCIAL RESULTS
Key financial metrics
Thousands of US$
Revenue
Gross profit
Gross profit %
Adjusted gross profit (excluding depreciation and amortisation)
Adjusted gross profit % (excluding depreciation and amortisation)
EBITDA
EBITDA per share (basic)
EBITDA per share (fully diluted)
Adjusted EBITDA
Adjusted EBITDA per share (basic)
Adjusted EBITDA per share (fully diluted)
Profit attributed to shareholders
(Loss) attributed to non-controlling interests
Earnings per share (Basic)
Earnings/(Loss) earnings per share (diluted)
Comprehensive income
Fiscal Year ended December 31
2020
88,223
37,884
42.9%
54,151
61.4%
30,963
0.055
0.054
45,962
0.082
0.080
7,667
-
1.36c
1.34c
7,612
2019
102,209
26,661
26.1%
46,916
45.9%
33,550
0.062
0.059
37,612
0.070
0.066
5,225
(3,586)
0.97c
0.93c
1,658
Note: Readers are cautioned that Adjusted EBITDA does not have standardised meanings as prescribed by IFRS and may not be comparable to similar measures presented
by other companies. Further, readers are cautioned that Adjusted EBITDA should not replace profit or loss or cash flows from operating, investing and financing
activities (as determined in accordance with IFRS), as an indicator of the Company’s performance.
EBITDA AND ADJUSTED EBITDA
Thousands of US$
Profit before tax
Depreciation and amortisation
Net finance (income) / costs
EBITDA
Other expenses
Settlement of union agreement at Guanaco/Amancaya
Severance of mining employees due to outsource of operations
Impairment of goodwill
Impairment of exploration and evaluation expenditure
Care and maintenance
Restructuring cost (Casposo)
Other
Loss/(gain) on financial assets
Share of loss of associate
Adjusted EBITDA
Fiscal Year ended December 31
2020
14,335
16,267
361
30,963
4,963
4,278
926
748
1,983
-
(180)
1,774
507
2019
9,508
20,255
3,787
33,550
-
-
-
862
1,185
2,087
(62)
(10)
-
45,962
37,612
Austral Gold Limited
37
Annual Report 2020
Thousands of US$
Cash & cash equivalents
Current assets
Non-current assets
Current liabilities
Non-current liabilities
Net assets
Net current assets
Current loans and borrowings
Current financial leases
Non-current loans and borrowings
Non-current financial leases
Combined debt (borrowings and financial leases)
Combined net debt (net of cash & cash equivalents)
Combined debt to EBITDA
Combined net debt to EBITDA
Current ratio*
Total liabilities to net assets
*Current Assets divided by Current Liabilities
Fiscal Year ended December 31
2020
12,401
31,942
73,523
24,035
20,162
61,268
7,907
831
2,905
1,246
3,416
8,398
(4,003)
27%
(13%)
1.33
0.72
2019
9,196
26,849
79,318
23,529
25,907
56,731
3,320
4,045
3,047
2,077
6,302
15,471
6,275
46%
19%
1.14
0.87
OPERATING AND FINANCIAL RESULTS OF THE GROUP
Adjusted EBITDA increased to US$46.0m (52%) from US$37.6m during FY19 (37%) while EBITDA decreased to US$31.0m (35%)
during FY20 from US$ 33.6m (33%) during FY19.
Net profit before and after tax increased to US$14.3m and US$7.7m during FY20 from US$9.5 and US$1.6m during FY19 and was
mainly due to higher operating margins, which resulted from both higher gold and silver prices per ounce realised and higher gold
grades. The cost of sales in the prior period was also impacted by unprofitable operations at Casposo due to low production and the
2019 restructuring when Casposo was placed on care and maintenance.
Net profit during FY20 was mainly due to the following:
• Gross profit of US$37.9m or 43% (including US$16.3m of depreciation and amortisation) was realised (FY19: gross profit of US$26.7m
or 26% including US$20.3m of depreciation and amortisation). Excluding depreciation and amortisation, a gross profit of US$54.2m
was earned during FY20 or 61% (FY19: US$46.9m or 46%).
• Other expenses include the following:
– payment of bonuses and other benefits to mining employees at Guanaco/Amancaya due to a new collective union agreement
during Q2 2020;
– the cost to terminate mining employees in December 2020 at Guanaco/Amancaya as a result of the Group’s decision to outsource
the underground mine operation at its 100% owned Amancaya mine and certain maintenance activities at Guanaco´s processing
plant;
– Impairment expenses which are mainly due to the expense of goodwill and the expense of certain exploration and evaluation
expenditures previously capitalised;
– care and maintenance expenses for the entire year as compared to FY19 when Casposo was placed on care and maintenance
during the second quarter of 2019
• lower administration costs, which were mainly due to the depreciation of the South American currencies against the USD dollar, lower
general and administrative expenses at Casposo and a decrease in the provision for employee entitlements.
• lower net finance costs which was primarily due to a decrease in interest expense as a result of debt repayments during the year and
a present value adjustment to the mine closure provision at Guanaco
• a loss on financial assets.
Net gold equivalent ounces (GEOs) produced (including production attributable from Rawhide) during FY20 decreased to 61,853 GEOs
from 70,136 GEOs produced during FY19. Production from the Guanaco/ Amancaya mine complex decreased to 55,190 GEOs from
67,005 GEOs, a decrease of 17.6%. The decrease in production was mainly a result of the lower throughput of the mine and lower
silver grades which was anticipated in accordance with the Group’s production guidance. Overall cash cost of production (“C1”)* and
All-in sustaining costs (“AISC”) at Guanaco/Amancaya increased slightly during FY20 due to lower throughput compared to the prior
year to US$723/AuEq oz and US$1,021/ AuEq oz (FY19:US$661/AuEq oz and US$899/ AuEq oz).
Austral Gold Limited
38
Annual Report 2020
FINANCIAL POSITION
Net assets increased by US$4.6m from 31 December 2019 to US$61.3m at 31 December 2020 (31 December 2019: US$56.7m). The
increase was mainly due to the profit earned during FY20 which was partially offset by the payment of a US$3.5m dividend. Working
capital increased by US$4.6m to US$7.9m at 31 December 2020 (31 December 2019: working capital of US$3.3m). The increase in
working capital arose mainly due to the increase in inventory as a result of the Company’s cash management strategy to maximise
gold and silver inventory. The increase was partially offset by an increase in income tax payable and the dividend paid to shareholders.
At 31 December 2020, the Group had a current ratio equal to 1.33 (FY19 1.14). Cash plus refined gold totaled US$24.1m, US$12.4m
cash and cash equivalents (31 December 2019: US$9.2m) and ~6,200 refined gold ounces in inventory with a fair value of ~US$11.7m.
Combined net debt (borrowings and financial leases net of cash & cash equivalents) decreased by US$10.3m to negative US$4.0m at
31 December 2020 compared to US$6.3m at 31 December 2019.
Trade and other receivables (current and non-current) decreased by US$1.4m to US$6.4m at 31 December 2020 mainly due to a
decrease in trade receivables, prepaid tax and GST/VAT receivable.
Inventories increased by US$4.1m to US$14.7m at 31 December 2020 (31 December 2019: $US$10.6m) and was mainly due to an
increase in gold and silver in process and gold and silver bullion due to the Company’s cash management strategy. The allowance for
inventory obsolescence increased by US$0.3m to US$1.6m at 31 December 2020.
Trade and other payables (current and non-current) increased by US$1.5m to US$10.4m at 31 December 2020 (31 December 2019:
US$8.9m) mainly due to a portion of severance which remained payable at year end.
CASH FLOW
Net cash provided from operating activities before and after changes in assets and liabilities increased to US$36.9m and US$30.5m
during the 12-months ended 31 December 2020 from US$33.3m and US$29.6m during the 12-months ended 31 December 2019
respectively. The increase was primarily due to the strong operational results during FY20.
Cash used in investing activities totaled US$16.2m during FY20 compared to US$14.7m during FY19. Cash was used primarily for
additions to plant, property and equipment, exploration and evaluation activities, payment of a promissory note and the exercise of
options to increase the Group’s equity interest to 26.46% in the Rawhide Mine in Nevada, USA.
Cash used in financing activities totaled US$11.0m during FY20 compared to US$7.5m during FY19 due to the net repayment of
borrowings and financial leases, the payment of a dividend to shareholders and the exercise of options by shareholders.
LIQUIDITY
Guidance
The Group forecasts 2021 production to be at the lower end of the 50,000-55,000 gold equivalent ounces range with C1 and AISC at
US$700-800 and US$800-1,000 respectively per gold equivalent ounce.
Access to capital
The Group has in the money options outstanding from the October 2019 rights issue equivalent to approximately US$0.7m and has
strong banking relationships from which it expects it can obtain financing if required.
Austral Gold Limited
39
Annual Report 2020
THE DIRECTORS
WAYNE HUBERT
Executive Chairman
EDUARDO ELSZTAIN
Vice-Chairman
Mr. Hubert is a mining executive with over 15 years’ expe-
rience working in the South American resources sector. From
2006 until 2010 he was the Chief Executive Officer of ASX-listed
Andean Resources Limited and led the team that increased
Andean’s value from $70 million to $3.5 billion in four years.
Andean was developing a world-class silver and gold mine in
Argentina with a resource of over 5 million ounces of gold when
it was acquired by Goldcorp Inc. of Canada.
Mr. Hubert holds a degree in Engineering and a Master of
Business Administration and has held executive roles for Merid-
ian Gold with experience in operations, finance and investor
relations. In addition to his role at Austral Gold Limited, Mr.
Hubert is currently serving as Chairman of Revival Gold Inc.
(TSX.V:RVG) (OTCQB:RVLGF) and Ensign Gold Inc . (private
company), and is also a director of InZinc Mining.
Appointed 18 Oct 2011
Re-elected by shareholders on 27 May 2020
Mr. Eduardo Elsztain is chairman of IRSA Inversiones y Repre-
sentaciones S.A. (NYSE:IRS), one of Argentina’s largest and
most diversified real estate companies; and IRSA Commercial
Properties (NASDAQ:IRCP), with shopping centers, premium
office buildings, five-star hotels and residential developments.
He also serves as Chairman of Cresud (NASDAQ:CRESY) and
BrasilAgro (NYSE:LND), leading Latin American agricultural
companies that own directly and indirectly almost 1M HA of
farmland.
Mr. Elsztain is Chairman of Banco Hipotecario S.A.
(BASE:BHIP); and of BACS, Argentinean leading bank
specialized in providing innovative financial solutions to local
companies.
He is also member of the World Economic Forum, the Council
of the Americas, the Group of 50 and Argentina’s Business
Association (AEA). He is President of Fundacion IRSA, which
promotes education among children and young people;
President of TAGLIT — Birthright Argentina; Co-Founder of
Endeavor Argentina; and Vice- President of the World Jewish
Congress.
Mr. Elsztain has not held any other Directorships with Austra-
lian or Canadian listed companies in the last three years.
Appointed Director 29 Jun 2007
Appointed Chairman on 2 Jun 2011
Re-elected by shareholders on 27 May 2020
Austral Gold Limited
40
Annual Report 2020
STABRO KASANEVA
Executive Director, Chief Executive Officer
SAUL ZANG
Non-Executive Director
Mr. Kasaneva is a Geologist with a degree from the Universi-
dad Católica del Norte, Chile and has over 30 years of experi-
ence in production geology, exploration and management of
precious metal mining operations.
Since Mr. Kasaneva joined Austral Gold in 2009, he has been
instrumental in transforming the Company by consolidating
the operations of the Guanaco Mine in Chile, restarting opera-
tions at the Casposo Mine in Argentina as well as identifying
a number of opportunities that represent the growth potential
for Austral Gold.
Throughout his career as a geologist, he worked on exploration
and production gaining vast experience in grade control, QA/
QC, modeling and geological resources estimation.
Mr. Kasaneva led Business Development Departments for
several years evaluating a number of mining business oppor-
tunities in South America, Central America and North America.
He has held the roles of General Manager of Mining Operations,
Vice-President of Operations and COO.
Mr. Kasaneva is a Director of Ensign Gold.
Mr. Kasaneva does not hold any other Directorships.
Appointed 7 Oct 2009
Re-elected by shareholders on 27 May 2020
Mr. Zang obtained a law degree from Universidad de Buenos
Aires. He is a founding member of the law firm Zang, Bergel
& Viñes.
Mr. Zang is an adviser and Member of the Board of Direc-
tors of the Buenos Aires Stock Exchange and provides legal
advice to national and international companies.
Mr. Zang currently holds:
i. Vice-Chairmanships on the Boards of IRSA (NYSE: IRS,
BASE: IRSA), IRSA Commercial Properties (NASDAQ:
IRCP, BASE: IRCP), Cresud (NASDAQ: CRESY, BASE:
CRES) and
ii. Directorships with Banco Hipotecario (BASE: BHIP), Brasil
Agro (NYSE: LND, BVMF:AGRO3), among others.
Mr. Zang has not held any other Directorships with Australian
or Canadian listed companies in the last three years.
Appointed 29 Jun 2007
Re-elected by shareholders on 27 May 2020
Austral Gold Limited
41
Annual Report 2020
THE DIRECTORS
BEN JARVIS
Non-Executive Director,
Member of the Audit Committee
PABLO VERGARA DEL CARRIL
Non-Executive Director,
Member of the Audit Committee
Mr. Jarvis is the Managing Director of Six Degrees Investor
Relations, an Australian advisory firm that provides investor
relations services to a broad range of companies listed on the
Australian Securities Exchange.
Mr. Jarvis was educated at the University of Adelaide where
he majored in Politics.
Other Directorships with listed companies in the last three
years: Hip Resources Limited (ASX: HIP) Appointed 24 Octo-
ber 2019.
Appointed 2 Jun 2011
Re-elected by shareholders on 27 May 2020
Mr. Vergara del Carril is a lawyer and is professor of Post-
graduate Degrees for Capital Markets, Corporate Law and
Business Law at the Argentine Catholic University.
He is a member of the International Bar Association, the
American Bar Association and the AMCHAM, among other
legal and business organisations. He is a founding Board
member of the recently incorporated Australian- Argentin-
ean Chamber of Commerce. He is a Board member of the
Argentine Chamber of Corporations and also an officer of
its Legal Committee. He is recognised as a leading lawyer in
Corporate, Real Estate, M&A, Banking & Finance and Real
Estate Law by international publications such as Chamber
& Partners, Legal 500, International Financial Law Review,
Latin Lawyer and Best Lawyer.
He is a Director of Banco Hipotecario SA. (BASE: BHIP),
Nuevas Fronteras (owner of the Intercontinental Hotel in
Buenos Aires), IRSA Commercial Properties (NASDAQ:
IRCP, BASE: APSA) and Emprendimiento Recoleta SA
(owner of the Buenos Aires Design Shopping Centre),
among other companies. Mr. Vergara del Carril is also a
Director of Guanaco Mining Company Limited and Guanaco
Capital Holding Corp.
Mr. Vergara del Carril has not held any other Directorships
with Australian or Canadian listed companies in the last
three years.
Appointed 18 May 2006
Re-elected by shareholders on 27 May 2020
Austral Gold Limited
42
Annual Report 2020
The Company’s Board believes
that a highly credentialed Board,
with diverse backgrounds, skills
and perspectives, will be effective
in supporting and enabling deliv-
ery of strong governance for the
Company and create value for the
Company’s shareholders.
The Board brings a broad mix of
experience and skills to the
Company including in the areas
of corporate governance, legal,
geological expertise and financial
management.
ROBERT TRZEBSKI
Non-Executive Director,
Chairman of the Audit Committee
Dr. Trzebski holds a degree in Geology, PhD in Geophys-
ics, Masters in Project Management and has over 30 years
of professional experience in mineral exploration, project
management and mining services.
He is currently Chief Operating Officer of Austmine Ltd. As
a fellow of the Australian Institute of Mining and Metallurgy,
Dr. Trzebski has acted as the Competent Person (CP) for the
Company’s ASX releases.
Dr. Trzebski is a non-executive director of Lake Resources
NL (ASX: LKE; OTC:LLKKF).
Dr. Trzebski has not held any other Directorships with Austra-
lian or Canadian listed companies in the last three years.
Appointed 10 Apr 2007
Re-elected by shareholders on 27 May 2020
Austral Gold Limited
43
Annual Report 2020
SENIOR MANAGEMENT AND COMPANY SECRETARY
Mr. Ramirez holds a Mining Engineering degree from the University of Chile.
He assumed the role of VP of Operations as the Company looks to maximize
efficiencies across three operations and seek out growth opportunities.
He has been involved with the Company since it was founded, to recommis-
sion the Guanaco mine in 2010. Mr. Ramirez has led mining and engineering
activities since then, as well as all reviews and analysis of the Company’s
growth activities. Mr. Ramirez recently led the design and construction of the
Company’s new agitation leach plant at Guanaco. Prior to joining Austral, Mr.
Ramirez held senior operational, planning and execution roles at Antofagasta
PLC and at Meridian Gold’s world class El Peñon mine acquired by Yamana
Gold.
Appointed 7 August 2017
Raul Guerra assumed the role of Corporate VP Exploration in August 2020. He
brings more than 30 years of precious metal exploration experience to the Austral
Gold team. Most recently, he was Vice-President of Latin America for Barrick Gold
Corporation (Barrick). He has been involved in the discovery of more than 50 million
ounces of gold including two large greenfield discoveries at Barrick.
Mr. Guerra is a Geologist from the Universidad de Chile.
Appointed as VP of Exploration in August 2020.
Mr. Bordogna joined Austral Gold in 2013 as Controller and was promoted to CFO
in 2016. Since then, he has overseen all the corporate finance and accounting
activities, including equity and direct investments in mining related assets, listing
the company on the TSX-V, amongst others.
Mr. Bordogna is a Certified Public Accountant and holds a Master of Finance
(Universidad del CEMA) and a Master of International Business (The University of
Sydney). He is also CFA Candidate Level 3.
Prior to joining Austral Gold, he worked for the International Finance Corporation
(IFC) and Deloitte in Latin America. He has over 15 years’ experience in corporate
finance, M&A, investment banking and accounting roles.
Appointed 22 August 2016
Mr. Hwang assumed the role of Company Secretary in July 2019. Mr. Hwang
is an experienced corporate lawyer specialising in listings on the ASX, equity
capital markets and providing advice on corporate governance and compli-
ance issues.
Appointed 31 July 2019
RODRIGO RAMIREZ
Vice President of Operations
RAUL GUERRA
Vice President of Exploration
JOSÉ BORDOGNA
Chief Financial Officer
DAVID HWANG
Automic Group, Company Secretary
Austral Gold Limited
44
Annual Report 2020
DIRECTORS’ MEETINGS
The number of Directors’ meetings (including meetings of Commit-
tees of Directors) and number of meetings attended by each of the
Directors of the Company during the financial year were
Directors’
meetings
Audit
Committee
meetings
Director
Pablo Vergara del Carril
Robert Trzebski
Wayne Hubert
Eduardo Elsztain
Saul Zang
Stabro Kasaneva
Ben Jarvis
A
6
5
6
6
6
6
6
B
6
6
6
6
6
6
6
A
2
2
N/A
N/A
N/A
N/A
2
B
2
2
N/A
N/A
N/A
N/A
2
A: Number of meetings attended
B: Number of meetings held during the time the Director held office during the
financial year
SHARES AND OPTIONS
At the date of this report there are no options over the Company’s
ordinary shares.
During or since the end of the financial year, the Company has not
granted options over its ordinary shares.
INDEMNITY AND INSURANCE OF OFFICERS
Under a deed of access, indemnity and insurance, the Company
indemnifies each person who is a Director or secretary of Austral
Gold Limited against:
• any liability (other than for legal costs) incurred by a Director or
secretary in his or her capacity as an officer of the Company or
of a subsidiary of the Company; and
• reasonable legal costs incurred in defending an action for a
liability incurred or allegedly incurred by a secretary in his or
her capacity as an officer of the Company or of a subsidiary of
the Company.
The above indemnities:
• apply only to the extent the Company is permitted by law to
indemnify a Director or secretary;
• are subject to the Company’s constitution and the prohibitions
in section 199A of the Corporations Act; and
• apply only to the extent and for the amount that a Director or
secretary is not otherwise entitled to be indemnified and is not
actually indemnified by another person (including a related body
corporate or an insurer).
INDEMNITY AND INSURANCE OF AUDITOR
• The Company has not, during or since the end of the finan-
cial year, indemnified or agreed to indemnify the auditor of the
Company or any related entity against a liability incurred by
the auditor.
• During the financial year, the Company has not paid a premium
in respect of a contract to insure the auditor of the Company or
any related entity.
INTERESTS KEY MANAGEMENT PERSONNEL
• The relevant interest of each Director and Executive Officer
(directly or indirectly) in the share capital of the Company, as
notified by the Directors to the Australian Securities Exchange
in accordance with S205G(1) of the Corporations Act 2001, at
the date of this report is as follows:
Director
Ordinary Shares
Options
P Vergara del Carril
68,119
-
-
-
R Trzebski
E Elsztain
S Zang
S Kasaneva
B Jarvis
W Hubert
Raul Guerra
R Ramirez
J Bordogna
It is also noted:
451,679,060
9,615,500
1,640,763
6,881,230
-
2,545,500
801,000
279,514
22,000
136,730
-
-
-
-
-
-
1. E Elsztain, S Zang, P Vergara del Carril and are Directors of
Guanaco Capital Holding Corp which holds 35,870,730 shares
and 2,989,226 options according to the last substantial holder
notice lodged in December 2020.
2. E Elsztain and S Zang are Directors of IFISA which holds
380,234,614 shares according to the last substantial holder
notice lodged in December 2020.
E Elsztain is the ultimate beneficial owner of IFISA.
REMUNERATION REPORT (AUDITED)
Remuneration Policy
The full Board of Austral Gold is responsible for determining remu-
neration policies in respect of executives and Key Management
Personnel (KMP).
The Company has a Remuneration Policy that aims to ensure
the remuneration packages of Directors and senior executives
properly reflect the person’s duties, responsibilities and level of
performance, as well as ensuring that remuneration is competitive
in attracting, retaining and motivating people of the highest quality.
The level of remuneration for non-executive Directors is consid-
ered with regard to the practices of other public companies and
the aggregate amount of fees paid to non-executive Directors
approved by shareholders.
At this stage, the level of remuneration is based on market rates
and is not directly linked to shareholders’ wealth.
Austral Gold Limited
45
Annual Report 2020
The Key Management Personnel (KMP) during or since the end of the financial year were:
The Directors of the Group during or since the end of the financial year:
• Wayne Hubert
Executive Director
• Eduardo Elsztain
Non-Executive Vice Chairman
• Saul Zang
Non-Executive Director
• Pablo Vergara de Carril
Non-Executive Director
• Robert Trzebski
Non-Executive Director
• Ben Jarvis
Non-Executive Director
• Stabro Kasaneva
Chief Executive Officer and Director
The Senior Executive KMP during or since the end of the financial year:
• Rodrigo Ramirez
Vice President of Operations
• Raul Guerra
Vice-President of Exploration
• José Bordogna
Chief Financial Officer
Remuneration of KMP
The Group has employment agreements with all executive KMP in accordance with the laws in the jurisdiction in which the KMP is
employed.
Remuneration of executive KMP is made up of a fixed component and a variable component. Performance against predetermined
targets (KPIs) are used to determine the portion of the variable component paid annually.
The KPIs are based on financial and non-financial indicators and include production, safety, cost of production, sustaining capital
investments, new business and value accretive investments amongst others.
Link Between Remuneration and Performance
The Group aims to align its executive remuneration to its strategic and business objectives and the creation of shareholder value.
The table below shows the measures of the Group’s financial performance over the last 5 financial years as required by the
Corporations Act 2001. However, these are not necessarily consistent with the measures used in determining the variable amounts
of remuneration to be awarded to each KMP. Consequently, there may not always be a direct correlation between the statutory key
performance measures and the variable remuneration awarded.
12 months ended
30 June
2016
12 months ended
30 June
2017
6 months ended
31 December
2018
12 months ended
31 December
2019
12 months ended
31 December
2020
Sales Revenue
(US$’000)
Profit/(loss) before
tax (US$’000)
Basic EPS
(US cents per share)
Diluted EPS
(US cents per share)
Share price
(cents AUD/CDN)
101,025
48,867
122,767
102,209
88,223
(6,232)
(14,905)
(37,054)
9,508
14,335
(0.85)
(2.56)
(4.88)
0.97
1.36
(0.85)
(2.56)
(4.88)
0.93
1.34
15.0/15.0
15.0/13.0
6.0/6.0
9.0/8.5
21.0/22.0
Austral Gold Limited
46
Annual Report 2020
Details of Remuneration
Details of the nature and amount of each major element of the remuneration of each Director of the Group and each of the KMP of the
Group during the financial year were:
12 month period ended 31 December 2020
Primary
Post-employment
Share-based
Total
Cash and
accrued
Salary and
Fees
US$
Accrued
Cash
Bonus
US$1
Non-
monetary
benefits
US$
Superannuation
US$
Retirement/
Termination
benefits
US$
Shares
US$
Options
US$
US$
Directors
Non-executive directors
–
–
–
368
–
–
–
–
–
4,305
4,305
–
368
8,610
Executive Director
–
–
–
–
E Elsztain
100,000
S Zang
W Hubert
R Trzebski
B Jarvis
50,000
33,833
45,695
45,695
P Vergara del Carril
50,000
Total non-
executive director
remuneration
325,223
W Hubert
60,000
–
–
–
–
–
–
–
-
S Kasaneva
326,358
364,973
Total Director
remuneration
711,581
364,973
368
8,610
Other Key Executives
–
–
–
–
–
–
–
–
R. Ramirez
263,828
295,053
R. Guerra3
123,192
61,596
J. Bordogna
108,010
86,377
495,030
443,026
Total other
executive
remuneration
Total director and
executive officer
remuneration
1,206,611
807,999
368
8,610
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
100,000
50,000
33,833
50,368
50,000
50,000
334,201
60,000
691,331
1,085,532
558,881
184,788
194,387
938,056
2,023,588
1 Accrued cash bonus defined as bonus earned during the year that has been paid or accrued
2 All salaries are paid in local currency and converted to USD by average FX — only for the purpose of preparing this table.
3 Commenced employment during the third quarter of 2020.
Austral Gold Limited
47
Annual Report 2020
Twelve-month period ended 31 December 2019
Cash and
accrued
Salary and
Fees US$
Primary
Accrued
Cash
Bonus
US$
Non-
monetary
benefits
US$1
Post-employment
Share-based
Total
Superannuation
US$
Retirement
benefits
US$
Shares
US$
Options
US$
US$
Directors
Non-executive directors
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
4,024
4,024
–
8,648
Executive director
–
8,048
Other Key Executives
–
–
–
8,048
–
–
–
–
–
–
–
–
–
–
–
–
–
E Elsztain
100,000
S Zang
50,000
W Hubert
58,000
R Trzebski
45,676
B Jarvis
45,676
P Vergara del Carril
50,000
Total non-
executive director
remuneration
349,352
–
–
–
–
–
–
–
S Kasaneva
355,127
311,255
Total Director
remuneration
705,079
311,255
R. Ramirez
287,069
251,606
J Bordogna
119,390
69,857
Total Other
Executive
remuneration
Total director and
executive officer
remuneration
406,459
321,463
1,111,538
632,718
1 Accrued cash bonus defined as bonus earned during the year that has been paid or accrued
2 All salaries are paid in local currency and converted to USD by average FX — only for the purpose of preparing this table
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
100,000
50,000
58,000
50,000
50,000
50,000
358,000
666,382
1,024,382
538,675
189,247
727,922
1,782,304
Austral Gold Limited
48
Annual Report 2020
Contractual Arrangement with Executive KMP at 31 December 2020
Name
Term of Agreement and notice
period
Base salary
Termination payments
Stabro Kasaneva
Chief Executive
Officer
No fixed term
30 days notice
Rodrigo Ramirez
VP of Operations
No fixed term
30 days notice
Raul Guerra
VP of Exploration
No fixed term
30 days notice
Base salary is paid in Chilean
pesos annually with no FX
adjustment clause
Base salary is paid in Chilean
pesos annually with no FX
adjustment clause
Base salary is paid in Chilean
pesos annually with no FX
adjustment clause
Pro rata bonus accrued
Pro rata bonus accrued
Pro rata bonus accrued
Jose Bordogna
Chief Financial
Officer
No fixed term
30 days notice
Base salary is paid in Argentine
pesos annually with no FX
adjustment clause
Pro rata bonus accrued
Relative Proportion of Fixed vs Variable Remuneration Expense
The following table shows the relative proportions of executive remuneration that are linked to performance and those that are fixed,
based on the amounts disclosed as statutory remuneration expense in the tables above
Fixed remuneration
At risk — short-term incentive
At risk — long-term incentive
Name
December 2020 December 2019 December 2020 December 2019 December 2020 December 2019
Stabro Kasaneva
47%
53%
53%
47%
0%
0%
Executive Directors
Executive Officers
Rodrigo Ramirez
Raul Guerra
Jose Bordogna
47%
67%
56%
53%
N/A
63%
53%
33%
44%
47%
N/A
37%
0%
0%
0%
0%
N/A
0%
Austral Gold Limited
49
Annual Report 2020
Other transactions with KMP
Zang, Bergel & Viñes Abogados is a related party since two non-executive Directors, Saul Zang and Pablo Vergara del Carril have
significant influence over this law firm based in Buenos Aires, Argentina. Fees charged to the Company for the year ended 31 December
2020 amounted to US$148,696 (2019: US$141,022).
Cresud S.A.C.I.F.Y.A, IRSA Inversiones y Representaciones S.A., IRSA Proiedades Comerciales S.A. and Consultores Asset Manage-
ment S.A. are related parties as they are controlled by Non-executive Director and Chairman, Eduardo Elsztain. During the twelve
month period ended 31 December 2020 a total of US$62,047 was charged to the Company (2019: US$326,437) in regard to IT services
support, HR services, software licenses building/ office expenses and other fees.
During April 2019, Consultores Assets Management SA, a company controlled by E Elsztain provided a loan of US$1.6 million at an
annual interest rate of at 10% per annum. The loan plus interest of $30,609, was repaid in July 2019.
This concludes the remuneration report, which has been audited.
Auditors
KPMG continues in office as auditors in accordance with the requirements of the Corporations Act 2001.
Non-audit services
Details of the amounts paid or payable to the auditor for non-audit services provided during the period by the auditor are outlined in
note 10 to the financial statements. There were no non-audit services provided by KPMG in 2020 (2019: Nil).
The Directors are satisfied that the provision of non-audit services during the period by the auditor (or by another person or firm on
the auditor’s behalf), is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001.
The Directors are of the opinion that the services as disclosed in note 10 during the period do not compromise the external auditor’s
independence requirements of the Corporations Act 2001 for the following reasons:
• all non-audit services have been reviewed and approved to ensure that they do not impact the integrity and objectivity of the audi-
tor; and
• none of the services undermine the general principles relating to auditor independence as set out in APES 110 Code of Ethics for
Professional Accountants issued by the Accounting Professional and Ethical Standards Board, including reviewing or auditing the
auditor’s own work, acting in a management or decision-making capacity for the company, acting as advocate for the company or
jointly sharing economic risks and rewards.
Proceedings on Behalf of the Company
No person has applied for leave of Court to bring proceedings on behalf of the Company or intervene in any proceedings to which the
Company is a party for the purpose of taking responsibility on behalf of the Company for all or part of those proceedings.
Auditor’s Independence Declaration
The lead auditor’s independence declaration for the period ended 31 December 2020 has been received and is included in this report.
Signed in accordance with a resolution of Directors at Sydney.
Rounding of Amounts
The Company is a company of the kind referred to in ASIC Instrument 2016/191, dated 1 April 2016, and in accordance with that Instru-
ment amounts in the Directors’ Report and the financial report are rounded off to the nearest thousand dollars, unless otherwise indicated.
Signed in accordance with a resolution of Directors made pursuant to s.298(2) of the Corporations Act 2001.
For and on behalf of the board
Robert Trzebski
Director
17 March 2021
Austral Gold Limited
50
Annual Report 2020
Lead Auditor’s Independence Declaration under
Section 307C of the Corporations Act 2001
To the Directors of Austral Gold Limited
I declare that, to the best of my knowledge and belief, in relation to the audit of Austral Gold Limited for
the financial year ended 31 December 2020 there have been:
no contraventions of the auditor independence requirements as set out in the
Corporations Act 2001 in relation to the audit; and
no contraventions of any applicable code of professional conduct in relation to the audit.
i.
ii.
KPM_INI_01
PAR_SIG_01
PAR_NAM_01
PAR_POS_01
PAR_DAT_01
PAR_CIT_01
KPMG
Daniel Camilleri
Partner
Sydney
17 March 2021
51
KPMG, an Australian partnership and a member firm of the KPMG
global organisation of independent member firms affiliated with
KPMG International Limited, a private English company limited by
guarantee. All rights reserved. The KPMG name and logo are
trademarks used under license by the independent member firms of
the KPMG global organisation.
Liability limited by a scheme
approved under Professional
Standards Legislation.
Austral Gold Limited
51
Annual Report 2020
Austral Gold Limited
52
Annual Report 2020
Austral Gold Limited
53
Annual Report 2020
FINANCIAL
STATEMENTS
Austral Gold Limited
54
Annual Report 2020
AUSTRAL GOLD LIMITED FINANCIAL REPORT 2020
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
All figures are reported in thousands of US$
Continuing operations
Sales revenue
Cost of sales
Gross profit before depreciation and amortisation expense
Depreciation and amortisation expense
Gross profit
Other expense
Administration expenses
Net finance costs
Share of loss of associate
(Loss)/gain on financial assets
Profit before income tax
Income tax expense
Profit after income tax expense
Profit attributable to:
Owners of the Company
Non-controlling interests
Items that may not be classified subsequently to profit or loss
Foreign currency translation
Total comprehensive income for the year
Comprehensive income/(loss) attributable to:
Owners of the Company
Non-controlling interests
Earnings per share (cents per share):
Basic earnings per share
Diluted earnings per share
The notes on pages (59) to (87) are an integral part of these consolidated financial statements.
For the year ended 31 December
Note
2020
2019
13
6
6
7
8
9
21
11
12
12
88,223
(34,072)
54,151
(16,267)
37,884
(13,000)
(7,907)
(361)
(507)
(1,774)
14,335
(6,668)
7,667
7,667
-
7,667
(55)
7,612
7,612
-
7,612
1.36
1.34
102,209
(55,293)
46,916
(20,255)
26,661
(4,072)
(9,304)
(3,787)
-
10
9,508
(7,869)
1,639
5,225
(3,586)
1,639
19
1,658
5,244
(3,586)
1,658
0.97
0.93
Austral Gold Limited
55
Annual Report 2020
AUSTRAL GOLD LIMITED FINANCIAL REPORT 2020
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
All figures are reported in thousands of US$
As at 31 December
Note
2020
2019
Assets
Current assets
Cash and cash equivalents
Trade and other receivables
Other financial assets
Inventories
Total current assets
Non-current assets
Other receivables
Mine properties
Property, plant and equipment
Exploration and evaluation expenditure
Investment accounted for using the Equity method
Goodwill
Deferred tax assets
Total non-current assets
Total assets
Liabilities
Current liabilities
Trade and other payables
Income tax payable
Employee entitlements
Loans and borrowings
Promissory note
Lease liabilities
Total current liabilities
Non-current liabilities
Trade and other payables
Provisions for reclamation and rehabilitation
Loans and borrowings
Lease liabilities
Employee entitlements
Deferred tax liability
Total non-current liabilities
Total liabilities
Net assets
Equity
Issued capital
Accumulated losses
Reserves
Total equity
14
16
17
15
16
18
19
20
21
7
11
22
23
25
21
19
22
24
25
19
23
11
26
27
28
12,401
4,469
404
14,668
31,942
1,907
3,876
44,146
18,941
4,221
-
432
9,196
6,825
277
10,551
26,849
990
6,484
50,432
15,281
3,976
926
1,229
73,523
105,465
79,318
106,167
10,371
6,034
3,894
831
-
2,905
24,035
8,910
2,022
3,548
4,045
1,957
3,047
23,529
-
1
11,050
10,814
1,246
3,416
24
4,426
20,162
44,197
61,268
102,177
(43,871)
2,962
61,268
2,077
6,302
1,048
5,665
25,907
49,436
56,731
101,682
(44,238)
(713)
56,731
The notes on pages (59) to (87) are an integral part of these consolidated financial statements.
Austral Gold Limited
56
Annual Report 2020
AUSTRAL GOLD LIMITED FINANCIAL REPORT 2020
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 31 December 2020 and 2019
All figures are reported
in thousands of US$
Balance at 31 December 2018
Adjustment on initial application
of AASB16
Note
Issued
capital
Accumulated
losses
Reserves
100,569
(49,473)
-
10
Adjusted balance at 1 January 2019
100,569
Profit (loss) for the year
Foreign exchange movements from
translation of financial statements to US$
Total comprehensive income/ (loss)
-
-
-
Issued Capital
26
1,113
Acquisition of 49% of Cachinalito
Acquisition of 30% of Casposo
Balance at 31 December 2019
Profit for the year
Profit transferred to profit reserve
Foreign exchange movements from
translation of financial statements to US$
Total comprehensive income/ (loss)
Issued Capital
Dividend paid
-
-
101,682
-
-
-
-
495
-
26
(49,463)
5,225
-
5,225
-
-
-
(44,238)
7,667
(7,300)
-
367
-
-
Balance at 31 December 2020
102,177
(43,871)
The notes on pages (59) to (87) are an integral part of these consolidated financial statements.
Non-
controlling
interest
Total
3,741
54,872
-
10
3,741
(3,586)
-
(3,586)
-
(1,361)
1,206
-
-
-
-
-
-
-
-
54,882
1,639
19
1,658
1,299
(908)
(200)
56,731
7,667
-
(55)
7,612
421
(3,496)
61,268
35
-
35
-
19
19
186
453
(1,406)
(713)
-
7,300
(55)
7,245
(74)
(3,496)
2,962
Austral Gold Limited
57
Annual Report 2020
AUSTRAL GOLD LIMITED FINANCIAL REPORT 2020
CONSOLIDATED STATEMENT OF CASH FLOWS
All figures are reported in thousands of US$
Changes in cash and cash equivalents
Cash and cash equivalents at the beginning of the period
Cash and cash equivalents, at the end of the period
Net increase in cash and cash equivalents
Causes of change in cash and cash equivalents
Operating activities
Profit after income tax
Non-cash items
Income tax expense recognized in profit or loss
Impairment of goodwill
Impairment of exploration and evaluation expenditure
Depreciation and amortisation
Interest received
(Gain)/loss on sale of equipment
Non-cash net finance charges
Provision for reclamation and rehabilitation
Inventory write-down
Allowance for doubtful accounts
Non-cash employee entitlements
Share of loss of associate
Loss/(gain) in fair value of other financial assets
Net cash from operating activities before change in assets and liabilities
Changes in working capital:
(Increase) Decrease in inventory
Decrease in trade and other receivables
(Decrease) in trade and other payables
(Decrease) in deferred revenue
(Decrease) in employee entitlements
Net cash provided through operating activities
Cash flows from investing activities
Additions to plant, property and equipment
Proceeds from maturity of bonds and sale of securities
Proceeds from sale of inventory and equipment
Payment for investment in exploration and evaluation
Payment for investment in mine properties
Payment for equity investment, net of costs
Payment for purchase of a property option
Payment for purchase of non-controlling interests
Interest received
Net cash used in investing activities
Cash flows from financing activities
Proceeds from loans and borrowings
Repayment of loans and borrowings
Repayment of lease liabilities
Interest paid on leases
Proceeds from rights offering net of offering costs
Proceeds from exercise of options net of costs
Dividends paid
Net cash used in financing activities
Net increase in cash and cash equivalents
For the year ended 31 December
Note
2020
2019
9,196
12,401
3,205
1,716
9,196
7,480
7,667
1,639
6,668
926
748
16,267
(4)
(114)
742
767
286
123
591
507
1,774
36,948
(4,653)
1,316
(1,860)
-
(1,269)
30,482
7,869
-
862
20,255
(27)
215
1,860
175
179
75
255
-
(10)
33,347
2,481
1,417
(4,183)
(2,140)
(1,287)
29,635
19
20
18
21
17
29
(7,624)
(10,035)
99
366
(3,329)
(1,036)
(2,708)
(2,000)
-
4
294
650
(779)
(1,993)
(2,019)
-
(817)
27
(16,228)
(14,672)
1,072
(5,117)
(3,495)
(434)
-
421
(3,496)
(11,049)
3,205
5,991
(11,455)
(2,794)
(524)
1,299
-
-
(7,483)
7,480
The notes on pages (59) to (87) are an integral part of these consolidated financial statements.
Austral Gold Limited
58
Annual Report 2020
NOTES TO THE FINANCIAL STATEMENTS
1. REPORTING ENTITY
Austral Gold Limited (“the Company”) is a company limited by shares that is incorporated and domiciled in Australia.
The Company’s shares are publicly traded on the Australian Securities Exchange under the symbol AGD and on the TSX
Venture Exchange under the symbol AGLD.
These consolidated financial statements (“financial statements”) as at and for the year ended 31 December 2020 comprise
the Company and its subsidiaries (together referred to as the “Group”). The nature of the operations and principal activi-
ties of the Group are described in the Directors’ Report.
These financial statements are available upon request from the Company’s registered office at Level 5, 126 Phillip Street,
Sydney NSW 2000 or at www.australgold.com.
2. BASIS OF PREPARATION
The consolidated financial statements are general purpose financial statements which have been prepared in accordance
with Australian Accounting Standards and Interpretations issued by the Australian Accounting Standards Board (‘AASB’)
and the Corporations Act 2001, as appropriate for profit oriented entities. The consolidated financial statements also
comply with International Financial Reporting Standards as issued by the International Accounting Standards Board.
The consolidated financial statements have been prepared under the historical cost convention, except for certain
financial assets and liabilities which are stated at fair value. These financial statements were authorised for issue by the
Company’s Board of Directors on 17 March 2021. Details of the Group’s accounting policies are included in Note 38.
2.1 Functional and Presentation currency
These consolidated financial statements are presented in United States dollars (US$), which is the Group’s functional
currency. The Group is of a kind referred to in ASIC Corporations (Rounding in Financial/Directors’ Reports) Instrument
2016/191 and in accordance with the legislative instrument, amounts in the audited financial statements have been
rounded off to the nearest thousand dollars, unless otherwise stated.
2.2 Parent entity information
In accordance with the Corporations Act 2001, these financial statements present the results of the Group only. Supple-
mentary information about the parent entity is disclosed in note 34.
2.3 Reclassification of Prior Year Presentation
Certain prior year amounts have been reclassified for consistency with the current year presentation. These reclassifica-
tions had no effect on the reported results of operations. Inventory movements previously included in Production in Cost
of Sales have been disclosed separately.
3. GOING CONCERN
The outbreak of the COVID-19 pandemic and the measures adopted by governments in countries worldwide to mitigate
the pandemic’s spread have impacted the Group. These measures required the Group to stop its exploration activities at
the Casposo Mine in Argentina during its second quarter and take several precautionary measures to protect the health
of the Group’s employees. However, the Group’s production, financial performance for the year and its liquidity have not
been negatively impacted by COVID-19.
For the year ended 31 December 2020, the Group made a profit after income tax of US$7,667 million (2019: profit after
income tax of US$1,639 million) from continuing operations and generated net cash flows from operating activities of
US$30,482 million (2019: net cash flow from operating activities of US$29,635 million). At 31 December 2020, the Group
has net current assets of US$7,907 million (2019: net current assets of US$3,320 million).
There is still significant uncertainty over how the outbreak of COVID-19 will impact the Group’s business in future periods.
However, the Directors note the following with regards to the ability of the Group to continue as a going concern:
i. At 31 December 2020, the Group had a cash balance of US$12,401 million and approximately 6,200 refined gold
ounces in inventory with a fair value of US$11.7 million.
ii. The Group’s cash flow forecasts following the most likely mine plan and 2021 production guidance that forecast sales of;
• 50,000-55,000 gold equivalent ounces; and
• average 2021 selling price of gold equivalent ounces US$1,790, indicate that the Group forecasts that it will have
free cash flow from operations to meet its borrowing obligations, to meet the required capital expenditures and fund
the acquisition and investment disclosed in note 37.
The financial statements have been prepared on a going concern basis, which contemplates the continuation of normal
business operations and the realization of assets and settlement of liabilities in the normal course of business. Based
on the factors set out above, the Directors believe that the going concern basis of preparation is appropriate and the
Group will be able to repay its debts as and when they fall due.
Austral Gold Limited
59
Annual Report 2020
NOTES TO THE FINANCIAL STATEMENTS
4. USE OF ESTIMATES AND JUDGEMENTS
In preparing these financial statements, Management has made judgements, estimates and assumptions that affect
the application of the accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual
results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to estimates are recognised
prospectively. Information about assumptions and estimation uncertainties that have a significant risk of resulting in a
material adjustment in the year ended 31 December 2020 is detailed below:
Carrying value of Mine Properties
The Group estimates its ore reserves and mineral resources annually at each year end, based on information compiled
by Competent Persons as defined in accordance with the Australasian code for reporting Exploration Results, Mineral
Resources and Ore Resources (JORC code 2012). The estimated quantities of economically recoverable reserves
are based upon interpretations of geological models and require assumptions to be made regarding factors such as
estimates of short and long-term exchange rates, estimates of short and long-term commodity prices, future capital
requirements and future operating performance. Changes in reported reserves estimates can impact the carrying amount
of mine development (including mine properties, property, plant and equipment and exploration and evaluation assets),
the provision for mine closure provisions, the recognition of deferred tax assets, as well as the amount of amortisation
charged to the statement of profit or loss.
Impairment
Significant judgements, estimates and assumptions are required in determining value in use or fair value less costs of
disposal. This is particularly so in the assessment of long life assets. It should be noted that the CGU recoverable amounts
are subject to variability in key assumptions including, but not limited to, gold and silver prices, currency exchange rates,
discount rates, production profiles and operating and capital costs. A change in one or more of the assumptions used
to determine value in use or fair value less costs of disposal could result in a change in a CGU’s recoverable amount.
Carrying value of exploration and evaluation assets
The Group tests at each reporting date whether there are any indicators of impairment as identified by AASB 6 “Exploration
for and Evaluation of Mineral Resources”. Where indicators of impairment are identified, the recoverable amounts of the
assets are determined and an impairment is recorded when the carrying value exceeds recoverable value.
Mine closure provisions
Obligations associated with exploration and mine properties are recognised when the Group has a present obligation,
the future sacrifice of the economic benefits is probable, and the provision can be measured reliably. The provision is
measured at the present value of the future expenditure and a corresponding rehabilitation asset is also recognised. On
an ongoing basis, the rehabilitation will be remeasured in line with the changes in the time value of money (recognised
as an expense and an increase in the provision), and additional disturbances (recognised as additions to a correspond-
ing asset and rehabilitation liability). The calculation of this provision requires assumptions such as application of envi-
ronmental legislation, mine closure dates, available technologies and engineering cost estimates. The related carrying
amounts are disclosed in note 24.
Measurement of fair values
The Group has established a control framework with respect to the measurement of fair values. Estimates and underly-
ing assumptions are reviewed on an ongoing basis. Revisions to estimates are recognised prospectively. Information
about assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment in the
year ended 31 December 2020 is detailed below:
A number of the Group’s accounting policies and disclosures require the measurement of fair values, for both financial
and non-financial assets and liabilities.
When measuring the fair value of an asset or a liability, the Group uses market observable data as far as possible. Fair
values are categorised into different levels in a fair value hierarchy based on the inputs used in the valuation techniques
as follows:
i. Level 1 — quoted prices (unadjusted) in active markets for identical assets or liabilities
ii. Level 2 — inputs other than quoted prices within Level 1 that are observable for the asset or liability, either directly
(i.e. as prices), or indirectly (i.e. derived from prices)
iii. Level 3 — inputs for the asset or liability that are not based on observable market data (unobservable inputs).
If the inputs used to measure the fair value of an asset or a liability might be categorised in different levels of the fair value
hierarchy, then the fair value measurement is categorised in its entirety in the same level of the fair value hierarchy as the
lowest level input that is significant to the entire measurement.
The Group recognises transfers between levels of the fair value hierarchy at the end of the reporting period during which
the change has occurred.
Austral Gold Limited
60
Annual Report 2020
NOTES TO THE FINANCIAL STATEMENTS
The Group holds listed equity securities on the Australian and Canadian stock exchanges and listed Argentine sovereign
bonds at fair value, which are measured at the closing bid price at the end of the reporting period. These financial assets
held at fair value fall within Level 1 of the fair value hierarchy. The Group also holds options which rely on estimates and
judgements to calculate a fair value for these financial instruments using the Black Scholes model. These financial assets
held at fair value fall within Level 2 of the fair value hierarchy.
Further information about the assumptions made in measuring fair values is included in Note 17 – Other financial assets
and Note 30 – Financial instruments.
5. CHANGES IN SIGNIFICANT ACCOUNTING POLICIES AND ADOPTION OF NEW/AMENDED AASB AND
AASB INTERPRETATIONS
Adoption of other narrow scope amendments to IFRSs and IFRS Interpretations
A number of new standards and amendments to standards are effective for annual periods beginning after 1 January
2021 and earlier application is permitted; however, the Group has not early adopted the new or amended standards in
preparing these consolidated financial statements.
6. COST OF SALES
All figures are reported in thousands of US$
Profit before income tax includes the following specific expenses:
For the year ended 31 December
2020
2019
Production
Staff costs
Royalties
Mining Fees
Inventory movements
Total cost of sales before depreciation and amortisation expense
Depreciation of plant and equipment
Amortisation of mine properties
Total depreciation and amortisation expense
Severance included in staff costs
7. OTHER EXPENSES
All figures are reported in thousands of US$
Settlement of union agreement at Guanaco/Amancaya
Severance of mining employees due to outsource of operations
Impairment of goodwill (i)
Impairment of exploration and evaluation expenditure
Care and maintenance
Restructuring expenses
Exploration expenses
(Gain)/loss on sale of fixed assets and inventory
Other
Total other expenses
18,020
17,843
1,962
474
(4,227)
34,072
14,229
2,038
16,267
1,608
For the year ended 31 December
2020
4,963
4,278
926
748
1,983
-
282
(114)
(66)
13,000
31,377
21,616
2,560
502
(762)
55,293
17,117
3,138
20,255
988
2019
-
-
-
862
1,185
2,087
-
215
(277)
4,072
(i) Goodwill of US$926,000, which arose on the acquisition of a subsidiary, Ingenieria y Mineria Cachinalito Limitada was
written off as Ingenieria y Mineria Cachinalito Limitada is in the process of being wound up.
Austral Gold Limited
61
Annual Report 2020
NOTES TO THE FINANCIAL STATEMENTS
8. ADMINISTRATION EXPENSES
All figures are reported in thousands of US$
Consulting and professional services
Administration
Staff costs
Non-executive director fees
Other
Total administration expenses
Severance included in staff costs
9. NET FINANCE COSTS
All figures are reported in thousands of US$
Interest income
Interest expense
Interest expense on leases
(Gain)/loss from foreign exchange
Present value adjustment to mine closure provision
Other
Net finance costs
10. AUDITOR’S REMUNERATION
All figures are reported in US$
Audit and review services:
Auditors of the Group-KPMG
Audit and review of financial statements-Group
Audit and review of financial statements-controlled entities
11. INCOME TAX EXPENSE
All figures are reported in thousands of US$
(A) Income tax expense comprises:
Current tax payable
Deferred tax (benefit)/expense
Income tax
(B) Reconciliation of effective income tax rate
Profit before tax
Prima facie income tax expense calculated at 30%
Difference due to blended overseas tax rate*
Non-deductible expenses
Temporary differences not brought into account
Recognition of carry-forward tax losses
Income tax
* Chile tax rate: 27.0% (31 December 2019: 27.0%). Argentina tax rate: 30% (31 December 2019: 30%)
For the year ended 31 December
2020
1,427
1,095
3,754
334
1,297
7,907
42
For the year ended 31 December
2020
(4)
214
434
(535)
252
-
361
2019
1,987
1,044
4,909
358
1,006
9,304
84
2019
(27)
901
524
1,845
517
27
3,787
For the year ended 31 December
2020
2019
92,885
144,700
237,585
74,000
159,500
233,500
For the year ended 31 December
2020
7,450
(782)
6,668
14,335
4,300
(720)
2,907
149
32
6,668
2019
2,312
5,557
7,869
9,508
2,852
(721)
6,510
(460)
(312)
7,869
Austral Gold Limited
62
Annual Report 2020
NOTES TO THE FINANCIAL STATEMENTS
All figures are reported in
thousands of US$
31 December 2020
31 December 2019
Chile Argentina
Other
Total
Chile Argentina
Other
Total
(C) Deferred tax assets and liabilities
Deferred tax assets
Other receivable
Inventory
Mining concessions brought
to account
Accrual for mine closure
Deferred income
Tax losses carried forward
Property, plant and
equipment
Payroll accrual
Other
Leasing
Tax losses not brought
to account
147
69
-
2,037
2,266
-
-
326
-
884
-
-
84
198
302
-
245
632
-
102
-
-
-
-
-
-
147
153
199
2,339
2,266
9,965
10,210
-
-
-
-
632
326
102
884
57
69
–
1,198
18
–
–
780
36
1,147
(9,965)
(9,965)
–
–
61
320
198
–
98
1,072
–
989
–
–
Deferred tax assets
5,729
1,563
Deferred tax liabilities
Mining concessions
(10,672)
-
-
-
7,292
3,305
2,738
(10,672)
(8,950)
–
–
–
–
–
–
57
130
320
1,396
18
9,182
9,280
–
–
–
–
1,072
780
1,025
1,147
(9,182)
(9,182)
-
–
6,043
(8,950)
Property plant and equipment
inflation adjustment
-
(1,040)
(23)
(1,063)
Financial assets
540
(91)
-
449
–
–
(1,474)
(20)
(1,494)
(35)
–
(35)
Deferred tax liabilities
(10,132)
(1,131)
(23)
(11,286)
(8,950)
(1,509)
(20)
(10,479)
Net deferred tax
(liabilities)/assets
(4,403)
432
(23)
(3,994)
(5,645)
1,229
(20)
(4,436)
Movement in deferred tax balances
Opening balance
(5,645)
1,229
(20)
(4,436)
(888)
3,892
–
3,004
Exchange rate difference
-
Charged to profit or loss
Closing balance
1,242
(4,403)
(349)
(448)
432
9
(340)
2
(1,897)
12
(1,883)
(12)
782
(4,759)
(766)
(32)
(5,557)
(23)
(3,994)
(5,645)
1,229
(20)
(4,436)
Deferred tax assets have not been recognised in respect to tax losses for certain entities of the Group. See Note 36 for details.
12. EARNINGS PER SHARE
All figures are reported in thousands of US$
Net profit/(loss) attributable to owners
Weighted average number of shares used as the denominator
Number for basic earnings per share
Number for diluted earnings per share
Basic earnings per ordinary share (cents)
Diluted earnings per ordinary share (cents)
For the year ended 31 December
2020
7,667
562,581,929
572,718,453
1.36
1.34
2019
5,225
539,424,350
556,237,880
0.97
0.93
Austral Gold Limited
63
Annual Report 2020
NOTES TO THE FINANCIAL STATEMENTS
13. OPERATING SEGMENTS
Management have determined the operating segments based on reports reviewed by the Chief Operating Decision Maker
(“CODM”). The CODM considers the business from both operations and geographic perspective and has identified two
reportable segments, Guanaco/Amancaya which is based in Chile and Casposo which is based in Argentina. The CODM
monitors the performance in these two regions separately. During the year ended 31 December 2020, the Group earned
approximately 57% (2019-78%) of its consolidated revenue from sales made to one customer.
All figures are
reported in
thousands of US$
Revenue:
Gold
Silver
Cost of sales
Depreciation
and amortization
expense
Other (expense)
Income
Administration
expenses
Finance costs
Share of loss of
associate
(Loss)/gain on
financial assets
For the year ended 31 December 2020
For the year ended 31 December 2019
Guanaco
Amancaya
Casposo
Group and
unallocated
items Consolidated
Guanaco/
Amancaya
Casposo
Group and
unallocated
items
Consolidated
82,810
5,413
(34,072)
-
-
-
-
-
-
82,810
5,413
84,823
8,650
5,045
3,691
(34,072)
(44,985)
(10,308)
-
-
-
(16,106)
(119)
(42)
(16,267)
(16,269)
(3,927)
(59)
89,868
12,341
(55,293)
(20,255)
(10,103)
(2,149)
(748)
(13,000)
(668)
(3,479)
75
(4,072)
(4,193)
(552)
(3,162)
(7,907)
(5,455)
(887)
(2,962)
(9,304)
(462)
1,450
(1,349)
-
(2,000)
-
-
(361)
(507)
(507)
226
(1,774)
(1,239)
(2,545)
-
-
-
-
(3)
-
10
118
(3,787)
-
10
(7,869)
Income tax expense
(6,224)
(397)
(47)
(6,668)
(7,155)
(832)
Segment profit/
(loss)
Segment assets
Segment liabilities
Capital expenditure
15,063
(1,767)
(5,629)
7,667
17,702
(13,242)
(2,821)
1,639
77,124
38,681
10,599
12,701
15,640
105,465
4,091
638
1,425
225
44,197
11,462
76,525
41,832
12,138
13,568
16,074
106,167
4,565
486
3,039
183
49,436
12,807
Austral Gold Limited
64
Annual Report 2020
NOTES TO THE FINANCIAL STATEMENTS
Geographic information:
All figures are reported in thousands of US$
Revenue by geographic location
Chile
Argentina
Australia
Canada
United States
Total revenue
Non-current assets by geographic location
Chile
Argentina
United States
British Virgin Islands
Canada
Australia
Total non-current assets
14. CASH AND CASH EQUIVALENTS
All figures are reported in thousands of US$
Cash at call and in hand
Short-term investments
Total cash and cash equivalents
For the year ended 31 December
2020
88,223
-
-
-
-
88,223
51,468
17,722
4,221
110
2
-
73,523
For the year ended 31 December
2020
12,285
116
12,401
2019
93,473
8,736
-
-
-
102,209
57,615
17,619
3,976
102
6
-
79,318
2019
7,756
1,440
9,196
Reconciliation of Cash
Cash at the end of the financial year as shown in the Statement of Cash Flows, is reconciled to items in the Statement of Financial
Position as follows:
Cash and cash equivalents
12,401
9,196
Risk Exposure
The Group’s exposure to interest rate risk is discussed in note 30. The maximum exposure to credit risk at the reporting date is
the carrying amount of each class of cash and cash equivalents mentioned above.
15. INVENTORIES
All figures are reported in thousands of US$
Materials and supplies
Ore stocks
Gold bullion and gold in process
Total inventories
As at 31 December
2020
8,538
776
5,354
14,668
2019
8,648
71
1,832
10,551
*Ore stock inventories require estimates and assumptions most notably in regard to grades, volumes, densities, future completion costs and ultimate sale price. Such
estimates and assumptions may change as new information becomes available which may impact upon the carrying value of inventory. The allowance for inventory
obsolescence forming part of the above balance is US$1,548k (31 December 2019:US$1,262k).
Austral Gold Limited
65
Annual Report 2020
NOTES TO THE FINANCIAL STATEMENTS
16. TRADE AND OTHER RECEIVABLES
All figures are reported in thousands of US$
Current
Trade receivables
Other current receivables
Loan receivable (i)
Prepaid income tax
GST/VAT receivable
Total current receivables
Non-current
GST/VAT receivable
Prepaid income tax
Loan receivable (i)
Other
Total non-current receivables
Allowance for doubtful accounts included in trade receivables
Trade debtors
The ageing of trade receivables is 0–30 days
As at 31 December
2020
2,285
1,072
132
112
868
4,469
905
799
12
191
1,907
513
2,285
2019
3,787
548
–
1,252
1,238
6,825
578
–
–
412
990
390
3,787
(i) As part of the new three year collective labour agreements with Unions at the Group’s Guanaco/Amancaya mines, the
Company provided non-interest-bearing loans to employees
16.1 Past due but not impaired
There were no receivables past due at 31 December 2020 (31 December 2019: nil).
16.2 Fair value and credit risk
Due to the short-term nature of trade receivables, their carrying amount is assumed to approximate their fair value. Refer
to note 30 for more information on the risk management policy of the Group and the credit quality of the receivables.
16.3 Key customers
The Group is mainly reliant on three customers to which gold and silver produced from the Guanaco/Amancaya mines
are sold.
17. OTHER FINANCIAL ASSETS
All figures are reported in thousands of US$
Current
Call option to buy a further 3.795% of Rawhide — level 3
Listed bonds — level 1
Listed equity securities — level 1
Total current other financial assets at fair value
As at 31 December
2020
-
34
370
404
2019
4
29
244
277
The table above sets out the Group’s assets and liabilities that are measured and recognised at fair value at 31 December
2020 and 2019.
Listed securities are shares of a Canadian listed mining company and sovereign bonds nominated in USD as at 31
December 2020 and 2019.
Call options as at 31 December 2019 are options to acquire an interest in a certain mining asset in North America which
were exercised during year ended 31 December 2020. During the year ended 31 December 2020, another option to
acquire certain mining properties in South America which was purchased at a cost of US$2 million. This option was
initially valued using the Black-Scholes option valuation model at the time of acquisition and revalued to nil during the
year ended 31 December 2020.
Fair value hierarchy
Refer to note 4 of these financial statements for details of the fair value hierarchy.
Transfers
During the year ended 31 December 2020 there were no transfers between the financial instrument levels of hierarchy.
Austral Gold Limited
66
Annual Report 2020
NOTES TO THE FINANCIAL STATEMENTS
18. MINE PROPERTIES
All figures are reported in thousands of US$
Guanaco/Amancaya
Casposo
Total
Mine Properties – 31 December 2019
Cost
Accumulated amortisation
Carrying value — Mine Properties
Movements in carrying value
Carrying amount at 1 January 2019
Additions
Transfers from Exploration and Evaluation expenditure
Amortisation
Carrying amount at 31 December 2019
Mine Properties — 31 December 2020
Cost
Accumulated amortisation
Carrying value — Mine Properties
Movements in carrying value
Carrying amount at 1 January 2020
Additions
Transfers to Exploration and Evaluation expenditure
Decrease in provision for reclamation and rehabilitation
Amortisation
Carrying amount at 31 December 2020
63,122
(56,638)
6,484
6,723
1,993
-
(2,232)
6,484
62,552
(58,676)
3,876
6,484
1,036
(1,079)
(527)
(2,038)
3,876
9,795
(9,795)
-
-
-
906
(906)
-
9,795
(9,795)
-
-
-
-
-
-
-
72,917
(66,433)
6,484
6,723
1,993
906
(3,138)
6,484
72,347
(68,471)
3,876
6,484
1,036
(1,079)
(527)
(2,038)
3,876
Carrying value — Guanaco/Amancaya
The Guanaco and Amancaya mines have been determined by Management to be a single cash generating unit (“CGU”).
The mine properties noted above and the property, plant and equipment that is an intrinsic part of the mine and its
structure (included in note 19) with a total book value of US$42.5 million are included in determining the carrying value
of the CGU for the purposes of assessing for impairment.
Management have assessed the fair value to be above book value of the Guanaco/Amancaya project and therefore
no impairment charge has been applied to the assets for the current year. An impairment test was also performed by
an independent party using the discounted cash flow model (DCF) as the primary valuation methodology along with a
crosscheck method using comparable listed market values.
Main assumptions of the DCF model for impairment test purposes are as follows:
• Real Forecast Gold price (2021-2024): US$1,554/oz – US$1,871/oz (31 December 2019 US$1,493/oz – US$1,498/oz)
• Real Forecast Silver price: (2021-2024) US$18.70/oz – US$23.1/oz (31 December 2019 US$17.10/oz – US$17.90/oz)
• One year of underground mining plus three years of processing existing heap leach pads
• Real Discount Rate (post-tax): 4.8% (31 December 2019: 4.9%)
The sensitivity to +/- 10% variation in the gold price (US$1,398-2,058/oz) on the fair value of the Guanaco/Amancaya
project results in an impact of +/- US$9.4 million.
The sensitivity to +/- 10% variation in the discount rate (4.3%-5.3%) fair value of the Guanaco/Amancaya project results
in an impact of +/- US$0.4 million.
The sensitivities do not lead to a fair value below the book value of the project.
Austral Gold Limited
67
Annual Report 2020
NOTES TO THE FINANCIAL STATEMENTS
19. PROPERTY, PLANT AND EQUIPMENT
All figures are reported in thousands of US$
Property, plant and equipment owned
Right-of-use
Property, plant and equipment owned
Cost
Accumulated depreciation
Carrying amount at 31 December 2020 and 31 December 2019
Movements in carrying value
Carrying amount at beginning of the year
Additions
Transfer of leases to right-of-use
Depreciation
Disposals
Carrying amount at 31 December 2020 and 31 December 2019
31 December 2020
31 December 2019
34,725
9,421
44,146
154,297
(119,572)
34,725
37,515
7,624
-
(10,411)
(3)
34,725
37,515
12,917
50,432
146,883
(109,368)
37,515
54,020
10,035
(12,930)
(13,352)
(258)
37,515
The majority of the property, plant and equipment is included in the Guanaco/Amancaya Cash Generating Unit (“CGU”).
Property, plant and equipment that does not form part of the Guanaco CGUs are being carried at the lower of their book
value and recoverable amount. The Casposo property, plant and equipment is recorded at salvage value as it is currently
not being used.
The Group leases production equipment under a number of finance leases. At 31 December 2020, the net carrying
amount of finance lease assets under AASB 16 was US$9.4m.
All figures are reported in
thousands of US$
Underground
Mine
Development
Plant
Mining
Equipment
31 December 2020
Buildings
Land
Other
Total
Movements in carrying value
Balance at 1 January, 2019
14,669
28,090
815
790
Additions
Transfer of leases to
right-of-use assets
Disposals
Depreciation
Carrying amount at 31
December 2019
Additions
Disposals
Depreciation
Carrying amount at 31
December 2020
7,687
655
-
-
(10,652)
-
(5,670)
(5,392)
5,600
1,013
(888)
(258)
(917)
16,686
12,701
4,550
5,718
-
401
-
(5,637)
(3,031)
362
-
(841)
4,056
680
(1,390)
-
(1,173)
2,173
2,173
1,037
(3)
(630)
-
-
-
815
815
-
-
-
54,020
10,035
(12,930)
(258)
-
-
-
(200)
(13,352)
590
590
106
-
37,515
37,515
7,624
(3)
(272)
(10,411)
16,767
10,071
4,071
2,577
815
424
34,725
Balance at 1 January, 2020
16,686
12,701
4,550
Austral Gold Limited
68
Annual Report 2020
NOTES TO THE FINANCIAL STATEMENTS
Reconciliation of carrying amount
All figures are
reported in
thousands of US$
Underground
Mine
Development
Plant
Mining
Equipment
Buildings
Land
Other
Total
Cost
Balance at 1
January, 2019
Recognition of right-
of-use assets on
initial recognition of
AASB 16
Adjusted balance
at 1 January 2019
Additions
Disposals
Balance at 31
December 2019
Additions
Disposals
Balance at 31
December 2020
62,770
48,608
21,402
14,732
815
7,109
155,436
-
(14,352)
(1,240)
(2,499)
-
-
(18,091)
62,770
34,256
20,162
12,233
815
7,109
137,345
7,687
-
655
-
1,013
(497)
680
-
-
-
-
-
10,035
(497)
70,457
34,911
20,678
12,913
815
7,109
146,883
5,718
-
401
-
362
(68)
1,037
(133)
-
-
106
(9)
7,624
(210)
76,175
35,312
20,972
13,817
815
7,206
154,297
All figures are
reported in
thousands of US$
Underground
Mine
Development
Plant
Mining
Equipment
Accumulated depreciation and impairment losses
Buildings
Land
Other
Total
Balance at 31
December, 2018
Recognition of
right-of-use on initial
recognition of AASB
16
Adjusted balance
at 1 January 2019
Depreciation
Disposals
Balance at 31
December 2019
Depreciation
Disposals
Balance at 31
December 2020
Carrying amounts
At 31 December
2019
At 31 December
2020
48,101
20,518
15,801
10,677
-
(3,700)
(352)
(1,110)
48,101
16,818
15,449
5,670
-
5,392
-
917
(238)
9,567
1,173
-
53,771
22,210
16,128
10,740
5,637
-
3,031
-
841
(68)
630
(130)
59,408
25,241
16,901
11,240
-
-
-
-
-
-
-
-
-
6,319
101,416
-
(5,162)
6,319
96,254
200
-
13,352
(238)
6,519
109,368
272
(9)
10,411
(207)
6,782
119,572
16,686
12,701
4,550
2,173
16,767
10,071
4,071
2,577
815
815
590
424
37,515
34,725
Austral Gold Limited
69
Annual Report 2020
NOTES TO THE FINANCIAL STATEMENTS
19 (ii). Right of use
All figures are reported in thousands of US$
Office
Vehicles Machinery and
equipment
Recognised on adoption of AASB 16
Additions
Less depreciation
Balance at 31 December 2019
Balance at 1 January 2020
Additions
Less depreciation
Balance at 31 December 2020
339
47
(94)
292
292
-
(99)
193
3,206
3,366
(1,383)
5,189
5,189
322
(1,834)
3,677
9,724
-
(2,288)
7,436
7,436
-
(1,885)
5,551
All figures are reported in thousands of US$
As at 31 December
Lease liabilities
Lease liabilities
Less: current portion
Non-current long-term liability
19 (iii). Undiscounted lease payments
All figures are reported in thousands of US$
Less than a year
Greater than a year
20. EXPLORATION AND EVALUATION EXPENDITURE
All figures are reported in thousands of US$
Costs carried forward in respect of areas of interest
Carrying amount at the beginning of the period
Additions
Impairment for the period
Transfers from/(to) Mining Properties
Carrying amount at end of the period
2020
6,321
(2,905)
3,416
As at 31 December
2020
3,193
7,712
10,905
As at 31 December
2020
15,281
3,329
(748)
1,079
18,941
Total
13,269
3,413
(3,765)
12,917
12,917
322
(3,818)
9,421
2019
9,349
(3,047)
6,302
2019
3,233
7,811
11,044
2019
16,270
779
(862)
(906)
15,281
The recovery of the carrying amount of the exploration and evaluation assets is dependent on the successful development
and commercial exploitation or sale of the areas of interest. This balance mainly relates to expenditures at the Guanaco,
Casposo and Pingüino exploration projects.
Additions for the year ended 31 December 2020 and 2019 relate mainly to exploration on the Guanaco and Casposo
projects and the initial payment for the Sierra Blanca project in Santa Cruz, Argentina.
The significant terms of the transaction to acquire the Sierra Blanca in October 2020 include the payment of US$100,000
cash (paid) on signing and work commitments of US$700,000. The transaction is being accounted for as an acquisition
of an asset and the work commitments are to be paid as follows:
Year 1: $100,000
Year 2: $200,000
Year 3: $300,000
After work commitments in Year 1 are incurred, the Group will acquire a 51% interest. After the work commitments in
Year 2 and Year 3 are incurred, the Group will acquire an additional 29% interest. Expenditures may be incurred earlier
than the work commitment dates.
Austral Gold Limited
70
Annual Report 2020
NOTES TO THE FINANCIAL STATEMENTS
After 80% of the project is earned, the Group also has an option to purchase the final 20% of the project for a total of
US$2.3 million cash and US$1.6 million in work commitments as follows:
Year 4: Cash of US$0.5 million and work commitments of US$0.4 million
Year 5: Cash of US$1.0 million and work commitments of US$0.4 million
At the time of acquisition, the Sierra Blanca project had no probable and proven resources. The project was not in produc-
tion and there was no mine plan to place them into production. For these reasons, the acquisition was accounted for as
an acquisition of assets and liabilities and not a business combination as defined under AASB3.
Impairment for the year ended 31 December 2020 and 2019 relate exploration projects with no expected value in
Argentina.
During December 2020, the Group entered into an option agreement to acquire certain mining concessions in Chile
named Buenos Aires from 1 to 199.
The total cost of the option is US$5.05 million (“Fixed Price”) and is to be paid in Chilean pesos as follows:
Upon execution of the agreement (paid)
6 months from the date of the agreement
12 months from the date of the agreement
18 months from the date of the agreement
24 months from the date of the agreement
30 months from the date of the agreement
36 months from the date of the agreement
48 months from the date of the agreement
US$
100,000
100,000
350,000
500,000
1,000,000
500,000
1,000,000
1,500,000
5,050,000
In addition, there is a 2% NSR on gold and silver and a 1.5% NSR on other minerals sold from these concessions.
During December 2020, the Group also entered into an agreement to acquire the Sierra Amarilla properties (334 hectares)
from SQM (SQM:NYSE). The total consideration was US$40,000 (paid) plus a 1% NSR royalty over precious metals sold
from those properties.
21. INVESTMENT ACCOUNTED FOR USING THE EQUITY METHOD
The Group’s interests in equity-accounted investees comprise an interest in Rawhide Acquisition Holding LLC.
(“Rawhide”). On 17 December 2019, the Group made an initial purchase of approximately 22.48% (21.28% on a fully
diluted basis) directly from Rawhide for a purchase price of US$3,957,406, of which US$2,000,000 was paid in cash at
closing. The balance of US$1,957,406 was paid on 31 January 2020. Transaction costs of US$19,016 were incurred. In
addition, on 17 December 2019, the Group entered into option agreements with three existing unit owners to acquire an
additional 3.795% of the issued and outstanding Rawhide Units for a total of US$750,813. The Group exercised these
options during 2020. During the year ended 31 December 2020, the Group recorded a loss of US$507,093 representing
the share of the loss incurred by Rawhide adjusted for the impact of AASB 16, Rawhide hedges and call options based
on their ownership interest throughout the period.
All figures are reported in thousands of US$
Percentage ownership interest
Non-current assets
Current assets
Non-current liabilities
Current liabilities
Net liabilities (100%)
Group’s share of net liabilities
Carrying amount of interest in associate
As at December
2020
26.46%
23,873
18,145
(33,504)
(11,047)
(2,533)
(670)
4,221
2019
22.48%
25,330
15,323
(34,557)
(7,347)
(1,251)
(281)
3,976
Austral Gold Limited
71
Annual Report 2020
NOTES TO THE FINANCIAL STATEMENTS
All figures are reported in thousands of US$
Revenue
(Loss) from continuing operations (100%)
Other comprehensive income (100%)
Total comprehensive income (100%)
Group’s share of total (loss) and comprehensive income (25.37%)*
*Weighted average of 25.37% ownership in the Rawhide Mine during the year ended 31 December 2020.
22. TRADE AND OTHER PAYABLES
All figures are reported in thousands of US$
For the year ended 31 December
2020
42,623
(1,999)
-
(1,999)
(507)
As at 31 December
Current
Trade payables
Accrued expenses
Royalty payable
Director fees
Other
Total trade and other payables
Non-Current
Other payables
23. EMPLOYEE ENTITLEMENTS
All figures are reported in thousands of US$
Current
Salaries and bonuses
Employee entitlements
Total employee entitlements
As at 31 December
2020
4,775
3,956
659
429
552
10,371
-
2020
2,579
1,315
3,894
2019
-
-
-
-
-
2019
4,081
3,075
746
432
576
8,910
1
2019
1,894
1,654
3,548
The current provision for employee entitlements includes all unconditional entitlements in accordance with the applicable
legislation. The entire amount is presented as current, since the Group does not have an unconditional right to defer payment. The
entire balance of employee benefits is expected to be settled within the next 12 months.
Non-current
Employee entitlements
24
1,048
Retirement benefits
Retirement benefits are to be paid upon the death of workers and for disability and retirement.
The methodology followed to determine the provision for all employees adhering to the agreements has considered turn-
over rates and the RV-2014 mortality table established by the Superintendency of Securities and Insurance to calculate
the reserves of life insurance in Chile according to the valuation method called Accumulated Benefit Valuation Method or
Accrued Benefit Cost. This methodology is established in AASB 119 Employee benefits on Retirement Benefits Costs. The
parameters of turnover rates, rates of increase of remunerations and discount rate have been determined by the Group.
Austral Gold Limited
72
Annual Report 2020
NOTES TO THE FINANCIAL STATEMENTS
24. PROVISIONS
All figures are reported in thousands of US$
Non current
Mine closure
Others
Closing balance
Movement in non current provisions
Opening balance
(Reductions)/additions
Exchange difference
Present Value Adjustment
Closing balance
As at 31 December
2020
11,045
5
11,050
10,814
(531)
515
252
11,050
2019
10,804
10
10,814
10,664
(25)
(342)
517
10,814
Rehabilitation provision
Provision for rehabilitation work has been recognised in relation to estimated future expenditures including rehabilitating
mine sites, dismantling operating facilities and restoring affected areas. These future cost estimates are discounted to
their present value. The calculation of this provision requires assumptions such as application of environmental legis-
lation, mine closure dates, available technologies and engineering cost estimates. The related carrying amounts are
disclosed in note 18.
As at 31 December 2020, the total restoration provision amounts to US$7.5m for Guanaco/Amancaya mine. The present
value of the restoration provision was determined based on the following assumptions:
Undiscounted rehabilitation costs: US$7.6m; and
Discount period: 2 years (Discount period based on expected timing of restoration activities).
Discount rate: 0.50% (2019-1.75%)
As at 31 December 2020, the total restoration provision amounts US$3.5m for the Casposo mine. The present value of
the restoration provision was determined based on the following assumptions:
Undiscounted rehabilitation costs: US$4.2m; and
Discount rate: 11.49% (2019–12.3%)
There are no current plans for rehabilitation and restoration as the Group has initiated an exploration program and there
is potential to restart operations in the future.
25. LOANS AND BORROWINGS
All figures are reported in thousands of US$
Current
Loan facilities
Vendor take-back loan
Total current loans and borrowings
Non-current
Loan facilities
Total non-current loans and borrowings
As at 31 December
2020
831
-
831
1,246
1,246
2019
3,754
291
4,045
2,077
2,077
Loan Facilities
At 31 December 2020, the Loan Facilities are payable to Banco Santander and are to be repaid over 30 months at an
annual average interest rate of 5.5% (2019–5.85%).
Austral Gold Limited
73
Annual Report 2020
NOTES TO THE FINANCIAL STATEMENTS
26. ISSUED CAPITAL
All figures are reported in thousands of US$
Fully paid ordinary shares
Number of ordinary shares
Weighted average number of ordinary shares (basic)
Movements in ordinary share capital
Balance at 1 January 2019
Shares issued pursuant to pro-rata rights offering
Share issue costs pursuant to exercise of options
Balance at 31 December 2019
Exercise of options
Share issue costs pursuant to exercise of options
Balance at 31 December 2020
As at 31 December
2020
102,177
566,070,265
562,581,929
Number of ordinary shares
534,173,010
25,220,249
-
559,393,259
6,677,006
-
566,070,265
2019
101,682
559,393,259
539,424,350
US$’000
100,569
1,194
(81)
101,682
504
(9)
102,177
On 15 October 2019, the Group closed its non-renounceable pro-rata rights offer of ordinary shares and attaching options
at a price of A$0.08 per share. One option was granted for each 1.5 shares ordinary issued. The fair value of the options
granted was US$186,000 (note 28). The Group received gross proceeds of US$0.43m.
Ordinary shares participate in dividends and the proceeds on winding up of the Parent Entity in proportion to the number
of shares held. At shareholders meetings each ordinary share is entitled to one vote when a poll is called, otherwise each
shareholder has one vote on a show of hands. The ordinary shares do not have any par value.
Movements in share options
Unlisted Options to acquire ordinary fully paid shares at
A$0.092 on or before 18 October 2021
27. ACCUMULATED LOSSES
All figures are reported in thousands of US$
Accumulated losses at beginning of year
Adjustment on initial application of AASB16 (net of tax)
Adjusted balance at 1 January 2020/1 January 2019
Net profit for the year
Profits transferred to profit reserve
Accumulated losses at end of year
Date
18 Oct
2019
As at 31 December
2020
2019
10,136,524
16,813,530
31 December 2020
31 December 2019
(44,238)
-
(44,238)
7,667
(7,300)
(43,871)
(49,473)
10
(49,463)
5,225
-
(44,238)
Austral Gold Limited
74
Annual Report 2020
NOTES TO THE FINANCIAL STATEMENTS
28. RESERVES
All figures are reported in thousands of US$
31 December 2020
31 December 2019
Foreign currency translation reserve
Balance at beginning of year
Foreign exchange movements from translation of financial statements to
US dollars
Balance at end of year
Share option reserve
Balance at beginning of year
Unlisted options (1)
Balance at end of year
Business combination reserve
Balance at beginning of year
Acquisition of 49% of Cachinalito
Acquisition of 30% of Casposo
Balance at end of year
Profit appropriation reserve
Transfer from accumulated losses
Dividend paid
Balance at end of year
Total reserves
375
(55)
320
(135)
(74)
(209)
(953)
-
-
(953)
7,300
(3,496)
3,804
2,962
356
19
375
(321)
186
(135)
-
453
(1,406)
(953)
-
-
-
(713)
(i) The fair value of the unlisted options issued in its non-renounceable pro-rata rights offer is determined at the date of
issuance using the Black-Scholes options valuation model that takes into account the assumptions per the following
table. Upon the exercise of options, the balance of the reserve relating to those options is transferred to share capital.
Exercise price
Term of option
Share price at date of issuance
Expected price volatility
Risk-free interest rate
Nature and purpose of reserves
AUS$ 0.092
2 years
AUS$ 0.073
53% per annum
0.72%
Foreign Currency Translation Reserve
Exchange differences arising on translation of the non-US$ denominated non-monetary balances of Group Companies
are recognised in the foreign currency translation reserve. The reserve is recognised in profit or loss when the net invest-
ment is disposed of.
Share Option Reserve
Options granted/issued as share-based payments and a capital raise are recognised in the share option reserve.
Profit appropriation Reserve
Transfers up to the net income earned during the year may be transferred from accumulated losses and paid as a dividend.
Austral Gold Limited
75
Annual Report 2020
NOTES TO THE FINANCIAL STATEMENTS
29. NON-CONTROLLING INTEREST
All figures are reported in thousands of US$
Non-controlling interest in subsidiaries comprise
Acquired as part of subsidiary
As at 31 December
2020
-
2019
-
On 20 March 2019, the Group entered into an agreement to acquire the 49% non-controlling interest in Cachinalito for
US$949,729 to be paid in eighteen monthly installments of approximately US$52,651. During the year ended 31 December
2020, the Company made twelve payments totaling US$332,729 (2019; US$617,000).
On 23 December 2019, the Group entered into an agreement to effectively acquire the 30% non-controlling interest in
Casposo for US$200,000.
30. FINANCIAL INSTRUMENTS
Financial risk management objectives
The Group’s principal financial instruments comprise borrowings, receivables, listed equity securities, cash and short-
term deposits. These activities expose the Group to a variety of financial risks: market risk (interest rate risk and foreign
currency risk), credit risk, price risk and liquidity risk.
The Group recognises the importance of risk management and has adopted a Risk Management and Internal Compliance
and Control policy which describes the role and accountabilities of management and of the Board. The Directors manage
the different types of risks to which the Group is exposed by considering risk and monitoring levels of exposure to the
main financial risks by being aware of market forecasts for interest rates, foreign exchange rates, commodity and market
prices. The Group’s exposure to credit risk and liquidity risk is monitored through general business budgets and forecasts.
The Group holds the following financial instruments:
All figures are reported in thousands of US$
Financial Assets
Cash and cash equivalents
Trade and other receivables
Other financial assets
Financial liabilities
Trade and other payables
Employee entitlements
Borrowings
Promissory note
Financial leases
a. Market Risk
As at 31 December
2020
12,401
4,603
404
10,371
3,918
2,077
-
6,321
2019
9,196
6,000
277
8,910
4,596
6,122
1,957
9,349
Foreign Currency Risk
The Group undertakes certain transactions denominated in foreign currency and is exposed to foreign currency risk
through foreign currency exchange rate fluctuations.
Foreign exchange rate risk arises from future commercial transactions and recognised financial assets and financial
liabilities denominated in a currency that is not the functional currency of the Group. The risk is measured using cash
flow forecasting. Foreign currency risk is minimal as most of the transactions are settled in US$.
As at 31 December 2020, the Group was exposed to foreign exchange risk though the following financial assets and
liabilities denominated in currencies other than the Group’s functional currency (thousands of US$).
Austral Gold Limited
76
Annual Report 2020
NOTES TO THE FINANCIAL STATEMENTS
Financial assets
Cash and cash equivalents
Trade and other receivables
Other financial assets
Financial liabilities
Trade and other payables
Employee entitlements
Financial leases
Argentinian Peso
(ARS)
Chilean Peso
(CLP)
Australian
(AUS)
Canadian
Dollar
81
1,981
34
289
420
1
120
54
-
2,591
2,159
86
4
334
-
369
-
-
15
14
-
39
-
-
ii. Price Risk
The Group’s revenues are exposed to fluctuations in the price of gold, silver and other prices. Gold and silver produced
is sold at prevailing market prices in US$.
The Group has resolved that for the present time the production should remain unhedged. The Group considers exposure
to commodity price fluctuations within reasonable boundaries to be an integral part of the business.
Historical Evolution in the gold and silver commodity prices (US$)
2500
2000
1400
1000
500
0
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
Gold Price (US$/oz)
Silver Price (US$/oz)
60
50
40
30
20
10
0
Sensitivity to Changes in Commodity Prices (Gold and Silver)
The below sensitivity analysis demonstrates the after tax effect on the profit/(loss) and equity which could result if there
were changes in the gold and silver commodity prices by +/- 10% of the actual commodity prices realised by the Group.
All figures are reported in thousands
of US$
Effect on profit/(loss) For the year ended
Effect on equity
31 December 2020
31 December 2019
31 December 2020
31 December 2019
10 % increase in gold and silver prices
10 % decrease in gold and silver prices
8,822
(8,822)
10,221
(10,221)
8,822
(8,822)
10,221
(10,221)
iii. Interest Rate Risk
The Group’s main interest rate risk arises from finance leases. The Group’s borrowings are at fixed rates and therefore
do not carry any variable interest rate risk.
Austral Gold Limited
77
Annual Report 2020
NOTES TO THE FINANCIAL STATEMENTS
a.
Financial Market Risk
The financial market risk is the risk that the fair value or future cash flows of the financial instruments will fluctuate
because of changes in market prices, which occurs due to the Group’s investment in listed securities where share prices
can fluctuate over time. This risk however is not deemed to be significant as these investments are held for long term
strategic purposes and therefore movement in the market prices do not impact the short-term profit or loss or cash
flows of the Group.
The group holds listed government bonds, and listed equity securities (note 17). These are classified as level 1 within
the fair value hierarchy as per AASB 7 “Financial Instruments”.
b. Credit Risk
The maximum exposure to credit risk at the reporting date to recognised financial assets is the carrying amount, net of
any allowance for doubtful debts, as disclosed in the statement of financial position and notes to the financial statements.
The Group trades only with recognised, creditworthy third parties, and as such collateral is not requested nor is it the
Group’s policy to securitise its other receivables.
In addition, receivable balances are monitored on an ongoing basis with the result that the Group’s exposure to bad
debts is not significant. There are no significant concentrations of credit risk.
c.
Liquidity Risk
The liquidity of the Group is managed to ensure sufficient funds are available to meet financial commitments in a timely
and cost effective manner.
Management continuously reviews the Group’s liquidity position through cash flow projections based upon the current
mine plan to determine the forecast liquidity position and maintain appropriate liquidity levels.
d. Maturities of financial liabilities
The tables below analyses the Group’s financial liabilities into relevant maturity groupings based on the remaining period
at the reporting date to the contractual maturity date.
The amounts disclosed in the table are the contractual undiscounted cash flows.
All figures reported in
thousands of US$
31 December 2020
Financial liabilities
Trade and other
payables
Employee entitlements
Borrowings
Leasing
Total 31 December
2020 liabilities
31 December 2019
Financial liabilities
Trade and other
payables
Employee entitlements
Promissory note
Borrowings
Leasing
Total 31 December
2019 liabilities
Consolidated
6 months
6-12 months
1-5 years
> 5 years
Total
10,371
3,894
416
1,468
16,149
8,910
3,548
1,957
3,484
1,532
19,431
-
-
415
1,437
1,852
-
-
-
561
1,515
2,076
-
24
1,246
3,416
4,686
1
1,048
-
2,077
6,302
9,428
-
-
-
-
-
-
-
-
-
-
-
10,371
3,918
2,077
6,321
22,687
8,911
4,596
1,957
6,122
9,349
30,935
Austral Gold Limited
78
Annual Report 2020
NOTES TO THE FINANCIAL STATEMENTS
31. DIVIDENDS
All figures are reported in thousands of US$
Dividends paid
For the year ended 31 December
2020
3,496
2019
-
An unfranked cash dividend of A$0.09 per share was paid on 24 July 2020.
32. COMMITMENTS
All figures are reported in thousands of US$
Lease commitments
Finance lease commitments at the reporting date and recognised as liabilities, payable:
Within one year
Two to five years
Total commitment
Less: Future finance charges
Net commitment recognised as liabilities
Representing:
Lease liability—current
Lease liability—non-current
Operating leases not recognised as liabilities
As at 31 December
2020
2019
3,179
3,553
6,732
(411)
6,321
2,905
3,416
-
3,496
6,711
10,207
(858)
9,349
3,047
6,302
-
To maintain legal rights to its properties, the Group pays fees for mining concessions and exploration. It anticipates that it will need to pay approximately US$0.5m during
the next year to maintain legal rights to all of its properties.
Exploration commitments not recognized as liabilities
Exploration commitments at the reporting date and not recognised as liabilities
Within one year
Two to five years
Total exploration commitments not recognised as liabilities
550
5,100
5,650
-
-
-
33. SUBSIDIARIES
Subsidiaries
Country of Incorporation
% owned
31 December 2020
31 December 2019
Guanaco Mining Company Limited
British Virgin Islands
Guanaco Compañía Minera SpA
Ingenieria y Mineria Cachinalito Limitada
Casposo Energías Renovables S.A.U.
Austral Gold Argentina S.A.
Chile
Chile
Argentina
Argentina
Austral Gold North America Corp.
United States
Argentex Mining Corporation
SCRN Properties Ltd.
Casposo Argentina Limited
Canada
Canada
Canada
100.000
99.998
100.000
100.000
99.970
100.000
100.000
100.000
100.000
100.000
99.998
100.000
100.000
99.970
100.000
100.000
100.000
100.000
Austral Gold Limited
79
Annual Report 2020
NOTES TO THE FINANCIAL STATEMENTS
34. PARENT ENTITY INFORMATION
All figures are reported in thousands of US$
31 December 2020
31 December 2019
Current assets
Total assets
Current liabilities
Total liabilities
Net assets
Issued capital
Accumulated losses
Reserves
Total shareholders’ equity
Profit for the year
Total comprehensive income/(loss) for the year
Details of any guarantees entered into by the parent entity in relation to
the debts of its subsidiaries
Details of any contingent liabilities of the parent entity
Details of any contractual commitments by the parent entity for the
acquisition of property, plant or equipment.
A* Austral Gold Limited is guarantor for the credit facility of US$0.3m between BAF and Guanaco Compañía Minera SpA.
35. RELATED PARTY TRANSACTIONS
35.1 KMP holdings of shares and share options at 31 December 2020
1,011
67,795
13,176
13,176
54,619
102,177
(47,326)
(231)
54,620
2,727
2,672
A*
None
None
1,136
67,920
12,896
12,896
55,024
101,682
(46,553)
(106)
55,023
(676)
(657)
A*
None
None
• Mr Eduardo Elsztain holds 451,679,060 shares and 9,615,500 options directly and indirectly in Austral Gold Limited.
(31 December 2019— 479,805,958 shares and 16,241,776 options)
• Mr Saul Zang holds 1,640,763 shares and 136,730 options directly in Austral Gold Limited. (31 December 2019—
1,640,763 shares and 136,730 options)
• Mr Pablo Vergara del Carril holds 68,119 shares directly in Austral Gold Limited. (31 December 2019—68,119)
• E Elsztain and S Zang are Directors of IFISA which holds 380,234,614 shares and nil options according to the last
substantial holder notice lodged in December 2020. (31 December 2019—433,448,890 and 12,378,689 options)
• P Vergara del Carril, E Elsztain and S Zang are Directors of Guanaco Capital Holding Corp which holds 35,870,730
shares and 2,989,226 options according to the last substantial holder notice lodged in December 2020. (31 December
2019—35,870,730 and 2,989,227 options)
• Mr Stabro Kasaneva holds 6,881,230 shares indirectly in Austral Gold Limited. (31 December 2019—6,881,230)
• Mr Wayne Hubert holds 2,545,500 shares indirectly in Austral Gold Limited. (31 December 2019—1,750,000)
• Mr. Raul Guerra holds 801,000 shares directly in Austral Gold Limited. (31 December 2019—nil)
• Mr. Rodrigo Ramirez holds 279,514 shares directly in Austral Gold Limited. (31 December 2019—279,514)
• Mr. Jose Bordogna holds 22,000 shares directly in Austral Gold Limited. (31 December 2019—nil)
35.2 Directors and Key Management Personnel Remuneration
The aggregate compensation made to Directors and other members of Key Management Personnel of the Group is set
out below:
All figures are reported in thousands of US$
Short-term employment benefits
Consulting fees
Non-executive director fees
Total
For the year ended 31 December
2020
1,691
60
334
2,085
2019
1,394
-
358
1,752
Austral Gold Limited
80
Annual Report 2020
NOTES TO THE FINANCIAL STATEMENTS
Other transactions with related parties
Zang, Bergel & Viñes Abogados is a related party since two non-executive Directors, Saul Zang and Pablo Vergara del
Carril have significant influence over this law firm based in Buenos Aires, Argentina. Fees charged and expenses to
reimbursement to the Group for the 12 months ended 31 December 2020 amounted to US$148,696 (2019: US$141,022).
Cresud S.A.C.I.F.Y.A, IRSA Inversiones y Representaciones S.A., IRSA Propiedades Comerciales S.A. and Consultores
Asset Management S.A. are related parties as they are controlled by Non-executive Director and Chairman, Eduardo Elsz-
tain. During the twelve month period ended 31 December 2020 a total of US$62,047 was charged to the Company (2019:
US$326,437) in regard to IT services support, HR services, software licenses building/office expenses and other fees.
During April 2019, Consultores Assets Management SA, a company controlled by E Elsztain provided a loan of US$1.6
million at an annual interest rate of at 10% per annum. The loan plus interest of US$30,609 was repaid in July 2019.
35.3 Ultimate parent entity
The Parent Entity is controlled by IFISA with a 67.17% non-diluted and diluted interest in Austral Gold Limited and is
incorporated in Uruguay.
The ultimate beneficial owner of IFISA is Eduardo Elsztain.
36. UNRECOGNISED DEFERRED TAX ASSETS
In certain entities of the Group, tax losses have not been recognised as deferred tax assets in respect of the following
items, because it is not probable that future taxable profit will be available against which the Group can use the benefits
therefrom.
Australia
Tax losses
Capital losses
Canada
Tax losses
As at 31 December 2020
US$ ‘000
15,332
2,486
Expiry
No Expiry
No Expiry
18,683
2021-2041
The ability of the Group to utilise Australian or Canadian tax losses will depend on the applicability and compliance
with the respective Australian or Canadian tax laws regarding continuity of ownership or same or similar business tests.
United States
Tax losses
37. SUBSEQUENT EVENTS
287
No Expiry
(i)
(ii)
During February 2021, the Group completed the acquisition of Revelo Resources Corp. (‘Revelo) under a plan of
arrangement (‘the Arrangement’) in Canada. Under terms of the Arrangement, Austral acquired all Revelo shares and
Revelo shareholders received total consideration of US$6,977,713 comprised of cash of US$917,059 (C$1,176,471)
and 35,475,095 ordinary shares of Austral valued at approximately US$6,060,654. Consequently, Revelo became
a wholly-owned subsidiary of Austral.
The fair value of the ordinary shares issued was based on the listed share price of the Company at the date of issue
on 05 February 2021, AUD$0.225 (US$0.1708) per share.
During February 2021, the Group acquired 5,950,000 units (19.96%) of Ensign Gold Inc, a Canadian entity that
is currently assembling a 5,000-hectare land package on Carlin-type gold deposit geology in the state of Utah.
The Group paid C$0.25 per Unit, for an aggregate purchase price of C$1,487,500 (US$1,162,109 at an assumed
exchange rate of 1.28). Each Unit consists of one Class A share (each, a “Share”) in the capital of Ensign and
one-half of one transferable share purchase warrant (each whole warrant, a “Warrant”). Each Warrant entitles the
holder to purchase one additional Share at an exercise price will C$1.50 for a period of 36 months, subject to an
acceleration provision that will accelerate expiration of the Warrants if the closing sale price for a Share on a public
market exceeds C$2.00 for 30 consecutive trading days.
(iii) During January 2021, the Group received shareholder and regulatory approval of the Companies Stock incentive
plan.
(iv) On 14 February 2021, 2,666 ordinary shares were issued pursuant to the exercise of options.
(v)
On 23 February 2021, the Group declared an unfranked dividend of A$0.008 per share to shareholders totaling
approximately US$3.8 million.
Austral Gold Limited
81
Annual Report 2020
NOTES TO THE FINANCIAL STATEMENTS
38. SIGNIFICANT ACCOUNTING POLICIES
The group has consistently applied the following accounting policies to all periods presented in these consolidated
financial statements, except if mentioned otherwise (see also Note 5).
38. 1
38.2
38.3
38.4
38.5
38.6
38.7
38.8
38.9
38.10
38.11
38.12
38.13
38.14
38.15
38.16
38.17
38.18
38.19
38.20
38.21
38.22
38.23
Set out below is an index of the significant accounting policies.
Basis of consolidation
Revenue recognition
Goods and services tax (GST)/ Value added tax (VAT)
Foreign currency translation
Mine properties
Exploration and evaluation expenditure
Property, plant and equipment
Cash and cash equivalents
Income tax
Inventories
Trade and other receivables
Trade and other payables
Interest bearing liabilities
Provisions
Leases
Impairment of non-financial assets
De-recognition of financial assets and financial liabilities
Contributed equity
Earnings per share
Borrowing costs
Employee leave benefits
Segment reporting
New, revised or amending Accounting Standards and Interpretations adopted
38.1 Basis of consolidation
A subsidiary is any entity over which the Group has control. The Group controls an entity when the Group is exposed to,
or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through
its power over the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group.
They are de-consolidated from the date that control ceases.
A list of subsidiaries is contained in note 33 to the financial statements. The financial statements of the subsidiaries are
prepared for the same reporting periods as the parent company using consistent accounting policies.
All intercompany balances and transactions between entities in the Group, including any unrealised profits or losses,
have been eliminated on consolidation.
The acquisition of subsidiaries is accounted for using the acquisition method of accounting.
Non-controlling interests in the equity and results of the subsidiaries are shown separately in the statement of profit or
loss and other comprehensive income, statement of financial position and statement of changes in equity of the Group.
Business combinations
The Group accounts for business combinations using the acquisition method when control is transferred to the Group.
The consideration transferred in the acquisition is generally measured at fair value, as are the identifiable net assets
acquired. Any goodwill that arises is tested annually for impairment. Any gain on a bargain purchase is recognised in profit
or loss immediately. Transaction costs are expensed as incurred, except if related to the issue of debt or equity securities.
Goodwill
Goodwill has arisen on the acquisition of a subsidiary, Ingenieria y Mineria Cachinalito Limitada. The recoverable amount of
the goodwill arising from the Cachinalito business has been determined by including it as part of the combined Guanaco/
Amancaya CGU described above.
As of 31 December 2020 the goodwill was written off as Ingenieria y Mineria Cachinalito Limitada is in the process of
being wound up.
Austral Gold Limited
82
Annual Report 2020
NOTES TO THE FINANCIAL STATEMENTS
38.2 Revenue Recognition
Under AASB 15, the sale of minerals is recognised at the transfer of control or point of sale, which is when the customer
has taken delivery of the goods, the risks and rewards have been transferred to the customer and there is a valid contract.
Determining the timing of the transfer of control at a point in time or over time requires judgement.
When the customer is the refinery, the control of the metals is transferred at the metal availability date. The metal availability
date is when the metals are available for pricing by the refinery. If the customer is not the refinery, revenue is recognized
when the metals are transferred to the customer upon receipt and the customer obtains control of the metals. Invoices
are payable two business days after the metal availability date.
Goods and services tax (GST)/ Value added tax (VAT)
Revenues, expenses and assets are recognised net of the amount of GST/VAT, except where the amount of GST/ VAT
incurred is not recoverable from the tax authorities. In these circumstances the GST/VAT is recognised as part of the
cost of acquisition of the asset or as part of the expense.
Receivables and payables in the statement of financial position are shown inclusive of GST/VAT. Cash flows are presented
in the statement of cash flows on a gross basis, except for the GST/VAT component of investing and financing activities,
which are disclosed as operating cash flows.
38.3 Foreign currency translation
The financial statements are presented in United States Dollars (US$), which is the Group’s functional and presentation
currency.
Foreign currency transactions
Foreign currency transactions are translated into US$ using the exchange rates prevailing at the dates of the
transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the
translation at financial year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are
recognised in profit or loss.
38.4 Mine Properties
Mines in production represent the aggregated exploration and evaluation expenditure and capitalised development costs
in respect of areas of interest in which mining is ready to or has commenced. Mine development costs are deferred until
commercial production commences, at which time they are depreciated on a units-of-production basis over the mineable
reserves. Once production commences, further development expenditure is classified as part of the cost of production,
unless substantial future economic benefits can be established.
Amortisation
Aggregated costs on productive areas are amortised over the life of the area of interest to which such costs relate on
the units-of-production basis.
Deferred stripping costs
Deferred stripping costs represent certain mining costs, principally those that relate to the stripping of waste, which
provides access so that future economically recoverable ore can be mined. Stripping (i.e. overburden and other waste
removal) costs incurred in the production phase of a surface mine are capitalised to the extent that they improve access
to an identified component of the ore body and are subsequently amortised on a systematic basis over the expected
useful life of the identified component of the ore body.
Capitalised stripping costs are disclosed as a component of Mine Properties. Components of an ore body are determined
with reference to mine plans and take account of factors such as the geographical separation of mining locations and/
or the economic status of mine development decisions. Capitalised stripping costs are initially measured at cost and
represent an accumulation of costs directly incurred in performing the stripping activity that improves access to the
identified component of the ore body, plus an allocation of directly attributable overhead costs. The amount of strip- ping
costs deferred is based on a relevant production measure which uses a ratio obtained by dividing the tonnage of waste
mined by the quantity of ore mined for an identified component of the ore body. Stripping costs incurred in the period
for an identified component of the ore body are deferred to the extent that the current period ratio exceeds the expected
waste to ratio for the life of the identified component of the ore body. Such deferred costs are then charged against the
statement of profit or loss when the stripping ratio falls below the mine ratio. These are a function of the mine design and
therefore any changes to the design will generally result in changes to the ratio. Changes in other technical or economic
parameters that impact on reserves may also have an impact on the component ratio even though they may not impact
the mine design. Changes to the mine plan, identified components of an ore body, stripping ratios, units of production
and expected useful life are accounted for prospectively. Deferred stripping costs form part of the total investment in a
cash generating unit, which is reviewed for impairment if events or changes in circumstances indicate that the carrying
value may not be recoverable.
Austral Gold Limited
83
Annual Report 2020
NOTES TO THE FINANCIAL STATEMENTS
38.6 Exploration and evaluation expenditure
Exploration and evaluation expenditure incurred is accumulated in respect of each identifiable area of interest and carried
forward in the statement of financial position where rights to tenure of the area of interest are current; and one of the
following conditions is met:
i. such costs are expected to be recouped through successful development and exploitation of the area of interest or
alternatively, by its sales; or
ii. exploration and/or evaluation activities in the area of interest have not, at reporting date, yet reached a stage which
permits a reasonable assessment of the existence or otherwise of economically recoverable reserves and active and
significant operations in the area are continuing.
Expenditure relating to pre-exploration activities is written off to the profit or loss during the period in which the
expenditure is incurred.
A regular review is undertaken of each area of interest to determine the appropriateness of continuing to carry forward
costs in relation to that area of interest.
Accumulated expenditure on areas that have been abandoned, or are considered to be of no value, are written off in the
year in which such a decision is made.
When the technical and commercial feasibility of an undeveloped mining project has been demonstrated, the project
enters the construction phase. The cost of the project assets are transferred from exploration and evaluation expenditure
and reclassified into construction phase and include past exploration and evaluation costs, development drilling and
other subsurface expenditure. When full commercial operation commences, the accumulated costs are transferred into
Mine Properties or an appropriate class of property, plant and equipment.
When production commences, the accumulated costs for the relevant area of interest are amortised over the life of the
area according to the production output basis.
38.7 Property, plant and equipment
Property, plant and equipment is stated at cost less accumulated depreciation and any accumulated impairment losses.
Depreciation
The depreciated amount of property, plant and equipment is recorded either on a straight-line basis or on the production
output basis to the residual value of the asset over the lesser of mine life or estimated useful life of the asset.
Depreciation rates and methods are reviewed annually for appropriateness. When changes are made, adjustments are
reflected prospectively in current and future periods only. Depreciation is expensed, except those that are included in
the amount of exploration assets as an allocation of production overheads. The depreciation rate used for fixed assets
except for underground mine development is between 10%-20%. The depreciation rate used in underground mine
development is provided for over the life of the area of interest on a production output basis. Assets that are idle or no
longer ready for use are not depreciated but are separately tested for impairment and where the recoverable value is
less than the book value of the asset, an impairment is recorded.
De-recognition and disposal
An item of property, plant and equipment is de-recognised upon disposal or when no further future economic benefits
are expected from its use or disposal.
Any gain or loss arising on de-recognition of the asset (calculated as the difference between net disposal proceeds and
the carrying amount of the asset) is included in the statement of profit or loss in the year the asset is de-recognised.
38.6 Cash and cash equivalents
Cash includes:
i. cash on hand and at call deposits with banks or financial institutions; and
ii. other short-term highly liquid investments with original maturities of three months or less, and bank overdrafts.
38.9 Income tax
Current tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered
from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted
or substantively enacted by reporting date.
Deferred income tax is provided on all temporary differences at reporting date between the tax bases of assets and
liabilities and their carrying amounts for financial reporting purposes.
Deferred income tax liabilities are recognised for all taxable temporary differences except:
Austral Gold Limited
84
Annual Report 2020
NOTES TO THE FINANCIAL STATEMENTS
i. when the deferred income tax liability arises from the initial recognition of goodwill or of an asset or liability in a trans-
action that is not a business combination and that, at the time of the transaction, affects neither the accounting profit
nor taxable profit or loss; or
ii. when the taxable temporary difference is associated with investments in subsidiaries, associates, or interests in
joint ventures, and the timing of the reversal of the temporary difference can be controlled and it is probable that the
temporary difference will not reverse in the foreseeable future.
Deferred income tax assets are recognised for all deductible temporary differences, carry-forward of unused tax assets
and unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible
temporary differences and the carry-forward of unused tax credits and unused tax losses can be utilised, except:
i. when the deferred income tax asset relating to the deductible temporary difference arises from the initial recognition
of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects
neither the accounting profit nor taxable profit or loss; or
ii. when the deductible temporary difference is associated with investments in subsidiaries, associates, or interests in
joint ventures, in which case a deferred tax asset is only recognised to the extent that it is probable that the tempo-
rary difference will reverse in the foreseeable future and taxable profit will be available against which the temporary
difference can be utilised.
The carrying amount of any deferred income tax assets recognised is reviewed at each reporting date and reduced to
the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred
income tax asset to be utilised.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply for the year when
the asset is realised or the liability is settled, based on tax laws that have been enacted or substantively enacted at
report- ing date.
Income taxes relating to items recognised directly to equity are recognised in equity and not in profit or loss. Deferred tax
assets and deferred tax liabilities are offset only if a legally enforceable right exists to set off current tax assets against
current tax liabilities and the deferred tax assets and liabilities relate to the same taxable entity and the same taxation
authority.
38.10 Inventories
Materials and supplies are stated at the lower of cost and net realisable value on a ‘first in first out’ basis. Cost comprises
direct materials and delivery costs, direct labour, import duties and other taxes, an appropriate proportion of variable
and fixed overhead expenditure based on normal operating capacity.
If the ore stockpile is not expected to be processed in 12 months after reporting date, it is included in non-current assets
and the net realisable value is calculated on a discounted cash flow basis. Stockpiles are measured by estimating the
number of tonnes added and removed from the stockpile, the number of contained ounces based on assay data, and
the estimated recovery percentage. Stockpile tonnages are verified to periodic surveys.
Gold bullion and gold-in-process are valued at the lower of cost and net realisable value. Net realisable value is
determined using the prevailing metal prices.
38.11 Trade and other receivables
Trade accounts receivable, amounts due from related parties and other receivables represent the principal amounts due at
balance date plus accrued interest and less, where applicable, any unearned income and provisions for doubtful accounts.
38.12 Trade and other payables
These amounts represent liabilities for goods and services provided to the Group prior to the end of the financial year
and which are unpaid. They are measured at amortised cost and are not discounted. The amounts are unsecured and
are usually paid within 30 days of recognition.
38.13 Interest bearing liabilities
Loans and borrowings are initially recognised at the fair value of the consideration received, net of transaction costs.
They are subsequently measured at amortised cost using the effective interest method. Where there is an uncondi-
tional right to defer settlement of the liability for at least 12 months after the reporting date, the loans or borrowings are
classified as non-current.
Austral Gold Limited
85
Annual Report 2020
NOTES TO THE FINANCIAL STATEMENTS
38.14 Provisions
Provisions are recognised when the Group has a legal or constructive obligation, as a result of past events, for which it
is probable that an outflow of economic benefits will result and that outflow can be reliably measured.
If the effect of the time value of money is material, provisions are determined by discounting the expected future cash
flows at a pre-tax rate that reflects current market assessments of the time value of money and where appropriate,
the risks specific to the liability. Where discounting is used, the increase in the provision due to the passage of time is
recognised as a finance cost.
38.15 Leases
At inception of a contract, the Group assesses whether a contract is, or contains, a lease. A contract is, or contains, a lease
if the contract conveys the right to control the use of an identified asset for a period for time in exchange for consideration.
At commencement or on modification of a contract that contains a lease component, the Group allocates the consid-
eration in the contract to each lease component on the basis of its relative stand-alone prices. However, for the leases
of property the Group has elected not to separate non-lease components and account for the lease and non-lease
components as a single lease component.
38.16 Impairment of non-financial assets
At each reporting date, the Group reviews the carrying values of its tangible and intangible assets to determine whether
there is any indication that those assets have been impaired. If such an indication exists, the recoverable amount of the
asset, being the higher of the asset’s fair value less costs to sell or value in use, is compared to the asset’s carrying value.
Any excess of the asset’s carrying value over its recoverable amount is expensed to the profit or loss. In assessing value
in use, the estimated future cash flows are discounted to their present value using a pre-tax rate.
Impairment testing is performed annually for goodwill and intangible assets with indefinite lives or more frequently if
events or circumstances indicate that the carrying value may be impaired.
Where it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the recoverable
amount of the cash-generating unit to which the asset belongs.
38.17 De-recognition of financial assets and financial liabilities
Financial assets
A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is
derecognised when:
i. the rights to receive cash flows from the asset have expired; or
ii. the Group retains the right to receive cash flows from the asset, but has assumed an obligation to pay them in full
without material delay to a third party under a ‘pass- through’ arrangement; or
iii. the Group has transferred its rights to receive cash flows from the asset and either;
a. has transferred substantially all the risks and rewards of the asset; or
b. has neither transferred nor retained substantially all the risks and rewards of the asset but has transferred control
of the asset.
When the Group has transferred its rights to receive cash flows from an asset and has neither transferred nor retained
substantially all the risks and rewards of the asset nor transferred control of the asset, the asset is recognised to the
extent of the Group’s continuing involvement in the asset. Continuing involvement that takes the form of a guarantee over
the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of
consideration received that the Group could be required to repay.
Fair value through other comprehensive income
The Group’s investments in equity securities are classified as ‘fair value through Other Comprehensive Income.
Subsequent to initial recognition fair value through other comprehensive income investments are measured at fair value
with gains or losses being recognised directly through Other Comprehensive Income in the Statement of Profit or Loss
and Other Comprehensive Income.
Financial liabilities
A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When
an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms
of an existing liability are substantially modified, such an exchange or modification is treated as a de recognition of the
original liability and the recognition of a new liability, and the difference in the respective carrying amounts is recognised
in profit or loss.
Austral Gold Limited
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Annual Report 2020
NOTES TO THE FINANCIAL STATEMENTS
38.18 Contributed equity
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are
shown in equity as a deduction, net of tax, from the proceeds.
38.19 Earnings per share
Basic earnings per share
Basic earnings per share is determined by dividing net profit after income tax attributable to members of the parent,
excluding any costs of servicing equity other than ordinary shares, by the weighted average number of ordinary shares
outstanding during the financial year, adjusted for bonus elements in ordinary shares issued during the year.
Diluted earnings per share
Diluted earnings per share adjusts the figures used in determination of basic earnings per share to take into account
the after income tax effect of interest and other financing costs associated with dilutive potential ordinary shares and
weighted average number of shares assumed to have been issued for no consideration in relation to dilutive potential
ordinary shares.
38.20 Borrowing costs
Borrowing costs are recognised as an expense when incurred unless they are attributable to qualifying assets, in which
case they are then capitalised as part of the assets.
38.21 Employee leave benefits
Short-term employee benefits
Liabilities for employees’ entitlements to wages and salaries, annual leave and other employee entitlements expected
to be settled within 12 months of the reporting date are recognised in the current provisions in respect of employees’
services up to reporting date and are measured at the amounts expected to be paid when the liabilities are settled.
Liabilities for non- accumulating sick leave are recognised when the leave is taken and measured at the rates paid or
payable.
Long service leave
The liability for long service leave is recognised in the provision for employee benefits and measured as the present
value of expected future payments to be made in respect of services provided by employees up to the reporting date
using the projected unit credit method. Consideration is given to expected future wage and salary levels, experience
of employee departures, and periods of service. Expected future payments are discounted using market yields at the
reporting date on national government bonds with terms to maturity and currencies that match, as closely as possible,
the estimated cash outflows.
Superannuation
The Company contributes to employee superannuation funds. Contributions made by the Company are legally enforce-
able. Contributions are made in accordance with the requirements of the Superannuation Guarantee Legislation.
38.22 Segment reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the Chief Operating
Decision Maker (“CODM”).
The CODM, who is responsible for allocating resources and assessing performance of the operating segments, has been
identified as the Chief Executive Officer.
38.23 New, revised or amending Accounting Standards and Interpretations adopted
The Group has adopted all of the new, revised or amending Accounting Standards and Interpretations issued by
the AASB that are mandatory for the current reporting period. The adoption of these Accounting Standards and
Interpretations did not have any significant impact on the financial performance or position of the Group.
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DIRECTORS’
DECLARATION
Austral Gold Limited
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IN THE DIRECTORS’ OPINION:
1. the attached consolidated financial statements and notes thereto comply with
the Corporations Act 2001, the Accounting Standards, the Corporations Regu-
lations 2001 and other mandatory professional reporting requirements;
2. the attached consolidated financial statements and notes thereto comply with
International Financial Reporting Standards as issued by the International Ac-
counting Standards Board as described in note 1 to the consolidated financial
statements;
3. the attached consolidated financial statements and notes thereto give a true
and fair view of the Group’s financial position as at 31 December 2020 and of
its performance for the 12 months ended on that date; and
4. there are reasonable grounds to believe that the Company will be able to pay
its debts as and when they become due and payable.
The Directors have been given the declarations required by section 295A of the
Corporations Act 2001. Signed in accordance with a resolution of Directors made
pursuant to section 295(5)(a) of the Corporations Act 2001.
Signed on behalf of the Directors by:
Robert Trzebski
Director
Sydney
17 March 2021
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INDEPENDENT
AUDITOR’S
REPORT
Austral Gold Limited
90
Annual Report 2020
Independent Auditor’s Report
To the shareholders of Austral Gold Limited
Report on the audit of the Financial Report
Opinion
We have audited the Financial Report of
Austral Gold Limited (the Company).
In our opinion, the accompanying Financial
Report of the Company is in accordance
with the Corporations Act 2001, including:
•
•
giving a true and fair view of the
Group’s financial position as at 31
December 2020 and of its financial
performance for the year ended on
that date; and
complying with Australian Accounting
Standards and the Corporations
Regulations 2001.
The Financial Report comprises:
• Consolidated statement of financial position as at
31 December 2020;
• Consolidated statement of profit or loss and other
comprehensive income, Consolidated statement
of changes in equity, and Consolidated statement
of cash flows for the year then ended;
• Notes including a summary of significant
accounting policies; and
• Directors’ Declaration.
The Group consists of the Company and the entities it
controlled at the year-end or from time to time during
the financial year.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Our responsibilities under those standards are further described in the Auditor’s responsibilities for
the audit of the Financial Report section of our report.
We are independent of the Group in accordance with the Corporations Act 2001 and the ethical
requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of
Ethics for Professional Accountants (including Independence Standards) (the Code) that are relevant
to our audit of the Financial Report in Australia. We have fulfilled our other ethical responsibilities in
accordance with the Code.
91
KPMG, an Australian partnership and a member firm of the KPMG
global organisation of independent member firms affiliated with
KPMG International Limited, a private English company limited by
guarantee. All rights reserved. The KPMG name and logo are
trademarks used under license by the independent member firms of
the KPMG global organisation.
Liability limited by a scheme
approved under Professional
Standards Legislation.
Austral Gold Limited
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Key Audit Matters
The Key Audit Matters we identified are:
• Going concern basis of preparation;
Key Audit Matters are those matters that, in our
professional judgement, were of most significance in
our audit of the Financial Report of the current period.
• Carrying value of mine assets and
plant & equipment; and
• Carrying value of exploration and
evaluation assets.
These matters were addressed in the context of our
audit of the Financial Report as a whole, and in
forming our opinion thereon, and we do not provide a
separate opinion on these matters.
Going concern basis of preparation
Refer to Note 3 “Going Concern” to the Financial Report
The key audit matter
How the matter was addressed in our audit
The Group’s use of the going concern basis of
preparation and the associated extent of
uncertainty is a key audit matter due to the high
level of judgment required by us in evaluating
the Group’s assessment of going concern.
We evaluated the extent of uncertainty regarding
events or conditions casting significant doubt in
the Group’s assessment of going concern. This
included:
• Analysing cash flow projections by:
The Directors have determined that the use of
the going concern basis of accounting is
appropriate in preparing the financial report.
Their assessment of going concern was based
on cash flow projections. The preparation of
these projections incorporated a number of
assumptions and judgments, and the Directors
have concluded that the range of possible
outcomes considered in arriving at this
judgment does not give rise to a material
uncertainty casting significant doubt on the
Group’s ability to continue as a going concern.
We critically assessed the level of uncertainty,
as it related to the Group’s ability to continue as
a going concern, within these assumptions and
judgments, focusing on the following:
•
•
•
Impact of future commodity prices to cash
inflows projected;
The Group’s planned levels of operational
and capital expenditures, and the ability of
the Group to manage cash outflows within
available funding; and
The nature and feasibility of planned
methods the Group has to meet its
financing commitments.
In assessing this key audit matter, we involved
-
evaluating the underlying data used to
generate the projections for consistency
with other information tested by us, our
understanding of the Group’s intentions,
and past results and practices. We
specifically looked for consistency
between commodity prices used by
management and those tested by us
and consistency with the Group’s
intentions, as outlined in Directors
minutes and strategy document; and
- Assessing the planned levels of
operating and capital expenditures for
consistency of relationships and trends
with the Group’s historical results,
results since year end, and our
understanding of the business, industry
and economic conditions of the Group;
• Analysing the impact of reasonably possible
changes in projected cash flows and their
timing, to the projected monthly cash
positions. We assessed the resulting impact
on the ability of the Group to pay debts as
and when they fall due and continue as a
going concern. The specific areas we
focused on were informed from the results
of our tests of the accuracy of previous
92
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Annual Report 2020
Austral Gold Limited
senior audit team members who understand
the Group’s business, industry and the
economic environment it operates in.
Group cash flow projections and sensitivity
analysis on key cash flow projection
assumptions;
• Assessing significant non-routine forecast
cash inflows and outflows for feasibility,
quantum and timing. We used our
knowledge of the Group, its industry and
status to assess the level of associated
uncertainty; and
•
Evaluating the Group’s going concern
disclosures in the financial report by
comparing them to our understanding of the
matter, the events or conditions
incorporated into the cash flow projection
assessment, the Group’s plans, and
accounting standard requirements.
Carrying value of mine assets and plant & equipment ($48.022 million)
Refer to Notes 18 “Mine properties” and 19 “Property, plant and equipment” to the Financial
Report
The key audit matter
How the matter was addressed in our audit
The Group’s mine properties and plant &
equipment are a significant portion (46%) of the
Group’s total assets. The recoverable value is
based on a net present value model for each
cash generating unit (‘CGU’), and is a key audit
matter due to:
Our procedures included:
• Obtaining an understanding of the key
controls associated with the preparation of
the net present value models used to assess
the recoverable amount of each CGU;
•
The high level of judgement used in
evaluating key assumptions applied by the
Group in each net present value model,
which are affected by expected future
operating performance and market
conditions, including:
•
•
-
-
-
-
level of resources and reserves
capable of being produced
economically, as reported in the
Group’s third-party Reserve Report;
forecast cost of developing areas of
interest and producing silver and gold;
future production volumes and timing;
and
specific discount rate applied in each
model.
Austral Gold Limited
Evaluating the net present value
methodology used by the Group for
consistency with the requirements of the
Accounting Standards;
Evaluating the Group’s determination of
CGUs based on our understanding of the
operations of the Group’s business and each
area of interest, and how independent cash
inflows were generated, against the
requirements of the accounting standards;
• Critically evaluating the Group’s key
assumptions used to determine the
recoverable amount of key CGUs relating to
commodity prices, and discount rate based
on our knowledge of the industry, publicly
available data of comparable entities, and
published forecast price expectations of
industry commentators;
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Annual Report 2020
These forward looking assumptions necessitate
additional scrutiny by us due to:
•
•
•
the inherent uncertainties in estimating
these assumptions;
the consistency of application and the
changes in silver and gold pricing
increasing the risk of inaccurate
forecasting; and
the sensitivity of the net present value
model to changes in assumptions such as
commodity prices and discount rate,
reducing available headroom.
Management engaged a third-party expert to
assist in their assessment of mine property and
plant & equipment carrying value.
• Considering the sensitivity of the models by
varying key assumptions such as commodity
price and discount rate within a reasonably
possible range to identify those CGUs at
higher risk of impairment and to focus our
further procedures;
• Checking the forecast cost of developing
areas of interest and producing silver and
gold, future production volumes and timing
to those within the Group’s Reserves
Report, Board approved plans and budgets.
We assessed these against our
understanding of the business and industry
trends;
• Corroborating mine closure plans with the
key operational and finance personnel;
• Assessing the historical accuracy of
budgeting and forecasting by the Group to
inform our evaluation of forecasts
incorporated in the models;
•
Evaluating the scope, competence, and
objectivity of the Group’s external experts
engaged to 1) assist the Group prepare the
Group’s Reserves Report as utilised within
the net present value model and 2) assess
the salvage value of plant and equipment;
and
• Assessing the financial report disclosures
based on our understanding and the
requirements of the accounting standards.
Carrying value of exploration and evaluation assets ($18.941 million)
Refer to Note 20 “Exploration and evaluation expenditure” to the Financial Report
The key audit matter
How the matter was addressed in our audit
The Group’s exploration and evaluation assets
(‘E&E assets’) are a significant portion (18%) of
the Group’s total assets.
The carrying value of E&E assets is a key audit
matter due to the high level of judgement used
in application of the requirements of the
industry specific accounting standard AASB 6
Exploration for and Evaluation of Mineral
Resources, in particular the conditions allowing
capitalisation of relevant expenditure and
presence of impairment indicators.
Austral Gold Limited
Our procedures included:
• Obtaining an understanding of the key
controls associated with evaluating the E&E
assets;
•
•
94
94
Evaluating the Group’s accounting policy to
recognise E&E assets using the criteria in
the accounting standard;
Evaluating the Group’s determination of
areas of interest based on our understanding
of the operations of the Group and each area
of interest, and how independent cash
Annual Report 2020
The conditions allowing capitalisation of
relevant expenditure focus on:
inflows were generated, against the
requirements of the accounting standards;
•
•
•
•
•
•
•
the determination of the areas of interest
(areas) in particular, evaluating the results
of the external expert engaged by the
Group;
documentation available regarding rights to
tenure, via licensing, and compliance with
relevant conditions, to maintain current
rights to an area of interest;
the Group’s determination of whether the
E&E assets are expected to be recouped
through successful development and
exploitation of the area of interest, or
alternatively, by its sale; and
The presence of impairment indicators
would necessitate a detailed analysis by
the Group of the value of E&E assets.
Assessing the presence of impairment
indicators includes factors that may draw
into question the commercial continuation
of E&E activities for the areas of interest
where significant capitalised E&E assets
exist.
For each area of interest, we assessed the
Group’s current rights to tenure by
corroborating the ownership of the relevant
license to government registries and
evaluating agreements in place with other
parties. We also tested for compliance with
conditions, such as minimum expenditure
requirements, on a sample of licenses;
Testing the Group’s additions to E&E assets
for the period by evaluating a sample of
recorded expenditure for consistency to
underlying records, the capitalisation
requirements of the Group’s accounting
policy and the requirements of the
accounting standard;
Evaluating documents, such as minutes of
directors’ meetings and ASX market
announcements, for consistency with the
Group’s stated intentions for continuing E&E
activities in certain areas. We corroborated
this through interviews with key operational
and finance personnel;
In addition to the assessments above we paid
particular attention to:
•
•
The impact of changes in gold and silver
prices to the Group’s strategy and
intentions;
The intention of the Group to fund the
continuation of activities; and
• Results from latest activities regarding the
existence or otherwise of economically
recoverable reserves or commercially
viable quantity of the reserves.
The Group engaged an external third party
expert to assist with these assessments for
certain exploration interests.
• Analysing the Group’s determination of
recoupment through successful
development and exploitation of the area (or
by its sale) by evaluating the Group’s
documentation of planned future and
continuing activities including work programs
and project and corporate budgets for a
sample of areas;
• Assessing the impact of changes in the gold
and silver prices to the Group’s modelling
underlying their decision for commercial
continuation of activities;
• Obtaining project and corporate budgets
identifying areas with existing funding and
those requiring alternate funding sources.
We compared this for consistency with
areas with E&E activities, for evidence of the
ability to fund continued activities. We
identified those areas relying on alternate
funding sources and evaluated the capacity
of the Group to secure such funding; and
• Assessing the results of the external expert.
Austral Gold Limited
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Annual Report 2020
Other Information
Other Information is financial and non-financial information in Austral Gold Limited’s annual
reporting which is provided in addition to the Financial Report and the Auditor’s Report. The
Directors are responsible for the Other Information.
Our opinion on the Financial Report does not cover the Other Information and, accordingly, we do
not express an audit opinion or any form of assurance conclusion thereon, with the exception of the
Remuneration Report and our related assurance opinion.
In connection with our audit of the Financial Report, our responsibility is to read the Other
Information. In doing so, we consider whether the Other Information is materially inconsistent with
the Financial Report or our knowledge obtained in the audit, or otherwise appears to be materially
misstated.
We are required to report if we conclude that there is a material misstatement of this Other
Information, and based on the work we have performed on the Other Information that we obtained
prior to the date of this Auditor’s Report we have nothing to report.
Responsibilities of the Directors for the Financial Report
The Directors are responsible for:
•
•
•
preparing the Financial Report that gives a true and fair view in accordance with Australian
Accounting Standards and the Corporations Act 2001;
implementing necessary internal control to enable the preparation of a Financial Report that
gives a true and fair view and is free from material misstatement, whether due to fraud or error;
and
assessing the Group and Company’s ability to continue as a going concern and whether the use
of the going concern basis of accounting is appropriate. This includes disclosing, as applicable,
matters related to going concern and using the going concern basis of accounting unless they
either intend to liquidate the Group and Company or to cease operations, or have no realistic
alternative but to do so.
Auditor’s responsibilities for the audit of the Financial Report
Our objective is:
•
•
to obtain reasonable assurance about whether the Financial Report as a whole is free from
material misstatement, whether due to fraud or error; and
to issue an Auditor’s Report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in
accordance with Australian Auditing Standards will always detect a material misstatement when it
exists.
Misstatements can arise from fraud or error. They are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken
on the basis of the Financial Report.
A further description of our responsibilities for the audit of the Financial Report is located at the
Auditing and Assurance Standards Board website at:
http://www.auasb.gov.au/auditors_responsibilities/ar1.pdf. This description forms part of our
Auditor’s Report.
Austral Gold Limited
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Annual Report 2020
Report on the Remuneration Report
Opinion
Directors’ responsibilities
In our opinion, the Remuneration Report
of Austral Gold Limited for the year ended
31 December 2020 complies with Section
300A of the Corporations Act 2001.
The Directors of the Company are responsible for the
preparation and presentation of the Remuneration
Report in accordance with Section 300A of the
Corporations Act 2001.
Our responsibilities
We have audited the Remuneration Report included in
pages 45 to 50 of the Directors’ report for the year
ended 31 December 2020.
Our responsibility is to express an opinion on the
Remuneration Report, based on our audit conducted
in accordance with Australian Auditing Standards.
KPMG
Daniel Camilleri
Partner
Sydney
17 March 2021
Austral Gold Limited
97
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Annual Report 2020
ADDITIONAL
INFORMATION
Austral Gold Limited
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Annual Report 2020
Forward Looking Statements
In this annual report that are not historical facts are forward-looking statements. Forward-looking statements are statements that are not historical, and consist primarily of
projections — statements regarding future plans, expectations and developments. Words such as “expects”, “intends”, “plans”, “may”, “could”, “potential”, “should”, “antici-
pates”, “likely”, “believes” and words of similar import tend to identify forward-looking statements. All forward-looking statements are subject to a variety of known and unknown
risks, uncertainties and other factors that could cause actual events or results to differ from those expressed or implied, including, without limitation, business integration risks;
uncertainty of production, development plans and cost estimates, commodity price fluctuations; political or economic instability and regulatory changes; currency fluctuations,
the state of the capital markets, uncertainty in the measurement of mineral reserves and resource estimates, Austral’s ability to attract and retain qualified personnel and manage-
ment, potential labour unrest, reclamation and closure requirements for mineral properties; unpredictable risks and hazards related to the development and operation of a mine
or mineral property that are beyond the Company’s control, the availability of capital to fund all of the Company’s projects and other risks and uncertainties identified under the
heading “Risk Factors” in the Company’s continuous disclosure documents filed on the ASX and SEDAR. You are cautioned that the foregoing list is not exhaustive of all factors
and assumptions which may have been used. Austral cannot assure you that actual events, performance or results will be consistent with these forward-looking statements, and
management’s assumptions may prove to be incorrect. Austral’s forward-looking statements reflect current expectations regarding future events and operating performance
and speak only as of the date hereof and Austral does not assume any obligation to update forward-looking statements if circumstances or management’s beliefs, expecta-
tions or opinions should change other than as required by applicable law. For the reasons set forth above, you should not place undue reliance on forward-looking statements.
CORPORATE GOVERNANCE STATEMENT
Austral Gold Limited and its subsidiaries have adopted the corporate governance framework and practices set out in its Corporate
Governance Statement. The Corporate Governance Statement is available on the Company’s website at www.australgold.com.
STATEMENT OF ISSUED CAPITAL
As at 28 February 2021 the total issued capital of Austral Gold Limited was 601,548,026 ordinary shares. 534,091,001 shares were
quoted on the Australian Securities Exchange under the code AGD. The only shares of the Company on issue are fully paid ordinary
shares. None of these shares are restricted securities or securities subject to voluntary escrow within the meaning of the Listing Rules
of the Australian Securities Exchange. 67,457,025 shares were quoted on the Toronto Venture Exchange under the code AGLD.
There are no restrictions on the voting rights attached to the fully paid ordinary shares. On a show of hands, every member present in
person, by proxy, by attorney or by representative shall have one vote. On a poll, every member present in person, by proxy, by attorney
or by representative shall have one vote for every share held.
DISTRIBUTION OF FULLY PAID ORDINARY SHARES
As at 28 February 2021
Size of Holding
1-1,000
1,001-5,000
5,001-10,000
50,001-100,000
>100,000
Holders
Shares held
% of issued capital
680
548
224
307
77
1,836
260,231
1,564,445
1,779,025
10,434,012
587,510,313
601,548,026
0.04
0.26
0.30
1.73
97.67
100.00
SUBSTANTIAL SHAREHOLDERS
The Company has been notified of the following substantial shareholdings as at 28 February 2021:
Registered Holder
Beneficial Holder
Shares Held
Options Held
HSBC Custody Nominees
(Australia) Limited
Citicorp Nominees Pty Limited
HSBC Custody Nominees
(Australia) Limited
HSBC Custody Nominees
(Australia) Limited
Inversiones Financieras
Del Sur SA (IFISA)
Inversiones Financieras
Del Sur SA (IFISA)
Guanaco Capital
Holding Corp
380,234,614
47,658,462
–
–
35,870,730
2,989,226
Eduardo Elsztain
35,573,716
6,626,274
Austral Gold Limited
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Annual Report 2020
Rank
Name
No. of shares % of issued capital
1
2
3
4
5
6
7
8
9
EDUARDO SERGIO ELSZTAIN *
451,679,060
75.09%
CS THIRD NOMINEES PTY LIMITED
16,458,232
2.74%
MICHAEL D WINN
15,978,225
2.66%
EMX ROYALTY CORPORATION
9,855,784
1.64%
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
9,244,035
1.54%
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED - A/C 2
8,825,769
1.47%
STABRO KASANEVA
6,881,230
1.14%
CITICORP NOMINEES PTY LIMITED
6,763,994
1.12%
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
4,910,954
0.82%
10
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
3,399,222
0.57%
11
TIMOTHY J BEALE
2,333,622
0.39%
12
SAUL ZANG
1,640,763
0.27%
13
BNP PARIBAS NOMS PTY LTD
1,541,378
0.26%
14
CS FOURTH NOMINEES PTY LIMITED
1,500,000
0.25%
15
ASOCIACION ISRAELITA ARGENTINA TZEIRE AGUDATH JABAD
1,158,265
0.19%
16
BNP PARIBAS NOMINEES PTY LTD
1,121,910
0.19%
17
SHANN SUPERANNUATION NOMINEES PTY LTD
1,100,000
0.18%
18
FUSION ELECTRICS (AUST) PTY LTD
1,000,000
0.17%
19
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
931,341
0.15%
20
TAYLOR FAMILY INVESTMENTS PTY LTD
750,000
0.12%
Total
Other
547,073,784
90.94%
54,474,242
9.06%
Total Shares on issue
601,548,026
100.00%
*Beneficial holdings
Austral Gold Limited
100
Annual Report 2020
Austral Gold Limited
101
Annual Report 2020
Austral Gold Limited
102
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Austral Gold Limited
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Annual Report 2020
www.australgold.com