ABN: 65 094 206 292
2021
ANNUAL
R E P O RT
De Grey Mining Limited
Contents
Contents ................................................................................................................................................................................... 1
Corporate Information ............................................................................................................................................................. 2
Chairman’s Letter ..................................................................................................................................................................... 3
Managing Directors Report and Review of Operations ........................................................................................................... 5
Detail of Activities undertaken during the 2020/21 Year ................................................................................................... 8
Greater Hemi Exploration ................................................................................................................................................. 13
Regional Exploration ......................................................................................................................................................... 14
Other Project Activities ..................................................................................................................................................... 15
Environment, Social and Governance Principles ................................................................................................................... 16
Sustainability ..................................................................................................................................................................... 16
Directors’ Report .................................................................................................................................................................... 21
Remuneration Report (Audited) ............................................................................................................................................ 27
Audit Independence Declaration ........................................................................................................................................... 42
Consolidated Statement of Comprehensive Income ............................................................................................................. 43
Consolidated Statement of Financial Position ....................................................................................................................... 44
Consolidated Statement of Changes in Equity ....................................................................................................................... 45
Consolidated Statement of Cash Flows ................................................................................................................................. 46
Notes to the Consolidated Financial Statements ................................................................................................................... 47
Director’s Declaration ............................................................................................................................................................ 82
Audit Report ........................................................................................................................................................................... 83
ASX Additional Information ................................................................................................................................................... 87
Annual Mineral Resources Statement ................................................................................................................................... 89
Schedule of Interests in Mining Tenements .......................................................................................................................... 93
1
De Grey Mining Limited
Corporate Information
ABN 65 094 206 292
Directors
Simon Lill (Chairman)
Glenn Jardine (Managing Director)
Andrew Beckwith (Technical Director)
Peter Hood AO (Non-Executive Director)
Eduard Eshuys (Non-Executive Director)
Bruce Parncutt AO (Non-Executive Director)
Chief Financial Officer
Peter Canterbury
Company Secretaries
Craig Nelmes
Patrick Holywell
Registered Office and Principal Place of Business
Ground Level
2 Kings Park Road
WEST PERTH WA 6005
Telephone: +61 8 6117 9328
Postal Address
PO Box 84,
WEST PERTH WA 6904
Share Registry
Automic Group
Level 2/267 St Georges Terrace
Perth WA 6000
Telephone: 1300 288 664
Auditors
Ernst & Young
11 Mounts Bay Road
PERTH WA 6000
Internet Address
www.degreymining.com.au
Email Address
admin@degreymining.com.au
Stock Exchange Listing
Australian Securities Exchange (ASX code DEG)
Frankfurt Stock Exchange (FRA code WKN 633879)
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De Grey Mining Limited
Chairman’s Letter
At the October 2020 Diggers and Dealers Mining Forum I was pleased to accept “The Best Emerging Company” Award on
behalf of all shareholders and staff, both past and present. In my speech I advised of my hope that other junior explorers
present had the opportunity to experience the excitement and fun that we at De Grey had recently experienced. It had
been less than 8 months since the Aquila and Brolga RC discovery holes and one month since the Falcon discovery. One of
our geologists described it as “…that winning grand final feeling.”
The Grand Final feeling has continued with the Diucon and Eagle discoveries in February 2021, both of which contributed
significantly to our maiden Mineral Resource Estimate (MRE) (JORC 2012) for Hemi of 192Mt @ 1.1g/t Au for 6.8Moz. In
only 4 months leading up maiden Hemi MRE, Diucon and Eagle added 1.45M ounces to our resource inventory. Subsequent
to the MRE release recent ASX releases for both Diucon and Eagle demonstrate the likely addition of substantial resource
ounces at an ongoing low discovery cost.
When combined with the Company’s existing resources prior to the Hemi discovery the Mallina Gold Project Mineral
Resource Estimate (JORC 2012) increased to a total of 230Mt @ 1.2g/t Au for 9.0Moz.
The world class Hemi discovery has resulted in a significant market capitalisation increase, resulting in De Grey entering
the S&P/ASX 300 Market Index, perhaps knocking on the door of inclusion to the ASX 200 Market Index.
The Company has been fortunate to be led through this period by an exceptional group of senior directors on the Board –
Andy Beckwith and Ed Eshuys, both very experienced gold exploration geologists, Bruce Parncutt with a storied career in
the finance industry and Peter Hood, a senior Chemical Engineer with a lengthy history within the resources industry. This
group of course was joined by Glenn Jardine in May of last year, a senior mining engineer with construction, commissioning,
and operational experience. All have had significant Board and corporate experience.
As a Board we recognise the additional scrutiny that the increase in market capitalisation and institutional shareholdings
brings. The Board commissioned an independent Board Review process and plans to implement the key recommendations
of that review. The recommendations are designed to satisfy Corporate Governance Principles associated with
independence and diversity. To that end the Company has commenced a search process to allow the selection of suitable
new Directors.
The Board understood early in 2020 that Hemi had the potential to be a major world class gold project and required a team
capable of developing the project, appointing Mr Glenn Jardine as Managing Director in May of 2020.
During the year Glenn has undertaken the substantial task in bringing together a team to deliver Hemi as a Tier One
production asset. He has been able to grow and retain the team and rig numbers through what has been an extremely
competitive market for staff due to Western Australia’s Covid-19 related isolation. The difficulties of this task through the
last 12 months should not be underestimated.
Glenn will detail the group’s capability later in this report as well as the significant achievements of the organisation during
the year.
At last year’s AGM shareholders approved key performance indicators (“KPIs”) for 3-year Long Term Incentives for Glenn
and his team to have financed and commenced construction of a 12-year x 500,000 ounces pa project with a total resource
inventory of 12m ounces. With 2 years still to go these KPI stretch targets are well within reach and may well be surpassed.
Hemi is now a world class gold discovery that matches other Western Australian discoveries such as:
-
-
-
-
-
Consolidation of the Kalgoorlie “super pit”.
Gruyere in the Yamana Belt.
Tropicana in the Fraser Range.
Bronzewing and Jundee in the Yandal Belt; and
Boddington.
The increase in resources since discovery to the MRE announcement has occurred at a rate of ~450,000 ounces per month
and a discovery cost of approximately~$8.50 per ounce.
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De Grey Mining Limited
We expect to continue to grow the Hemi resource through the next 12 months. To expect a similar rate of growth as last
year may be ambitious but I note recent Diucon and Eagle exploration results continue to add resources rapidly whilst all
other Hemi deposits – Aquila, Brolga, Crow and Falcon – remain open at depth and in most directions.
De Grey’s exploration team is led by Executive Director Andy Beckwith and Phil Tornatora as General Manager of
Exploration. They are ably supported by an experienced team that includes Exploration Manager Rohan Deshpande and
Business Development and Regional Geologist Mr. Allan Kneeshaw. They have expanded a highly dedicated and substantial
geological team resulting in ~12 drill rigs now employed across the broader Mallina Gold project.
Additionally, a dedicated team has been established to focus on regional exploration beyond the Greater Hemi area to
ensure the substantial untested potential across the Mallina Gold Project continues to be advanced.
Collectively they have had an outstanding year with the discovery of Hemi and the rapid delineation of the maiden MRE.
Major discoveries like Hemi do not occur overnight and our dedicated exploration team has had the conviction over the
past five years to undertake the complex process of consolidating, validating, and interpreting the large historic datasets
and designing an exploration program to prioritise and advance the many targets across our 1,500km2 Mallina Gold Project.
The earlier years of this 5-year period was not easy for the team and I am pleased to see them enjoying the rewards and
excitement associated with the discovery.
There is a high level of confidence within the Board and Management that the exploration drilling will continue for many
years to come, supported eventually by the likely Tier One production profile of Hemi.
We have also enjoyed the support of local aboriginal groups - the Ngarluma, Kariyarra and Nyamal peoples - with whom
we regularly engage as we move forward with ongoing heritage clearances and negotiations for mining agreements. Our
key pastoral lease holders are also supportive. We have increased our engagement levels with the traditional owners and
pastoral lease holders through the appointment of a General Manager of Community Relations, Bronwyn Campbell.
We have been grateful for the support of our brokers during the year through capital raising and research activities. It is
extremely pleasing to note the quality of the institutional support that has continued to develop on our register, aided by
the broking groups with whom we work. Many of our shareholders have enjoyed substantial returns during the discovery
phase and through the recent financial year. We look forward to the continued support of shareholders through to
production and beyond.
In an environment of growing demands from institutional investors for the adoption of ESG principles and carbon emission
reductions, De Grey is in a fortunate position. We have a world class gold project on a blank canvas and the opportunity to
develop it in an environmentally responsible and sustainable manner.
In closing I thank all staff and all contractors – many more this year to thank than last. Without good people the task
becomes even more mountainous. We are conscious of ensuring the right level of rewards are in place and maintained to
retain good staff, including the provision of an appropriate risk-free environment with suitable growth pathways for all
staff.
2021 has been yet another exciting year. We will continue the growing and de-risking of the project through the next 12
months, but also plan to continue the excitement to retain that Grand Final winning feeling!
Yours sincerely,
Simon Lill
Chairman
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De Grey Mining Limited
Managing Directors Report and Review of Operations
In my first full year as Managing Director it is a pleasure to report on a most remarkable year in the De Grey Mining (“De
Grey”) or the (“Company”) history. It is very rare to be given the opportunity to lead a Company in the rapid definition of
a world class Maiden Mineral Resource at Hemi following its discovery in November 2019 by aircore drilling and
confirmation in February 2020 via RC drilling.
This discovery was many years in the making through the dedicated team at De Grey led by our Chairman Simon Lill. De
Grey is engaged in gold exploration and development activities in one of the world’s strongest Tier 1 mining jurisdictions.
The Company has built a dominant position in the prospective Mallina Basin of the Pilbara Craton, located near Port
Hedland in the northwest of Western Australia. De Grey has redefined gold exploration in the Pilbara.
Figure 1: Comparing Pilbara to Yilgarn
The Mallina Gold Project (“Project”) comprises a landholding of more than 1,500km2, stretching across a contiguous
tenement package running SW to NE of 150km and boasts greater than 200km of gold hosting shear zones and numerous
intrusion targets (Figure 1). The Project is located within a 45-minute drive of Port Hedland (Figure 1) in a region rich with
critical infrastructure to support a future mining operation. Two major sealed highways run within 20km of the Hemi
discovery. A gas pipeline runs within 20km of Hemi with a spur within 4km. A major 220kV electricity transmission line
also lies within 20km of Hemi. The town of Port Hedland is a significant regional centre with excellent mining services and
large airport facilities, as has the town of Karratha, 120km to the southwest. Port Hedland is the largest economic export
port in Australia. The Port is also opening up for import shipping which is expected to allow the direct landing of mining
equipment into the region, which may provide substantial transport cost savings during development.
5
Figure 2: Mallina Gold Project
De Grey Mining Limited
During the year the Company was able to build on the earlier discoveries of Aquila, Brolga and Crow via the discoveries
of Falcon in 2020 and then the further discoveries of Diucon and Eagle in early 2021. Following the initial discoveries the
Company deployed a major exploration program with 3 Air Core, 4 Reverse Circulation and 4 Diamond drill rigs at Hemi
and the greater Hemi region. This sizeable operation has continued to expand the existing deposits through extension
drilling on Aquila, Brolga, Crow and Falcon, all of which remain open at depth and laterally, whilst deploying significant
drilling capicity at Eagle and Diucon.
Our exploration team was led by Techncial Director Andy Beckwith through to December and subsequently by General
Manager Exploration, Philip Tornatora, Our site based exploration team has been ably managed by Rohan Deshpande,
who has led a dedicated exploration team to rapidly undertake the drilling activities which has enabled the Maiden
Mineral Resource Estimate for Hemi of 6.8Moz to be released on 21 June 2021.
Hemi Total Mineral Resource Estimate
(JORC 2012)
Indicated (41% of ounces)
Inferred (59% of ounces)
MGP Mineral Resource Estimate
(JORC 2012)
Measured & Indicated (43% of ounces)
Inferred (57% of ounces)
192Mt
1.1g/t Au
6.8Moz
66Mt
127Mt
1.3g/t Au
1.0g/t Au
2.8Moz
4.0Moz
230Mt
1.2g/t Au
9.0Moz
85Mt
145Mt
1.4g/t Au
1.1g/t Au
3.9Moz
5.1Moz
(0.3g/t Au Cut-off above 370m depth, 1.5g/t Au Cut-off below 370m depth, assays to 17 May 2021)
The Maiden Mineral Resource Estimate is based on 688 RC holes (134,166m) and 169 diamond
holes (69,061m including RC pre-collars) for a total of 203,228m. Overall, drilling at Hemi
including aircore drilling exceeds over 400,000m with substantial aircore, RC and diamond
drilling programs continuing.
Global Mineral Resources for the MGP, following the inclusion of Hemi,
increased to 9.0Moz.
MGP
9.0Moz
230Mt
1.2g/t Au
HEMI
+6.8Moz
192Mt
1.1g/t Au
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Figure 3: Hemi Mineral Resource
De Grey Mining Limited
Figure 4: Mallina Gold Project Resource Locations
Gold mineralisation at Hemi was first discovered in aircore drilling in November 2019 and confirmed by RC drilling in March
2020. Hemi currently comprises a cluster of six individual gold deposits: Brolga, Aquila, Crow, Falcon, and the more recent
discoveries of Diucon and Eagle (Figure 3). The mineralisation is hosted in a series of intermediate intrusions associated
with sulphide (pyrite and arsenopyrite) stringers and disseminations within brecciated and altered quartz diorites that
intrude into the surrounding Archaean aged Mallina Basin sediments. The Archaean basement is eroded and truncated by
a 25m to 45m thick horizon of transported sediments that are barren of gold mineralisation. The Hemi style of
mineralisation is new to the Pilbara region and shows a scale of gold mineralisation not previously seen in the Mallina Basin.
Global Mineral Resources for the MGP, following the inclusion of Hemi, increased to 9.0Moz.
7
The announcement of the Maiden Hemi JORC Code compliant resource is a major milestone in the Company’s history;
however, it was only part of the overall focus of activities for the 2020/21 year. The Company also achieved several other
objectives for 2020/21 highlighted in last year’s annual report:
De Grey Mining Limited
Continue drilling to extend and define the
overall footprint of the Hemi discovery, leading
to a maiden Hemi Mineral Resource Estimate
by the middle of calendar year 2021
Explore and define new mineralised intrusions
within the Greater Hemi region
Improve site
communications to support planned activities
infrastructure, systems and
– Achieved –
– Achieved –
– Achieved –
Explore the large prospective regional shear
zones and other intrusion targets
Continue to expand the existing 2.2Moz
regional resources
– Partially achieved –
– Partially achieved –
Complete and evaluate early-stage project de-
risking
including metallurgy,
environmental, hydrology and geotechnical
aspects
studies
– Achieved –
JORC
Maiden Hemi
announced in June 2021
code
compliant
intrusion
several
targets drilled during
2020/21 including the discovery of Diucon
and Eagle
Stage 1 of the microwave communications was
commenced and is now operational along with
improved camp facilities and the securing of
additional camp facilities close to Hemi where
total accommodation is now over 150 persons
A regional exploration team was established
the year and has commenced
during
exploration of both intrusive and shear zone
targets within the area outside greater Hemi;
A regional exploration team was established
during the year and has commenced both Air
Core and RC drilling with an objective to
expand the regional resource base.
Announced that a scoping study will be
released in September 2021 Quarter which
will provide an early
indication of the
production potential to be a Tier 1 Gold
Project. In addition, metallurgy, hydrology
and
programs were
environmental
commenced during the year.
Detail of Activities undertaken during the 2020/21 Year
During 2020/21 the Company rapidly built its exploration capacity on site with 6 drill rigs at the commencement of July
2020 growing to 12 rigs by the end of June 2021. A total of 402,653 metres of drilling occurred during the year including
195,704m of Aircore, 167,486m of RC and 38,858m of Diamond drilling.
This exceptional drilling program was integral to the company being able to identify intrusives through initial aircore drilling
and followed up with targeted RC and DD rigs. This was a key to the Company being able to rapidly define new deposits at
Falcon, Diucon and Eagle which provided the catalyst to be able to define one of the largest Australian maiden gold JORC
resources, in recent times, at Hemi. Our ability to rapidly deploy drilling assets at these discoveries has allowed us to find
gold at A$8.50 per ounce for 6.8 million ounces at a rate of 450,000 ounces per month since the first RC hole at Hemi back
in February 2020.
8
Figure 5: Drilling at Greater Hemi
De Grey Mining Limited
In addition to delivering an outstanding Maiden JORC Code Compliant Mineral Resource at Hemi of 6.8Moz, the Company
has also delivered with a high proportion of Indicated resources within the Hemi MRE.
The quality of the individual deposits is demonstrated by the high percentage of Indicated Mineral Resource within the
upper portions of the deposits where the highest concentration of drilling has occurred to date.
Brolga
Aquila
Crow
Falcon
77% Indicated to 140m below surface and 53% overall
84% Indicated to 220m below surface and 62% overall
46% Indicated to 140m below surface and 34% overall
77% Indicated to 140m below surface and 57% overall
9
Figure 6: Hemi gold deposits showing Indicated and Inferred Mineral Resource categories.
De Grey Mining Limited
Details of each of the deposits are detailed below:
Brolga/Brolga South
The Brolga deposit is the largest gold resource identified at Hemi to date. The mineralised intrusion now spans 800m along
strike and up to 300m wide. Gold mineralisation at Brolga remains open down dip to the south-east and down plunge to
the west and within the large Brolga South extension. Infill and extensional drilling continued during the period.
The infill program (40m x 40m) was designed to provide sufficient drill density to enable a significant portion of the resource
to meet JORC 2012 Indicated classification. Intercepts received to date have been successful in demonstrating continuity
of the previous wide spaced drilling (80m x 80m). Results continue to show broad zones of consistent gold mineralisation
and strong correlations between adjacent holes.
10
Figure 7: Brolga Resource
De Grey Mining Limited
Aquila
Aquila is a gold-sulphide zone located to the immediate north of the Brolga and adjacent to the Crow intrusion to the north
and Falcon zone to the south (Figure 6).
The Aquila intrusion has been outlined over a length of +1,200m with well-defined mineralisation over 800m strike and has
been confirmed to depths of approximately 500m. Recent results have confirmed extensions to the plunging higher-grade
shoots at the eastern and western ends of the intrusion. Mineralisation remains open along strike and at depth.
Infill drilling has been conducted at a nominal 40m x 40m spacing to define the overall mineralised system and to provide
confidence in the continuity of higher-grade lodes. Extensional drilling is being conducted to test depth and strike
extensions to higher grade mineralisation.
Figure 8: Brolga, Aquila & Crow Resource
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De Grey Mining Limited
Crow
The Crow zone is a large intrusion located immediately north of the Aquila zone. The style of mineralisation is similar to
the Aquila and Brolga zones with more discrete sub vertical dipping lodes of sulphide rich alteration and brecciated
intrusion. Mineralisation remains open at depth, to the north and to the west towards the newly discovered Diucon and
Eagle zones.
The most dominant lode within the Crow intrusion has been named the McLeod lode and is located approximately 200m
north and oblique to Aquila intersecting each other at the eastern end. The McLeod lode is currently defined over 600m
in strike, 300m depth and up to 60m true thickness and remains open. The McLeod lode contains some of the highest-
grade intercepts in the overall Hemi deposit.
The RC drilling program at Crow has targeted resource definition at a 40m x 40m spacing. This drilling is to confirm
continuity of mineralisation between the existing 80m x 80m drilling. Results to date have been positive, with continuity
confirmed and additional stacked lodes intersected or extended.
Falcon
The Falcon intrusion is located approximately 600m west of Brolga and immediately south of Aquila. Strong mineralisation
has been defined over a strike length of approximately 1km. The intrusion has been defined in shallow aircore drilling over
a further 2km to the south. The bedrock is covered by approximately 30m to 40m of transported material similar to the
other deposits at Hemi.
The mineralisation at Falcon dips steeply to the east and is intimately associated with highly brecciated and extensively
sulphide altered portions of the north-south orientated subvertical intrusion. The style and intensity of alteration and
brecciation is similar to the nearby Aquila deposit.
Extension drilling has continued since the resource estimate targeting depth extensions along the known 1km strike of the
resource area.
Figure 9 – Falcon & Aquila Resource
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De Grey Mining Limited
Diucon and Eagle
The discoveries of the Diucon and Eagle zones were first announced during the March quarter of 2021. Diucon and Eagle
are located immediately to the west of Crow and present a potential geological link between the Crow intrusion to Antwerp
(Figure 12). The gold mineralisation shows similar alteration and sulphide development as seen at the adjacent deposits
of Aquila, Brolga, Crow and Falcon.
Diucon is defined over approximately 900m of strike and remains open down plunge to the west and at depth beneath
sediments to the south. The Eagle mineralisation is currently defined over 600m strike and remains open in most directions
as drilling is at an early stage.
Figure 10 – Diucon & Eagle Resource
Greater Hemi Exploration
Scooby, Antwerp, Alectroenas and Shaggy
The Greater Hemi area covers a corridor approximately 20km x 10km surrounding the Hemi deposits and includes four
other known intrusion targets: Scooby, Antwerp, Alectroenas and Shaggy and numerous targets based on the geophysical
interpretation (Figure 12).
First pass aircore drilling occurred during the year at all these four intrusion targets.
At Scooby, aircore drilling has outlined a zone of anomalous gold and arsenic mineralisation of approximately 2km in strike
and up to 1km wide with a coincident bedrock conductivity IP anomaly. The IP anomaly is interpreted to represent
disseminated sulphide-rich mineralisation within the fresh bedrock at depth.
Aircore drilling results returned during the year include a shallow high-grade intercept of 3m @ 97.4g/t Au from 45m
including 1m @ 264g/t Au and 2m @ 4.8g/t Au in BXAC437 which occurs at the uppermost weathered bedrock interface
with the transported cover sequence.
Aircore drilling at Scooby has been completed to an average depth of approximately 50 to 60 metres. This is due to the
hardness of bedrock and aircore rig penetration. The shallow penetration of the aircore drilling provides information on
only a relatively thin veneer of the underlying intrusion. In areas where deeper aircore drilling has been achieved, broad
lower grade intercepts (i.e. 48m @ 0.2g/t Au) suggest wider zones of mineralisation and alteration occur.
Late in the year, RC drilling recommenced at Scooby to complete the first pass wide spaced RC drilling program which was
interrupted by the discovery and resource drilling at Diucon and Eagle. Results of this program are pending at the time of
this report.
13
Figure 11: Greater Hemi region showing Hemi and the surrounding target areas
De Grey Mining Limited
Regional Exploration
Regional exploration activities outside of the greater Hemi corridor recommenced during the year throughout the MGP
following the formation of a regional exploration team. The initial focus of the regional exploration team is to identify new,
large scale, high value intrusion hosted deposits similar to Hemi and new structural shear zone targets. The MGP hosts a
combined Mineral Resource of 37.4 million tonnes grading 1.8g/t Au for 2.2 million ounces (excluding Hemi) with the
majority of resources hosted along shear zones in sediments and only the Toweranna deposit is hosted by an intrusion.
The interpretation of a detailed, project-wide aeromagnetic survey and geochemical sampling results has already
highlighted more than 30 potential intrusive targets requiring assessment and work continues to target potential new
intrusions throughout the project area (Figure 12). Three known intrusions have been identified with aircore drilling at
Charity Well, Calvert and Geemas.
Late in the year, aircore and RC drilling has been undertaken at Calvert, aiming to increase the existing shallow Calvert
resource and to test the previous defined and gold anomalous intrusion to the north of the resource area. Results of this
drilling are expected during the December quarter.
At Withnell, aircore and RC drilling programs have commenced aiming to test a series of targets within the mining leases
along the Withnell Trend.
Heritage surveys have commenced at Geemas and Charity Well areas after delays associated with Covid 19 constraints.
In the eastern portion of the MGP, a follow-up RC program has been recently completed at the Buckle prospect aiming to
extend previously intersected gold mineralisation at the Buckle prospect.
Farno Joint Venture (De Grey Mining Ltd 75%, Novo Resources Corp 25%)
During the year the Company has completed earning a 75% equity interest in the Farno JV. De Grey is the JV manager with
25% equity partner TSX-listed Novo Resources Corp (TSX:NVO).
14
Figure 12: Intrusion targets within the Mallina Project, including regional magnetic survey
De Grey Mining Limited
At the Gillies prospect (Figure 12), a program of 11 follow-up RC holes has recently been completed aiming to extend
previously defined mineralisation (15m @ 1.8g/t Au from 90m in GLRC016 within a broader 52m @ 0.7g/t Au from 53m)
along a potential 600m strike length. Results from this program are pending as at the reporting date.
Other Project Activities
Project Studies
During the year, the Company has progressed long lead time and its initial economic studies for the project. The intention
of the studies is to be able to demonstrate Tier 1 production potential of Hemi. This work has well during the year and as
part of the Hemi maiden resources announcement the Company confirmed it was seeking to finalise results of a Scoping
Study on the Mallina Gold Project during the September quarter 2021.
Building Organisational Capability
Following the discovery of Hemi the Company has progressively been building the organisation to support this work class
project and during key management appointments were made, including:
John Brockelsby – Health, Safety, Environment and Risk Manager
•
• Adam Randall – Health & Safety Superintendent
•
Sarah Thomas – Environment Superintendent
• Bronwyn Campbell – General Manager of Community Relations
•
Peter Canterbury - Chief Financial Officer
• Rachel Kogiopoulos – Financial Controller
• Rod Smith – Studies Manager
• Courtney Morgan-Evans – General Manager Human Resources
All of these people have exceptional skills in their relevant specialities and build on the capability of the Company to be
able to deliver the Mallina Gold Project into a producing asset in the foreseeable future.
It is a pleasure to be chosen to lead such an exceptional team at De Grey and I look forward to reporting on the following
2021/22 objectives for next year:
Forward looking to the 2021/22 year ahead, the Company plans to:
•
Continue drilling programs with the aim to extend the Mallina Gold Project Resources above the 9-million-ounce
JORC resource defined to date;
Complete the scoping study on the project to deliver a Tier 1 production capability at Hemi
•
• Materially advance and evaluate early-stage project de-risking studies including metallurgy, environmental,
hydrology and geotechnical aspects of the project to support the completion of a PFS during Calendar year 2022;
and
Pursue a corporate strategy aiming to use the IP knowledge to identify Intrusion style mineralisation targets within
our project area and the greater Pilbara region.
•
15
De Grey Mining Limited
Environment, Social and Governance Principles
ACKNOWLEDGEMENT OF COUNTRY
At De Grey Mining, we acknowledge the Traditional Custodians of the land upon which we operate and recognise their
unique cultural heritage, beliefs, and connection to these lands, waters, and communities.
We pay our respects to all members of these Indigenous communities, and to Elders past, present, and emerging. We also
recognise the importance of continued protection and preservation of cultural, spiritual, and educational practices.
As we value treating all people with respect, we are committed to building successful and mutually beneficial relationships
with the Traditional Custodians throughout our areas of operation.
Sustainability
The Board and management team of De Grey takes its responsibilities towards the business conducting its activities in a
safe, ethical and sustainable manner very seriously.
During the 2020/2021 financial year the majority of the Company’s resources were focused on exploration and drilling
programs at the Mallina Gold Project. During this period the company also continued an aggressive capability development
program with the appointment of key roles in Health and Safety, Environment and Community Relations to ensure the
company was positioned to address its future Sustainability requirements. Economic studies culminating in the release of
a Scoping Study subsequent to the end of the period in September 2021 were also completed.
The Company has undertaken its operations within a Sustainability framework across five key areas as set out in Figure 13
below. This framework outlines the priority areas of focus for the Board, management, employees, and contractors at the
current stage of De Grey’s enterprise. The Sustainability framework orientates De Grey to carry out its activities in a
responsible manner and provides a robust foundation from which to expand and grow.
Figure 13: De Grey’s Sustainability framework
16
De Grey Mining Limited
Consistent with the expected growth of the Company and scaling up of development studies alongside a large drilling and
exploration program, the Company has also completed a review of its Sustainability practices and future reporting
standards.
The Board has resolved to implement the International Council of Mining and Metals’ (ICMM) Mining Principles into its
development planning and anticipated future execution for the Hemi Gold Project. These 10 principles align with the United
Nations Sustainable Development Goals (Figure 14) and provide a critical framework through which the development of
Hemi can be carried out in a sustainable manner which provides significant benefits for all stakeholders. The principles are
consistent with De Grey’s current Sustainability framework with additional focus on key areas such as human rights and
the supply chain.
The alignment of De Grey’s development planning for the Hemi project with the ICMM’s Mining Principles will have
practical outcomes in areas including the use of renewable energy, future procurement decisions, environmental
management, and mine closure planning. The outcomes will be detailed in future feasibility studies for the Hemi project.
Figure 14: ICMM Mining Principles
To augment the ICMM Mining Principles in the area of climate change, the Board has also resolved to adhere to the Task
Force on Climate-Related Financial Disclosures (TCFD). The TCFD sets out 11 recommendations for managing climate-
related risks to business and incorporates governance, strategy and risk management metrics and targets which companies
are required to report against. De Grey has committed to adhere to the TCFD as it moves into the future construction and
operations phase for the Hemi project.
17
De Grey Mining Limited
“The De Grey board is committed to the adoption of ICMM Mining Principles and the
Task Force on Climate-Related Financial Disclosures with the oversight of a new
sustainability committee established in the 2021/22 financial year for the sustainable
future development of the Mallina Gold Project.”
De Grey will continue to develop further principles as we progress through the project.
Health and Safety
De Grey is committed to creating value and improving lives though a fatality, injury and illness free performance and
culture. In 2020/21 we continued to achieve our objective of zero (0) workplace injuries, with by 510 LTI free days and a
0.00 rolling Lost Time Injury Frequency Rate (LTIFR) for De Grey and the Hemi Project as of 30 June 2021. This was measured
against the 2019-20 Exploration industry average for LTIFR in WA for 2019/2020 of 4.20.
During the year, De Grey built significant capability within the organisation, appointing an experienced Health & Safety
Superintendent and site-based Health and Safety advisors supporting the Hemi Project. Building this capability supports
the implementation of our Health and Safety Management System (HSMS) and ensures significant risks have robust and
sustainable safety critical controls.
The development of a health and hygiene management strategy has allowed targeted programs such as pre-employment
medicals, fatigue prevention, heat stress management and respiratory protection programs to reduce actual and potential
health risks to our employees and business partners. This has been supported by independent quarterly atmospheric and
biological monitoring.
On 30 January 2020, the World Health Organisation announced that the coronavirus (COVID-19) was a global health
emergency and on 11 March 2020 declared it a global pandemic. Since the outbreak, we have monitored its impact,
introducing, and maintaining measures to protect the health and safety of our employees and business partners.
Polymerase Chain Reaction (PCR) screening for all employees mobilising to the Hemi Operations.
Temperature checks and health screening at both Head Office and site locations daily.
The introduction of initiatives, including changes to gymnasium, food service and cleaning services.
The following key measures have ensured that COVID-19 has had a minimal impact on our operations with no positive
cases of COVID-19 recorded during the period:
•
•
•
• Adjustments to rosters for the duration of lockdowns (February, April, and June 2021) based on Western Australian
Government advice. Office-based team members and non-essential site employees worked from home during these
periods.
Environment
De Grey strives to continuously meet or exceed stakeholder expectations, regulatory obligations, and best practice ESG
Principles in relation to Environmental Management. The Company remains committed to the ICMM Principles which focus
on ensuring positive environmental outcomes are embedded in the business decision making process
During the year the Company appointed an Environment Superintendent, Sarah Thomas, who is highly experienced in the
Pilbara region and in undertaking environmental studies of the scale required. Since this appointment, De Grey has begun
developing a robust Environmental Management System (EMS) which focuses on risk based, outcomes focused approach
to environmental management.
As part of the Mallina Gold Project Scoping Study the Company commissioned an Environmental Scoping Report which was
developed by Blueprint Environmental Strategies in conjunction with De Grey environmental personnel. Included in the
scoping study document were a number of biological and technical reports and desktop assessments pertaining to
Environmental Impact Assessment (EIA) of the project including flora baseline studies, terrestrial fauna database searches,
subterranean fauna, short-range endemic reviews and groundwater and surface water study outcomes.
18
The company has maintained a strong focus and is committed to ensuring environmental compliance requirements are
documented, communicated, measured and maintained. An environmental improvement plan, aligned with the De Grey’s
strategic development plan, outlines the opportunities for continuous improvement, streamlining of environmental
processes, and ensuring adequate technical and biological studies are undertaken to meet regulator guidance and facilitate
effective and efficient environmental approval processes.
De Grey Mining Limited
Community
During the year De Grey increased its capability in Community Relations with the appointment of Bronwyn Campbell -
General Manager of Community Relations. Bronwyn is a senior community relations and social performance professional
with many years’ experience working with international, national, and regional communities.
De Grey Mining aspires to be an outstanding community partner who engages with and supports the long-term goals of
the people and places neighbouring our operations. The Company has continued to build strong networks this year with
local residents, community groups, Traditional Owners and pastoralists, resulting in regular positive feedback across the
industry and throughout the region.
Regular meetings occur with the Kariyarra Aboriginal Corporation where the Hemi deposit is located as well as the
Ngarluma Aboriginal Corporation and Nyamal Aboriginal Corporation where the Company also has tenements and existing
JORC compliant Mineral Resources. The Company works with these groups in relation to heritage surveys, exploration
agreements and longer term, executing mining agreements.
Our objective in all dealings is one of achieving mutual respect and outcomes which provide meaningful benefits in the
long term.
The Company’s tenements are located across five pastoral leases where we regularly engage with lease holders to ensure
positive relationships.
Consultations with higher educational facilities and local government regarding workforce planning and local housing
commenced during the year aimed at identifying opportunities to employ within the region.
During the year the Company supported Mission Australia in establishing a Port Hedland representative to support regional
victims of domestic violence. Domestic violence has seen an increase during the Covid-19 pandemic.
Consistent with our commitment to ICMM principles, the Company has undertaken its initial Socio-Economic Baseline study
on the region in which we operate.
19
Governance
De Grey Mining Limited
The Company has undertaken a board review during the year and has agreed to implement the key recommendations of
Principles,
that
(https://degreymining.com.au/corporate-governance/), associated with independence and diversity.
Corporate Governance
recommendations
designed
review.
satisfy
The
are
to
The Company has existing policies in place to ensure its activities are carried out in a manner which is consistent with its
objective to always behave in a proper and ethical manner. The full policies are contained on the Company’s website and
are reviewed and updated as required periodically to ensure they remain suitable for the growing scale of De Grey’s
activities.
Post 30 June 2021, the Board has established a Sustainability Committee, to be Chaired by Lead Independent Director, Mr
Peter Hood.
20
De Grey Mining Limited
Directors’ Report
Your directors present their report on the consolidated entity comprising De Grey Mining Limited (“De Grey” or “the
Company”) and its controlled entities (“the consolidated entity” or “Group”) for the financial year ended 30 June 2021.
All amounts are expressed in Australian dollars unless otherwise stated.
De Grey is a company limited by shares that is incorporated and domiciled in Australia.
Directors
The following persons were Directors of the Company during the whole of the financial year and up to the date of this
report, except as otherwise indicated:
Simon Lill
Glenn Jardine
Andrew Beckwith
Peter Hood
Eduard Eshuys
Bruce Parncutt
Information on Directors
Simon Lill, BSc MBA
Executive Chairman
Mr Lill was appointed to the board in October 2013 and became Executive Chairman in 2014. He has previously worked
with Anaconda Nickel Limited through engineering studies, financing, and construction phases of the Murrin Murrin Nickel
mine. He also has extensive experience since the 1980’s with ASX listed companies, spanning small cap companies to larger
concerns, involving restructuring, corporate, compliance, marketing, company secretarial and management activities,
resulting in his role at De Grey Mining Ltd.
During the past three years Mr Lill has also served as a director of the following listed companies:
Date appointed
18 May 2011
2 September 2013
29 March 2018
Company
Finexia Financial Group Limited (formerly Mejority Capital Limited)
Purifloh Limited
XPD Soccer Gear Group Limited
Date ceased
25 November 2019
-
-
Interest in shares and at the date of this report:
13,739,063 ordinary fully paid shares
130,566 unlisted options over ordinary shares in De Grey Mining Limited
500,000 performance rights
Committees
Audit & Risk Committee
Remuneration & Nomination Committee
21
De Grey Mining Limited
Glenn Jardine, BE (Mining) FAusIMM
Managing Director
Mr Jardine was appointed Managing Director in May 2020. He is an experienced mining executive of 35 years with direct
experience in growing resource companies from early-stage exploration through to multi-operation entities, including
taking projects through feasibility studies, equity funding, debt financing, project development and operations. His
experience includes Project Manager & General Manager of the Henty Gold Mine in Tasmania for Goldfields Ltd; Project
Manager of the Emily Ann & Maggie Hays nickel mines; General Manager New Business, Chief Operating Officer &
Managing Director for Lion Ore Australia. He has more recently been Chief Operating Officer of Azure Minerals Limited.
Commodity experience includes precious metals, base metals, and bulk commodities across underground and open pit
operations. Processing methods utilised at these projects and operations include CIP/CIL, DMS, sulphide flotation, BIOX,
pressure oxidation and SX/EW.
Projects developed have received Australian State and Federal recognition for environmental best practice and health
and safety and human resources systems.
During the past three years Mr Jardine has not served as a director of any other listed companies.
Interest in shares and options at the date of this report:
553,454 unlisted options over ordinary shares in De Grey Mining Limited
140,846 performance rights (Tranche 1)
300,300 performance rights (Tranche 2)
282,486 performance rights (Tranche 3)
Rights issued to Mr Jardine are issued in 3 tranches, T1 140,846 will vest in September 2021, T2 300,300 will vest in
September 2022 and T3 282,486 will vest in September 2023. The number of rights to be issued for T2 and T3 are a
provisional number and will be adjusted when the rights are issued.
Andrew Beckwith, BSc Geology, Aus IMM
Technical Director
Mr Beckwith was appointed to the board in October 2017, having commenced his time with De Grey as a Technical
Consultant in February 2016.
He is a successful and experienced exploration geologist who has previously held senior technical roles with AngloGold
Ashanti, Acacia Resources, Helix Resources, Normandy NFM, North Flinders Mines, BP Minerals Australia and Westgold
Resources. At Westgold, Mr Beckwith initially held the role of exploration manager before appointment as Managing
Director. Additionally, Mr Beckwith was an Executive director of Bulletin Resources Limited until June 2014.
During his time at Westgold, he was intimately involved in the Explorer 108 Pb-Zn-Ag and the Au-Cu Rover 1 (1.2Moz)
discoveries in the Northern Territory as well as the acquisition of the Central Murchison Gold Project located in Western
Australia.
During the past three years Mr Beckwith has also served as a director of the following listed companies:
Company
Carnavale Resources Limited
Date appointed
29 July 2014
Date ceased
-
Interest in shares and options at the date of this report:
8,031,668 ordinary fully paid shares
659,896 unlisted options over ordinary shares in De Grey Mining Limited
400,000 performance rights
22
De Grey Mining Limited
Peter Hood AO, BE(Chem), MAusIMM, FlChemE, FAICD
Non-executive Director & Lead Independent Director
Mr Hood was appointed to the board on 19 November 2018. Mr Hood, a Chemical Engineer, has had a distinguished career
in the Australian Mining and Chemical Industries. He held the position of Senior Production Engineer at the Kwinana Nickel
Refinery from 1971 to 1981, then Mill Superintendent of the WMC Kambalda Nickel and Gold Operations between 1982 to
1985. In 1985, he joined Coogee Chemicals Pty Ltd in the position of General Manager and then as their CEO between 1998
and 2005. He then held the position of CEO of Coogee Resources Ltd before retiring in 2008. Through that period he was
part of the management team that oversaw significant growth in Coogee Chemicals.
In 2020, Mr Hood was recognised as an Officer of the Order of Australia in the Australia Day Honours List for distinguished
service to business and commerce at the state, national and international level, and to the resources sector.
During the past three years Mr Hood has also served as a Director of the following listed companies:
Company
Cue Energy Resources Limited
GR Engineering Limited
Matrix Composites and Engineering Limited
Date appointed
23 February 2018
10 February 2011
15 September 2011
Date ceased
-
-
-
Interest in shares and options at the date of this report:
4,300,000 ordinary fully paid shares
52,227 unlisted options over ordinary shares in De Grey Mining Limited
Committees
Audit & Risk Committee
Remuneration & Nomination Committee
Eduard Eshuys, BSc, FAusIMM, FAICD
Non-executive Director
Mr Eshuys was appointed to the board on 23 July 2019. Mr Eshuys is a highly experienced and well credentialled geologist
with over 40 years exploration and company management experience in Australia. In the late 1980s and early 1990s he led
the teams that discovered the Plutonic, Bronzewing and Jundee gold deposits, and the Cawse Nickel Deposit. He was also
involved in the Maggie Hays and Mariners nickel discoveries in the 1970’s. He was the Managing Director and CEO of St
Barbara Limited from July 2004 to March 2009. During this time St Barbara Limited grew substantially as a gold producer.
During the past three years Mr Eshuys has also served as a director of the following listed companies:
Company
DGO Gold Limited*
NTM Gold Limited
Dacian Gold Limited
Date appointed
15 July 2010
26 March 2019
16 March 2021
Date ceased
-
16 March 2021
-
*As at the date of this report, DGO Gold Ltd holds 203,577,703 ordinary fully shares in De Grey Mining Limited (representing 15.8% of
De Grey’s issued capital).
Interest in shares and options at the date of this report:
No ordinary fully paid shares
52,227 options over ordinary shares in De Grey Mining Limited
Committees
Chair of the Remuneration & Nomination Committee
Audit & Risk Committee
23
De Grey Mining Limited
Bruce Parncutt AO, BSc, MBA
Non-executive Director
Mr Parncutt was appointed to the board on 23 July 2019. Mr Parncutt is currently Chairman of investment banking group
Lion Capital and has had a career spanning over 40 years in investment management, investment banking and stock
broking, where he has previously held roles as Managing Director of McIntosh Securities, Senior Vice President of Merrill
Lynch, Director of Australian Stock Exchange Ltd.
In 2016, Mr Parncutt was recognised as an Officer of the Order of Australia in the Queen’s Birthday Honours List for
distinguished service to the community as a philanthropist (particularly in arts and education) and as an advocate and
supporter of charitable causes, and to business and commerce. He is currently a member of The Australian Ballet Board
and a Trustee of the Helen MacPherson Smith Trust.
During the past three years Mr Parncutt has also served as a director of the following listed companies:
Company
DGO Gold Limited*
Date appointed
23 May 2018
Date ceased
-
*As at the date of this report, DGO Gold Ltd holds 203,577,703 ordinary fully shares in De Grey Mining Limited (representing 15.8%).
Interest in shares and options at the date of this report:
No ordinary fully paid shares
52,227 options over ordinary shares in De Grey Mining Limited
Committees
Chair of the Audit & Risk Committee
Remuneration & Nomination Committee
Company Secretaries
The following persons acted as Company Secretary of the Company during the whole of the financial year and up to the
date of this report:
Craig Nelmes, BBus
Mr Nelmes is an Accountant who joined De Grey in October 2013 and has over 25 years’ experience in the provision of
finance, secretarial, governance, financial systems and providing accounting services to the mining sector in Australia and
overseas. His experiences include over seven years with International Accounting firm Deloitte, nine years with a multi-
national resource’s entity and most recently ten years with Corporate Consultants Pty Ltd, a Company providing accounting,
secretarial and administrative services to ASX and TSX listed entities.
Patrick Holywell, FGIA GradDipCA GAICD BCom
Mr Holywell is a Chartered Accountant who joined De Grey in July 2018. He has over 15 years’ experience in corporate
governance, finance and accounting including employment with Deloitte and Patersons Securities Ltd. Mr Holywell has
been employed by and acted as company secretary, CFO and/or director of several companies in various sectors.
24
De Grey Mining Limited
Chief Financial Officer
Peter Canterbury, BBus CPA
Mr Canterbury is an experienced mining executive and Certified Practicing Accountant with substantial experience in
leading ASX-listed mining companies, most recently as MD of ASX-listed Triton Minerals and CEO of Bauxite Resources.
Peter has as a broad skillset spanning financial and corporate management, accounting, project financing, feasibility
studies, contract negotiation and mining operations. He has held senior roles within the mining industry for close to 30
years. Previously CFO and Acting CEO of Sundance Resources, where he played a lead role in rebuilding the company
following a plane accident in 2010 and was instrumental in negotiating the Mining and Development convention for
Sundance in Cameroon and Republic of Congo for the US$5 billion iron ore mine, rail and port project. His previous positions
include CFO of Dadco Europe with its alumina and bauxite operations in Europe and Africa and several positions with Alcoa
in finance, marketing and project development. Peter brings highly relevant financial expertise to support De Grey’s
ambitions of becoming a Tier 1 gold producer from Hemi.
Principal Activities
The principal activity of the consolidated entity during the year was exploration and development activities at the Mallina
Gold Project, 80 kms southwest of Port Hedland in the Pilbara region of Western Australia. De Grey currently controls a
considerable tenement package comprising over 1,500km2. The tenement package is highly prospective for gold, other
precious metals and comprises significant base metals resources (Zn-Ag-Pb) as well as lithium prospects.
Earlier this year, the Company announced the Maiden mineral resource at Hemi, which occurs in the central portion of De
Grey’s large Mallina Gold Project. A substantial resource, measuring 6.8Moz, which has boosted the project to 9.0Moz
The exploration activities are focused on increasing resources across the existing deposits and new
target areas including:
• Resource extensions at Hemi.
• Discovery of new intrusion style mineralisation in the Greater Hemi region.
• Resource extensions at Withnell and the other regional shear hosted deposits.
• Resource extensions at Calvert, another intrusion related target; and
• Reconnaissance drilling along the 200km of shear zones and numerous interpreted intrusion
targets.
Financial Review
The consolidated loss after tax for the year ended 30 June 2021 was $5,250,269 (2020: $3,976,002). Details of our
operations is included in the Managing Directors report and operations review, preceding this report.
Earnings per share
The basic loss per share for the year ended 30 June 2021 was 0.41 cents per share (2020: 0.41 cents per share).
Dividends
No dividends were paid or declared during the financial year (2020: None). No recommendation for payment of dividends
has been made.
25
De Grey Mining Limited
Significant changes in state of affairs
There were no significant changes in the nature of the activities of the Group during the year, other than those included
in the Key Highlights within the Review of Operations.
Matters subsequent to the end of the financial year
There has been no matters or circumstances occurring subsequent to the end of the financial year that has significantly
affected, or may significantly affect the operations of the Group, the results of those operations, or the state of affairs of
the Group in future financial years.
Likely developments and expected results
De Grey seeks to maximise shareholder value through its ongoing exploration and development work at The Mallina Gold
Project (“MGP”).
The Company has an aspirational goal of achieving a Tier 1 scale of mineralisation within the MGP, and has recently
announced the Maiden Mineral resource which further strengthens the project with Measured and Indicated Mineral
Resources as follows:
• Hemi – Tier 1 scale maiden Gold Mineral Resource confirmed at 6.8Moz
Hemi Total Mineral Resource Estimate (JORC 2012)
Indicated (41% of ounces)
Inferred (59% of ounces)
192Mt @ 1.1g/t Au (6.8Moz)
66Mt @ 1.3g/t Au (2.8Moz)
127Mt @ 1.0g/t Au (4.0Moz)
• Mallina Gold Project – Global Mineral Resources, including Hemi, increase to 9.0Moz
MGP Mineral Resource Estimate (JORC 2012)
Measured & Indicated (43% of ounces)
Inferred (57% of ounces)
230Mt @ 1.2g/t Au (9.0Moz)
85Mt @ 1.4g/t Au (3.8Moz)
145Mt @ 1.1g/t Au (5.1Moz)
These Mineral Resources provide a strong platform for a scoping study targeted for completion in the September quarter
2021.
The Company’s immediate growth strategy will continue to focus on expanding the footprint of the Hemi deposits,
increasing the global project resource and making new discoveries within the large Mallina Gold Project.
26
De Grey Mining Limited
Remuneration Report (Audited)
The remuneration report is set out under the following headings:
A. Remuneration report overview
B. Overview of executive remuneration
C. Service agreements
D. Details of remuneration
E. Securities based compensation
F. Other transactions and balances with key management personnel
A. Remuneration Report Overview
The Directors of De Grey Mining Limited present the Remuneration Report for the Group for the year ended 30 June 2021.
The report forms part of the Directors’ Report and has been audited in accordance with section 300A of the Corporations
Act 2001.
The report details the remuneration arrangements for the Company’s Key Management Personnel (KMP):
• Non-executive directors (NEDs)
•
Executive directors and senior executives
KMPS are those persons who, directly or indirectly, have authority and responsibility for planning, directing, and controlling
the major activities of the Group including all directors of the Company.
The table below outlines the KMP of the Company and their movements during the year.
Name
Non-Executive directors
Mr Simon Lill
Mr Peter Hood AO
Mr Eduard Eshuys
Mr Bruce Parncutt AO
Executive Directors
Mr Glenn Jardine
Mr Andrew Beckwith
Position
Term
Non-Executive Chairman
Non-Executive Director
Non-Executive Director
Non-Executive Director
Full financial year
Full financial year
Full financial year
Full financial year
Managing Director
Technical Director
Full financial year
Full financial year
Other Key Management Personnel
Mr Craig Nelmes
Mr Patrick Holywell
Mr Peter Canterbury
Mr Philip Tornatora
Company Secretary
Company Secretary
Chief Financial Officer
General Manager - Exploration
Full financial year
Full financial year
Appointed 1 February 2021
Full financial year
B. Overview of Executive Remuneration
The remuneration policy of De Grey has been designed by the board taking into consideration the stage of development of
the Group and the activities undertaken. The guidance is to build mutually beneficial outcomes by aligning key management
personnel with shareholder and business objectives.
We reward executives by providing a mix of fixed remuneration and variable remuneration consisting of short term (“STIP”)
and long-term incentives (“LTIP”) on key performance areas affecting the Group’s financial results or operational
milestones.
27
De Grey Mining Limited
Mix of Remuneration
Managing Director
Fixed Remuneration
STIP
LTIP
Senior Executives
%
50%
15%
35%
Fixed Remuneration
STIP
LTIP
57-60%
15%
24-28%
Up to 50% is held at risk and measured against performance
Up to 50% is held at risk and measured against performance
Our Executives performance is evaluated annually, and both cash components and awards held at risk are described below.
The performance of any company depends largely on the quality of its executives, to this end, De Grey Mining Limited
endeavours to attract, motivate and retain highly skilled executives and embodies the following principles in its
remuneration framework.
Provide competitive rewards to attract high calibre executives
Link executive rewards to shareholder value
Ensure a significant portion of executive remuneration is ‘at risk’, dependent on meeting performance
benchmarks
Establish appropriate, demanding performance hurdles in relation to variable executive remuneration
The board of De Grey Mining Limited believes the remuneration policy to be appropriate and effective in its ability to attract
and retain the best executives and directors to run and manage the Group.
Executive remuneration levels are reviewed annually by the Remuneration & Nomination Committee with reference to the
remuneration guiding principles and market movements. When reviewing remuneration, the Company may also source
external advice to assist with salary setting and determination of other benefits, including short term and long-term
incentive plans. Advice provided by BDO rewards WA Pty Ltd during the year is included in this report.
Fixed Remuneration
Variable Remuneration
Fixed Pay
Retention
Pay
Incentive
pay
Reward pay
Pay for performance approach in
meeting the role requirements.
Executive must meet performance
expectations otherwise 50% of
retention incentive will not be awarded
and therefore 'At risk'.
Incentives are paid to deliver on long
term business goals.
(Non-Market measures)
Reward for creating sustainable
shareholder value. (Market measures)
Measurement tools used for fixed remuneration includes the market rate for the role. Zero Exercise Price Options
(‘ZEPOs) are granted as variable remuneration and are held at risk where performance targets are not reached. Cash
bonus payments are aligned with long-term business goals and reflect ‘line-of-sight long term performance. Milestones
include building reserves, completing a definitive feasibility study and completing funding for the project which are non-
market measures. Non-market measures are intended to reward executives for creating sustainable shareholder value.
Short-term Incentive Plan
An annual STIP opportunity exists for all Executives in the form of cash, but which the board has discretion to settle in
ZEPO’s. This would be agreed individually with each executive and be converted using the 10-day VWAP on the day the
ZEPO’s are granted. The executive must be employed to be eligible to receive the payment and achieve a score of 65% or
more on the annual short term incentive criteria (‘STIC’) which is subject to certain KPI’s listed below and are in line with
role objectives for the year.
28
In addition to the cash bonus, where performance related awards are held at risk, the criteria (STIC) to be awarded the 50%
of ZEPO’s each year are as follows:
The annual short-term incentive criteria (“STIC”) consists of a weighted scorecard comprising the following wealth
preservation measures and wealth creation measures (subject to Board review on an annual basis):
De Grey Mining Limited
annual project-based milestones.
all regulatory compliance requirements met.
•
•
• meeting budget (as adjusted and approved by Board).
•
safety- Total Recordable Injury Frequency Rate.
• maintain and increase institutional shareholder base and undertake successful capital raising activities.
•
•
keeping tenements in good standings; and
business development.
The Board will also retain discretion to vary or supplement the STIP, following conferral with the executive, to better define
and formalise those criteria, having regard to the nature and scale of the business and any other applicable matters.
Long-term Incentive Plan
The annual LTIP opportunity consists of ZEPOs, and which have been issued to both executive directors and other key
management personnel. The LTIP is designed to reward performance over a three-year period. The ZEPO’s will vest upon
satisfaction of the following vesting conditions or where, vesting conditions are not satisfied, the Board has discretion to
vest the options.
• Remain employed by the company until vesting date to be eligible to receive the payment.
•
delineation of Mineral Resources (as that term is defined in JORC, 2012 Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves) of not less than 12 million ounces of gold at the
Company’s Mallina Gold Project (inclusive of the existing regional 2.2 million ounces) by 3 December 2024.
completion of a Definitive Feasibility Study (DFS) confirming feasibility for a 500,000 ounces of gold per annum
project through a mine life of no less than 12 years, or such other number as approved by the Board following
completion of a Pre-Feasibility Study. The DFS is to be signed off in its entirety by a suitably qualified engineering
group (with oversight from the Board); and
the Company securing debt and/or equity finance for a Board approved Project arising from the DFS.
•
•
Non-market measures are intended to reward executives for aligning their rewards with De Greys business outcomes and
creating sustainable shareholder value.
The 2,619,326 ZEPO’s issued have a 4-year term, one third of those issued are evaluated annually in June against the
scorecard. Upon achieving a 65%+ STIC score, 50% of these ZEPO’s achieve the incentive condition and remain eligible to
vest. If the executive does not achieve the score of 65% or more, 50% of the ZEPOs will be cancelled, whilst the balance
will vest solely subject to achieving the LTIP Milestones. The one-third of ZEPO’s issued within this tranche to executives
and other key management personnel in the 2021 financial year will be tested against the scorecard in June 2022.
If the executive ceases employment before the STIP and LTIP payment, they will lose the STIP and any LTIP award unless
the executive is a "Good Leaver". Where the executive is a "Good Leaver", a pro-rata award may be made, subject to the
Board's discretion (based on time served during the performance period and the satisfaction of any agreed KPI). The
executive loses the award on cessation of employment where they are considered a "Bad Leaver".
•
A good Leaver means the Executive ceases to be employed by the Company because the Executive dies or is
permanently incapacitated so that they are unable to perform their employment duties,
is aged 60 or older and permanently retires from all employment
validly terminates the Employment in accordance with its terms due to material breach by the Company
•
•
• has the Employment terminated by the Company other than for reasons justifying summary dismissal, a material
•
breach of contract, underperformance or any other reason specified under the ESA; and/or
validly terminates the Employment because of a diminution of role after the Company undergoes a Change in
Control.
29
De Grey Mining Limited
Other ZEPO’s Issued during 2021
Also, in FY2021, 450,454 ZEPO’s were issued to directors with no vesting conditions. They were granted on 10 July 2020
after receiving shareholder approval and vested 30 July 2020. It was determined by the Board that these ZEPO’s reward
the efforts in achieving the new Discovery which has since been included in the Maiden Mineral Resource announced in
June 2021.
Overview of Company Performance and Governance
The table below sets out information about De Grey Mining’s performance and movements in shareholder wealth for the
past four years up to and including the current financial year.
Net loss
Share price at year end ($)
Basic EPS (cents)
Total Dividends per share
2021
5,250,000
1.24
(0.41)
2020
3,976,000
0.91
(0.41)
-
2019
2,009,000
0.67
(0.50)
-
2018
2,477,000
0.16
(0.85)
-
2017
3,219,000
0.04
(1.91)
-
NOV 2019
Capital
raising
$5M
111.1M
shares at
$0.045
MAY 2020
commencement of
Managing Director
Glenn Jardine to lead
the development of
MGP
Capital Raising
$31.2M
111.4M shares at
$0.28
DEC 2019
* DISCOVERY *
SEP 2020
Capital Raising
$100M
83M shares at
$1.20
JUN 2021
Achievement of
milestone
"Maiden Mineral
Resource -
Hemi" 9.0Moz
AUG 2020
Consider
Remuneration
policies to attract
talent and build
the capability of
the Company
OCT 2020 - FEB 2021
Build the Exco
Managers responsible
for Community, HSE &
Risk, CFO
Share Price & Volume
$1.80
$1.60
$1.40
$1.20
$1.00
$0.80
$0.60
$0.40
$0.20
$-
s
n
o
i
l
l
i
M
700
600
500
400
300
200
100
-
Nov
19
Dec
19
Jan
20
Feb
20
Mar
20
Apr
20
May
20
Jun
20
Jul
20
Aug
20
Sep
20
Oct
20
Nov
20
Dec
20
Jan
21
Feb
21
Mar
21
Apr
21
May
21
Jun
21
Share Price
Volume
30
De Grey Mining Limited
Non-executive Directors’ remuneration
The board policy is to remunerate non-executive directors at market rates for comparable companies for time,
commitment, and responsibilities. The board determines payments to the non-executive directors and reviews their
remuneration annually, based on market practice, duties and accountability.
Fees for non-executive directors are not linked to the performance of the Group. However, to align Directors’ interests
with shareholder interests, the non-executive directors may receive short term performance incentives and longer-term
performance incentives as approved by shareholders.
NED’s fees are determined within an aggregate NED fee pool limit, which is periodically approved by shareholders. The
maximum aggregate amount of fees that can be paid to non-executive directors is subject to approval by shareholders at
the Annual General Meeting. The last aggregate pool was approved at the AGM held in November 2019 and is currently
$700,000.
The annual remuneration for each non-executive director was set in the range of $94,000 - $140,000 per annum for the
2020-2021 financial year. These fees have been supported by independent advice from BDO Rewards (WA) Pty Ltd and
determined by the Board of the Company. The fees take into consideration factors such as the market rates of industry
peer companies, the current level of activity and the experience of the Directors. Where there is a significant change in the
size and scale of Company activities these annual fees will be reviewed. Where approved and at the request of the board,
any of the Non-Executive Directors may from time to time be required to fulfil certain executive functions.
Use of remuneration consultants
The Board from time to time engages the services of external consultants to advise on the remuneration policy and to
benchmark director and key management personnel remuneration against comparable entities to ensure that
remuneration packages are consistent with the market and are appropriate for the organisation. During the year, the
Remuneration & Nomination Committee approved the engagement of BDO Rewards (WA) Pty Ltd, (“BDO”) to provide
advice on the Executive Incentive Framework, Executive Remuneration Benchmarking and Non-Executive Director
Remuneration.
Both BDO and the Committee are satisfied the advice from BDO is free from undue influence from the KMP to whom the
remuneration recommendations apply. The remuneration recommendations were provided to the Committee as an input
into decision making only. The Remuneration & Nomination Committee considered the recommendations, along with
other factors, in making its decisions.
Fees paid to BDO with respect to the advice were $29,730. In addition to providing remuneration recommendations, BDO
provided advice on other aspects of remuneration of the Groups employees. Fees for these services amounted to $5,410.
Performance Rights (PRP) and Employee Option Plans (EOP) of De Grey Mining Limited
The PRP and EOP were last approved by Shareholders at the 2017 and 2018 Annual General Meetings respectively. The
instruments issued in FY2021 were approved at the General Meeting on 10 July 2020 and the AGM on 4 December 2020.
All Directors, full and part time employees, as well as key consultants of De Grey Mining Limited are eligible to participate
in each Plan. Any issue of Rights or Options to Directors under either Plan will be subject to Shareholder approval pursuant
to the provisions of the ASX Listing Rules and the Corporations Act 2001. The Directors consider that collectively the PRP
and EOP represent an appropriate method to:
• Reward Directors, Key management personnel and employees for their past performance.
•
•
•
•
Provide long term incentives for participation in the Company’s future growth.
To motivate and retain Directors, KMP and senior employees.
Establish a sense of ownership in the Company for the Directors and employees.
Enhance the relationship between the Company and its employees for the long-term mutual benefit of all
parties; and
Enable the Company to attract high calibre individuals who can bring specific expertise to the Company.
•
31
De Grey Mining Limited
Vesting conditions of the performance rights
Issued and approved November 2017:
•
•
•
•
Tranche 1 – (100% vested) the Company declaring greater than 1,500,000-ounce gold resource (JORC 2012) at
an overall grade of at least 1.7 g/t and a minimum category of JORC inferred within 2 years of this AGM at the
Pilbara Gold Project, – vested November 2019
Tranche 2 – (100% expired) the Company declaring greater than 2,000,000-ounce gold resource (JORC 2012) at
an overall grade of at least 1.7 g/t and a minimum category of JORC inferred within 2 years of this AGM at the
Pilbara Gold Project, - Expired November 2019
Tranche 3 - (100% vested) finalisation of the Company's acquisition of 100% of Indee Gold Pty Ltd, vested
November 2019
Tranche 4 – (not yet vested) The Company securing Project Financing for the Pilbara Gold Project at a minimum
throughput of 1M tpa, Expiry date: November 2021 – not yet vested
Tranche 5 – (100% vested) the Company confirming higher grade resources of at least 200,000 ounces and at an
overall grade of > 5 g/t within 2 years of the Company’s AGM - vested November 2019.
Issued September 2020 (Approved 10 July 2020) Tranche 1-2021:
•
•
•
the Company’s shares reaching a price equal to or greater than 120% of the volume weighted average price of
the Company’s shares or the 10 trading days prior to your acceptance of the Offer, within the period 27 July
2020 and 15 September 2021.
Satisfactory completion of the executives Probationary Period as per the Executive Services Agreement between
the Company and executive; and
The executive remaining employed as Managing Director by the Company as of 15 September 2021.
Two further tranches were approved for issue and are expected to be issued over the next 2-year period on the 15
September of each year. The vesting conditions are as follows.
Estimated number of performance rights to be issued is 300,300 (the final number will be confirmed on issue) in September
2021 (Approved 10 July 2020) Tranche 2-2021:
•
•
the Company’s shares reaching a price equal to or greater than 120% of the volume weighted average price of
the Company’s shares; and
The executive remaining employed as Managing Director by the Company as of 15 September 2022.
Estimated number of performance rights to be issued is 282,486 (the final number will be confirmed on issue) in September
2022 (Approved 10 July 2020) Tranche 3-2021:
•
•
the Company’s shares reaching a price equal to or greater than 120% of the volume weighted average price of
the Company’s shares; and
The executive remaining employed as Managing Director by the Company as of 15 September 2023.
The Group have commenced the amortisation of the rights which have not yet been issued as their grant date was approved
by the Board on 10 July 2020.
Vesting conditions of options
•
•
•
•
The executive has remained employed until the vesting date.
Delineation of Mineral Resources (as that term is defined in JORC, 2012 Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves) of not less than 12 million ounces of gold at the
Company’s Mallina Gold Project (inclusive of the existing regional 2.2 million ounces) by 3 December 2024.
Completion of a Definitive Feasibility Study (DFS) confirming feasibility for a 500,000 ounces of gold per annum
project through a mine life of no less than 12 years, or such other number as approved by the Board following
completion of a Pre-Feasibility Study. The DFS is to be signed off in its entirety by a suitably qualified engineering
group (with oversight from the Board); and
The Company securing debt and/or equity finance for a Board approved Project arising from the DFS.
32
De Grey Mining Limited
And annually:
•
One third of issued ZEPOs are evaluated against the scorecard in June of each year and upon achieving 65%+
score, 50% of these ZEPO’s achieve the incentive condition and are eligible to vest. If the executive does not
achieve the score of 65% or more, 50% of the ZEPOs will be cancelled, whilst the balance will vest solely subject
to achieving the LTIP Milestones.
In FY2021 450,454 ZEPO’s were issued to executives with no vesting conditions. They were granted on 10 July 2020 and
vested 30 July 2020. It was determined by the Board that these would reward the efforts in achieving the new Discovery
which has since been included in the Maiden Mineral Resource announced in June 2021.
Voting on the Remuneration Report - 2020 Annual General Meeting
The Company received approximately 98.39% of “yes” votes on its remuneration report for the current financial year (2019:
98.3%).
C. Executive service agreements
Remuneration and other terms of employment for the executive directors and other KMP are formalised in employment
or service agreements. The major provisions of the agreements relating to remuneration for the year ended 30 June 2021
are set out in the table below:
Name
Agreement
Glenn Jardine
Andrew Beckwith
Craig Nelmes
Patrick Holywell1
Peter Canterbury
Philip Tornatora
Service
Service
Service
Service
Service
Service
Base Salary
/Fees (p.a.)
$420,000
$280,000
$240,000
-
$350,000
$300,000
STIP/LTIP
$425,000
$215,000
$130,000
-
$265,000
$200,000
Consulting/Hr
Duration
Notice Period
Termination
-
-
-
$120
-
-
Ongoing
Ongoing
Ongoing
Ongoing
Ongoing
Ongoing
3 months
3 months
3 months
1 month
3 months
3 months
6 months
6 months
6 months
1 month
3 months
3 months
1 Mr Holywell provides Company Secretarial services as a consultant under a service agreement.
33
De Grey Mining Limited
D. Details of Remuneration
Details of the remuneration of the directors, the key management personnel of the Group.
Termination
Payments
Short-term
Post-employment
Share based
payments1
Total
Cash, Salary &
Fees
$
STIP
Cash
Bonus1
$
Leave
$
Other
$
Super-
LTIP
LTIP
annuation
Options
Performance rights
$
$
$
$
$
% of
remuneration
performance-
based
%
Directors
Simon Lill
2021
2020
Glenn Jardine
2021
2020
Andrew Beckwith
2021
2020
Peter Hood
2021
2020
Bruce Parncutt
2021
2020
Eduard Eshuys
2021
2020
Steven Morris
2021
2020
Brett Lambert
2021
2020
Sub-total Directors
2021
2020
124,201
156,000
-
10,0003
-
-
-
100,0002
370,268
55,175
150,000
-
20,567
4,333
261,994
228,324
67,260
10,0003
11,123
(7,355)
85,845
43,836
85,845
41,096
85,845
41,096
-
3,000
-
3,653
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
10,0002
-
-
-
-
1,013,998
572,180
217,260
20,000
31,690
(3,022)
-
110,000
-
-
-
-
-
-
-
-
-
-
-
-
-
9,0005
-
12,0005
-
21,000
34
11,799
-
25,000
5,242
24,889
22,641
8,155
4,164
8,155
3,904
8,155
3,904
-
-
-
347
103,800
-
87,916
-
208,649
-
41,520
-
41,520
-
41,520
-
-
-
-
-
17,235
32,414
155,355
-
13,788
55,238
-
-
-
-
-
-
-
20,714
-
13,809
257,035
298,414
809,106
64,750
587,703
308,848
135,520
48,000
135,520
45,000
135,520
55,000
-
32,714
-
29,809
86,153
40,202
524,925
-
186,378
122,175
2,060,404
882,535
47%
14%
49%
0%
49%
21%
31%
0%
31%
0%
31%
0%
-
63%
-
46%
Short-term
STIP
Cash
Bonus1
$
Cash, Salary &
Fees
$
Other Executives
Termination
Payments
Post-
employment
Share based
payments1
Leave
Other
$
$
Super-
annuation
$
LTIP
Options
$
Total
% of
remuneration
performance-
based
LTIP
Performance rights
$
$
%
De Grey Mining Limited
Craig Nelmes
2021
2020
Patrick Holywell
2021
2020
Peter Canterbury4
2021
2020
Philip Tornatora
2021
2020
2021
2020
219,178
200,505
-
10,0003
10,959
-
62,040
90,520
-
2,0003
-
-
145,833
-
35,625
-
6,771
-
-
-
-
-
-
-
95,200
10,0003
257,230
207,076
18,821
6,956
-
-
Total key management personnel compensation
-
110,000
1,698,279
1,070,281
68,241
3,934
348,085
42,000
-
-
-
-
-
-
-
-
20,822
-
-
-
-
-
24,437
19,672
36,068
36,480
2,256
18,240
57,055
-
54,102
-
10,341
19,448
-
-
-
-
-
-
297,368
266,433
64,296
110,760
245,284
-
449,790
243,704
-
21,000
131,412
59,874
674,406
54,720
196,719
141,623
3,117,142
1,503,432
16%
25%
4%
18%
38%
-
33%
4%
¹The bonus was paid in August 2021 for the FY2021 reporting period. There were no forfeited bonus or share based payments due to non-performance during the year.
2Mr Lill received the payment in lieu of termination of his Executive Services agreement on 20 June 2020. From 1 July 2020 Mr Lill continued in his role as Chairman as a Non-Executive Director. Mr Eshuys received an additional fee for
assistance with the August 2010 capital raising.
3Bonuses paid in the previous year were paid on the 23 December 2019.
4Mr Peter Canterbury commenced with the company on 1st February 2021.
5 Mr Lambert and Mr Morris resigned 22 July 2019 and received a termination payment in lieu of notice.
35
De Grey Mining Limited
Shareholdings of Key Management Personnel
Opening
Balance
1 July 2020
No.
13,239,063
-
Directors
Simon Lill
Glenn Jardine
Andrew Beckwith
7,631,668
Peter Hood
Bruce Parncutt
Eduard Eshuys
Other executives
3,000,000
-
-
Craig Nelmes
4,698,253
Patrick Holywell
Peter Canterbury1
150,000
-
Philip Tornatora
5,208,479
Total
33,927,463
Received on
exercise
of rights &/or
options
No.
Underly-
ing share
price on
exercise
$
Paid per
instrument
$
Purchases
(disposals)
during the
year
Other
changes
during the
year
No.
No.
Closing
Balance
30 June
2021
No.
1,000,000
-
1,000,000
1,000,000
-
-
500,000
250,000
150,000
-
750,000
500,000
5,150,000
$1.50
-
$1.50
$1.56
-
-
$1.50
$1.56
$1.49
-
$1.14
$1.56
0.30
-
0.10
0.30
-
-
0.10
0.30
0.30
-
0.10
0.30
(500,000)
-
(1,600,000)
1,300,000
-
-
-
-
-
-
-
-
13,739,063
-
8,031,668
4,300,000
-
-
(500,000)
-
4,948,253
(130,000)
-
-
4,0001
170,000
4,000
(810,000)
-
5,648,479
(2,240,000)
4,000
36,841,463
1Peter Canterbury was appointed 1 February 2021 and at the time held 4,000 shares.
Option-holdings of Key Management Personnel
Opening
Balance
1 July 2020
Options
granted
during the
year
Options
exercised
during the year
Intrinsic
value of
options on
exercise3
Options
Lapsed
during
the year
Closing
Balance
30 June 2021
Vested and
exercisable
30 June 20212
No.
No.
No.
$
No.
No.
No.
Directors
Simon Lill
Glenn Jardine
1,000,000
-
Andrew Beckwith
2,000,000
Peter Hood
Bruce Parncutt
Eduard Eshuys
Other executives
-
-
-
130,566
553,454
659,896
52,227
52,227
52,227
(1,000,000)
-
(1,000,000)
(1,000,000)
-
-
-
1,200,000
-
1,400,000
1,260,000
-
-
Craig Nelmes
1,350,000
227,058
Patrick Holywell
Peter Canterbury1
450,000
-
25,714
547,422
Philip Tornatora
2,050,000
340,587
(500,000)
(250,000)
(150,000)
-
(750,000)
500,000
(5,150,000)
700,000
205,000
178,500
-
855,000
630,000
6,323,500
-
-
-
-
-
-
-
-
-
-
130,566
553,454
659,896
52,227
52,227
52,227
827,058
325,714
547,422
1,140,587
130,566
-
163,207
52,227
52,227
52,227
600,000
300,000
-
800,000
6,850,000
Total
1Mr Peter Canterbury was appointed 1 February 2021
2There are no options that have vested that are not exercisable
3Options were multiplied by the share price at the date of vesting minus the exercise price payable (refer to shareholding of key management personnel)
4,341,378
2,641,378
2,150,454
-
36
De Grey Mining Limited
Performance rights of Key Management Personnel
Opening
Balance
1 July 2020
No.
500,000
-
400,000
-
-
-
300,000
-
-
-
Directors
Simon Lill
Glenn Jardine
Andrew Beckwith
Peter Hood
Bruce Parncutt
Eduard Eshuys
Other executives
Craig Nelmes
Patrick Holywell
Peter Canterbury1
Philip Tornatora
Rights granted
during the year
Rights
exercised
during the year
Rights Lapsed
during the year
Closing Balance
30 June 2021
Vested and
exercisable
30 June 20212
No.
No.
No.
No.
-
723,6323
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
500,000
723,632
400,000
-
-
-
300,000
-
-
-
-
-
-
-
-
-
-
-
-
-
1,200,000
Total
1Mr Canterbury was appointed 1 February 2021
2There are no rights that have vested that are not exercisable
3 Rights issued to Mr Jardine are issued in 3 tranches, T1 140,846 will vest in September 2021, T2 300,300 will vest in September 2022 and T3 282,486
will vest in September 2023. The number of rights to be issued for T2 and T3 are a provisional number and will be adjusted when the rights are issued,
Refer to section B above for further information.
1,923,632
723,632
-
-
-
E. Securities based compensation - options
The Company granted 2,641,378 (2020: 900,000) options over unissued ordinary shares during the financial year to
Directors and other key management personnel as part of their remuneration, as detailed in the table below:
Grant
Date
Expiry
Date
Exercise
Price
(cents)
2021
Andrew Beckwith
10 Jul 2020
29 Jul 2022
Simon Lill
Eduard Eshuys
Bruce Parncutt
Peter Hood
10 Jul 2020
29 Jul 2022
10 Jul 2020
29 Jul 2022
10 Jul 2020
29 Jul 2022
10 Jul 2020
29 Jul 2022
Andrew Beckwith
4 Dec 2020
3 Dec 2024
Glenn Jardine
4 Dec 2020
3 Dec 2024
Philip Tornatora
4 Dec 2020
3 Dec 2024
Craig Nelmes
4 Dec 2020
3 Dec 2024
Patrick Holywell
31 May 2021
30 Jun 2022
Peter Canterbury
1 Feb 2021
3 Dec 2024
2020
0
0
0
0
0
0
0
0
0
0
0
Craig Nelmes
12 Mar 2020
12 Mar 2022
Patrick Holywell
12 Mar 2020
12 Mar 2022
35.0
35.0
Value per
option at
grant
date
(cents)
79.5
79.5
79.5
79.5
79.5
111.5
111.5
111.5
111.5
115.5
98.00
6.08
6.08
Granted
Number
Value of
Options
Granted
Vesting Date
163,207
$129,750
30 Jul 2020
130,566
$103,800
30 Jul 2020
52,227
52,227
52,227
$41,520
30 Jul 2020
$41,520
30 Jul 2020
$41,520
30 Jul 2020
496,689
$553,808
3 Dec 2024
553,454
$617,101
3 Dec 2024
340,587
$379,755
3 Dec 2024
227,058
$253,170
3 Dec 2024
25,714
$29,700
30 Jun 2022
547,422
$536,474
3 Dec 2024
Number
Vested and
exercisable
at end of
year
163,207
130,566
52,227
52,227
52,227
-
-
-
-
-
-
600,000
300,000
36,480
12 Mar 2020
18,240
12 Mar 2020
600,000
300,000
Maximum
expense to
be
recognised
in future
years
-
-
-
-
-
474,910
529,185
325,652
217,102
27,444
479,418
-
-
Options granted to Key management personnel under the shareholder approved Employee Option plans as both
37
De Grey Mining Limited
compensation for their past performance and as a mechanism to retain key management personnel. Options are subject
to vesting conditions which are disclosed in Part B, Remuneration Policy.
F. Securities based compensation – performance rights
The following performance rights were issued during the 30 June 2021 financial year (30 June 2020: nil).
2021
Glenn Jardine
Glenn Jardine
Glenn Jardine
2020
Simon Lill
Andrew Beckwith
Brett Lambert1
Steven Morris1
Grant
Date
Expiry
Date
10 Jul 2020
23 Sep 2023
10 Jul 2020
23 Sep 2023
10 Jul 2020
23 Sep 2023
21 Dec 2017
30 Nov 2022
21 Dec 2017
30 Nov 2022
21 Dec 2017
30 Nov 2022
21 Dec 2017
30 Nov 2022
Craig Nelmes
21 Dec 2017
30 Nov 2022
Philip Tornatora
21 Dec 2017
30 Nov 2022
Value
per
right at
grant
date
(cents)
69.0
33.3
33.3
17.0
17.0
17.0
17.0
17.0
17.0
Granted
Number
Exercised
Number
Expired
Number
Vesting Date
Maximum
expense to
be
recognised
in future
years
Number
Vested at
end of year
140,8462
300,3002
282,4862
-
-
-
-
-
-
15 Sep 2021
15 Sep 2022
15 Sep 2023
-
-
-
-
-
-
-
-
-
(800,000)
(200,000)
30 Nov 2019
(1,200,000)
(400,000)
30 Nov 2019
(300,000)
(100,000)
30 Nov 2019
(450,000)
(150,000)
30 Nov 2019
(500,000)
(100,000)
30 Nov 2019
(700,000)
(350,000)
30 Nov 2019
500,000
400,000
150,000
100,000
300,000
-
17,332
55,388
69,390
24,323
19,459
-
-
14,594
-
1 Mr Lambert and Mr Morris both resigned during the prior year and are entitled to the performance rights which have vested.
2 Rights issued to Mr Jardine are issued in 3 tranches, T1 140,846 will vest in September 2021, T2 300,300 will vest in September 2022 and T3
282,486 will vest in September 2023. The number of rights to be issued for T2 and T3are a provisional number and will be adjusted when the
rights are issued. Refer to section B above for further information.
G. Other transactions and balances with Key Management Personnel
De Grey have entered into a number of contracts which resulted in transactions with key management personnel as follows.
Purchases of equipment
Paid to Engineering consultants
Paid to employees
Accounts payable
2021
2020
$
$
185,425
636,274
227,945
91,969
264,119
216,623
49,731
110,007
• Mak Water have supplied De Grey with equipment at the Wingina Camp site, and
• GR Engineering have provided consultancy where Mr Peter Hood, non-executive director, is a director of both
entities.
Where personnel are employed by De Grey and are considered a related party to key management personnel, those
transactions are entered into in the ordinary course of business at arm’s length.
• De Grey employed the daughter of Mr Andrew Beckwith, the daughter of Mr Simon Lill and the nephew of Mr Phil
Tornatora. None of these employees reported directly to a KMP.
Terms and conditions of transactions with related parties
Outstanding balances at the yearend are unsecured and interest free and settlement occurs in cash and are presented as
part of trade payables.
During the year DGO Gold Limited increased their shareholding with net purchases of 10,000,000 shares in De Grey Mining
Two of our directors are also directors of DGO Gold Limited who hold a significant interest in the Company. Details of this
is disclosed in the Directors Report.
38
Directors’ and Committee Meetings
----------- End of Audited Remuneration Report -----------
The number of meetings of the Company’s Board of Directors and its committees held in the 12 months to 30 June 2021
and the number of meetings attended by each Director are as per the following table:
De Grey Mining Limited
Directors Meetings
Audit & Risk
Committee
Remuneration &
Nomination
Committee1
Eligible
Attended
Eligible
Attended
Eligible
Attended
Simon Lill1
11
Glenn Jardine
11
11
Andrew Beckwith
Peter Hood
11
Eduard Eshuys
11
Bruce Parncutt
11
1On the 1 July 2020, Mr Lill was appointed to the Remuneration & Nominations Committee
1
n/a
n/a
2
2
2
11
11
11
11
11
11
1
n/a
n/a
2
2
2
3
n/a
n/a
5
5
5
3
n/a
n/a
5
5
5
Share Options and Performance rights
At the date of this report there are 7,463,020 unissued ordinary shares in respect of which options are outstanding and
1,923,632 performance rights outstanding.
Unlisted options
Unlisted options
Performance rights
Performance rights
Performance rights
Performance rights
Unlisted options
Unlisted options
Number
2,790,000
450,454
1,200,000
140,846
300,3001
282,4861
1,603,240
2,619,326
Exercise Price
35 cents
Nil cents
N/A
N/A
N/A
N/A
Nil cents
Nil cents
Expiry Date
12 March 2022
29 July 2022
30 November 2022
23 September 2023
23 September 2023
23 September 2023
30 June 2022
3 December 2024
1 Rights issued to Mr Jardine are issued in 3 tranches, T1 140,846 will vest in September 2021, T2 300,300 will vest in September 2022 and T3 282,486
will vest in September 2023. The number of rights to be issued for T2 and T3are a provisional number and will be adjusted when the rights are issued.
Refer to section B above for further information.
During the financial year 4,673,020 options were issued, 8,593,333 options were exercised, and no options expired. 723,632
performance rights were issued, none were exercised, and none expired. Since the end of the financial year, no further
options have been issued and no options have been exercised.
No person entitled to exercise options and/or performance rights had or has any right by virtue of the option to participate
in any share issue of the Company or a right to vote at a shareholder meeting.
Insurance of Directors and Officers
During the financial year, De Grey paid a premium to insure the directors, officers and joint secretaries of the Company.
The total amount of insurance contract premiums paid is confidential under the terms of the insurance policy.
The liabilities insured are legal costs that may be incurred in defending civil or criminal proceedings that may be brought
against the officers in their capacity as officers of the Company, and any other payments arising from liabilities incurred by
the officers in connection with such proceedings. This does not include such liabilities that arise from conduct involving a
wilful breach of duty by the officers or the improper use by the officers of their position or of information to gain advantage
for themselves or someone else or to cause detriment to the company. It is not possible to apportion the premium between
amounts relating to the insurance against legal costs and those relating to other liabilities.
39
De Grey Mining Limited
Indemnification of auditors
To the extent permitted by law, the Company has agreed to indemnify its auditors, Ernst & Young Australia, as part of the
terms of its audit engagement agreement against claims by third parties arising from the audit (for an unspecified amount).
No payment has been made to indemnify Ernst & Young Australia during or since the financial year.
Non-Audit Services
There were no non-audit services provided by the Group’s current auditor, Ernst & Young, or associated entities (refer Note
23) in the current year.
In the previous year, the Company’s previous auditor, Butler Settineri (Audit) Pty Ltd provided non-audit services. The
directors are satisfied that the provision of non-audit services was compatible with the general standard of independence
for auditors imposed by the Corporations Act 2001. The directors were satisfied that the provision of non-audit services by
the auditor, as set out below, did not compromise the auditor independence requirements of the Corporations Act 2001
for the following reasons:
• All non-audit services were reviewed by the board to ensure they did not impact the impartiality and objectivity
of the auditor; and
• None of the services undermine the general standard of independence for auditors.
Butler Settineri (Audit) Pty Ltd received or were due to receive the following amounts for the provision of non-audit
services:
Tax compliance services
Proceedings on behalf of the Company
2021
$
2020
$
-
3,675
As at the date of this report there are no leave applications or proceedings booked on behalf of De Grey under section 237
of the Corporations Act 2001.
Competent Person
The information in this report that relates to exploration results is based on, and fairly represents information and
supporting documentation prepared by Mr. Andrew Beckwith and Mr Phil Tornatora, who are both Competent Persons
and are members of The Australasian Institute of Mining and Metallurgy. Mr. Beckwith and Mr Tornatora are employees
of De Grey Mining Limited. Both Mr. Beckwith and Mr Tornatora have sufficient experience that is relevant to the style of
mineralisation and 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 Resource
and Ore Reserves”. Mr. Beckwith and Mr Tornatora have consented to the inclusion in this report of the matters based
on their information in the form and context in which it appears.
The Information in this report that relates to Mineral Resources is based on information compiled by Mr Paul Payne, a
Competent Person who is a Fellow of the Australasian Institute of Mining and Metallurgy. Mr Payne is a full-time
employee of Payne Geological Services. Mr Payne has sufficient experience that is relevant to the style of mineralisation
and 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”.
Mr Payne consents to the inclusion in the report of the matters based on his information in the form and context in which
it appears.
Environmental Regulation
The Group is subject to environmental regulation in respect to its exploration activities. The Group aims to ensure the
appropriate standard of environmental care is achieved, and in doing so, that it is aware of and compliant with all
environmental legislation. The directors of the Group are not aware of any breach of environmental legislation for the year
under review.
40
Auditor’s Independence Declaration
A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set out
on page 42.
De Grey Mining Limited
This report is made in accordance with a resolution of the Directors
Simon Lill
Chairman
Perth, 17 September 2021
Bruce Parncutt
Chairman of the Audit & Risk Committee
41
Ernst & Young
11 Mounts Bay Road
Perth WA 6000 Australia
GPO Box M939 Perth WA 6843
Tel: +61 8 9429 2222
Fax: +61 8 9429 2436
ey.com/au
Auditor’s independence declaration to the directors of De Grey Mining
Limited
As lead auditor for the audit of the financial report of De Grey Mining Limited for the financial year
ended 30 June 2021, I declare to the best of my knowledge and belief, there have been:
a. No contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit; and
b. No contraventions of any applicable code of professional conduct in relation to the audit.
This declaration is in respect of De Grey Mining Limited and the entities it controlled during the
financial year.
Ernst & Young
Pierre Dreyer
Partner
17 September 2021
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
PD:ET:DEG:008
Consolidated Statement of Comprehensive Income
FOR THE YEAR ENDED 30 JUNE 2021
Notes
Consolidated
De Grey Mining Limited
REVENUE & OTHER INCOME
Revenue
Interest income
Other income
EXPENDITURE
Employee benefits expense
Share based payments expense
Compliance expenses
Corporate advisory and consulting expenses
Administration and other expenses
Depreciation and amortisation
Impairment
Finance income
Finance costs
LOSS BEFORE INCOME TAX
INCOME TAX EXPENSE
LOSS FOR THE YEAR
OTHER COMPREHENSIVE INCOME
Items that may be reclassified to profit or loss
Other comprehensive income for the year, net of tax
5
5
5
6/31
2021
$
2020
$
35,751
279,198
260,540
(2,294,547)
(1,043,414)
(422,972)
(548,389)
(777,046)
(636,426)
-
-
(102,964)
11,889
78,721
189,247
(1,449,448)
(650,740)
(492,538)
(656,337)
(714,370)
(336,823)
(27,571)
86,172
(14,204)
(5,250,269)
(3,976,002)
7
-
-
(5,250,269)
(3,976,002)
-
-
TOTAL COMPREHENSIVE LOSS FOR THE YEAR ATTRIBUTABLE TO EQUITY
HOLDERS OF DE GREY MINING LIMITED
(5,250,269)
(3,976,002)
Basic and diluted loss per share for loss attributable to the ordinary equity
holders of the company (cents per share)
30
(0.41)
(0.41)
The above Consolidated Statement of Comprehensive Income should be read in conjunction with the Notes to the
Consolidated Financial Statements.
43
Consolidated Statement of Financial Position
AT 30 JUNE 2021
Notes
Consolidated
De Grey Mining Limited
CURRENT ASSETS
Cash and cash equivalents
Trade and other receivables
Inventories
Other assets
TOTAL CURRENT ASSETS
NON-CURRENT ASSETS
Financial assets
Deferred exploration & evaluation expenditure
Property, plant and equipment
Right of use asset
TOTAL NON-CURRENT ASSETS
TOTAL ASSETS
CURRENT LIABILITIES
Trade and other payables
Lease liabilities
Employee benefit obligations
TOTAL CURRENT LIABILITIES
NON-CURRENT LIABILITIES
Lease liabilities
Employee benefit obligations
Rehabilitation provision
TOTAL NON-CURRENT LIABILITIES
TOTAL LIABILITIES
NET ASSETS
EQUITY
Contributed equity
Reserves
Accumulated losses
TOTAL EQUITY
2021
$
70,949,700
1,503,359
206,656
924,936
73,584,651
111,871
114,402,821
6,581,282
2,223,792
123,319,766
2020
$
28,152,622
428,348
87,758
1,797
28,670,525
201,275
48,938,399
1,455,005
499,975
51,094,654
196,904,417
79,765,179
17,339,122
353,212
616,570
18,308,904
1,870,580
65,303
1,022,230
2,958,113
2,915,522
115,864
79,318
3,110,704
399,815
-
1,022,230
1,422,045
21,267,017
4,532,749
175,637,400
75,232,430
235,892,228
1,339,024
(61,593,852)
175,637,400
130,713,404
862,609
(56,343,583)
75,232,430
8
9
10
11
12
13
14
15
16
17
18
17
18
19
20
21
21
The above Consolidated Statement of Financial Position should be read in conjunction with the Notes to the Consolidated
Financial Statements.
44
De Grey Mining Limited
Consolidated Statement of Changes in Equity
FOR THE YEAR ENDED 30 JUNE 2021
Share Based
Consolidated
$
$
$
Contributed
Payments
Notes
Equity
Reserves
Accumulated
Losses
Total
$
BALANCE AT 30 JUNE 2019
Loss for the year
OTHER COMPREHENSIVE INCOME
TOTAL COMPREHENSIVE LOSS
TRANSACTIONS WITH OWNERS IN THEIR CAPACITY
AS OWNERS
Shares issued during the year
Share issue costs
Share based payments
Transfer of reserve on exercise/expiry of SBP
BALANCE AT 30 JUNE 2020
Loss for the year
OTHER COMPREHENSIVE INCOME
TOTAL COMPREHENSIVE LOSS
TRANSACTIONS WITH OWNERS IN THEIR CAPACITY
AS OWNERS
Shares issued during the year
Share issue costs
Share based payments
Share based reserve transfer - exercised
BALANCE AT 30 JUNE 2021
21(b)
20(a)
20(a)
21(a)
21(a)
21(b)
20(a)
20(a)
21(a)
21(a)
70,787,718
1,414,570
(52,588,581)
19,613,707
-
-
-
-
-
-
(3,976,002)
-
(3,976,002)
(3,976,002)
-
(3,976,002)
62,088,208
(3,144,223)
-
981,701
-
-
650,740
(1,202,701)
-
-
-
221,000
62,088,208
(3,144,223)
650,740
-
130,713,404
862,609
(56,343,583)
75,232,430
-
-
-
-
-
-
(5,250,269)
-
(5,250,269)
(5,250,269)
-
(5,250,269)
109,181,570
(4,569,745)
-
566,999
235,892,228
-
-
1,043,414
(566,999)
1,339,024
-
-
-
-
(61,593,852)
109,181,570
(4,569,745)
1,043,414
-
175,637,400
The above Consolidated Statement of Changes in Equity should be read in conjunction with the Notes to the Consolidated
Financial Statements.
45
Consolidated Statement of Cash Flows
De Grey Mining Limited
FOR THE YEAR ENDED 30 JUNE 2021
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers
Other income received
Research & development grant received
Payments to suppliers and employees
Interest payments
Interest received
NET CASH OUTFLOW FROM OPERATING ACTIVITIES
CASH FLOWS FROM INVESTING ACTIVITIES
Option payments to acquire tenements
Payments to acquire – Indee Gold Pty Ltd
Proceeds from insurance
Payments for plant and equipment
Payments for exploration and evaluation expenditure
NET CASH OUTFLOW FROM INVESTING ACTIVITIES
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issues of ordinary shares
Payments of share issue transaction costs
Principal elements of lease payments
Transaction costs related to loans & borrowings
NET CASH INFLOW FROM FINANCING ACTIVITIES
Notes
Consolidated
2021
$
2020
$
29
27,664
327,622
-
(4,723,223)
(13,228)
273,892
(4,107,273)
(500,000)
-
36,800
(5,931,327)
(50,877,906)
(57,272,433)
108,864,570
(4,569,746)
(118,040)
-
104,176,784
42,797,078
28,152,622
70,949,700
437,637
-
306,651
(2,748,550)
(27,278)
52,192
(1,979,348)
-
(10,142,178)
-
(845,712)
(15,456,942)
(26,444,832)
58,841,029
(3,144,223)
(87,650)
(367,752)
55,241,404
26,817,224
1,335,398
28,152,622
NET INCREASE IN CASH AND CASH EQUIVALENTS
Cash and cash equivalents at the beginning of the financial year
CASH AND CASH EQUIVALENTS AT THE END OF THE FINANCIAL YEAR
8
The above Consolidated Statement of Cash Flows should be read in conjunction with the Notes to the Consolidated Financial
Statements.
46
De Grey Mining Limited
Notes to the Consolidated Financial Statements
FOR THE YEAR ENDED 30 June 2021
1. Summary of significant accounting policies
De Grey Mining Limited is a company limited by shares, domiciled and incorporated in Australia.
The financial statements are for the consolidated entity consisting of De Grey Mining Limited and its subsidiaries (“Group”)
and have been presented in Australian dollars rounded to the nearest dollar unless stated otherwise.
The principal accounting policies adopted in the preparation of the financial statements are set out below. These policies
have been consistently applied to all the years presented, unless otherwise stated.
The financial statements were authorised for issue by the directors on 17 September 2021.
A. Basis of preparation
These general purpose financial statements have been prepared in accordance with the Corporations Act 2001, Australian
Accounting Standards, and other authoritative pronouncements of the Australian Accounting Standards Board (AASB). De
Grey Mining Limited is a for-profit entity for the purpose of preparing the financial statements.
(i) Compliance with IFRS
The financial report also complies with the International Financial Reporting Standards (IFRS) as issued by the International
Accounting Standards Board (IASB).
(ii) Historical cost convention
These financial statements have been prepared on a historical cost basis, except for certain financial assets which have been
measured at fair value through profit or loss.
(iii) New, 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
Australian Accounting Standards Board (‘AASB’) that are mandatory for annual periods beginning on or after 1 July 2020. The
adoption of these Accounting Standards and Interpretations did not have any significant impact on the financial performance
or position of the Group during the financial year, other than as noted below.
Amendments to AASB 3: Definition of a Business
The amendment to AASB 3 Business Combinations clarifies that to be considered a business, an integrated set of activities
and assets must include, at a minimum, an input and a substantive process that, together, significantly contribute to the
ability to create output. Furthermore, it clarifies that a business can exist without including all of the inputs and processes
needed to create outputs. These amendments had no impact on the consolidated financial statements of the Group but may
impact future periods should the Group enter into any business combinations.
Amendments to AASB 101 and AASB 108 Definition of Material
The amendments provide a new definition of material that states, “information is material if omitting, misstating or obscuring
it could reasonably be expected to influence decisions that the primary users of general purpose financial statements make
on the basis of those financial statements, which provide financial information about a specific reporting entity.” The
amendments clarify that materiality will depend on the nature or magnitude of information, either individually or in
combination with other information, in the context of the financial statements. A misstatement of information is material if
it could reasonably be expected to influence decisions made by the primary users. These amendments had no impact on the
consolidated financial statements of, to the Group.
47
De Grey Mining Limited
Conceptual Framework for Financial Reporting issued on 29 March 2018
The Conceptual Framework is not a standard, and none of the concepts contained therein override the concepts or
requirements in any standard. The purpose of the Conceptual Framework is to assist the IASB in developing standards, to
help preparers develop consistent accounting policies where there is no applicable standard in place and to assist all parties
to understand and interpret the standards. This will affect those entities which developed their accounting policies based on
the Conceptual Framework. The revised Conceptual Framework includes some new concepts, updated definitions and
recognition criteria for assets and liabilities and clarifies some important concepts. These amendments had no impact on the
consolidated financial statements of the Group.
AASB 2020-4 Amendments to AASs - Covid-19 Related Rent Concessions
The amendments provide relief to lessees from applying AASB 16 guidance on lease modification accounting for rent
concessions arising as a direct consequence of the Covid-19 pandemic. As a practical expedient, a lessee may elect not to
assess whether a Covid-19 related rent concession from a lessor is a lease modification. A lessee that makes this election
accounts for any change in lease payments resulting from the Covid-19 related rent concession the same way it would
account for the change under AASB 16 if the change were not a lease modification.
The amendment applies to annual reporting periods beginning on or after 1 June 2020. This amendment had no impact on
the consolidated financial statements of the Group.
(iv) New Accounting Standards and Interpretations not yet mandatory or early adopted
Several Australian Accounting Standards and Interpretations, that have recently been issued or amended but are not yet
mandatory, have not been early adopted by the Group for the annual reporting period ended 30 June 2021. The Group is
assessing the impacts of the amendments; however, the amendments are not expected to have a material impact on the
Group.
AASB 2014-10 Amendments to AASs – Sale or Contribution of Assets between an Investor and its Associate or Joint Venture
(effective 1 January 2022)
The amendments to AASB 10 Consolidated Financial Statements and AASB 128 Investments in Associates and Joint Ventures
clarify that a full gain or loss is recognised when a transfer to an associate or joint venture involves a business as defined in
AASB 3 Business Combinations. Any gain or loss resulting from the sale or contribution of assets that does not constitute a
business, however, is recognised only to the extent of unrelated investors’ interests in the associate or joint venture.
De Grey will consider this guidance where it sells or contributes assets to its associates and joint ventures and look to update
any required accounting treatments in line with the requirements outlined.
AASB 2020-3 Amendments to AAS – Annual Improvements 2018–2020 and Other Amendments (effective 1 January 2022)
The amendments clarify certain requirements in:
► AASB 1 First-Time Adoption of Australian Accounting Standards – to simplify the application of AASB 1 by a subsidiary that
becomes a first-time adopter after its parent in relation to the measurement of cumulative translation differences
► AASB 3 Business Combinations – to update a reference to the Conceptual Framework for Financial Reporting without
changing the accounting requirements for business combinations
► AASB 9 Financial Instruments – to clarify the fees an entity includes when assessing whether the terms of a new or
modified financial liability are substantially different from the terms of the original financial liability
► AASB 116 Property, Plant and Equipment – to require an entity to recognise the sales proceeds from selling items
produced while preparing property, plant and equipment for its intended use and the related cost in profit or loss, instead
of deducting the amounts received from the cost of the asset
► AASB 137 Provisions, Contingent Liabilities and Contingent Assets – to specify the costs that an entity includes when
assessing whether a contract will be loss-making.
De Grey will consider where these amendments result in changes to the Group’s accounting policies and look to update any
required accounting treatments in line with the requirements outlined.
48
AASB 141 Agriculture – to remove the requirement to exclude cash flows from taxation when measuring fair value, thereby
aligning the fair value measurement requirements in AASB 141 with those in other AAS.
De Grey will consider the application of this amendment should the Group purchase a landholding utilised for Agricultural
purposes.
De Grey Mining Limited
AASB 2020-1 Amendments to AASs – Classification of Liabilities as Current or Non-current
(Effective 1 January 2023)
A liability is classified as current if the entity has no right at the end of the reporting period to defer settlement for at least
12 months after the reporting period. These amendments to AASB 101 Presentation of Financial Statements clarify the
requirements for classifying liabilities as current or non-current. Specifically:
► The amendments specify that the conditions which exist at the end of the reporting period are those which will be used
to determine if a right to defer settlement of a liability exists.
► Management intention or expectation does not affect classification of liabilities.
► In cases where an instrument with a conversion option is classified wholly as a liability, the transfer of equity instruments
would constitute settlement of the liability for the purpose of classifying it as current or non-current. The classification of
liabilities between current and non-current can have important implications for key ratios, debt covenants etc.
Whilst not applicable to De Grey right now, De Grey will consider the amendments and whether these clarifications may result
in changes for classification in future in light of future financing.
2021-2 Amendments to Australian Accounting Standards – Disclosure of Accounting Policies and Definition of Accounting
Estimates (effective 1 January 2023)
Provides amendments in:
► AASB Practice Statement 2 – Adding guidance on how entities apply the concept of materiality in making decisions about
accounting policy disclosures
► AASB 101 – replacing the requirement for entities to disclose their ‘significant’ accounting policies with a requirement to
disclose their ‘material’ accounting policies
► AASB 108 Definition of Accounting Estimates – to clarify the distinction between changes in accounting estimates and
changes in accounting policies and the correction of errors
► AASB 7 Financial Instruments: Disclosures – to clarify that information about measurement bases for financial instruments
is expected to be material to an entity’s financial statements
► AASB 134 Interim Financial Reporting – to identify material accounting policy information as a component of a complete
set of financial statements.
De Grey will consider the guidance on applying materiality in making decisions about accounting policies disclosures as well
as the further clarifications around accounting estimates, correction of errors and changes in accounting policies. De Grey
will need to consider how disclosure of their financial statements may need to change once these amendments become
effective.
(v) Going concern
The financial statements have been prepared on the going concern basis, which contemplates the continuity of normal
business activities and the realisation of assets and settlement of liabilities in the ordinary course of business.
Management have considered the funding and operational status of the business in arriving at their assessment of going
concern and believe that the going concern basis of preparation is appropriate.
(vi) Changes in the presentation of the financial statements
Comparatives presented on the financial statements have been amended to present a more concise and meaningful report.
De Grey have grouped items on the Statement of Comprehensive Income together within the nature of the income and
expenditure and therefore has no impact on the overall loss presented.
The comparatives from the previous year are as follows.
49
REVENUE & OTHER INCOME
Revenue
Interest income
Other income
EXPENDITURE
Exploration expenditure – written off
Depreciation expense
Director & employee expenses
Share based payments (directors & employees)
Share based payments – corporate advisory
Share based payments expense
Corporate and compliance expenses
Consulting expenses
Corporate advisory
Corporate advisory and consulting expenses
Investor relations & promotional expenses
Occupancy expenses
Finance costs
Finance income
Administration and other expenses
5
6/33
6
De Grey Mining Limited
Consolidated
2020
(Restated)
$
11,889
78,721
189,247
(27,571)
(336,823)
(1,449,448)
-
-
(650,740)
(492,538)
-
-
(656,337)
-
-
(14,204)
86,172
(714,370)
2020
(As reported
previously)
$
366,029
-
-
-
(27,571)
(336,823)
(1,449,448)
(514,489)
(136,251)
-
(492,538)
(89,479)
(566,858)
-
(482,464)
(48,527)
(14,204)
-
(183,379)
LOSS BEFORE INCOME TAX
There is no impact on EPS or loss for the period.
(3,976,002)
(3,976,002)
De Grey have reclassified the Consolidated Statement of Comprehensive Income in order to classify income and expenses by
nature.
CASH FLOWS FROM OPERATING ACTIVITIES
Payments for exploration and evaluation expenditure
CASH FLOWS FROM INVESTING ACTIVITIES
Payments for exploration and evaluation expenditure
Consolidated
2020
(Restated)
$
-
2020
(As reported
previously)
$
(15,456,942)
(15,456,942)
-
De Grey have reclassified exploration expenditure on the Cash Flow Statement to correctly present exploration and
evaluation expenditure.
B. Principles of consolidation
(i) Subsidiaries
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of De Grey Mining Limited
(“company” or “parent entity”) as at 30 June 2021 and the results of all subsidiaries for the year then ended. De Grey Mining
Limited and its subsidiaries together are referred to in this financial report as the Group or the consolidated entity.
50
De Grey Mining Limited
Subsidiaries are entities the parent controls. The parent controls an entity when it is exposed to, or has rights to, variable
returns from its involvement with the entity and could 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. The acquisition method of accounting is used to account for business combinations by the
Group.
Intercompany transactions, balances, and unrealised gains on transactions between Group companies are eliminated.
Unrealised losses are also eliminated unless the transaction provides evidence of the impairment of the asset transferred.
Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by
the Group.
Investments in subsidiaries are accounted for at cost in the separate financial statements of De Grey Mining Limited.
(ii) Joint Operations
A joint operation is an arrangement in which the Group shares joint control, primarily via contractual arrangements with
other parties. In a joint operation, the Group has rights to the assets and obligations for the liabilities relating to the
arrangement. This includes situations where the parties benefit from the joint activity through a share of the output, rather
than by receiving a share of the results of trading. In relation to the Group’s interest in a joint operation, the Group
recognises: its assets and liabilities, including its share of any assets and liabilities held or incurred jointly; revenue from the
sale of its share of the output and its share of any revenue generated from the sale of the output by the joint operation; and
its expenses including its share of expenses incurred jointly. All such amounts are measured in accordance with the terms of
the arrangement, which is usually in proportion to the Group’s interest in the joint operation. Details of the joint operations
are set out in Note 28.
(iii) Changes in ownership interests
The Group treats transactions with non-controlling interests that do not result in a loss of control as transactions with equity
owners of the Group. A change in ownership interest results in an adjustment between the carrying amounts of the
controlling and non-controlling interests to reflect their relative interests in the subsidiary. Any difference between the
amount of the adjustment to non-controlling interests and any consideration paid or received is recognised in a separate
reserve within equity attributable to owners of De Grey Mining Limited.
When the Group ceases to have control, joint control or significant influence, any retained interest in the entity is remeasured
to its fair value with the change in carrying amount recognised in profit or loss. The fair value is the initial carrying amount
for the purposes of subsequently accounting for the retained interest as an associate, jointly controlled entity or financial
asset. In addition, any amounts previously recognised in other comprehensive income in respect of that entity are accounted
for as if the Group had directly disposed of the related assets or liabilities. This may mean that amounts previously recognised
in other comprehensive income are reclassified to profit or loss.
C. Segment reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision
maker. The chief operating decision maker, who is responsible for allocating resources and assessing performance of the
operating segments, has been identified as the full Board of Directors.
D. Foreign currency translation
(i)
Functional and presentation currency
Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary
economic environment in which the entity operates (‘the functional currency’). The consolidated financial statements are
presented in Australian dollars, which is De Grey Mining Limited's functional and presentation currency.
51
(ii)
Transactions and balances
Foreign currency transactions are translated into the functional currency 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 year end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in
profit or loss.
De Grey Mining Limited
E. Revenue recognition
Revenue from contracts with customers
Revenue is recognised at an amount that reflects the consideration to which the Group is expected to be entitled in exchange
for transferring goods or services to a customer. For each contract with a customer, the consolidated entity: identifies the
contract with a customer; identifies the performance obligations in the contract; determines the transaction price which
takes into account estimates of variable consideration and the time value of money; allocates the transaction price to the
separate performance obligations on the basis of the relative stand-alone selling price of each distinct good or service to be
delivered; and recognises revenue when or as each performance obligation is satisfied in a manner that depicts the transfer
to the customer of the goods or services promised.
Variable consideration with the transaction price, if any, reflects concessions provided to the customers such as discounts,
rebates and refunds, any potential bonuses receivable from the customer and any other contingent events. Such estimates
are determined using either the ‘expected value’ or ‘most likely amount’ method. The measurement of the variable
consideration is subject to a constraining principle whereby revenue will only be recognised to the extent that it is highly
probably that a significant reversal in the amount of cumulative revenue recognised will not occur. The measurement
constraint continues until the uncertainty associated with the variable consideration is subsequently resolved. Amounts
received that are subject to the constraining principle are recognised as a refund liability.
Interest Revenue
Interest income is recognised as it accrues using the effective interest method.
F. Cash and cash equivalents
For the purposes of presentation in the statement of cash flows, cash and cash equivalents includes cash on hand, deposits
held at call with financial institutions, other short-term highly liquid investments that are readily convertible to known
amounts of cash and which are subject to insignificant risk of changes in value.
G. Trade & other receivables
Classification as trade and other receivables
If collection of the amounts is expected within one year or less they are initially classified as current assets and recorded at
cost. If collection of the amounts is expected after one year, they are presented as non-current assets and measured initially
at fair value and subsequently at amortised cost. Trade receivables are generally due for settlement within 30 days and
therefore are all classified as current.
Fair value of trade and other receivables
As the majority of receivables are short term in nature, their carrying amount is assumed to be the same as their fair value.
H. Inventories
Inventories are valued at the lower of cost and net realisable value. Cost is determined on a weighted average basis. Any
provision for obsolescence or damage is determined by reference to specific stock items identified. The carrying value of
obsolete or damaged items is written down to net realisable value.
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De Grey Mining Limited
I.
Income tax
The income tax expense or revenue for the period is the tax payable on the current period’s taxable income based on the
applicable income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to
temporary differences and to unused tax losses.
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the end of the
reporting period in the countries where the Company’s subsidiaries and associates operate and generate taxable income.
Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation
is subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the
tax authorities.
Deferred income tax is provided in full, using the full liability method, on temporary differences arising between the tax
bases of assets and liabilities and their carrying amounts in the consolidated financial statements. However, the deferred
income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business
combination that at the time of the transaction affects neither accounting nor taxable profit or loss.
Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the
reporting date and are expected to apply when the related deferred income tax asset is realised, or the deferred income
tax liability is settled.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that
future taxable amounts will be available to utilise those temporary differences and losses.
Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount and tax bases
of investments in controlled entities where the parent entity is able to control the timing of the reversal of the temporary
differences and it is probable that the differences will not reverse in the foreseeable future.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities
and when the deferred tax balances relate to the same taxation authority. Current tax assets and tax liabilities are offset
where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realise the asset
and settle the liability simultaneously.
De Grey Mining Limited and its wholly owned Australian resident entities are part of a tax-consolidated group under
Australian taxation law. De Grey Mining Limited is the head entity in the tax-consolidated group. Current tax liabilities and
assets and deferred tax assets arising from unused tax losses and tax credits of the members of the tax-consolidated group
are recognised by the Company (as head entity in the tax-consolidated group).
Due to the existence of a tax funding arrangement between the entities in the tax-consolidated group, amounts are
recognised as payable to or receivable by the Company and each member of the Group in relation to the tax contribution
amounts paid or payable between the parent entity and the other members of the tax-consolidated group in accordance
with the arrangement. Further information about the tax funding arrangement is detailed in Note 7 to the financial
statements. Where the tax contribution amount recognised by each member of the tax consolidated group for a particular
period is different to the aggregate of the current tax liability or asset and any deferred tax asset arising from unused tax
losses and tax credits in respect of that period, the difference is recognised as a contribution from (or distribution to) equity
participants.
J. Financial instruments
Classification of financial instruments
those to be measured at fair value (either through other comprehensive income, or through profit or loss); and
those to be measured at amortised cost.
The Group classifies its financial assets into the following measurement categories:
•
•
The classification depends on the Group’s business model for managing financial assets and the contractual terms of the
financial assets' cash flows.
53
The Group classifies its financial liabilities at amortised cost unless it has designated liabilities at fair value through profit or
loss or is required to measure liabilities at fair value through profit or loss such as derivative liabilities.
Measurement of financial instruments
De Grey Mining Limited
Receivables
Receivables are measured at amortised cost where they have:
•
contractual terms that give rise to cash flows on specified dates, that represent solely payments of principal and
interest on the principal amount outstanding; and
are held within a business model whose objective is achieved by holding to collect contractual cash flows.
•
Receivables are initially recognised at fair value plus directly attributable transaction costs and subsequently measured at
amortised cost using the effective interest rate (EIR) method. The measurement of credit impairment is based on the three-
stage expected credit loss model described below regarding impairment of financial assets.
Equity instruments
Equity instruments held at fair value through profit or loss are initially recognised at fair value, with transaction costs
recognised in the income statement as incurred. Subsequently, they are measured at fair value and any gains or losses are
recognised in the income statement as they arise.
Trade and other creditors
Initial recognition and measurement
Trade and other creditors are classified, at initial recognition, as financial liabilities at fair value through profit or loss, loans
and borrowings, payables, or as derivatives designated as hedging instruments in an effective hedge, as appropriate.
All trade and other creditors are recognised initially at fair value and, in the case of payables, net of directly attributable
transaction costs.
For purposes of subsequent measurement, trade and other creditors are measured at amortised cost.
Impairment of financial assets
The Group recognises a loss allowance for expected credit losses on financial assets which are either measured at amortised
cost or fair value through other comprehensive income. The ECL is based on the difference between the contractual cash
flows due in accordance with the contract and all the cashflows that the Group expects to receive, discounted at an
approximation of the original EIR.
For receivables due in less than 12 months, the Group recognises a loss allowance based on the financial asset’s lifetime
ECL at each reporting date. The Group establishes a provision matrix for these receivables that is based on its historical
credit loss experience, adjusted for forward-looking factors specific to the debtors and the economic environment as sales
from product eventuate or significant receivables come to hand.
The Group considers a financial asset in default when contractual payments are 60 days past due. In certain cases, the
Group may consider a financial asset to be in default when internal or external information indicates that the Group is
unlikely to receive the outstanding contractual amounts in full before taking into account any credit enhancements held by
the Group. A financial asset is written off when there is no reasonable expectation of recovering the contractual cash flows
and usually occurs when past due for more than one year and not subject to enforcement activity.
Recognition and derecognition of financial instruments
A financial asset or financial liability is recognised in the statement of financial position when the Group becomes a party
to the contractual provisions of the instrument, which is generally on trade date.
The Group derecognises a financial asset when the contractual cash flows from the asset expire or it transfers its rights to
receive contractual cash flows from the financial asset in a transaction in which substantially all the risks and rewards of
ownership are transferred. Any interest in transferred financial assets that is created or retained by the Group is recognised
as a separate asset or liability.
54
De Grey Mining Limited
A financial liability is derecognised from the statement of financial position when the Group has discharged its obligations,
or the contract is cancelled or expires.
Offsetting
Financial assets and liabilities are offset and the net amount is presented in the balance sheet when the Group has a legal
right to offset the amounts and intends to settle on a net basis or to realise the asset and settle the liability simultaneously.
K. Property, plant and equipment
Each class of plant, equipment and motor vehicle is carried at historical cost less, where applicable, any accumulated
depreciation and impairment losses. Cost includes expenditure that is directly attributable to the asset.
The carrying amounts are reviewed annually by Directors to ensure it is not more than the estimated recoverable amount
from these assets. The recoverable amount is assessed based on the expected net cash flows that will be received from the
asset’s employment and subsequent disposal. The expected net cash flows have been discounted to their present values in
determining recoverable amounts and an asset’s carrying amount is written down immediately to its recoverable amount
if the asset’s carrying amount is greater than its estimated recoverable amount.
Depreciation of property, plant and equipment is calculated using the straight line or reducing balance method to allocate
their cost, net of their residual values, over their estimated useful lives, as follows:
Plant and Equipment
Furniture and fittings
Computers
Motor Vehicles
Land and buildings
4% - 50%
5% - 50%
20% - 50%
17% - 40%
5% - 30%
Straight line
Straight line
Straight line
Reducing balance
Straight line
The assets’ residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each
reporting date. The Group has changed the depreciation method of all items of property, plant and equipment (except
motor vehicles) to the straight-line method of depreciation for the year commencing 1 July 2020.
L. Right of use assets and lease liabilities
An assessment is made, at inception or when contract terms are changed, to determine whether the contract is, or contains,
a lease. A contract is or contains a lease if the contract conveys a right to control the use of an identified asset for a period
of time in exchange for consideration.
Right-of-use assets
The Group recognises all right of use assets, except for leases that are short-term (12 months or less) and low value leases
at the lease commencement date. Right-of-use assets are measured at cost, less any accumulated depreciation and
impairment losses, and adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets includes the
amount of lease liabilities recognised, initial direct costs incurred, and lease payments made at or before the
commencement date less any lease incentives received. Right-of-use assets are depreciated on a straight-line basis over
the shorter of the lease term and the estimated useful lives of the assets.
If ownership of the leased asset transfers to the Group at the end of the lease term or the cost reflects the exercise of a
purchase option, depreciation is calculated using the estimated useful life of the asset.
The right-of-use assets are also subject to impairment.
Lease liabilities
At the commencement date of the lease, the Group recognises lease liabilities measured at the present value of lease
payments to be made over the lease term. The lease payments include fixed payments (including in-substance fixed
payments) less any lease incentives receivable, variable lease payments that depend on an index or a rate, and amounts
expected to be paid under residual value guarantees. The lease payments also include lease extension options and the
exercise price of a purchase option that are reasonably certain to be exercised by the Group and payments of penalties for
terminating the lease, if the lease term reflects the Group exercising the option to terminate.
55
De Grey Mining Limited
Variable lease payments that do not depend on an index or a rate are recognised as expenses (unless they are incurred to
produce inventories) in the period in which the event or condition that triggers the payment occurs.
The present value of future lease payments is determined by discounting future lease payments using the interest rate
implicit in the lease or, if that rate cannot be determined, then the Group’s incremental borrowing rate, which is generally
the case.
The present value of the lease liability is increased by the interest cost and decreased by the lease payment each period
over the life of the lease. In addition, the carrying amount of lease liabilities is remeasured if there is a modification, a
change in the lease term, a change in the lease payments (e.g., changes to future payments resulting from a change in an
index or rate used to determine such lease payments) or a change in the assessment of an option to purchase the underlying
asset
Short-term leases and leases of low-value assets
For leases that are short-term (12 months or less) and/or low value asset leases at the lease commencement date, the
Group recognises the lease payments as an operating expense on a straight-line basis over the term of the lease unless
another systematic basis is more representative of the time pattern in which economic benefits from the leased assets are
consumed.
M. Deferred exploration & evaluation expenditure
Exploration and evaluation expenditures in relation to each separate area of interest are recognised as an exploration and
evaluation asset in the year in which the expenditure is incurred where:
•
•
The Group has secured (or has the legal right to) tenure, and/or the legal rights to explore an area of interest; and
Exploration and evaluation activities in the area of interest have not at the end of the reporting period reached a stage
which permits a reasonable assessment of the existence or otherwise of economically recoverable reserves, and active
and significant operations in, or in relation to, the area of interest are continuing; or
The exploration and evaluation expenditures are expected to be recouped through successful development and
exploitation of the area of interest, or alternatively, by its sale.
•
Where the conditions outlined are not met in relation to specific area(s) of interest, then those exploration and evaluation
costs are expensed as incurred.
If an area of interest is abandoned or if the Directors consider the expenditure to be of reduced value, accumulated costs
carried forward are written off or impaired in the year in which that assessment is made. 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.
When a decision is made to proceed with development in a particular area of interest, the relevant exploration and
evaluation asset is tested for impairment and the balance is transferred to mine properties under development.
N. Trade and other payables
These amounts represent liabilities for goods and services provided to the Group prior to the end of the financial year which
are unpaid. The amounts are unsecured and are paid on normal commercial terms.
O. Employee benefits
Wages and salaries, annual leave and other short-term benefits
Liabilities for wages and salaries, including non-monetary benefits, and annual leave expected to be settled within 12
months of the reporting date are measured at the amounts expected to be paid when the liabilities are settled.
The liability for annual leave is recognised in the provision for employee benefits. All other short-term employee benefit
obligations are presented as payables.
56
De Grey Mining Limited
Other long-term employee benefits
The Group’s liabilities for long service leave are included in other long-term benefits as they are not expected to be settled
wholly within twelve (12) months after the end of the period in which the employees render the related service. They are
measured at the present value of the expected future payments to be made to employees. The expected future payments
incorporate anticipated future wage and salary levels, experience of employee departures and periods of service, and are
discounted at rates determined by reference to market yields at the end of the reporting period on high quality corporate
bonds that have maturity dates that approximate the timing of the estimated future cash outflows. Any re-measurements
arising from experience adjustments and changes in assumptions are recognised in profit or loss in the periods in which the
changes occur.
The Group presents employee benefit obligations as current liabilities in the statement of financial position if the Group
does not have an unconditional right to defer settlement for at least twelve (12) months after the reporting period,
irrespective of when the actual settlement is expected to take place.
P. Provisions
Provisions are recognised when the Group has a present legal or constructive obligation as a result of past events, it is
probable that an outflow of resources will be required to settle the obligation and the amount can be reliably estimated.
Provisions are not recognised for future operating losses.
Rehabilitation provision
Provisions are measured at the present value of management's best estimate of the expenditure required to settle the
present obligation at the end of the reporting period. The discount rate used to determine the present value is a pre-tax
rate that reflects current market assessments of the time value of money and the risks specific to the liability only to the
extent the estimated future cashflows have not been adjusted for the risks
Rehabilitation costs include the dismantling and removal of mining plant, equipment and building structures, waste removal
and rehabilitation of the site in accordance with the requirements of the mining permits. Such costs are determined using
estimates of future costs, current legal requirements, and technology.
Rehabilitation costs are recognised in full at present value as a non-current liability. An equivalent amount is capitalised as
part of the cost of the asset when an obligation arises to decommission or restore a site to a certain condition after
abandonment because of bringing the assets to its present location. The capitalised cost is amortised over the life of the
project and the provision is accreted periodically as the discounting of the liability unwinds. The unwinding of the discount
is recorded as a finance cost.
Any changes in the estimates for the costs or other assumptions against the cost of relevant assets are accounted
for on a prospective basis. In determining the costs of site restoration there is uncertainty regarding the nature and
extent of the restoration due to community expectations and future legislation.
Q. 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.
R. Earnings per share
(i) Basic earnings per share
Basic earnings per share is calculated by dividing the profit attributable to owners of the company, 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.
57
De Grey Mining Limited
(ii) Diluted earnings per share
Diluted earnings per share adjusts the figures used in the 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 the
weighted average number of shares assumed to have been issued for no consideration in relation to dilutive potential
ordinary shares.
S. Share-based payments
The Group provides benefits to employees (including directors) of the Group in the form of share-based payment
transactions, whereby employees render services in exchange for shares or rights over shares (‘equity-settled
transactions’), refer to Note 31.
The cost of these equity-settled transactions with employees is measured by reference to the fair value at the date at which
they are granted. The fair value is determined by a combination of internal and external sources using a Black-Scholes
option pricing model and independent third-party valuations.
The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over the period in
which the performance conditions are fulfilled, ending on the date on which the relevant employees become fully entitled
to the award (‘vesting date’).
The cumulative expense recognised for equity-settled transactions at each reporting date until vesting date reflects (i) the
extent to which the vesting period has expired and (ii) the number of options that, in the opinion of the directors of the
Group, will ultimately vest. This opinion is formed based on the best available information at balance date. No adjustment
is made for the likelihood of market performance conditions being met as the effect of these conditions is included in the
determination of fair value at grant date.
No expense is recognised for awards that do not ultimately vest, except for awards where vesting is conditional upon a
market condition.
Where an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and any expense not
yet recognised for the award is recognised immediately. However, if a new award is substituted for the cancelled award
and designated as a replacement award on the date that it is granted, the cancelled and new award are treated as if they
were a modification of the original award.
Options over ordinary shares have also been issued as consideration for the acquisition of interests in tenements and other
services. These options have been treated in the same manner as employee options described above, with the expense
being included as part of exploration expenditure.
T. Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not
recoverable from the taxation authority. In this case it is recognised as part of the cost of acquisition of the asset or as part
of the expense.
Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST
recoverable from, or payable to, the taxation authority is included with other receivables or payables in the statement of
financial position.
Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities
which are recoverable from, or payable to the taxation authority, are presented as operating cash flows.
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De Grey Mining Limited
U. Significant accounting judgements estimates and assumptions
The preparation of the Group’s consolidated financial statements requires management to make judgements, estimates
and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, the accompanying
disclosures, and the disclosure of contingent liabilities at the date of the consolidated financial statements. Estimates
and assumptions are continually evaluated and are based on management’s experience and other factors, including
expectations of future events that are believed to be reasonable under the circumstances. Uncertainty about these
assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets
or liabilities affected in future periods.
In particular, the Group has identified a number of areas where significant judgements, estimates and assumptions are
required. Further information on each of these areas and how they impact the various accounting policies are described
and highlighted separately with the associated accounting policy note within the related qualitative and quantitative
note, as described below.
These include:
• Deferred exploration and evaluation expenditure – Note 13
• Right of use asset & lease liability – Note 15 & 17
• Rehabilitation provision – Note 19
•
Share based payments – Note 31.
2. Financial Risk Management
The Group’s exposure to a variety of financial risks that may affect the Group’s future financial performance. The Board has
the overall responsibility for the establishment, with the Audit and Risk Committee having oversight of all risk management
policies.
The Committee reports periodically to the Board on its activities and with the assistance of senior management team are
responsible for identifying, assessing, treating, and monitoring risks and risk management policies. The Committee oversees
management’s compliance monitoring processes as well as reviewing the adequacy of the risk management framework in
relation to the risks faced by the Group.
Risk management policies and systems are reviewed regularly by the senior management team to reflect changes in market
conditions and the Group’s activities. The Group aims to develop a disciplined and constructive control environment in
which all employees understand their roles and obligations.
A. Market risk
Foreign exchange risk
The Group’s operations are in Australia and currently has limited exposures to foreign exchange risk arising from foreign
currency transactions.
Foreign exchange risk arises from recognising assets and liabilities denominated in a currency that is not the functional
currency of the relevant entity. The Company has a holding of Canadian dollar listed securities.
Financial assets at fair value through the profit or loss
Consolidated Total
2021
$
2020
$
111,871
111,871
201,275
201,275
The sensitivity of profit or loss to changes in the exchange rates arises mainly from Canadian dollar-denominated financial
instruments. A 10 percent increase in the AUD/CAD exchange rate would increase post tax loss by $10,170 (2020: $18,298),
while a 10 percent decrease in the AUD/CAD exchange rate would decrease post tax loss by $12,430 (2020: $22,364).
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De Grey Mining Limited
Price risk
The Group’s listed and equity investments are susceptible to market price risk arising from uncertainties about future values
of the investment securities. The Group manages the market price risk by placing limits on individual and total equity
instruments.
At the reporting date, the exposure to equity investments at fair value listed on the TSX was CAD104,241. Given that the
changes in fair values of the equity investments held are strongly positively correlated with changes of the TSX market index,
the Group has determined that an increase/(decrease) of 10% on the TSX market index could have an impact of $11,187
increase/(decrease) on the income and equity attributable to the Group.
Interest rate risk
The Group is exposed to movements in market interest rates on cash and cash equivalents. The Group policy is to monitor
the interest rate yield curve out to six months to ensure a balance is maintained between the liquidity of cash assets and the
interest rate return.
The balance of cash and cash equivalents for the Group of $70,949,700 (2020: $28,152,622) is subject to interest rate risk.
The proportional mix of floating interest rates and fixed rates to a maximum of six months fluctuate during the year
depending on current working capital requirements. The weighted average interest rate received on cash and cash
equivalents by the Group was 0.56% (2020: 0.70%).
Sensitivity analysis
At 30 June 2021, if interest rates had changed by -/+ 50 basis points from the weighted average rate for the year with all
other variables held constant, post-tax loss for the Group would have been $247,756 lower/higher (2020: $55,911
lower/higher) as a result of lower/higher interest income from cash and cash equivalents.
B. Credit risk
Credit risk refers to the risk that a counter party will default on its contractual obligation resulting in financial loss to
the Group.
(i) Risk management
The Group has adopted the policy of dealing with creditworthy counterparties as a means of mitigating the risk of financial
loss from a counterparty not meeting its obligations. Customer receivables have 30-day payment terms and outstanding
receivables are regularly monitored. Cash is deposited only with institutions approved by the Board and typically with a
current minimum credit rating of A (or equivalent) as determined by a reputable credit rating agency. The Group has
established a policy of having aggregate funds on term deposit or invested in money markets allocated across financial
counterparties.
Trade receivables
Counterparties without external credit rating - other
Total trade receivables
Cash and cash equivalents
A + external credit rating
A - external credit rating
Total cash and cash equivalents
(ii) Impaired trade receivables
Consolidated Total
2021
$
2020
$
13,546
13,546
48,510
48,510
64,904,307
6,045,393
70,949,700
22,152,622
6,000,000
28,152,622
In determining the recoverability of trade and other receivables, the Group performs a risk analysis using a provision matrix
to measure expected credit losses. The provisions rates are based on the type and age of the outstanding receivable and the
creditworthiness of the counterparty. The calculation reflects the probability-weighted outcome, the time value of money
and reasonable and supportable information that is available at the reporting date about past events, current conditions and
forecasts of future economic conditions. If appropriate, an impairment loss is recognised in profit or loss. The Group does
not have any impaired trade and other receivables as at 30 June 2021 (2020: nil).
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De Grey Mining Limited
C. Liquidity risk
The Group manages liquidity risk by monitoring the immediate and forecasted cash requirements and ensures that
adequate cash reserves and/or marketable securities are available to pay debts as and when due.
The Group’s primary activities are currently mineral exploration. Prudent liquidity risk management implies maintaining
sufficient cash and marketable securities as the Group does not have ready access to credit facilities at this stage of its life
cycle. Management regularly monitors its rolling cash forecasts and the state of equity markets in initiating the timing of
capital raisings for its future funding requirements.
Maturities of financial liabilities
An analysis of the Group's financial liabilities into relevant maturity groupings based on their contractual maturities and on
the basis of the contractual undiscounted cash flows as presented in the table that follows.
As at 30 June 2021
Trade and other payables
Lease liabilities
Total non-derivatives
As at 30 June 2020
Trade and other payables
Lease liabilities
Total non-derivatives
D. Fair value estimation
Less than
6 months
$
17,339,122
190,875
17,529,997
6-12
months
$
-
229,051
229,051
1-2
Years
$
2-5
years
$
Total
$
-
471,844
471,844
-
1,546,432
1,546,432
17,339,122
2,438,202
19,777,324
2,915,522
64,391
2,979,913
-
65,373
65,373
-
135,502
135,502
-
283,321
283,321
2,915,522
548,587
3,464,109
The fair value of financial assets and financial liabilities must be estimated for recognition and measurement or for
disclosure purposes. All financial assets and financial liabilities of the Group at the balance date are recorded at amounts
approximating their carrying amount. The fair value of financial instruments traded in active markets is based on quoted
market prices at the reporting date. The quoted market price used for financial assets held by the Group is the current bid
price.
Movements in the fair value of financial assets and liabilities may be recognised through the consolidated statement of
comprehensive income.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the
fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement
as a whole:
•
•
Level 1 — Quoted (unadjusted) market prices in active markets for identical assets or liabilities
Level 2 — Valuation techniques for which the lowest level input that is significant to the fair value measurement
is directly or indirectly observable
Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value measurement
is unobservable
•
The financial assets and liabilities are presented by class in the table below at their carrying amounts.
Financial assets
Investment in listed shares
Level 1
Fair value through profit and loss
111,871
201,275
Fair value
hierarchy
AASB 9 classification
2021
2020
There have been no transfers between fair value levels during the reporting period.
The carrying value less impairment provision of trade receivables and payables are assumed to approximate their fair values
due to their short-term nature.
61
De Grey Mining Limited
3. Capital management
For the purpose of the Group’s capital management, capital includes issued capital, and all other equity reserves attributable
to the equity holders of the parent. The Group’s objectives when managing capital are to safeguard their ability to continue
as a going concern, so that they may continue to provide returns for shareholders and benefits for other stakeholders
Due to the nature of the Group’s activities, being mineral exploration, the Group does not have ready access to credit
facilities, with the primary source of funding being equity raisings. Therefore, the focus of the Group’s capital risk
management is the current working capital position against the requirements of the Group to meet exploration programmes
and corporate overheads.
The Group’s strategy is to ensure appropriate liquidity is maintained to meet anticipated operating requirements, with a
view to initiating appropriate capital raisings as required. The working capital position of the Group at 30 June 2021 and 30
June 2020 are as follows:
Cash and cash equivalents
Trade and other receivables
Trade and other payables (i)
Working capital position
Consolidated
2021
$
2020
$
70,949,700
1,503,359
(17,339,122)
55,113,937
28,152,622
428,348
(2,951,552)
25,665,418
(i) This is net of payables totalling $Nil (2020: $Nil) settled/or to be settled by an equity issue of ordinary fully paid shares.
4. Segment Information
Management has determined the operating segments based on the reports reviewed by the Board of Directors that are used
to make strategic decisions. For management purposes, the Group has identified one reportable operating segment being
exploration activities undertaken in one geographical segment being Australasia. This segment includes the activities
associated with the determination and assessment of the existence of commercial economic reserves, from the Group’s
mineral assets in the sole geographic location.
5. Revenue and other income
Revenue - from continuing operations
Revenue from customers
Interest income
Other Income
EIS Grant
Gain sale of assets
Other income
Consolidated
2021
$
2020
$
35,751
279,198
22,775
7,200
230,565
575,489
11,889
78,721
91,102
-
98,145
279,857
62
6. Expenses
Loss before income tax includes the following specific expenses:
Contributions to superannuation funds
Lease liability – interest charge
Share based payments – options (Directors & under approved plan)
Share based payments – performance rights (Directors & under approved plan)
Share based payments – corporate advisory services
Loss or (Gain) on Change in fair value of investment
31
31
31
7. Income tax
(a) Income tax expense
Current tax expense
Deferred tax expense
Total Income tax expense per income statement
De Grey Mining Limited
Consolidated
2021
$
2020
$
718,030
13,228
892,717
150,697
-
89,405
199,747
14,025
334,400
180,089
136,251
(86,172)
Consolidated
2021
$
2020
$
-
-
-
-
-
-
(b) Numerical reconciliation between tax expense and pre-tax net loss
Net loss before tax
(5,250,269)
(3,976,002)
Corporate tax rate applicable 30% (2020: 27.5%)
30%
27.50%
Income tax expense/(benefit) on above at applicable corporate tax rate
(1,575,081)
(1,093,401)
Increase/(decrease) in income tax due to tax effect of:
Share based payments expense
Non-deductible expenses
Deductible temporary differences not recognised
Non-assessable income
Effect of Tax rate change at 30%
313,024
45,603
1,227,704
(11,250)
-
-
-
137,979
955,422
-
-
(99,400)
Consolidated
2020
$
2021
$
(c) Recognised deferred tax assets and liabilities
30%
27.50%
Deferred tax assets
Employee provisions
Other provisions and accruals
Rehabilitation assets and liabilities
Blackhole previously expensed
Tax losses
Set-off deferred tax liabilities
Net deferred tax assets
204,562
10,736
306,669
-
29,921,240
30,443,207
21,812
28,883
281,113
3,647
9,475,875
9,811,330
(30,443,207)
-
(9,811,330)
-
63
Deferred tax liabilities
Exploration & Mine Properties
Unearned Income
Other deferred tax liabilities
Gross deferred tax liabilities
Set-off of deferred tax assets
Net deferred tax liabilities
(d) Unused tax losses and temporary differences for which no deferred tax
asset has been recognised
Deductible Temporary Differences
Tax Revenue Losses
Total Unrecognised Deductible temporary differences
De Grey Mining Limited
(30,433,586)
(9,622)
-
(30,443,207)
30,443,207
-
(9,802,637)
(7,361)
(1,333)
(9,811,330)
9,811,330
-
30%
27.50%
1,750,095
16,693,707
18,443,802
772,684
13,745,530
14,518,214
The corporate tax rates on both recognised and unrecognised deferred tax assets and deferred tax liabilities have been
calculated with respect to the tax rate that is expected to apply in the year the deferred tax asset is realised, or the liability
is settled.
(d) Tax consolidation
Effective 1 July 2004, for the purposes of income taxation, De Grey Mining Limited and its 100% owned Australian subsidiaries
formed a tax consolidated group. Members of the group have entered a tax sharing arrangement to allocate income tax
between the entities should the head entity default on its tax payment obligations. At the balance date, the
possibility of default is remote. The head entity of the tax consolidated group is De Grey Mining Limited.
The entities have also entered into a tax funding agreement under which the wholly owned entities fully compensate De
Grey Mining Limited for any current tax payable assumed and are compensated by De Grey Mining Limited for any current
tax receivable and deferred tax assets relating to unused tax losses or unused tax credits that are transferred to De Grey
Mining Limited under the tax consolidation legislation. The funding amounts are determined by reference to the amounts
recognised in the wholly owned entities’ financial statements.
The amounts receivable/payable under the tax funding agreement are due upon receipt of the funding advice from the head
entity, which is issued as soon as practicable after the end of each financial year. The head entity may also require payment
of interim funding amounts to assist with its obligations to pay tax instalments. The funding amounts are recognised as
current intercompany receivables or payables. Subsidiaries will recognise any current tax expense equal to the current tax
liability and be charged through intercompany by the head entity.
(e) Franking credits
The company has no franking credits available for use in future years (2020: Nil).
64
8. Current assets – Cash and cash equivalents
Cash at bank & on hand (i)
Short-term & on-call deposits (ii)
De Grey Mining Limited
Consolidated
2021
$
2020
$
52,427,074
18,522,626
70,949,700
391,734
27,760,888
28,152,622
(i) Cash at bank earns interest at floating rates based on daily bank deposit rates.
(ii) Short term deposits held for the purposes of meeting short term cash commitments of the Group are made for varying periods typically
between one day and three months depending on the immediate cash requirements of the Group. If the short-term deposits have an
original maturity greater than three months, principal amounts must be able to be redeemed in full prior to scheduled maturity with
no significant penalty otherwise the deposits will be classified as other financial assets. The weighted average interest rate achieved
for the year was 0.56% (2020: 0.70%).
9. Current assets – Trade and other receivables
Trade and other receivables
GST receivable (net)
Fuel tax credits receivable
Accrued interest
Sundry debtors
Consolidated
2021
$
536,931
934,356
-
32,072
-
1,503,359
2020
$
48,510
252,580
67,075
26,767
33,416
428,348
As the majority of receivables are short term in nature, their carrying amount approximates fair value. Receivables are
generally due for settlement within 30 days.
10. Current assets - Inventories
Diesel fuel inventories
11. Current assets – Other assets
Prepayment – other (i)
Advances & deposits
(i)
Prepayments – other includes accommodation for the Mt Dove camp site.
65
Consolidated
2020
$
2021
$
206,656
206,656
87,758
87,758
Consolidated
2021
$
918,388
6,548
924,936
2020
$
-
1,797
1,797
12. Financial assets
Financial assets at fair value through profit or loss
Current
Canadian (TSX-V) listed equity securities (i) (ii)
De Grey Mining Limited
2021
$
Consolidated
2020
$
111,871
111,871
201,275
201,275
(i) The financial assets are presented as non-current assets unless management intends to dispose of them within 12 months of the end
of the reporting period.
(ii) Financial assets are valued at the quoted closing share price as at reporting date, being CAD $2.08 (2020: CAD $3.77). During the year,
a loss of $89,405 (2020: gain of $86,172) was recognised in the consolidated statement of comprehensive income (Note 5).
13. Non-current assets – Deferred exploration & evaluation expenditure
Beginning of financial year
Exploration expenditure - all areas of interest (i)
Tenement acquisition
Fuel Tax credit offset
Indee Gold Pty Ltd recognised on settlement of acquisition (Note 28)
Expensed to consolidated statement of comprehensive income
Consolidated
2021
$
48,938,399
65,908,260
817,000
(1,260,838)
-
-
114,402,821
2020
$
30,675,391
16,839,283
-
-
1,451,296
(27,571)
48,938,399
(i) The Group has capitalised all costs associated with The Mallina Project. The recoverability of the carrying amount of the exploration
and evaluation assets is dependent on successful development and commercial exploitation, or alternatively, sale of the respective
areas of interest.
(ii) At 30 June 2021, the Group conducted an assessment to determine whether there were any indicators of impairment in relation to
the carrying value of its capitalised deferred exploration and evaluation expenditure. No indicators of impairment were present and
therefore the Group did not impair any previously capitalised expenditure (2020: $27,571).
Significant judgements, estimates and assumptions
The application of the Group’s accounting policy for E&E expenditure requires judgement to determine whether future
economic benefits are likely from either future exploitation or sale, or whether activities have not reached a stage that
permits a reasonable assessment of the existence of reserves.
In addition to applying judgement to determine whether future economic benefits are likely to arise from the Group’s E&E
assets or whether activities have not reached a stage that permits a reasonable assessment of the existence of reserves, the
Group has to apply a number of estimates and assumptions. The determination of a JORC (The Australasian Code for
Reporting of exploration results, mineral resources and ore reserves) resource is itself an estimation process that involves
varying degrees of uncertainty depending on how the resources are classified (i.e., measured, indicated or inferred). The
estimates directly impact when the Group defers E&E expenditure.
The deferral policy requires management to make certain estimates and assumptions about future events and circumstances,
particularly, whether an economically viable extraction operation can be established. Any such estimates and assumptions
may change as new information becomes available. If, after expenditure is capitalised, information becomes available
suggesting that the recovery of expenditure is unlikely, the relevant capitalised amount is written off to the statement of
profit or loss and other comprehensive income in the period when the new information becomes available.
66
De Grey Mining Limited
14. Non-current assets – Property, plant and equipment
Plant &
Equipment
Computer
Equipment
Furniture &
Fittings
Consolidated
Motor
Vehicles
Land &
Buildings
Assets in
Progress
$
$
$
$
$
$
1,295,999
(356,082)
486,116
(153,647)
124,156
(30,466)
1,446,707
(233,290)
842,099
(234,666)
3,394,356
-
939,917
332,469
93,690
1,213,417
607,433
3,394,356
Total
$
7,589,433
(1,008,151)
6,581,282
204,895
898,641
-
-
(163,619)
939,917
122,360
304,692
-
-
(94,583)
332,469
36,698
78,664
-
-
(21,672)
93,690
427,444
965,214
-
(29,600)
(149,641)
1,213,417
507,782
31,586
172,641
-
(104,576)
607,433
155,826
3,411,171
(172,641)
-
-
3,394,356
1,455,005
5,689,968
-
(29,600)
(534,091)
6,581,282
Plant &
Equipment
Computer
Equipment
Furniture &
Fittings
Consolidated
Motor
Vehicles
Land &
Buildings
Assets in
Progress
$
$
$
$
$
$
Total
$
397,358
(192,463)
204,895
181,424
(59,064)
122,360
45,492
(8,794)
36,698
526,793
637,872
155,826
1,944,765
(99,349)
(130,090)
-
(489,760)
427,444
507,782
155,826
1,455,005
183,077
77,809
13,113
(69,104)
204,895
59,283
83,491
-
(20,414)
122,360
27,639
13,046
-
(3,987)
36,698
113,188
382,045
-
(67,789)
427,444
345,902
234,055
-
(72,175)
507,782
-
155,826
729,089
946,272
-
-
155,826
13,113
(233,469)
1,455,005
2021
Gross carrying amount
Accumulated depreciation
Net book amount
Property, plant and equipment
movement 2021
Opening net book amount
Additions
Completion of assets in progress
Assets written off
Depreciation charge
Closing net book amount
2020
Cost
Accumulated depreciation
Net book amount
Property, plant and equipment
movement 2020
Opening net book amount
Additions
Additions - on acquisition of Indee
Gold Pty Ltd
Depreciation charge
Closing net book amount
67
15. Non-current right of use asset
Right of use asset – office premises
Gross carrying amount (i)
Accumulated depreciation
Net book amount
Opening net book amount
Impact of adopting AASB 16
Additions on inception
Additions – additions for the year
Depreciation for the year – leased office premises
Office lease cancelled during the year
Closing net book amount
De Grey Mining Limited
Consolidated
2021
$
2020
$
2,223,792
-
2,223,792
499,975
-
2,223,792
-
(102,335)
(397,640)
2,223,792
603,329
(103,354)
499,975
-
495,129
-
108,200
(103,354)
-
499,975
(i) The right of use asset assumes that the options for office lease term extensions will be exercised.
(ii) The present value of future lease payments is determined by discounting future lease payments using the interest rate implicit in the
lease. The interest rate implicit in the lease for the year ending 30 June 2021 is 3% (2020: 3%)
(iii) The expense relating to the short-term leases is $1,367,904 (2020: $253,673).
16. Current liabilities – Trade and other payables
Trade payables
Other payables and accruals (i)
Consolidated
2020
$
2021
$
15,950,850
1,388,272
17,339,122
2,798,952
116,570
2,915,522
(i) Other payables and accruals are non-interest bearing and are normally settled on terms of 30-45 days.
17. Current & non-current lease liabilities
Current
Lease liabilities – office premises
Non-current
Lease liabilities – office premises
Consolidated
2021
$
2020
$
353,212
115,864
1,870,580
399,815
The group is required to make significant judgements, estimates and assumptions in assessing the NPV of the office lease
and has used an interest rate of 3%, which is implicit in the contract, the term of 5 years, however the contract provides for
an extension of a further 3 years and this has not been included in the calculations of the NPV, and would have the effect
of increasing the lease liability.
68
18. Employee benefit obligations
Current
Annual Leave (i)
Non-current
Long Service Leave (ii)
De Grey Mining Limited
Consolidated
2021
$
2020
$
616,570
79,318
65,303
-
(i) The current provision for employee benefits includes all unconditional entitlements where employees have completed the required
period of service. The entire amount is presented as current, since the consolidated entity does not have an unconditional right to
defer settlement and has an expectation that employees will take the full amount of accrued leave or require payment within the next
12 months.
(ii) The Group’s employee benefit obligations for long service leave are shown as non-current as they are not expected to be settled wholly
within twelve (12) months after the end of the period in which the employees render the related service. They are measured at the
present value of the expected future payments to be made to employees.
19. Non-current liabilities – Rehabilitation provision
Rehabilitation provision (i)
Consolidated
2021
$
1,022,230
1,022,230
2020
$
1,022,230
1,022,230
(i) This provision was brought to account on settlement of the Indee Gold acquisition and covers the mining leases that are subject of an
approved Mine closure plan (Note 28). The Group assesses its mine rehabilitation provision annually and as there have been no further
disturbances during the year, and the impact of discount rates minimal, the Group have considered the liability to be reasonable.
Significant judgement is required in determining the provision for mine rehabilitation and closure as there are many factors that will
affect the ultimate liability payable to rehabilitate the mine sites, including future disturbances caused by further development,
changes in technology, changes in regulations, price increases, changes in timing of cash flows which are based on life of mine plans
and changes in discount rates. When these factors change or become known in the future, such differences will impact the mine
rehabilitation provision in the period in which the change becomes known.
In determining the liability, a discount rate of 2% has been applied over a 10-year term as this is the most reasonable timeframe with the
current activities of the Group. Sensitivity analysis was performed to evaluate the difference by extending and shortening the time frame
to 5 years and 15 years which provided an NPV of $1,106, 543 and $907,750 respectively.
69
De Grey Mining Limited
20. Contributed equity
(a) Share capital
Ordinary shares issued and fully paid
2021
2020
Issue
Price
Number of
shares
1,292,417,059
$
Number of
shares
235,892,228 1,172,514,204
$
130,713,404
Total contributed equity
1,292,417,059
235,892,228 1,172,514,204
130,713,404
(b) Movements in ordinary share capital
Beginning of the financial year
Issued during the current & prior years:
Shares issued on exercise of options
Shares issued on exercise of options
Shares issued on exercise of options
Share issued in lieu of supplier invoices (non-cash)
Share issued in exercise of performance rights
Placement share issue
Placement share issue
Placement share issue
Placement share issue(i)
$1.20
Shares issued part consideration – Indee Gold Pty Ltd (non-cash) $0.050791
Shares issued as part consideration for tenement purchase
$1.585
Transaction costs
Share based payments reserve transfer on exercise
End of the financial year
(c) Movements in options on issue
Beginning of the financial year
Net issued / (exercised or cancelled) during the year:
− Exercisable at 10 cents, on or before 31 Oct 2019
− Exercisable at 20 cents, on or before 30 Nov 2019
− Exercisable at 25 cents, on or before 30 Nov 2019
− Exercisable at 10 cents, on or before 31 Oct 2020
− Exercisable at 30 cents, on or before 30 May 2021
− Exercisable at 30 cents, on or before 30 Sep 2021
− Exercisable at 10 cents, on or before 31 Dec 2021
− Exercisable at 35 cents, on or before 12 Mar 2021
− Exercisable at 0 cents, on or before 29 July 2022
− Exercisable at 0 cents, on or before 3 December 2024
− Exercisable at 0 cents, on or before 29 June 2022
End of the financial year
$0.10
$0.30
$0.35
$0.045
$0.05
$0.28
1,172,514,204
130,713,404
427,590,370
70,787,718
9,210,714
5,733,333
2,110,000
-
-
-
-
19,232,142
83,416,666
-
200,000
-
-
1,292,417,059
921,071
1,720,000
738,500
-
-
-
-
5,385,000
100,100,000
-
317,000
(4,569,746)
566,999
17,039,286
13,016,667
600,000
3,802,748
3,950,000
111,111,111
444,142,014
92,196,429
-
59,065,579
-
-
-
235,892,228 1,172,514,204
1,703,928
3,905,000
210,000
247,179
-
5,000,000
22,207,101
25,815,000
-
3,000,000
-
(3,144,223)
972,701
130,713,404
Unlisted
Unlisted
Unlisted
Unlisted
Unlisted
Unlisted
Unlisted
Unlisted
Unlisted
Unlisted
Unlisted
Number of options
2021
2020
19,844,047
77,333,333
-
-
-
(7,210,714)
(4,233,333)
(1,500,000)
(2,000,000)
(2,110,000)
450,454
2,619,326
1,603,240
7,463,020
(7,039,286)
(33,333,333)
(12,500,000)
-
(13,016,667)
1,500,000
2,000,000
4,900,000
-
-
-
19,844,047
(i) De Grey issued 73,116,666 ordinary fully paid shares at $1.20 per share through clients of Argonaut Securities Pty Ltd and Canaccord
Genuity (Australia) Limited as Joint Lead Managers and Bookrunners. It includes global institutional participation and represents the 1st
Tranche of the Placement. De Grey also issued 10,300,000 ordinary fully paid shares at an issue price of $1.20 per share to DGO Gold
Limited (10,000,000) and Mr. Peter Hood (300,000). This allotment followed shareholder approval on 23 October 2020 and represents the
2nd Tranche of the Placement.
70
De Grey Mining Limited
(d) Movement in performance rights on issue
During the year there were 140,846 unlisted Performance Rights issued (2020: nil) to directors and employees of the Group.
2021
Opening balance – 1 July 2020
Performance rights vested
Performance rights expired
Performance rights issued
Performance rights issued
Performance rights issued
Closing balance – 30 June 2021
2020
Tranche 11
Tranche 2
Tranche 3
Tranche 4
Tranche 5
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,450,000
-
-
-
-
-
1,450,000
Tranche
1,2,3-2021
Total
-
-
-
-
-
-
-
-
-
-
140,8461
300,3001
282,4861
1,450,000
-
-
140,846
300,300
282,486
723,632
2,173,632
Tranche 12
Tranche 23
Tranche 32
Tranche 4
Tranche 52
Tranche
1,2,3-2021
Total
Opening balance – 1 July 2019
1,300,000
1,300,000
1,450,000
1,450,000
1,200,000
Performance rights vested
(1,300,000)
-
(1,450,000)
Performance rights expired
Performance rights issued
Closing balance – 30 June 2020
-
-
-
(1,300,000)
-
-
-
-
-
-
-
-
1,450,000
(1,200,000)
-
-
-
-
-
-
-
-
6,700,000
(3,950,000)
(1,300,000)
-
1,450,000
1 Rights issued to Mr Jardine are issued in 3 tranches, T1 140,846 will vest in September 2021, T2 300,300 will vest in September 2022 and T3 282,486 will
vest in September 2023. The number of rights to be issued for T2 and T3 are a provisional number and will be adjusted when the rights are issued.
1. Tranche 1-2021 - Vesting conditions for the performance rights issued during 2021 are.
• the Company’s shares reaching a price equal to or greater than 120% of the volume weighted average price of the
Company’s shares for 10 trading days after acceptance of the Offer, within the period 27 July 2020 and 15 September
2021. For completeness it is noted the share price target to be achieved is $0.852 which must be achieved on or
before 15 September 2021.
• Satisfactory completion of a probationary period; and
• remaining employed by the Company as at 15 September 2021.
Two further tranches were approved for issue and are expected to be issued over the next 2-year period on the 15 September
with the following vesting conditions:
Estimated number of performance rights to be issued 300,300 (the final number will be confirmed on issue) on September
2021 (Approved 10 July 2020) Tranche 2-2021:
•
•
the Company’s shares reaching a price equal to or greater than 120% of the volume weighted average price of the
Company’s shares; and
The executive remaining employed as Managing Director by the Company as at 15 September 2022.
Estimated number of performance rights to be issued 282,486 (the final number will be confirmed on issue) on September
2022 (Approved 10 July 2020) Tranche 3-2021:
•
•
the Company’s shares reaching a price equal to or greater than 120% of the volume weighted average price of the
Company’s shares; and
The executive remaining employed as Managing Director by the Company as at 15 September 2023.
The Group have commenced the amortisation of the rights which have not yet been issued as their grant date was approved
by the Board on 10 July 2020.
71
De Grey Mining Limited
2. The vesting conditions for tranches one, three and five were met during the 2020 reporting period. Each of the tranches
were exercised by the holders and shares allotted on 22 August 2019.
• Tranche One – the Company declaring greater than 1,500,000-ounce gold resource (JORC 2012) at an overall grade of
at least 1.7 g/t and a minimum category of JORC inferred at the Mallina Gold Project, on or before 30 November 2019.
• Tranche Three – settlement of the Company’s 100% acquisition of Indee Gold Pty Ltd; and
• Tranche Five – The Company confirming higher grade resources of at least 200,000 ounces and at an overall grade of
greater than 5 g/t or before 30 November 2019.
3. The vesting conditions for the following tranche expired during the 2020 financial year:
• Tranche Two – the Company declaring greater than 2,000,000-ounce gold resource (JORC 2012) at an overall grade
of at least 1.7 g/t and a minimum category of JORC inferred at the Mallina Gold Project, or before 30 November 2019.
4. The following Performance Right tranche remains outstanding as at the end of the financial year:
• Tranche Four – The Company securing Project Financing for the Mallina Gold Project at a minimum throughput of 1
million tpa.
(e) Ordinary shares
Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the Company in proportion
to the number of and amounts paid on the shares held. On a show of hands every holder of ordinary shares present at a
meeting in person or by proxy, is entitled to one vote, and upon a poll each share is entitled to one vote. Ordinary shares
have no par value, and the Company does not have a limited number of authorised shares. Neither the Company, nor any of
its subsidiaries, holds any shares in the Company at 30 June 2021 (2020: Nil).
21. Reserves and accumulated losses
(a) Reserves
Share-based payments reserve (i)
Movements:
Share-based payments reserve
Balance at beginning of year
Share based payments (options) expense (Directors & EOP plan)
Share based payments (options) expense (Corporate advisory)
Share based payments (performance rights) expense (Directors & PR plan)
Transfer to Issued Capital on exercise of performance rights
Transfer to Issued Capital on exercise of options
Transfer to Accumulated losses on expiry of performance rights
Balance at end of year
(b) Accumulated losses
Balance at beginning of year
Net loss for the year
Transfer from Reserves on expiry of performance rights
Balance at end of year
Consolidated
2021
$
2020
$
1,339,024
1,339,024
862,609
862,609
862,609
892,717
-
150,697
-
(566,999)
-
1,339,024
1,414,570
334,400
136,251
180,089
(671,500)
(310,201)
(221,000)
862,609
(56,343,583)
(5,250,269)
-
(61,593,852)
(52,588,581)
(3,976,002)
221,000
(56,343,583)
(c) Nature and purpose of reserves
(i) Share-based payments reserve - the share-based payments reserve is used to recognise the value of equity benefits provided to either
employees or directors as remuneration or to suppliers as payment for products and services.
72
22. Dividends
No dividends were paid during the financial year (2020: Nil).
No recommendation for payment of dividends has been made.
23. Remuneration of auditors
During the year the following fees were paid or payable for services
provided by the auditor of the parent entity, its related practices and non-
related audit firms:
(a) Audit services
Butler Settineri (Audit) Pty Ltd - audit and review of financial reports
Ernst & Young - audit and review of financial reports
Total remuneration for audit services
(b) Non-audit services
Butler Settineri – tax compliance services
Total remuneration for other services
24. Contingent liabilities
De Grey Mining Limited
Consolidated
2021
$
2020
$
-
-
Consolidated
2021
$
2020
$
4,718
49,000
53,718
-
-
47,842
-
47,842
3,675
3,675
There are no contingent liabilities or contingent assets of the Group at reporting date (2020: Nil).
25. Commitments
(a) Exploration commitments
The Group has certain commitments to meet minimum expenditure
requirements on the mineral exploration assets it has an interest in.
Outstanding Mallina Project exploration commitments are as follows:
Mallina Project tenements (100% owned)
Tenements under option agreements (i)
Annual commitment for the Mallina Project assets
Consolidated
2021
$
2020
$
1,569,040
199,280
1,768,320
1,474,040
199,280
1,673,320
(i) The tenements that remain under option and/or earn-in agreements are with respect to the Farno McMahon
and Vanmaris Projects, as detailed in Note 28.
(b) Capital commitments
The Group did not have any capital commitments as at the current or prior balance date.
73
De Grey Mining Limited
26. Related party transactions
(a) Parent entity
The ultimate parent entity within the Group is De Grey Mining Limited.
(b) Subsidiaries
Interests in subsidiaries are set out in Note 27.
(c) Transactions with related parties
De Grey have entered into a number of contracts which resulted in transactions with key management personnel as follows.
Transactions with related parties.
Purchases of equipment
Paid to Engineering consultants
Paid to employees
Accounts payable
2021
2020
$
$
185,425
636,274
227,945
91,969
264,119
216,623
49,731
110,007
• Mak Water have supplied De Grey with equipment at the Wingina Camp site, and
• GR Engineering have provided consultancy where Mr Peter Hood, non-executive director, is a director of both
entities.
Where personnel are employed by De Grey and are considered a related party to key management personnel, those
transactions are entered into in the ordinary course of business at arm’s length.
• De Grey employed the daughter of Mr Andrew Beckwith, the daughter of Mr Simon Lill and the nephew of Mr Phil
Tornatora. None of these employees reported directly to a KMP.
Terms and conditions of transactions with related parties
Outstanding balances at the yearend are unsecured and interest free and settlement occurs in cash and are presented as
part of trade payables.
Details of compensation paid to key management personnel are fully disclosed in the Remuneration Report.
Compensation of key management personnel of the Group
Short term employee benefits
Post-Employment benefits
Termination benefits
Share based payment transaction
Total compensation paid to key management personnel
2021
$
2,114,605
131,412
-
871,125
3,117,142
2020
$
1,226,215
59,874
21,000
196,343
1,503,432
During the year DGO Gold Limited increased their shareholding with net purchases of 10,000,000 shares in De Grey Mining
Two of our directors are also directors of DGO Gold Limited who hold a significant interest in the Company. Details of this is
disclosed in the Directors Report.
74
De Grey Mining Limited
27.
Subsidiaries
The consolidated financial statements incorporate the assets, liabilities, and results of the following subsidiaries in
accordance with the accounting policy described in Note 1(b):
Name
Country of Incorporation Class of Shares
Equity Holding¹
Beyondie Gold Pty Ltd
Domain Mining Pty Ltd
Winterwhite Resources Pty Ltd
Last Crusade Pty Ltd
Indee Gold Pty Ltd2
Australia
Australia
Australia
Australia
Australia
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
¹ The proportion of ownership interest is equal to the proportion of voting power held.
2021
%
2020
%
100
100
100
100
100
100
100
100
100
100
2De Grey originally executed a detailed Share Sale Agreement (“SSA”) on 9 February 2018, to acquire all the shares in Indee Gold Pty Ltd from Northwest
Nonferreous Australia Mining Pty Ltd for a total acquisition price of $15 Million. The transaction was complete in the 2020 financial year.
28.
Interests in joint operations / other acquisitions
(a) Attgold Pty Ltd Retained Pegmatite Rights across E45-2364 (a tenement within the Mallina Project)
Principal place of business: Perth, WA
In February 2007, De Grey acquired 100% of tenement E45-2364 on exercise of an option. Under the agreement, Attgold
retained the pegmatite related rights on this tenement only. The pegmatite rights give Attgold rights to explore on the
tenement for pegmatite minerals, which in turn are defined as “tin, tantalum, niobium, lithium, caesium and non-gold
bearing or base metal bearing aggregate.” This is subject to various clauses of priority, access, and normal statutory
requirements. De Grey holds all other mineral rights in this tenement, most specifically gold and base metals and the joint
venture has a carrying value of nil.
(b) Mount Dove Iron Rights
Principal place of business: Perth, WA
On 22 September 2015, the company entered into a Deed of Termination with the Atlas Iron Group, where the Atlas Iron
Group relinquished its iron ore rights on any of the Turner River Project tenements. If De Grey mines iron ore on any of its
the Turner River Project tenements it will pay the Atlas Iron Group a one-off payment of $50,000.
(c) Turner River Shingles, River Sand and Limestone Blocks Farm-Out
Principal place of business: Perth, WA
In October 2012 De Grey, through its wholly owned subsidiary Last Crusade Pty Ltd (“LC”), entered into an agreement with
Mobile Concreting Solutions Pty Ltd (“MCS”) under which LC facilitated the excision of graticule B703 from LC’s Exploration
Licence 45/3390. Under the agreement, MCS applied for a mining licence over the excised graticule to mine for shingles,
river sand and limestone blocks. LC retains the right to explore for all other minerals on the affected ground and MCS pays
$0.50 per tonne to LC for all material removed. The sands mining operations commenced in the December 2013 quarter and
have continued throughout the current financial year.
(d) Farno McMahon Project Option
Principal place of business: Perth, WA
On 28 July 2017, De Grey secured an option to enter into a joint arrangement for tenement E47/2502 and referred to as the
Farno McMahon Project. An option fee of $40,000 was paid to the vendor granting De Grey an exclusive right and period to
assess the project and on 2 October 2017, the Company elected to enter into a Joint Venture Earn-in. The vendor retains all
alluvial rights. The Joint Venture Earn-in consists of two stages:
Stage 1 – During the financial year and having expended a minimum of $1.0 million over the 3-year period to 13 December
2019, the Company has earned an initial 30% interest.
75
De Grey Mining Limited
Stage 2 - DEG has spent a further $1.0 million expenditure over an additional 1-year period (Year 4) which earns an additional
45% equity in the tenement for a total equity of 75%.
During the year De Grey Mining successfully earned its 75% equity in the Farno McMahon Project and will continue
exploration during the 2022 financial year. De Grey Mining Limited will manage the joint arrangement.
(e) Vanmaris Project Option
Principal place of business: Perth, WA
On 25 September 2017, De Grey entered into a letter agreement with the owner of tenements E47/3399, E47/3428-3430,
P47/1732-1733 whereby De Grey may acquire an 80% interest in each of these listed tenements, within a 4-year option
period.
The terms of the letter agreement included a cash and script option payment to the vendors of $30,000 cash and 150,000
ordinary fully paid De Grey shares.
De Grey are to maintain the tenements in good standing during the 4-year option period and during which time it can elect
to acquire an 80% interest on payment of $500,000 cash. The vendor retains the alluvial and prospecting rights to a depth of
3 metres.
On 28 May 2021, the Company agreed to exercise the option and purchase the remaining 20% interest in the tenements
referred as an asset acquisition. The final consideration paid for the tenements was $500,000 cash and 200,000 share in De
Grey Mining Limited. De Grey now owns 100% interest in the tenements listed where the vendor retains the alluvial and
prospecting rights to a depth of 3m.
29.
Notes to the statement of cash flows
a) Reconciliation of net loss after income tax to net cash outflow from operating
activities
Net loss for the year
Non-Cash Items
Depreciation of non-current assets
Share based payments (options and performance rights)
Loss/(gain) on available for sale investments
Loss on disposal of PP&E
Change in operating assets and liabilities
(Increase)/decrease in trade, other receivables, and assets
(Increase)/decrease in inventories
(Decrease)/increase in trade, other payables, and provisions
Other Items
Payments for transaction costs – loans and borrowings
Net cash outflow from operating activities
Consolidated
2021
$
2020
$
(5,250,269)
(3,976,002)
636,426
1,043,414
89,405
(7,200)
58,285
-
(677,334)
336,823
650,740
(86,173)
-
334,083
(76,765)
470,194
-
367,752
(4,107,273)
(1,979,348)
76
30. Loss per share
(a) Basic and Diluted Loss per Share
Basic and diluted loss per share for loss attributable to the ordinary equity holders of
the company (cents per share)
De Grey Mining Limited
Consolidated
2021
$
2020
$
(0.41)
(0.41)
(b) Reconciliation of earnings used in calculating loss per share
Loss attributable to the owners of the company used in calculating basic and diluted
loss per share
(5,250,269)
(3,976,002)
(c) Weighted average number of shares used as the denominator
Weighted average number of ordinary shares used as the denominator in calculating
basic and diluted loss per share
1,266,164,930
959,669,364
(d) Information on the classification of options
As the Group has made a loss for the year ended 30 June 2021, all options on issue are considered antidilutive and have not been included
in the calculation of diluted earnings per share. These options could potentially dilute basic earnings per share in the future.. There are
7,463,020 unlisted options, of which 3,240,454 are fully vested and potentially issued as ordinary shares at 30 June 2021. A further
1,603,240 options will vest and become exercisable with the potential to become ordinary shares in the next financial year. Since the end
of the financial year, no further options have been issued and no options have been exercised.
31.
Share-based payments
From time-to-time options are granted to.
(i) eligible employees under the Performance Rights Plan (“PRP”) and/or the Employee Option Plan (“EOP”) of De Grey
Mining Limited to align their interests with that of the shareholders of the company.
(ii) Directors under rules comparable with the PRP and/or EOP, but subject to shareholder approval pursuant to the
provisions of the ASX Listing Rules and the Corporations Act 2001.
(a) Options
Employee Option Plan (‘EOP’) of De Grey Mining Limited
Shareholders last approved the EOP at the Annual General Meeting held on 28 November 2018. The EOP is designed to
attract and retain eligible employees, provide an incentive to deliver growth and value for the benefit of all shareholders
and facilitate capital management by enabling the Company to preserve cash reserves for expenditure on principal
activities. Participation in the EOP is at the discretion of the Board and no eligible employee has a contractual right to
receive an option under the Plan.
The exercise price and expiry date for all options granted will be determined by the board prior to granting of the options,
and in the case of Director options subject to shareholder approval. The options granted may also be subject to
conditions on exercise and usually have a contractual life of two to three years. Options granted carry no dividend or
voting rights. When exercisable, each option is convertible into one ordinary share in the capital of the company with
full dividend and voting rights.
ZEPO’s have been issued during the year to both executives and employees. The following vesting conditions apply to
options issued during the year.
Employees
•
The options will vest with the employee once the employee has remained employed from the later of twelve
(12) months) from the grant date or 30 June 2022.
77
De Grey Mining Limited
Executives
The executive has remained employed until the vesting date.
•
• Delineation of Mineral Resources (as that term is defined in JORC, 2012 Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves) of not less than 12 million ounces of gold at the
Company’s Mallina Gold Project (inclusive of the existing regional 2.2 million ounces) by 3 December 2024.
•
Completion of a Definitive Feasibility Study (DFS) confirming feasibility for a 500,000 ounces of gold per annum
project through a mine life of no less than 12 years, or such other number as approved by the Board following
completion of a Pre-Feasibility Study. The DFS is to be signed off in its entirety by a suitably qualified engineering
group (with oversight from the Board); and
The Company securing debt and/or equity finance for a Board approved Project arising from the DFS.
•
And annually.
• One third of issued ZEPOs are evaluated against the scorecard in June of each year and upon achieving 65%+
score, 50% of these ZEPO’s achieve the incentive condition and are eligible to vest. If the executive does not
achieve the score of 65% or more, 50% of the ZEPOs will be cancelled, whilst the balance will vest solely subject
to achieving the LTIP Milestones.
In FY2021 450,454 ZEPO’s were issued to executives with no vesting conditions. They were granted on 10 July 2020 and
vested 30 July 2020. It was determined by the Board that these would reward the efforts in achieving the new Discovery
which has since been included in the Maiden Mineral Resource announced in June 2021.
There were 1,500,597 director options granted (2020: nil) and 3,172,423 EOP options granted (2020: 5,500,000) in the
financial year ended 30 June 2021 and are all currently outstanding are detailed in the following table:
Exercise price
Grant date
Expiry date
Cents
2020-2021
24 Sep 2017
31 Oct 2020
17 Oct 2018 30 May 2021
12 Mar 2020 12 Mar 2022
29 Jul 2022
3 Dec 2024
3 Dec 2024
30 Jun 2022
10 Jul 2020
4 Dec 2020
1 Feb 2021
31 May 2021
10 cents
30 cents
35 cents
0 cents
0 cents
0 cents
0 cents
2019-2020
24 Sep 2017
31 Oct 2020
17 Oct 2018 30 May 2021
12 Mar 2020 12 Mar 2022
10 cents
30 cents
35 cents
Balance at start of
the year Number
Granted during the
year Number
Exercised during
the year
Number
Balance at end of
the year
Number1
Vested and
exercisable at end
of the year
Number2
2,250,000
4,233,333
4,900,000
-
-
-
-
11,383,333
2,250,000
4,750,000
-
7,000,000
-
-
-
450,454
2,071,904
547,422
1,603,240
4,673,020
(2,250,000)
(4,233,333)
(2,110,000)
-
-
-
-
(8,593,333)
-
-
2,790,000
450,454
2,071,904
547,422
1,603,240
7,463,020
-
-
2,790,000
450,454
-
-
-
2,790,000
-
-
5,500,000
5,500,000
-
(516,667)
(600,000)
(1,116,667)
2,250,000
4,233,333
4,900,000
11,383,333
2,250,000
4,233,333
4,900,000
11,383,333
¹ No options were forfeited or lapsed during the year.
2There are no options that have vested that are not exercisable
Expenses arising from share-based payment transactions - options
The weighted average fair value of the options granted during the year was $1.12 (2020: $0.0608). The price was calculated
by using the Black-Scholes European Option Pricing Model applying the following inputs:
Weighted average exercise price (cents)
Weighted average life of the option (years)
Weighted average underlying share price (cents)
Expected share price volatility
Weighted average risk-free interest rate
78
2021
0
2.39
95.5-112.0
95%-110%
0.184%
2020
35.0
2.0
21.0
80%
0.25%
De Grey Mining Limited
Historical volatility has been used as the basis for determining expected share price volatility as it assumed that this is
indicative of future trends, which may not eventuate.
No assumptions have been made relating to dividends and there are no other inputs to the model. There are no options that
have vested that are not exercisable
Total expenses arising from equity settled share-based payment transactions recognised during the period were as follows:
Options issued to directors and EOP to eligible employees
(b) Performance rights
Employee Performance Rights Plan (PRP)
2021
$
892,717
2020
$
334,400
Shareholders approved the PRP at the Annual General Meeting held on 30 November 2017. The performance rights
issued during FY2021 were approved in the AGM on 4 December 2020. The PRP, like the EOP, is designed to attract and
retain eligible employees, provide an incentive to deliver growth and value for the benefit of all shareholders and
facilitate capital management by enabling the Company to preserve cash reserves for expenditure on principal activities.
Participation in the PRP is at the discretion of the Board and no eligible employee has a contractual right to receive
performance rights under the PRP.
The performance rights granted will be determined by the board prior to granting of the rights, and in the case of Director
performance rights, these are subject to shareholder approval. The rights granted may be subject to performance
milestones before the holder has the right to exercise (Refer Note 21 (d)) and can have a contractual life of up to 5 years.
Rights granted carry no dividend or voting rights. When exercisable, each right is convertible into one ordinary share in
the capital of the company with full dividend and voting rights.
The following vesting conditions apply to the performance rights issued during 2021:
• the Company’s shares reaching a price equal to or greater than 120% of the volume weighted average price of the
Company’s shares for 10 trading days after acceptance of the Offer, within the period 27 July 2020 and 15 September
2021. For completeness it is noted the share price target to be achieved is $0.852 which must be achieved on or
before 15 September 2021.
• Satisfactory completion of Probationary Period as per the Executive Services Agreement, and
• Remaining employed by the Company as at 15 September 2021.
Two further tranches were approved for issue and are expected to be issued over the next 2-year period on the 15 September
of each year. The vesting conditions are as follows.
Estimated number of performance rights to be issued 300,300 (the final number will be confirmed on issue) on September
2021 (Approved 10 July 2020) Tranche 2-2021:
•
•
the Company’s shares reaching a price equal to or greater than 120% of the volume weighted average price of the
Company’s shares; and
The executive remaining employed as Managing Director by the Company as at 15 September 2022.
Estimated number of performance rights to be issued 282,486 (the final number will be confirmed on issue) on September
2021 (Approved 10 July 2020) Tranche 3-2021:
•
•
the Company’s shares reaching a price equal to or greater than 120% of the volume weighted average price of the
Company’s shares; and
The executive remaining employed as Managing Director by the Company as at 15 September 2023.
The Group have commenced the amortisation of the rights which have not yet been issued as their grant date was approved
by the Board on 10 July 2020.
79
De Grey Mining Limited
Balance at start
Granted during
Expired during
Converted during
Grant date
Expiry date
Number
of the year
the year
Number
the year
Number
the year
Number
Balance at end of
the year
Vested and
exercisable
Number
30 June 2021
2020-2021
10 July 2020
23 Sep 2023
2019-2020
12 Mar 2020 12 Mar 2022
1,450,000
1,450,000
723,632
723,632
-
-
-
-
2,173,632
2,173,632
-
-
6,700,000
6,700,000
(1,300,000)
(1,300,000)
(3,950,000)
(3,950,000)
1,450,000
1,450,000
-
-
-
-
1 Rights issued to Mr Jardine are issued in 3 tranches, T1 140,846 will vest in September 2021, T2 300,300 will vest in September 2022 and T3 282,486 will
vest in September 2023. The number of rights to be issued for T2 and T3are a provisional number and will be adjusted when the rights are issued.
Expenses arising from share-based payment transactions - performance rights
On 18 September 2020, 140,846 unlisted Performance Rights were issued to directors of the Group. As at the end of the
financial year 1,590,846 remain outstanding.
Number Issued (No.)
Grant Date
Exercise Price ($)
Expiry Date
Amortisation date
Underlying Share Price on Grant ($)
Fair value of performance rights
Total Fair Value ($) – Life of Right issued during 2021
140,846
10 July 2020
N/A
23 September 2023
15 September 2021
$0.84
$0.69
$97,184
Total Fair Value for all rights ($) – Expensed 30 June 2021
$150,697
Significant estimates and assumptions
When the fair values of financial assets and financial liabilities recorded in the statement of financial position cannot be
measured based on quoted prices in active markets, they are measured using valuation techniques including the Black-
Scholes model. The Black-Scholes model makes certain assumptions:
• No dividends are paid out during the life of the option.
• Markets are random (i.e., market movements cannot be predicted).
•
•
•
•
There are no transaction costs in buying the option.
The risk-free rate and volatility of the underlying asset are known and constant.
The returns on the underlying asset are log-normally distributed.
The option is European and can only be exercised at expiration.
32.
Events occurring after the reporting date
There have been no matters or circumstances occurring subsequent to the end of the financial year that has significantly
affected or may significantly affect the operations of the Group or the result of those operations, or the state of affairs of
the Group in future financial years.
80
33. Parent entity information
De Grey Mining Limited
Parent Entity
2021
$
2020
$
The following information relates to the parent entity, De Grey Mining Limited, at 30 June 2021. The information presented here has been
prepared using accounting policies consistent with those presented in Note 1.
Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
Contributed equity
Reserves
Accumulated losses
Total equity
Loss for the year
Other comprehensive loss
Total comprehensive loss for the year
73,584,651
120,949,948
194,534,599
16,920,632
1,935,883
18,856,515
235,892,228
1,339,024
(61,553,168)
175,678,084
(5,250,269)
-
(5,250,269)
28,670,525
51,094,654
79,765,179
3,110,704
1,422,045
4,532,749
130,740,019
860,954
(56,368,543)
75,232,430
(3,953,338)
-
(3,953,338)
Contingent liabilities
The parent entity had no contingent liabilities as at 30 June 2021 and 30 June 2020.
Capital commitments
The parent entity had no capital commitments as at 30 June 2021 and 30 June 2020.
Accounting policies
The accounting policies of the parent entity are consistent with those of the consolidated entity, as disclosed in Note 1.
81
De Grey Mining Limited
Director’s Declaration
In the directors’ opinion:
(a)
the financial statements and notes set out on pages 47 to 81 are in accordance with the Corporations Act 2001,
including:
(i)
(ii)
complying with Accounting Standards, the Corporations Regulations 2001 and other mandatory professional
reporting requirements; and
giving a true and fair view of the consolidated entity’s financial position as at 30 June 2021 and of its
performance for the financial year ended on that date;
the audited remuneration report set out on pages 27 to 38 of the directors’ report complies with section 300A of
the Corporations Act 2001;
there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become
due and payable; and
(b)
(c)
Note 1 confirms that the financial statements also comply with International Financial Reporting Standards as issued by the
International Accounting Standards Board.
The directors have been given the declarations by the chief executive officer and chief financial officer required by section
295A of the Corporations Act 2001.
This declaration is made in accordance with a resolution of the directors.
Simon Lill
Executive Chairman
Perth, 17 September 2021
82
Ernst & Young
11 Mounts Bay Road
Perth WA 6000 Australia
GPO Box M939 Perth WA 6843
Tel: +61 8 9429 2222
Fax: +61 8 9429 2436
ey.com/au
Independent auditor’s report to the members of De Grey Mining Limited
Report on the audit of the financial report
Opinion
We have audited the financial report of De Grey Mining Limited (the Company) and its subsidiaries
(collectively the Group), which comprises the consolidated statement of financial position as at
30 June 2021, the consolidated statement of comprehensive income, the consolidated statement of
changes in equity and the consolidated statement of cash flows for the year then ended, notes to the
financial statements, including a summary of significant accounting policies, and the directors’
declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations
Act 2001, including:
a. Giving a true and fair view of the consolidated financial position of the Group as at 30 June 2021
and of its consolidated financial performance for the year ended on that date; and
b. Complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. 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 auditor
independence requirements of 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 also fulfilled our other ethical responsibilities in accordance with
the Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in
our audit of the financial report of the current year. These matters were addressed in the context of
our audit of the financial report as a whole, and in forming our opinion thereon, but we do not provide
a separate opinion on these matters. For the matter below, our description of how our audit addressed
the matter is provided in that context.
We have fulfilled the responsibilities described in the Auditor’s responsibilities for the audit of the
financial report section of our report, including in relation to this matter. Accordingly, our audit
included the performance of procedures designed to respond to our assessment of the risks of
material misstatement of the financial report. The results of our audit procedures, including the
PD:ET:DEG:009
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Liability limited by a scheme approved under Professional
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procedures performed to address the matter below, provide the basis for our audit opinion on the
accompanying financial report.
Carrying value of exploration and evaluation assets
Why significant
How our audit addressed the key audit matter
As disclosed in Note 13 to the financial
statements, at 30 June 2021 the Group held
capitalised exploration and evaluation assets of
$114.4 million.
The carrying value of capitalised exploration and
evaluation assets is assessed for impairment by
the Group when facts and circumstances
indicate that the carrying value of capitalised
exploration and evaluation assets may exceed
its recoverable amount.
The determination as to whether there are any
indicators of impairment, involves a number of
judgments including whether the Group has
tenure, will be able to perform ongoing
expenditure and whether there is sufficient
information for a decision to be made that the
area of interest is not commercially viable. The
directors did not identify any impairment
indicators as at 30 June 2021.
Given the size of the balance and the judgmental
nature of impairment indicator assessments
associated with exploration and evaluation
assets, we consider this a key audit matter.
In performing our procedures, we:
• Considered whether the Group’s right to
explore was current, which included
obtaining and assessing supporting
documentation such as license agreements
• Considered the Group’s intention to carry
out significant ongoing exploration and
evaluation activities in the relevant areas of
interest which included reviewing the
Group’s Board meeting minutes and
enquiring of senior management and the
directors as to their intentions and the
strategy of the Group
• Assessed whether exploration and
evaluation data existed to indicate that the
carrying value of capitalised exploration and
evaluation is unlikely to be recovered
through development or sale
• Assessed the adequacy of the disclosures in
the financial report.
Information other than the financial report and auditor’s report thereon
The directors are responsible for the other information. The other information comprises the
information included in the Company’s 2021 annual report, but does not include the financial report
and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not
express 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
and, in doing so, 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.
If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional
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Responsibilities of the directors for the financial report
The directors of the Company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due to
fraud or error.
In preparing the financial report, the directors are responsible for assessing the Group’s ability to
continue as a going concern, disclosing, as applicable, matters relating to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the Group or to cease
operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial report
Our objectives are 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 the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and 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 this financial report.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional
judgment and maintain professional scepticism throughout the audit. We also:
►
Identify and assess the risks of material misstatement of the financial report, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from fraud is higher than for one resulting from
error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the
override of internal control
► Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Group’s internal control
► Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the directors
► Conclude on the appropriateness of the directors’ use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to
events or conditions that may cast significant doubt on the Group’s ability to continue as a going
concern. If we conclude that a material uncertainty exists, we are required to draw attention in
our auditor’s report to the related disclosures in the financial report or, if such disclosures are
inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up
to the date of our auditor’s report. However, future events or conditions may cause the Group to
cease to continue as a going concern
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional
Standards Legislation
► Evaluate the overall presentation, structure and content of the financial report, including the
disclosures, and whether the financial report represents the underlying transactions and events
in a manner that achieves fair presentation
► Obtain sufficient appropriate audit evidence regarding the financial information of the entities or
business activities within the Group to express an opinion on the financial report. We are
responsible for the direction, supervision and performance of the Group audit. We remain solely
responsible for our audit opinion.
We communicate with the directors regarding, among other matters, the planned scope and timing of
the audit and significant audit findings, including any significant deficiencies in internal control that we
identify during our audit.
We also provide the directors with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other
matters that may reasonably be thought to bear on our independence, and where applicable, actions
taken to eliminate threats or safeguards applied.
From the matters communicated to the directors, we determine those matters that were of most
significance in the audit of the financial report of the current year and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter
should not be communicated in our report because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.
Report on the audit of the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in the directors’ report for the year ended 30
June 2021.
In our opinion, the Remuneration Report of De Grey Mining Limited for the year ended 30 June 2021,
complies with section 300A of the Corporations Act 2001.
Responsibilities
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
responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in
accordance with Australian Auditing Standards.
Ernst & Young
Pierre Dreyer
Partner
Perth
17 September 2021
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional
Standards Legislation
ASX Additional Information
Additional information required by Australian Stock Exchange Ltd, and not shown elsewhere in this report, is as follows. The
information is current as at 10 September 2021.
De Grey Mining Limited
(a) Distribution of equity securities
Analysis of numbers of equity security holders by size of holding:
1
1,001
5,001
10,001
100,001
-
-
-
-
1,000
5,000
10,000
100,000
and over
The number of shareholders holding
marketable parcel of shares are:
less than a
Ordinary shares
Number of holders
Number of shares
2,469
4,332
1,936
3,085
676
12,498
1,561,969
12,285,638
15,478,344
102,474,724
1,160,616,386
1,292,417,061
677
180,830
(b) Twenty largest shareholders
The names of the twenty largest holders of quoted ordinary shares are as follows:
HSBC Custody Nominees (Australia) Limited
BNP Paribas Nominees Pty Ltd
BNP Paribas Nominees Pty Ltd Six Sis Ltd
HSBC Custody Nominees (Australia) Limited
Citicorp Nominees Pty Limited
DGO Gold Limited
J P Morgan Nominees Australia Pty Limited
Northwest Nonferrous Australia Mining Pty Ltd
1
2
3
4
5
6 Mr Yi Weng & Ms Ning Li
7
8
9
10 BNP Paribas Noms Pty Ltd
11 BNP Paribas Nominees Pty Ltd
12 Merrill Lynch (Australia) Nominees Pty Limited
13 Caroline House Superannuation Fund Pty Ltd
14 BNP Paribas Nominees Pty Ltd
15 UBS Nominees Pty Ltd
16 Mr John Henry Matterson
17 Brispot Nominees Pty Ltd
18 Mr Andrew Rhys Jackson
19 Penand Pty Ltd
20 HSBC Custody Nominees (Australia) Limited - A/C 2
87
Listed ordinary shares
Number of shares
Percentage of
ordinary shares
239,938,243
189,450,317
203,577,703
75,388,918
43,580,870
19,231,000
13,643,058
10,705,292
9,935,713
9,892,188
8,929,568
7,934,052
7,600,000
6,440,797
6,055,062
6,000,000
5,951,518
5,095,000
5,023,334
3,950,162
878,322,795
18.57%
14.66%
15.75%
5.83%
3.37%
1.49%
1.06%
0.83%
0.77%
0.77%
0.69%
0.61%
0.59%
0.50%
0.47%
0.46%
0.46%
0.39%
0.39%
0.31%
67.96%
(c) Substantial shareholders
The names of substantial shareholders who have notified the Company in accordance with section 671B of the Corporations
Act 2001 are:
De Grey Mining Limited
DGO Gold Limited (i)
Jupiter Asset Management Ltd.
Van Eck Associates Corporation and its associates
Invesco Australia Limited
(d) Unquoted (unlisted) Securities
Number of Shares
%
203,577,703
77,927,394
71,905,550
66,920,575
15.75%
6.04%
5.56%
5.18%
Class
Holders of 20% or more of the class
Number of
Securities
Number
of
Holders
Holder Name
Number of
Securities
Unlisted $0.35 options, expiry 12 March 2022
2,790,000
Unlisted $Nil options, expiry 29 July 2022
450,454
Unlisted $Nil options, expiry 31 July 2023
Unlisted $Nil options, expiry 3 December 2024
1,603,240
2,619,326
Performance rights – Series 1
1,450,000
Performance rights – Series 2
140,846
18
5
Philip Tornatora
Craig Nelmes
Andrew Beckwith
Simon Lill
58 Nil
7
Glenn Jardine
Peter Canterbury
Simon Lill
Andrew Beckwith
Craig Nelmes
Glenn Jardine
5
1
800,000
600,000
163,207
130,566
553,454
547,422
500,000
400,000
300,000
140,846
(e) Voting rights
All ordinary shares (whether fully paid or not) carry one vote per share without restriction.
The Quoted and unquoted (unlisted) options have no voting rights.
(f) Corporate Governance
De Grey Mining Ltd, its subsidiaries (“Group”) and its Board of directors are committed to achieving and demonstrating the
highest standards of corporate governance. The Board is responsible to its shareholders for the performance of the Company
and seeks to communicate extensively with shareholders. The Board believes that sound corporate governance practices will
assist in the creation of shareholder wealth and provide accountability. In accordance with ASX Listing Rule 4.10.3, the
Company has elected to disclose its corporate governance policies and its compliance with them on its website, rather than
in this Annual Report. Accordingly, information about the Company's corporate governance practices is set out on the
Company's website at www.https://degreymining.com.au/corporate-governance.
(g) Application of Funds
During the financial year, in accordance with ASX Listing Rule 4.10.19, De Grey Mining Limited confirms that it has used its
cash and assets (in a form readily convertible to cash) in a manner which is consistent with the Company’s business
objectives.
88
Annual Mineral Resources Statement
De Grey Mining Limited
Mallina Gold Project - Global Mineral Resource Estimate, June 2021
Mining Centre
Hemi Mining Centre
Withnell Mining Centre
Wingina Mining Centre
TOTAL Mallina Gold
Project
Measured
Indicated
Inferred
Total
Mt
1.6
3.1
Au
g/t
1.8
1.7
Moz Mt
65.5
11.7
2.5
0.1
0.2
Au
g/t
1.3
1.8
1.5
Moz
Mt
2.8
0.7
0.1
126.9
12.2
6.3
Au
g/t
1.0
2.2
1.2
Moz
Mt
4.0
0.9
0.2
192.4
25.6
11.9
Au
g/t
1.1
2.0
1.4
Moz
6.8
1.6
0.5
4.71
1.7
0.3
79.8
1.4
3.6
145.3
1.1
5.1
229.8
1.2
9.0
The regional resource estimates at the Withnell and Wingina Mining Centres have not changed since the April 2020 statement.
Mallina Gold Project – Global Mineral Resource Estimate by Type, June 2021
Mining
Centre
Hemi
Mining
Centre
Withnell
Mining
Centre
Wingina
Mining
Centre
TOTAL
Mallina
Gold
Project
Type
Oxide
Sulphide
Total
Measured
Indicated
Inferred
Total
Mt
Au
g/t
Au Oz
Mt
Au
g/t
5.00 1.4
Au Oz
228,500
Mt
Au
g/t
5.47 0.9
Au Oz
151,800
Mt
Au
g/t
10.48 1.1
Au Oz
380,300
60.54 1.3 2,550,900 121.38 1.0 3,873,000 181.92 1.1 6,424,000
65.55 1.3 2,779,400 126.85 1.0 4,024,900 192.40 1.1 6,804,300
Oxide
0.98 1.8
57,500
2.69 1.3
113,400
1.70 1.4
74,000
5.37 1.4
245,000
Sulphide 0.66 1.7
34,800
9.02 1.9
550,100
10.54 2.4
796,200
20.22 2.1 1,381,100
Total
1.63 1.8
92,300 11.72 1.8
663,500
12.24 2.2
870,200
25.58 2.0 1,626,100
Oxide
2.68 1.8 152,100
1.84 1.5
Sulphide 0.40 1.6
20,500
0.68 1.6
87,600
34,900
2.21 1.1
74,900
6.74 1.5
314,500
4.04 1.3
168,400
5.12 1.4
223,800
Total
3.08 1.7 172,700
2.52 1.5
122,500
6.25 1.2
243,200
11.86 1.4
538,400
Oxide
3.66 1.8 209,600
9.54 1.4
429,500
9.4 1.0
300,700
22.6 1.3
939,800
Sulphide 1.06 1.6
55,300 70.24 1.4 3,135,900
136.0 1.1 4,837,600
207.3 1.2 8,028,900
Total
4.71 1.7 265,000 79.79 1.4 3,565,400
145.3 1.1 5,138,300
229.8 1.2 8,968,800
89
De Grey Mining Limited
Mallina Gold Project – Mineral Resource Estimate by Deposit, June 2021
Hemi - Mining Centre
Measured
Indicated
Inferred
Total
Deposit
Type
Mt
Au
g/t
Au
Oz
Brolga
Aquila
Oxide
Sulphide
Total
Oxide
Sulphide
Total
Oxide
Sulphide
Total
Oxide
Sulphide
Total
Diucon/Eagle Oxide
Falcon
Crow
Hemi Mining
Centre
Sulphide
Total
Oxide
Sulphide
Total
Wingina - Mining Centre
Mt
Au
g/t
1.32 1.4
26.77 1.3
28.09 1.3
1.00 1.4
9.64 1.5
10.64 1.5
0.97 1.0
8.85 1.1
9.81 1.1
1.71 1.7
15.29 1.2
17.00 1.3
5.00 1.4
60.54 1.3
65.55 1.3
Mt
Mt
Au Oz
Au Oz
Au Oz
Au
g/t
3.57 1.0
57,300
1,148,300
1,205,600
45,100
479,600
524,700
31,500
320,400
352,000
94,500
602,700
697,200
Au
g/t
113,000
55,700
2.25 0.8
59.24 1.1 2,142,900
994,700
32.47 1.0
62.81 1.1 2,255,900
34.72 0.9 1,050,300
49,100
1.23 1.2
4,000
791,700
16.86 1.5
312,100
840,700
18.09 1.4
316,100
61,700
2.03 0.9
30,200
27.31 1.1
970,400
649,900
29.34 1.1 1,032,100
680,100
112,100
17,600
31.38 1.1 1,113,900
511,200
33.65 1.1 1,226,800
529,700
44,400
44,400
47.14 0.9 1,405,100
47.14 0.9 1,405,100
48.52 0.9 1,449,500
48.52 0.9 1,449,500
380,300
10.48 1.1
151,800
2,550,900 121.38 1.0 3,873,000 181.92 1.1 6,424,000
2,779,400 126.85 1.0 4,024,900 192.40 1.1 6,804,300
0.23 0.5
7.22 1.3
7.45 1.3
1.07 0.9
18.46 1.1
19.53 1.1
0.55 1.0
16.10 1.0
16.65 1.0
1.38 1.0
5.47 0.9
2.27 1.5
1.38 1.0
228,500
Measured
Indicated
Inferred
Total
Deposit
Type
Mt
Au
g/t
Au Oz
Mt
Wingina
Oxide
Sulphide
Total
Mt Berghaus Oxide
2.68 1.8 152,100
0.40 1.6
20,500
3.08 1.7 172,700
Sulphide
Total
Oxide
Sulphide
Total
Oxide
Sulphide
Total
Amanda
Wingina
Mining
Centre
2.68 1.8 152,100
20,500
0.40 1.6
3.08 1.7 172,700
0.65
0.34
0.99
0.68
0.27
0.95
0.51
0.07
0.58
1.84
0.68
2.52
Au Oz Mt
Au
g/t
27,000 0.34
1.3
16,300 1.08
1.5
43,300 1.42
1.4
38,900 0.99
1.8
14,400 2.40
1.7
53,300 3.39
1.7
21,700 0.89
1.3
4,200 0.56
1.8
25,800 1.44
1.4
87,600 2.21
1.5
34,900 4.04
1.6
1.5 122,500 6.25
90
Mt
Au Oz
Au
g/t
3.67
14,400
1.3
1.82
57,400
1.7
5.49
71,700
1.6
1.67
35,800
1.1
2.67
1.2
91,800
4.34
1.2 127,600
1.40
24,700
0.9
0.63
19,200
1.1
2.03
43,900
0.9
6.74
1.1
74,900
5.12
1.3 168,400
1.2 243,200 11.86
Au Oz
Au
g/t
1.6 193,500
1.6
94,200
1.6 287,700
74,700
1.4
1.2 106,300
1.3 181,000
46,300
1.0
23,300
1.2
1.1
69,700
1.5 314,500
1.4 223,800
1.4 538,400
De Grey Mining Limited
Withnell – Mining Centre
Measured
Indicated
Inferred
Total
Deposit
Type
Mt
Au
g/t
Au Oz Mt
Au
g/t
Au Oz
Mt
Au
g/t
Au Oz
Mt
0.36
2.68
3.05
0.11
0.11
0.48
1.13
1.61
0.05
4.28
4.33
0.32
0.14
0.46
0.43
0.56
0.99
0.13
0.07
0.20
0.03
0.03
0.06
0.86
1.2
14,400
1.9 163,500
1.8 177,800
15,600
15,600
19,900
44,100
64,100
4,700
4.3
4.3
1.3
1.2
1.2
3.1
2.1 288,600
2.1 293,200
2.6
1.4
2.2
1.3
1.3
1.3
1.5
2.3
1.8
1.6
1.6
1.6
0.7
26,800
6,500
33,300
17,900
23,800
41,700
6,000
5,300
11,300
1,400
1,700
3,200
19,300
0.15
0.53
0.68
0.00
2.38
2.39
1.22
3.93
5.15
0.05
2.41
2.46
0.56
0.56
0.04
0.14
0.19
0.05
0.23
0.28
0.11
0.21
0.33
0.04
0.08
0.12
5,300
38,000
43,300
300
1.1
2.2
2.0
2.5
3.9 301,100
3.9 301,400
53,000
1.4
1.5 190,300
1.5 243,300
2.2
2.1 162,800
2.1 166,400
3,500
3.6
3.6
1.1
1.8
1.7
0.8
1.2
1.2
1.6
2.2
2.0
1.6
1.8
1.7
64,500
64,500
1,500
8,600
10,100
1,400
9,300
10,700
5,700
14,800
20,500
2,200
4,700
6,900
1.14
3.85
4.99
0.00
2.50
2.50
1.70
5.06
6.76
0.10
6.69
6.79
0.56
0.56
0.54
0.29
0.84
0.48
0.79
1.27
0.30
0.30
0.60
0.17
0.12
0.29
0.86
Au
g/t
1.3
1.9
1.8
2.5
3.9
3.9
1.3
1.4
1.4
2.6
2.1
2.1
3.6
3.6
2.6
1.7
2.2
1.3
1.3
1.3
1.8
2.2
2.0
1.9
1.7
1.9
0.7
Au Oz
48,200
234,700
282,900
300
316,700
317,100
72,900
234,500
307,400
8,200
451,400
459,600
64,500
64,500
44,700
15,700
60,400
19,300
33,100
52,400
17,200
21,100
38,300
10,800
6,400
17,200
19,300
Withnell
Open Pit
Withnell
Underground
Mallina
Toweranna
Open Pit
Toweranna
Underground
Camel
Calvert
Roe
Dromedary
Leach Pad
Hester
Withnell
Mining
Centre
600
0.18 2.8 16,400
Oxide
0.63 1.4 28,500
Sulphide 0.63 1.6 33,200
Total
1.26 1.5 61,700
Oxide
Sulphide
Total
Oxide
Sulphide
Total
Oxide
Sulphide
Total
Oxide
Sulphide
Total
Oxide
Sulphide 0.01 2.1
Total
Oxide
Sulphide
Total
Oxide
0.06 2.7
Sulphide 0.01 2.5
0.08 2.7
Total
0.10 2.2
Oxide
Sulphide
Total
Oxide
Sulphide
Total
Oxide
Sulphide
Total
Oxide
0.98 1.8 57,500
Sulphide 0.66 1.7 34,800
Total
5,500
1,000
6,500
7,200
0.19 2.8 17,000
0.10 2.2
7,200
19,300
0.7
4,100
2.1
3,100
2.1
7,200
2.1
1.3 113,400
245,000
1.9 550,100 10.54 2.4 796,200 20.22 2.1 1,381,100
1.63 1.8 92,300 11.72 1.8 663,500 12.24 2.2 870,200 25.58 2.0 1,626,100
0.86
0.04
0.01
0.06
2.69
9.02
1,100
2,100
3,300
74,000
19,300
3,000
900
3,900
0.86
0.07
0.06
0.13
5.37
0.03
0.05
0.07
1.70
0.7
1.8
1.6
1.7
1.4
1.3
1.4
1.4
1.4
91
De Grey Mining Limited
Mineral Resource and Ore Reserve governance and internal controls
De Grey ensures that the Mineral Resource and Ore Reserve estimates quoted are subject to governance arrangements and
internal controls activated at a site level and at the corporate level. Internal and external reviews of Mineral Resource
estimation procedures and results are carried out through a team of experience technical personnel that is comprised of
highly competent and qualified professionals. These reviews have not identified any material issues.
De Grey reports its Mineral Resources and Ore Reserves on at least an annual basis in accordance with the Australasian Code
for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the JORC Code) 2012 Edition. Competent Persons
named by De Grey are Members or Fellows of the Australasian Institute of Mining and Metallurgy and/or the Australian
Institute of Geoscientists and qualify as Competent Persons as defined in the JORC Code.
The Company’s procedures for the sample techniques and sample preparation are regularly reviewed and audited by
independent experts. Assays are performed by independent internationally accredited laboratories with a QAQC program
showing acceptable levels of accuracy and precision. The exploration assay results database is maintained and appropriate
backed-up internally. All De Grey Mineral Resource estimates have been undertaken independently by Payne Geological
Services Pty Ltd.
COMPETENT PERSON STATEMENT
The information in this Annual Mineral Resources Statement is based on, and fairly represents information and supporting
documentation prepared by Mr Paul Payne, a Competent Person who is a Fellow of the Australasian Institute of Mining and
Metallurgy. Mr Payne is a full-time employee of Payne Geological Services. Mr Payne has sufficient experience that is relevant
to the style of mineralisation and 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”. Mr Payne consents to the inclusion in the report of the matters based on his information in the
form and context in which it appears.
Mr Payne has approved this Mineral Resources Statement as a whole and consents to its inclusion in the Annual Report in the
form and context in which it appears.
In relation to Mineral Resources, the Company confirms that all material assumptions and technical parameters that
underpin the relevant market announcement continue to apply and have not materially changed.
92
De Grey Mining Limited
Schedule of Interests in Mining Tenements
Project/Location
Country
Tenement
Percentage
held/earning
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Farno-McMahon
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Vanmaris
Vanmaris
Vanmaris
Vanmaris
Vanmaris
Vanmaris
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
E47/891
E45/2533
E45/2364
E45/2983
E45/2995
E45/3390
E45/3391
E45/3392
E45/5140
E45/4751
E47/3552
E47/3553
E47/3554
E47/3750
P45/3029
P47/1866
E47/2502
E47/2720
E47/3504
M47/473
M47/474
M47/475
M47/476
M47/477
M47/480
L45/578
L47/164
L47/165
E47/3399
E47/3428
E47/3429
E47/3430
P47/1732
P47/1733
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
75%¹
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%²
100%²
100%²
100%²
100%²
100%²
¹ De Grey has earned a 75% interest in the joint venture agreement with Farno McMahon Pty Ltd (owned 100% by Novo Resources Corp)
details of the agreement can be found in Note 298(d).
² De Grey has exercised an option to acquire an 100% interest from tenement holder Mr Mathew Vanmaris (Note 28(e)). Consideration
for the tenements was settled on 28 May 2021, and we are awaiting for confirmation of the title transfer.
93
De Grey Mining Limited
94